‘What are strategic plans?' is a common question for employees in a range of industries. Strategic planning is an approach companies can use to work towards their goals. Understanding what strategic plans are and how they are executed can help you reach professional goals. In this article, we define strategic planning and explain its purpose before demonstrating how to make a strategic plan.
What are strategic plans?
Strategic plans are detailed proposals developed to help a group achieve their goals. The term is typically used in the business world to describe the proposals that companies create. These proposals provide a framework for success by defining the company's mission, vision and values, then detailing the company's goals and the steps they'll take to accomplish them.
What is the purpose of a strategic plan?
The main purpose of a strategic plan is connecting a business's mission, vision and intended actions. Connecting these three elements helps employees focus on achieving shared goals. Some of the other purposes of a strategic plan are:
- Defining the actions likely to encourage business growth
- Defining achievable objectives that employees can work towards
- Helping the business allocate, manage and prioritise its time and resources
- Giving the business direction that should help it gain a competitive advantage
- Engaging employees and providing clear communication about the future
- Increasing certainty and stability in the workplace
- Highlighting potential challenges and how they'll be managed for smoother operations
How do you develop and implement a strategic plan?
If you are a member of your business's decision-making team, such as a manager or team leader, you may help create, update or implement a strategic plan. These steps can help you with this process:
1. Assess the business
Evaluate the business and its current performance using proven assessment tools. A SWOT analysis, which assesses strengths, weaknesses, opportunities and threats, is a common tool. You could also use the Five Forces Framework to evaluate the business's place in its industry and how it may respond to market challenges. Using a range of different tools provides the most comprehensive assessment of the business.
Related: SWOT Analysis Guide (With Examples)
2. Formulate your strategic plan
After gaining a deeper understanding of the business, you can develop a strategic plan. Define or confirm the business's mission, vision and values. A concise, single-sentence mission is memorable. Your vision expands on your mission, with five to seven points explaining how your company may look in the next few years. Choose three to five values that support every element of the business and its operations.
Define three to five medium to long-term goals that align with your mission, vision and values. Most strategic plans are for three to five years, so try to set goals achievable within this time. Decide which actions can help the company achieve these goals. Agree on measures for assessing progress and achievement, so the business can evaluate its efforts. Include an explanation of the context or environment your business operates in and your stakeholders.
Related: What Is Corporate Culture?
3. Get approval for your strategic plan, if applicable
Depending on the size of your business, you may need approval from your board before implementing it. This is a common arrangement for a large business with a board responsible for its performance. Organise a formal presentation explaining the elements of your strategic plan and why they are important. Prepare answers to possible questions from board members about why you believe your strategic plan gives the business its best chance of success.
4. Implement your strategic plan
Appoint a responsible person in a position of power to lead the implementation of your strategic plan. This person can explain to all staff members what the strategic plan is, why it's implemented and the role they each play. Depending on the business, you may also want to publish your strategic plan on your company website. This makes your strategic plan accessible for stakeholders and interested members of the public. Clear communication and transparency across all levels of the business engages people and increases your strategic plan's chance of success.
Implementing your strategic plan is an ongoing process. When new employees join your organisation, discuss the strategic plan with them in their induction period. This step helps ensure new employees have the same understanding of the business and its direction as more senior employees do.
5. Review your performance and strategic plan
Review your performance and strategic plan regularly – at least once a year – to make sure your business is making progress. Schedule an early review if your business or industry experiences significant changes. If your progress is slower than anticipated, talk to relevant employees about how you could improve your performance. Adjust your strategic plan as necessary and communicate the changes to all employees.
What is an example of a strategic plan?
This is an example of a simple strategic plan for an early learning centre, Cheerful Children's Care. Note that strategic plans can be many pages, especially for large businesses with many departments. However, this format includes all the elements you need to write your own strategic plan.
Cheerful Children's Care Strategic Plan 2020-2025
Mission: We inspire confidence and success in every child in our care.
Vision: We'll achieve our vision for this strategic plan by:
- Creating a space to learn and socialise where children and employees feel valued and happy
- Engaging all children and employees to achieve their potential
- Offering a variety of learning programs to help children discover what they're passionate about
- Incorporating technology into our learning programs to innovate, engage and encourage creativity
- Ensuring all children have equal access and opportunities for learning
- Communicating openly with the community and welcoming the involvement of parents, extended family and community members
Values: Our values help us build strong relationships with our children, their parents and one another. They help us build a safe and supportive environment that prepares children for bright futures. Our values are:
- Compassion for each other and all members of the community
- Respect for everyone and their differences, other people's property and the world around us
- Honesty in all our interactions with one another
- Cooperation, because by working together we can achieve great things
Goals and strategies: We have set the following goals which we hope to achieve with a variety of simultaneous strategies:
- Set high expectations to make sure all children achieve their potential
- Develop and implement an early learning strategy
- Introduce Mandarin lessons
- Use the Empowering Modern Learners model to incorporate more technology into our sessions
- Make Cheerful Children's Care a more inclusive environment where everyone feels welcome
- Review and update the equity and inclusive education policy
- Implement a voluntary, confidential workplace survey to gauge employee feelings regarding inclusion and initiatives to improve it
- Celebrate Harmony Day, Mardi Gras and cultural holidays to highlight community diversity
- Develop a strategy to support marginalised children including children living in poverty, children with disabilities and Aboriginal and Torres Strait Islander children
- Engage employees, parents and community members to support student success
- Involve employees with curriculum development to ensure they engage with the learning materials
- Invite parents to centre to lead reading groups and give career talks
- Implement a program with a local aged care facility modelled on the ‘Old People's Home for 4-Year-Olds' TV series
- Make Cheerful Children's Care a safe and supportive place for children and employees
- Implement and promote a mental health strategy to support wellbeing
- Introduce lessons discussing bullying and how to be a good friend
- Review special education supports and implement any recommendations
Measuring progress: We'll measure our progress by:
- Reviewing which items we implemented, which are in the planning stage and which are awaiting action at our yearly review
- Assessing children's behaviour and academic performance each quarter
- Evaluating the diversity of our student population and student numbers
Context: We are an independent early learning centre based in Newcastle. Our student population of 130 children hails from Newcastle, Lake Macquarie and the Hunter Valley. Parents typically choose our early learning centre because they want to give their child a good head start in life. They appreciate that we introduce children to various academic topics while paying attention to their social skills. We anticipate a slight decline in our numbers as working from home becomes more commonplace. However, at this stage we still have more than enough children to remain sustainable.
Stakeholders: Our stakeholders are our employees and parents, especially those who volunteer their time in our classes. While approval of our strategic plan is optional, we want our stakeholders to feel included as we move forward. We'll post this strategic plan on our company website so current and future parents can read it. We'll also present our strategic plan to staff and encourage discussion about its elements.
Please note that none of the companies mentioned in this article are affiliated with Indeed.