How Strategic Planning Benefits Leaders at Every Level
Because success rarely happens by accident, strategic planning is crucial to the viability of every business.
At the company level, a strategy involves each worker understanding what they are responsible for, what the company wants to grow into and how to make it all happen. It specifies the scope of a company’s reach and the extent of its objectives. A sound business strategy, expertly implemented, recognizes the goals and direction that supervisors and workers at every level need to have to be able to make their company thrive.
Creating a strategic plan
Strategy creation is an essential step for directing a business’s durability, profitability and competitive advantage. Once developed, management of the plan begins, which includes research, decision making, execution and evaluation.
Developing an effective strategy calls for primary stakeholders to start with a sound foundation of thorough research into a company’s internal capabilities and any external factors that may impact the company’s success. After targeting top-priority issues, the company must create action plans for each key item, along with a sequence for their execution.
A powerful strategy requires time, consideration and communication between senior management and departmental leaders. This engagement is essential for assessing the business’ capabilities and its competitive environment. It also generates buy-in and alignment up and down the company, which is extremely critical because a strategy should be carried out at all levels.
If at all possible, communication with customers, clients and other crucial stakeholders should also be taken into consideration. Feedback from customers and other stakeholders gives management insight and 360-degree point of view on their operations.
Strengths, weaknesses, opportunities and threats (SWOT)
A SWOT analysis is a proven tool for gaining internal and external perspectives on a business. Strengths and weaknesses are normally internal factors, while opportunities and threats are usually external in nature.
Realizing company strengths reveals how it can succeed by leveraging particular attributes, while knowing weaknesses allows for them to be addressed.
Threats are outside factors the organization cannot control that may call for contingency plans. Threats are not necessarily main strategy considerations. For instance, a Gulf Coast business needs a plan to handle a major hurricane. Incidentally, a threat to one company is often an opportunity for a different company. So the same hurricane threat to hotels can be an opportunity for home repair businesses.
Opportunities and threats are often further analyzed through a PEST investigation, which examines political, environmental, social and technological trends. Analyzing trends is useful in dealing with factors that could influence businesses down the road.
Types of strategy
While business strategies can come in all shapes and sizes, they typically come in one of three different categories:
- Low cost – This strategy involves trying to undercut the competition by offering a product or service at a lower price point. Or, it involves creating the impression of getting great value on the dollar.
- Differentiation – This approach offers customers something they cannot get at a competitor. For instance, Apple offers a design and lifestyle aesthetic that competitors do not.
- Customer relations – The strategy seeks to gain customer loyalty and preference, often by offering a superior customer experience.
Whatever strategy your company is pursuing, you can count on Labor Temps to support it with custom staffing solutions and managed services. Contact our team today to learn more about what we have to offer.