Benefits of Strategic Planning

There are so many benefits of strategic planning. For starters, it helps you make well-defined goals that show how your organization will achieve the mission and vision over the next three or five years. Imagine your company trajectory as a line on a map: a strategic business plan will guide you in determining the action you need to move from where you stand right now (Point A) to where you need to move (Point B) a few years later. This blog will focus on the many benefits of strategic planning for both small and large companies.

What is a Strategy?

When you decide you want to perform various activities that can be recorded and will give you a sustainable competitive edge over your rivals, that technique is a strategy. At its core, it is a mental exercise. It is an approach to doing business as well as perceiving the world, waging war, and even more. The process you follow to come up with creative, innovative ideas that form the core foundation of your company and help guide its future is called strategic business planning.

The Benefits of Strategic Planning

Whether you own a large organization or a small business, strategic business planning works wonders for all companies! From immediate to long-term, it has all kinds of impacts on the organization. The benefits of strategic planning include:

1. You MAKE your future happen, instead of IT happening to YOU: Business owners who take a proactive approach always stand apart from those who have a reactive one. You could choose when to be offensive and when to be defensive, just like you need to in a game of chess. The choice you make will ultimately decide whether you stand victorious or fall victim to challenging circumstances. While it is virtually impossible to foresee all situations, keeping expected market and business changes in mind and taking proactive decisions aligned with those always helps. Strategic business planning helps you do that by forecasting expected changes.
2. The Direction Your Business Takes Gets Defined: Sound strategic business planning defines the company’s purpose, outlining goals and objectives that are realistic and aligned with the mission and vision statements. Once finalized, the plan gets shared with all stakeholders, including your employees. It forms the foundation of measuring progress, compensating employees, and setting strong boundaries for effective decision-making in the future.
3. Helps You Make Sound Corporate Decisions: Sometimes, it gets downright confusing to tell apart one great idea from another. If you don’t have a well-defined vision of the things you need to achieve and any related purpose and mission to get there, anything and everything will look nice to you. You have choices to make. Which project is worth investing in? What is the best way for your staff and you to spend your time? Having a clear sense of what you need to do helps you figure out the kind of people right for the job and the strategies needed to get there. This is particularly essential given that companies usually have limited people and financial resources.
4. Helps Your Business Stay Profitable in the Long Term Both local and global markets are experiencing economic and other changes at a rapid pace nowadays. For companies, this spells trouble: organizations that don’t have a solid foundation or have reached this far thanks to opportunities or luck won’t stick around long enough. That’s why you need strategic business planning: it helps your business survive the various challenges stemming from changing market scenarios. Companies that make a strategic plan tend to stay profitable as they minimize all the distractions that tend to push them off track.
5. Also Helps Expand Your Market Share: Focused strategic business planning and tactful thinking help you identify new product and service offers, market conditions, as well as potential clients. All this serves the best interests of your company. When you take a rather focused and intentional approach to the external market opportunities, that helps you guide your distribution and marketing activities as well as sales. It also helps you make other business decisions that ultimately contribute to the overall profit your company reports every year, enhancing its chances to expand its market share.
6. You Get to Differentiate Yourself Instead of Following Competitors’ Best Practices: Smart business owners that make time to do proper strategic business planning reap its many benefits. One of these is that you get a chance to stand out from the crowd when you apply the differentiation strategy. Instead of trying to replicate what works best for your rivals, you devise an out-of-the-box approach, unique to your business and its nature. When a number of market rivals are following the same-old, run-of-the-mill technique that is somehow still delivering them results, the tendency to give in is high. One of the benefits of strategic planning is that you stand out from the crowd.
7. Provides a Sense of Purpose & Meaning, Leading to Improved Motivation: You would be surprised to know that around 80% of employees who quit a company do so due to lack of job satisfaction! Employees need to have a reason and motivation to come in to work every day and deliver their best. This comes from making them feel like they are also an important part of the team. You can do that by helping them feel they are contributing to the strategic business planning process in the company. Your employees are your assets and one of the best sources of coming up with new, innovative ideas for achieving targets. Having employees feel they are working to achieve a common goal and a shared purpose drives them to work harder and invest their heart into their work.
The bottom line is, one of the much-needed benefits of strategic planning is that it provides you a direction to head into. They say, “Direction is more important than speed” – this means that if you have achieved targets speedily in six months instead of the one year you had, but not in the direction/department you should have achieved it in, it would become meaningless. So, strategic business planning helps a business define its purpose.