4 Fundamentals of a Growth-Oriented Business Plan

We at Kapso Business Services, India's leading business brokers help small-medium enterprise owners who want to Buy a business or Sell a business and guide them through the process and make sure they achieve their goals. One of the fundamental aspects that make nbsp;or breaks the business's prospective growth is inconsistencies in its core business decisions, steps, metrics., and actualizing goals into reality

Key components of the business plan for strategic growth:

  1. Strategy

  2. Execution

  3. Milestones and metrics

  4. Essential business numbers

Let’s look at each of these.

1. Strategy

 

A business strategy is the means by which it sets out to achieve its desired ends (objectives). It can simply be described as a long-term business planning. Typically a business strategy will cover a period of about 3-5 years (sometimes even longer).

A business strategy is concerned with major resource issues e.g. raising the finance to build a new factory or plant. Strategies are also concerned with deciding on what products to allocate major resources to - for e xample when Coca-Cola launched Pooh Roo Juice to target the important demography of 2- year olds with colorful packaging and Winnie the pooh as the mascot

Michael Porter, who is perhaps the best-known business writer on strategy, said:

“The essence of strategy is choosing what not to do.”

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Identity, market, and offering

One of the most useful strategy frameworks  is the problem, solution, market, and identity (or why us) framework . Don’t pull them apart. It’s the interrelationship between them that drives your business. Each affects the other two.

We forget too often, so start with this: Your business is about your customers. And, most important, the problem you solve for your customers.

In a social media company that posts updates for its clients, the problem it solves is not social media; it’s getting the word out, and getting people to know you.

The best restaurant doesn't just serve food. The restaurant offers you a memorable experience for you and your family.  

Every business had better be solving a problem. If not, it’s continued existence is threatened.

Your solution

Your solution to the problem above is your product or service. You can already see from the restaurant example that the choice of market influences the business offering. That’s strategy at work.

Your businesses identity influences your choice of market, which influences your choice of product. Your choice of product influences your choice of market. They have to work together.

Target market

Your identity influences your choice of target market. The more tightly identified, the better.

Successful restaurants focus on people in certain areas with defined tastes, price sensitivity (or not), time sensitivity (or not), couples, parents with kids, business travelers, and so on.

What part of the market do you identify with? Who are you most comfortable serving?

Identity (in other words, “why us”)

Every business has its core identity. How is your business different from others?

What are your strengths and weaknesses? What is your core competence? What are your goals? What makes you different?

These four choices are your business strategy. The growth in your strategy is what makes the difference.

Is there room in your current strategy to grow the business? Are you looking at a new market, maybe contiguous to your existing market? New products? The genius is finding the opportunity for growth, and managing the steps and resources to make it happen.

Don’t pull the strategy apart. Don’t take the various elements one at a time. Don’t ever stop thinking about them. Remember, in planning as well as in all aspects of business, things change.

Keep watching for this change. Change is the opportunity to grow.

2. Execution

One of the major limitations of a strategy is that in most cases it never gets implemented.

Execution tactics are the steps, the activities, the decisions you make and paths you take to execute on strategy.

Execution tactics are the key elements of a marketing plan, product plan, and finance plan. Pricing, products, promotion, messaging, channels, social media, support, lead generation—it’s all about execution. And you can’t do a strategic growth plan without working through the tactics that will execute the strategy.

In the plan itself, as with strategy, tactics are only as formal as you need for execution. They are probably simple lists and bullet points. A Lean Plan is a good framework. No need to elaborate if your plan is for your team only, to manage growth. But write them down so you can use them later as reminders, and checklists for analyzing execution. The main use of your plan is for constant review and revision, like a business dashboard.

As you work with tactics, think about strategic alignment. Make sure your tactics match your strategy. If you have a high-price, high-value strategy, make sure your pricing and product offerings match. Make sure your messaging, channels, and promotions match. That’s strategic alignment.

3. Milestones and metrics

Your goal is execution, and milestones and metrics inform execution. Think of dates, deadlines, and concrete specifics.

Ask yourself how you’ll know as you execute your strategy whether or not you are on track. >People like working toward milestones, and they like seeing their progress marked in specific and concrete metrics.

Metrics are sales and spending, of course. But also, depending on your type of business, other performance indicators like traffic, leads, conversions, presentations, visits, trips, engagements—and even likes, retweets, and follows. Make your metrics measurable and meaningful.

In your strategic growth plan, milestones and metrics are beautifully edited text. They are lists. They are dates, teams, names, and numbers.

4. Essential business numbers

Real planning has to be rooted in specifics, including sales, spending, and cash flow.

If you have an existing business, you are probably already managing cash flow and reviewing your performance and against your forecasted numbers regularly.

5. From then on, keep it fresh

The business plan is just the first step. From there, your projections lead you gracefully into reviewing plan versus actual results and looking for course corrections.

I call this the planning process, involving regular reviews. You track results, you compare the results to plan, and this year to last year. And you make course corrections, or stay the course, depending on what you decide.

Remember what former U.S. president Dwight Eisenhower said: “The plan is useless, but planning is essential. We at Kapso Business Services, India's leading business brokers help small medium enterprise owners who want to Buy a business or Sell a business and guide them to follow the best strategy to grow their business or exit from their business to pursue other ventures.