Whether you’re building or growing your business, strategic planning is crucial.
That’s because you can’t get to where you want to go if you don’t know where you want to be—or how to get there.
But finding this clarity in business isn’t always easy, especially when the market is ever-changing, and there are multiple moving parts to manage.
So how do you get to a place of business clarity? It starts with questions.
First, let’s start with the big one: what do you really want for your business? What’s your ultimate destination and purpose?
Think about your long-term goals, the impact you want to make, and the values you want your business to embody. By answering this fundamental question, you lay solid foundations for the strategic planning process.
Importantly, don’t limit your thinking to what you consider realistic. What if you had unlimited resources? Would that change what you want? This is the level of business clarity you want to strive for!
If you can’t think of what you want, think of what you don’t want.
It can often be easier to say what you don’t want than what you do. Your answer is then the opposite.
Once you’ve figured out your big goal, you then need to start asking questions around specific key areas of your business.
Most financial goals or targets relate to profit and sales.
Ask yourself, ‘What profit do I want to be making?’ And ‘How many sales do I need to achieve this?’
When answering these questions, consider things like gross profit, net profit, and labour cost percentages.
Finance also covers wealth. What does your balance sheet need to look like? What do you want the net assets of your business to be?
In addition, what financial returns from the business do you want? And how can you, or do you, prefer to generate them for yourself, for example, through salary, dividends, capital gain on exit, or a combination of these?
Personal wealth should also be considered. This can relate to a desired residence, investments, debt reduction, or lifestyle choices.
As well as gaining clarity around what you want your financial situation to look like, you also need to ask questions about your team.
What does your ideal team look like? What roles and skill sets are needed to help you achieve your business objectives?
Consider your organisational structure, specific positions and responsibilities, and the expertise, experience and qualifications for each role. Also, explore what development might need to happen.
In addition, assess the cultural side of your business. Do your current culture and values align with your strategic objectives? What are the desired attitudes, ethics, collaboration, and communication styles you want to see?
Sometimes in business, we end up with clients or customers we don’t want.
You know the ones. Those people you dread dealing with as they’re either unfairly demanding of your time, or your values don’t align or both.
Therefore, another great question to ask at the start of the strategic planning process is, ‘What does my ideal client look like?’
Things to consider include:
Once you’ve come up with your ideal target client profile, review your existing client list. Do you need to sack any?
Think about your physical space. Are there any changes you’d like to see?
Are your premises located in the right place? Are they big enough? Are they laid out in the most effective way? Do they have the facilities you want and need? Do they positively reflect your business?
Also, think about how cost-effective they are.
Consider rent or mortgage payments, utilities, maintenance, and any additional fees associated with the location. Then compare these costs to the value and benefits the premises provide your business.
Do your systems and processes support your goals, streamline operations, and enhance productivity? Can you identify any bottlenecks, redundancies, or inefficiencies? And where are the opportunities?
To answer these questions fully, seek input from your team members who directly engage with them.
Are you getting the most out of your current IT systems? What technology and automation could you invest in to improve efficiency?
How are you ensuring quality and monitoring performance? What could you be doing better?
Marketing and business development are crucial whether you’re building, growing or scaling. So ask yourself, ‘Are we doing enough and doing it right?’
Are your marketing goals aligned with your overall business goals? Are your strategies effectively targeting your ideal clients? Think about your messaging, branding, and communications channels.
What can you do to attract more customers? What are other businesses in your industry doing that are working?
Consider how many leads you would like to get a month, and use this as a benchmark.
Having a clear goal—where you want to be—is all well and good, but you’ll need money to get there. But how much will you need? Figure this out, and then see how you can get there.
Assess your current financial position and identify surplus cash or liquid assets. Also, look at how you could generate extra cash from shareholders or profits.
In addition, look at your existing credit facilities, including lenders, banks and investors. What are your credit limits? Do you have the ability to draw on these to assist funding?
You could also explore what government programs, grants and subsidies might be available.
Strategic planning should always consider business exit.
Think about when you want to exit the business. It’s okay to say you’re not sure. Also, what would happen in a forced or unplanned exit?
Do you have a succession plan in place? What steps do you need to take to maximise the value of your business before you exit? What are the tax implications?
You should always be making financial decisions to increase business value. So how are you increasing sustainable profit? And could your business survive if the key people left?
Gaining business clarity through answering these questions will help you determine where you want to be and how to get there. It’s the starting place for successful strategic planning.
If you’re struggling to figure out or articulate what you really want for your business, seeking the help of a financial advisor can be a smart move.
The right advisor will intuitively challenge you to seek what you want rather than what you think others may expect you to say.
Would you like help figuring out what you want for your business? Reach out to your Maxim Advisor or contact our team to arrange an initial chat with one of our experts.