Driving revenue and catalyzing growth are at the forefront of most every company's agenda, but achieving aggressive goals are often complicated by an increasingly dynamic business environment and uncertain economy.
AcornOak has created a community of female executive leaders with a wealth of expertise to guide founders and business leaders in successfully navigating that journey.
Four of our leaders were featured on a recent panel of experts to discuss the topic “Planning as a Strategy” and share insights into the impact strategic planning has on the success of a business.
Going beyond the mere act of planning, critical elements of strategic plan creation and execution were shared which are essential for any business looking to scale effectively.
The Eye-Opening Study by Dun and Bradstreet
Dun and Bradstreet has extensively profiled businesses for more than 100 years. Several years ago, a DnB study surveyed hundreds of small businesses to identify what characteristics distinguished a successful business from a failed one. The critical distinguishing factor between thriving businesses and failed businesses was the degree to which they were engaged with strategic planning.
This insight demonstrating the power of strategic planning in driving business growth and sustainability forms the cornerstone of our discussion.
Understanding Strategic Planning
Strategic planning isn't just a buzzword or fad; it's a timeless, structured process which forms the backbone of successful organizations.
The process involves four steps:
1. Establish Clear Organizational Goals: Define organizational objectives for the time period in question. Goals will likely be driven by the needs of the business, the competitive market, the economy or other benchmarks. They are also often influenced by the founder’s vision or company mission.
Goals are typically limited to one or two per quarter, perhaps more for a fiscal year.
2. Create Clear Functional Area Goals to Support Organizational Goals: Each functional area with potential impact on the organizational goal will require a strategic approach for successful achievement. At this level, goals are broken down into actions, resources and timelines needed for success.
Each functional area goal incorporates on average three supporting goals, or paths, to successful achievement of the organizational goal.
3. Document Action Plans to Execute Goals: Organizational and functional area goals provide roadmaps and action plans break down those maps into specific, actionable steps, ensuring clarity and focus in execution.
Action plans may vary for each goal depending on the granular detail required. Typically, three to five action plans per goal are a manageable baseline.
4. Measure, and Evaluate Results, Adapt as Needed: Step four is actually an iterative step. Measuring progress, evaluating results, pivoting as needed and recalibrating the goal, strategy or action item is critical for success. Continued learning will foster a cycle of continuous improvement.
Case Study: Gamma Gamma Technologies
Let’s illustrate a practical application of strategic planning in action.
For our “Planning as a Strategy” panel event, Gamma Gamma Technologies was shared as a case study. As a young health tech SaaS startup, their ambitious goal was to leverage innovation to expand their market and triple revenue in three years with 50% revenue growth in the next year.
Goal Setting and The SMART Framework
Gamma Gamma followed the time-tested SMART goal setting framework: Specific, Measurable, Achievable, Relevant, and Time-bound.
This framework should be applied to each goal to establish a pattern of consistency, keep all team members accountable to the same understanding of the goal and reinforce the SMART goal concepts.
S is for Specific: Drill down to exactly the goal you want to achieve. Get granular!
M is for Measurable: How much growth? What percentage of savings? How much more efficient? If you cannot measure it, it's not detailed enough.
A is for Achievable: It should be a stretch goal, but it needs to be realistically able to be achieved.
R is for Relevant: The goal needs to advance your organization or your functional area towards achieving your next goal or be directly in support of the organizational mission or vision.
T is for Time-bound: Make sure your goal meets this critical component and has a deadline. Without a date to be accomplished, it is simply a wish, not a plan.
In the case of Gamma Gamma Technologies, their goal wasn’t simply to grow, but specifically a SMART goal of 3x revenue in three years.
The Cascade of Goals
While strategic planning can and should be done at every level of an organization, the organizational cascade of goals drives a common commitment to achieving shared goals. Strategic planning of organizational goals does not stop at the top level.
It cascaded down to every functional area, from the executive offices to finance, operation and technology, on to sales, marketing and production and support. Each department develops supporting goals aligned with the organization's primary objectives and may even collaborate cross-functionally on shared priorities.
The Power of Cross-Functional Collaboration
The success of Gamma Gamma’s strategy hinged on cross-functional communication and collaboration. Regular meetings facilitated open lines of communication, ensuring a cohesive and focused effort across the company. With each department’s execution synchronized, efficiency and impact were maximized and goals were achieved.
The McKinsey & Company article “Seven Principles for achieving transformational growth” share this insight:
“Delivering transformative growth requires the whole enterprise to act in concert—from the marketing-and-sales teams that drive customer acquisition,
to the product and service leaders who deliver the customer experience,
to the customer-service staff who help ensure customer satisfaction and loyalty. Because market conditions, competitive threats, and customer sentiments change often, such growth requires a mixture
of doggedly persistent and nimble execution.”
Bringing Strategy to Life
Going back to our Gamma Gamma Technologies case study, the organizational goal was to leverage innovation to enter new markets to achieve their 3x revenue goal. Innovations would encompass R&D, and likely Operations and Production.
With innovations in hand to enter new markets, sales and marketing would need to collaborate for tactical goals regarding which markets to target and what resources are needed from Technology, Human Resources and Finance for the sales team, CRM and budget.
Conclusion: The Essence of Strategic Planning
Gamma Gamma Technologies' story is a testament to the power of strategic planning. It's not just about setting goals but creating a living, breathing process that evolves with your organization. It's about aligning every part of your business with your overarching objectives and ensuring that every step taken is a step towards success.
Strategic planning is more than a strategy; it's a culture, a mindset that empowers businesses to not just envision success but to map out a tangible path to achieve it.
About the Author
Michelle L. Page
Fractional Chief Fractional Business Development and Revenue Officer
When it comes to seizing ambitious goals and conquering complex sales and marketing hurdles, Michelle Page is the go-to professional who delivers results.
Read Michelle's bio
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