Course Link:
https://www.lynda.com/Business-Skills-tutorials/Understanding-principles-strategic-planning/183682/384105-4.html
Before planning
Strategic Plan
Defines what you stand of
Defines the market
Defines how you compete
Initiatives to pursue
Goals to achieve
Why is it important?
Provides focus
Gives a rallying point
Helps identify risks and opportunities
Plan for risks or exploit opportunities
3 Principles of Strategic planning
Set a clear direction and stay in your lane
Say no to distractions
Diversify your bets, then execute the plan (Don’t put all eggs in one basket)
Different markets
Different time horizons
Different products
Avoid Analysis paralysis
We continue analyzing the market, running financial scenarios, and looking at the data and numbers ad nauseam and the problem is we never advance the plan.
Running the process
Set a clear direction and stay in your lane
Articulate
Vision
Mission
Goals
Define Core Competencies
What are you great at?
How will you compete?
Define strategic filters
Say no to distractions
2x2 Matrix - to evaluate which opportunities should we pursue
Draw the line
Diversify
Short term
Long Term
Execute the plan
Right Resources assigned to the right projects
Outcomes
Strategic plan
Defined core competencies
Prioritized list of initiatives
Implementation and sequencing plan
Which initiatives
When
And What resources are going to be allocated
Defining the Strategic Environment
Assess the market
Porter’s Five Forces
Five forces to evaluate all the different dynamics that can affect your organization
Internal Competition - Competitive Rivalry
How many competitors are in the marketplace
How do they behave
How are they distributed by market share?
How do they go to market?
Threats of new Entry
New competitors who will enter the market
Time and costs of new entry
Economics of scale
Learning Curve
Threat of substitution
Buyer Power
Supplier Power
Inputs into your business
SWOT Analysis
Strength
Weaknesses
Opportunities
Threats
Strengths and weaknesses are within your organization, capabilities you have and don’t have.
Opportunities and Threats can be internal or external to the organization.
Using SWOT
Eliminate the things that aren’t going to be strategic themes
Look for a consistent theme
Setting Your Strategic Direction
Defining the direction
Mission
Why does your organization exist?
What is its purpose?
Short, clear and free of buzz words.
Vision
If we are fulfilling that purpose, where are we going to be?
What do we want to achieve?
What will it look like in a few years?
Guiding Principles
Rules you want to live by
How do you want people behaving?
Clear and understandable
Goals
Quantifiable
Measurable
Aggressive and pragmatic