Sunday, February 25, 2018

Business Management

Strategic planning vs strategic thinking

Conventional thinking suggests all businesses should develop strategic plans and business plans to help direct the business and facilitate successful growth
However there may be instances where strategic planning may be inappropriate for some small companies.

Here are some reasons that may be the case and alternative action these companies may take.

1.  Time. There may be conditions that exist that do not allow management to take the time to invest in days of planning.

2.  Cost. The company may not have the financing to support engaging professional help and more important may not be able to take key executives like sales managers away from the jobs as it could impact revenue generation.

3. Change. Smaller companies could be in an environment where change is needed frequently and long term strategies are inappropriate.

The option in this environment is for companies to adapt Strategic Thinking.
Fast growing companies need to take advantage of challenges and opportunities and turn their size into an advantage.

1. Plan informally on the go. All big ideas don’t have to come from formal strategy planning offsite. Quick huddles with key team members to examine key issues are effective.

2. Challenge. Brainstorm to ask “why not” when faced with the inevitable “that won’t work”. Test whether initial negative positions are really valid.

3. Make Small Bets.
 Large companies with major investments at stake may do exhaustive analysis before acting. Smaller companies can develop and test new potential strategies by making smaller bets by discussing an idea with a customer before the item is built, seeking out a potential supplier that is trustworthy, or discussing the idea with another person with expertise in the area.

These are some options available for strategic planning; the important issue is to make the process fit your organization. Be sure to take some action, sitting on the sidelines while competition takes the business should not be an option.

Let me hear your thoughts.

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