Aggrey Jonathan K Bett

I have written a book called How to Start and Run Your Own Business. Why did I write the book? I wrote because self-employed startups and enterprises perform a noble duty in Society, providing employment, products, services, and government revenue for public goods and services. Yet, the failure rate for startups is very high. So, I wrote the book to provide information that can help reduce this failure rate. The book contains a full suite of what it takes to start and operate a business successfully. However, strategic planning is the starting point of creating a company, so I am sharing this article.

Strategic planning is a cornerstone of effective organizational development. This article outlines key ideas, emphasizing the concepts, purposes, and methods of strategic thinking, planning, and management for new and ongoing businesses.

What is Strategic Thinking, Planning and Management?

Strategic thinking is about applying the mind to create a vision, innovative ideas, and possibilities for doing business, while strategic planning is about turning those ideas into an action plan with objectives, strategies, initiatives, and resources to implement the plan. Strategic management refers to the continuous actions of executing, monitoring, evaluating and adjusting the strategic plan to cope with changes in the market. You start with strategic thinking, then strategic planning, and end with strategic management when contemplating starting and running a business. However, in practice, you go back and forth between these activities as you create and operate the business. Strategic thinking and planning are structured brainstorming processes enterprises use to chart their future direction and devise methods to develop and achieve their goals. Strategic planning is not only for large enterprises. Every business, even a Kiosk or a Candy shop, can benefit from any scale or form of strategic planning. This process involves:

• Environmental Scanning: Identifying external developments and internal concerns that may impact the business. A popular method of scanning the environment is the SWOT analysis-SWOT stands for Strengths, Weaknesses, Opportunities and Threats. You analyze these factors to identify and take advantage of your core competencies, strengths and opportunities and mitigate weaknesses and threats.  
• Priority Setting involves establishing clear objectives and priorities and devising strategies and initiatives to implement the plan. Objectives are end goals or targets. Strategies are innovative or competitive ways to achieve beneficial results. Strategies define how to achieve the goals. Initiatives are actions or steps to execute plans or strategies.
• Resource Allocation: Assigning resources effectively to meet the established goals. Resources include funds, facilities, systems and people to facilitate the execution of strategies.
• Crafting an Implementation Framework: Creating an execution, monitoring, and evaluation structure to ensure implementation and change of course when results are out of track or the plan.

Strategic planning is an iterative process that culminates in creating a strategic plan—a document serving as a roadmap for the organization's objectives and how to achieve them.

Strategic Planning for New Businesses

For a new business, strategic planning focuses on setting the foundation for success and ensuring a smooth start. Key areas of strategic thinking for startups include:

1. Viable Business Idea: Developing an idea that addresses a market need.
2. Company Identity: Creating a compelling name and brand identity.
3. Business Format: Choosing a suitable legal structure (e.g., sole proprietorship, partnership, corporation).
4. Permits and Regulations: Securing necessary licenses and permits.
5. Initial Operations: Assessing the need for premises, facilities, and systems and arranging to acquire them where necessary.
6. Human Resources: Establishing employee hiring policies and staff management systems.
7. Business Administration: Developing management structures and organs.
8. Financial Planning and Control: This entails designing robust financial management frameworks and securing startup funding.
9. Marketing and Sales: Launching initiatives to introduce the business to the market and find, attract and retain customers.
10. Vision, Mission, and Values: Defining the company's core principles to guide decision-making and culture. Vision is the image of an ideal or advantageous situation the enterprise hopes to attain. The Mission is the purpose or reason for bringing the enterprise into existence, and values are the moral cornerstones guiding the organization's conduct.

Strategic Planning for Ongoing Businesses

Strategic planning sets the stage for growth and adaptability for an ongoing business. The primary goals include:

1. Organic Growth: Enhancing core activities such as management leadership, sales, marketing, pricing strategies and operational efficiency.
2. Innovation involves developing new products or services to meet evolving customer needs.
3. Strategic Positioning: Differentiating from competitors by offering unique products, addressing specific customer needs, or improving accessibility.
4. Expansion: This involves exploring mergers, acquisitions, horizontal and vertical integrations, and strategic alliances.
5. Operational Efficiency: Performing similar activities better than competitors.
6. Diversification: Diversification entails considering divestitures, foreign currency transactions, or other avenues to expand the business's reach and profitability.

Differentiation and Competitive Advantage

For ongoing businesses, differentiation is vital for maintaining a competitive edge. Strategic thinking should consider the following:

• Product Offerings: This term means expanding or refining various products or services.
• Customer-Centric Approaches: Positioning based on customer needs or access methods.
• Innovation: Adopting unique practices that set the company apart from competitors.

Conclusion