Small Business Strategy Examples

Small Business Strategy Examples – What is a plan without a strategy? As economist and business strategy guru Michael Porter says, “The essence of strategy is choosing what not to do.” With strategic planning, businesses identify their strengths and weaknesses, choose what not to do, and decide which opportunities to pursue. In sales operations, having a clearly defined strategy will help your organization plan for the future, set actionable goals and achieve them. So how do you start strategic planning? You start with strategic planning models and tools. Here’s a look at nine of the most prominent. Strategic planning models Strategic planning is used to set long-term goals and priorities for an organization. A strategic plan is a written document that summarizes these goals. Do not confuse strategic planning with tactical planning. Strategic planning focuses on long-term goals while tactical planning focuses on short-term goals. Free, resource-free strategic planning template Fill out the form to access the business strategic planning template. Here are some strategic planning models you can use to get you started. 1. The Balanced Scorecard The Balanced Scorecard is one of the premier strategic planning models designed to give executives a holistic view of the company’s operations in tight timelines. It considers both financial and operational metrics to provide valuable context about how a business has performed in the past, how it is performing now, and how it will perform in the future. The model is built on four concerns: time, quality, performance and service, and cost. The sum of these components creates four specific reference points for goal setting and performance measurement: Customer – how customers see your business Internal process – how you can improve your internal processes Corporate capacity – how you can grow, adapt and improve Financials – your potential profitability can provide information about focused goals and the most appropriate metrics you can use to track them. But what you choose to track and measure is ultimately up to you. They vary from organization to organization – there is no definitive list. However, there is one universally applicable technique you can use when using the model – creating an immutable scorecard. It is a document that keeps track of your goals and how you use them. Here is an example of what it might look like: Image source: IntraFocus Balanced Scorecard is ideal for businesses that want to break high-level goals into more specific, measurable goals. If you’re interested in turning your big goals into practical projects, consider looking into this. Balanced Scorecard Example Consider a B2B SaaS company selling a construction management solution. He got into trouble in almost every way. It struggles with customer retention and, in turn, weakens revenues. The company’s salespeople work with few qualified leads, and the organization’s technology stack is limiting growth and innovation. The company decides to use the Balanced Scorecard approach to fix various issues. In this case, the full strategic plan developed according to this model might look like this: The company sets a broad financial goal of increasing revenue by 10% year over year. To achieve this, it aims to increase its customer retention rate by 5% each year by investing in a more robust customer service infrastructure. Internally, leadership seems to be increasing the company’s lead sales figures by 20% year-over-year by revamping the onboarding process of the pre-sales team. Ultimately, the business decides to replace the legacy technology stack in favor of a virtualized operating system that provides at least 50% faster software delivery for consistent product improvements. The elements listed above address key flaws in the company’s customer perception, internal processes, finances, and organizational capacity. Every improvement that the business hopes to achieve includes a concrete goal with clearly defined calculations and precise figures to measure the success of each individual. Overall, the organization’s plan is aligned with the Balanced Scorecard model. 2. Objectives and Key Results As the name suggests, this model is about transforming broader corporate goals into goals and tracking their key results. The framework is based on setting three to five achievable goals and three to five outcomes that should result from each. Once you have them in place, plan the initiatives based on these results. Once you find these criteria, you identify the most appropriate metrics to measure their success. When you run projects on ideal outcomes, measure their success by scoring 0 to 1 or 0 to 100%. For example, your goal might be to build relationships with 100 new targets or named accounts in a particular region. If you could only develop 95, you would have a score of 0.95 or 95%. Here’s an example of what an OKR model might look like: Image source: Perdoo It’s recommended that you structure your goals to achieve a score of around 70% – give them a hard time while presenting them with a precise ideal result. The OKR model is relatively simple and can be applied almost universally. This model may work for you if your company wants to operate to well-established, easily visible standards. Example of goals and key outcomes Consider a hypothetical company that creates curricula and timelines for higher education institutions. The company decides to expand its presence in the California public university system – which is a goal. But what will it take to achieve this? And how will the company know if it is successful? Well, in this case, management in the business gets there by identifying three to five results they want to see. These are: Generating qualified leads from 30 institutions. Implementation of demos in 10 colleges. Finalize deals at 5 work locations. These results will pave the way for initiatives such as setting standards for lead qualification and training top-of-the-funnel agents on how to use them properly, renewing sales. notifications for discovery calls and research to better tailor the demo process to the needs of colleges. Leveraging this model often involves repeating this process two to four more times – resulting in a substantial crop of comprehensive, actionable, ambitious, measurable, realistic plans. 3. Theory of Change (TOC) The Theory of Change (TOC) model is about organizations setting long-term goals and essentially “working backwards” to achieve those goals. When you use strategy, you start by setting yourself a bigger goal. Next, you identify the intermediate adjustments and plans you need to make to achieve the desired result. Finally, you go down one level and plan the various short-term changes you need to make to effect the intermediate changes. More specifically, you need to take these steps: Set your long-term goals. Map back the prerequisites necessary to achieve your goal and explain why they are necessary. Identify your key assumptions about the situation. Identify the interventions your initiative will take to achieve your goals. Find indicators to evaluate the results of your initiative. Write a description of the rationale behind your initiative. Here’s another visualization of what it looks like. Image source: Wageningen University and Research This planning model works best for organizations interested in undertaking initiatives such as building a team, planning a venture, or developing a plan of action. It differs from other models in that it helps you distinguish between desired and actual results. It also enables stakeholders to model exactly what they want from a project, enabling them to be more actively involved in the planning process. It is based on sharper details than similar models. Stakeholders often need to come up with more details, including the company’s target audience, how success will be determined, and a precise timeline for each planned action and intervention. Again, almost any organization, public, corporate, nonprofit or otherwise, can benefit greatly from this strategic model. Theory of Change Example For the sake of this example, imagine a company that makes HR Payroll Software – a company that hasn’t been doing so well lately. Management at the company feels directionless. They think it’s time to stick with it and put some solid plans in motion, but right now they have some big picture ramifications for the company in mind without knowing how to get there. In this case, the business can benefit from using the Theory of Change model. Let’s say the ultimate goal is to expand market share. Management will then consider the assumptions that will ultimately lead to this goal and why they are relevant. One of these prerequisites could be, for example, leveraging a new customer base without alienating the existing customer base. The company might hypothesize: “We currently serve almost exclusively midsize businesses and don’t have the resources to expand high-end markets to enterprise-level leads.