Developing Strategic Plan

/Developing Strategic Plan
Developing Strategic Plan 2020-05-14T12:18:09+00:00
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Hello and welcome to my video on how to develop a strategic plan for your organization my name is Edward Shehab and in this video I’m going to show you the steps that you have to follow in order for you to develop a good strategic plan stay tuned all right so what is the strategic plan a strategic plan is a plan that shows how your company is going to create value on an ongoing basis for its own shareholders and stakeholders the strategic plan is threaded through the organization and is part of the ongoing operation of the business strategic planning in itself helps the high-level concepts and visions that the organization has become a reality through taking actions on specific projects sometimes you know we are confused on who the strategic plan is intended for and so one of the first things that we need to ask ourselves is who are we developing this for first and foremost you need to be focused on who your shareholders are the people at the highest level who are asking for this value to be realized from your plan so keep that in mind as you develop your strategic plan because they play a big role in how you balance out your strategic plan in general it is recommended that your plan is balanced and based on four or five different perspectives such as the shareholders the which is the financial side that they need the customers and the value that they get the internal processes that need to be developed as well as the people that are involved in making this happen this is called the balanced scorecard and I’ll talk about that in a little bit all right so the first thing that you need to do when you develop a strategic plan is you need to understand what your values are as an organization every organization holds some values as part of their core foundations so what are the things that the organization will never budge from or shift from examples of some of these values will be let’s say honesty loyalty innovation creativity maybe ethics sometimes it is more like profits market share so you really need to understand the values that your organization’s if you’re not really sure what the values are put together a team and brainstorm some ideas of what you think the values are and you can start with as many as you like and then narrow these down to like the ten most important values then narrow down to narrow them down to the five topmost values and then bring them down to the three most important values that your organization stands by once you know what your values are the next step that you want to take is to prepare a value statement something that says that this is what’s important to us and therefore we do it like this so you might say for example if innovation was really what is important to you then you could say something like we innovate in everything that we work on in order to create maximum value for our customers so if if that’s what your values are then that’s going to drive what your vision and mission is going to be most organizations are founded in the values of that organization so if our values relate to education and we believe that knowledge is King and everybody should have access to knowledge right then our mission statement would be most likely related to us sharing knowledge and educating people and our vision would be that in the next so many years that we would have accomplished this kind of education or knowledge sharing so once you know what your values are the next step is to go into defining what your vision is your vision is where you see your organization over the next two to five or ten years right so depending on where you are in the ranking of the organization if you are a CEO or zero a c-level person you’re probably looking at about five years of a vision or more and if you are a department head you’re probably looking at it two years and maybe it goes lower from there so at different levels all the way to the team lead level you will see that the duration of that vision statement is going to be shorter and shorter so the lowest that you may have is three to six months and that would be someone at the team level trying to execute on a short-term vision so what goes into a vision statement well a vision statement there are two ways to look at or maybe there are two sides to a vision statement there’s the one that organizations put on their website for everybody to see and that tends to be quite generic that says you know something like we aim to be the benchmark and let’s say in customer service or we aim to be number one and providing the best hospitality experience so these are pretty generic that companies will put on their website but internally the leadership needs to have their own vision statement that describes where they see themselves in the next few years and these vision statements would be more effective if they have some numbers associated with them or some expectations some benchmarks that we want to use so the way you should imagine vision statements is like this if we’re talking about a two-year vision statement then just imagine that you went into that today’s 2019 you went into a time travel pod your stepped inside and you said it for two years from now 2021 so in two years steam comes out this pod makes some buzzing sounds the door opens and you come out what you see out there pertaining to what you had stated two years back should have become a reality so if you had stated that your organization let’s say in 2019 right now your organization has three locations you’re a retail organization and you have three locations and in your vision statement you stated that in the next two years you would expand to twenty-five different locations so now we have a clear understanding of what you expect to happen in the next two years so basically if you go into a time travel pod at that point and you set it for two years from now and you come out you should see when evaluate how many locations you have you should be able to find that you have 25 different locations and that if you see the 25 different locations then your vision became a reality so that’s what it means to have a vision statement where you see yourself but it needs to be a realistic view of the future it shouldn’t be just a generic you know dream able unrealistic vision that if you want you can put it out there for customers to see but you know I wouldn’t encourage that because if customers see your vision and you know they see that this was maybe a written way back and they’re you know they’re evaluating you right now and they see that none of that has actually happened then you become a laughingstock you become a joke alright so what you want is a vision that is realistic of where you see yourself as an organization and the next two five or ten years and when we talk about where you see yourself we mean the state of your organization your people your processes the tools the location the space the procedures policies the cash position your network and your market share these are some of the things that you might consider when you’re thinking about how you will be in the next two to five or ten years so let’s say you’re able to put together a vision statement stating where you expect yourself to be so we have three different locations right now and we aim to have one location in every major city over the next two years so now it means if a place is the major city we will need to have a branch in it right so that’s how we prepare the vision statements the next thing that you need to do is look at preparing a mission statement a mission statements defines who you are and what you have been set up to do your mission statement states that this is this is what we do for business so for example our mission is to educate everyone in this town our mission is to provide best class health care services in our city okay or it could be something that says our mission is to ensure that everyone in our community has access to health insurance so whatever your mission statement is what defines you as an organization and why you have been set up as an organization now if you have your values and you have your vision and you have your mission the next thing that you need to do is analyze yourself to understand how well you are positioned for that vision to be realized and so typically what we do here is we do a SWOT analysis and SWOT that stands for strengths weaknesses opportunities and threats all right strengths and weaknesses are internal to us and they represent areas that we if we’re looking at strengths we’re looking at areas that we feel good about ourselves in such as we have the right amount of cash or we have abundant cash we have qualified resources we are well-connected in our organization we have a lot of maturity we have a lot of history background in that specific industry we are supported maybe by government and so these are going to be considered strengths the opposite of that would be considered a weakness on the other side of the SWOT is the opportunities and the threats so where are the opportunities when it comes to our industry mind you when you do your SWOT analysis don’t do a SWOT analysis for your whole company do a SWOT analysis for a specific strategic objective that you’re working on right so if your goal is expansion to 25 different locations then do a SWOT analysis for expansion how suited are you for that expansion what are the strengths that you have and where do you see you have some weaknesses internally these are your current strengths and weaknesses but then what about opportunities that lay out there where are the opportunities let’s say we have some areas that are underserved in our market right maybe these are opportunities for us to open locations in right and what about the threats who where are the threats coming from maybe you have competition that could challenge you in some of these areas maybe regulation could limit you in certain ways or maybe some political instability or example power struggles in the area don’t make you feel very comfortable about expanding that fast so you want to evaluate where the opportunities are and you want to you want to look at where the threats may be coming from so once you’ve done this you’ve done your strengths weaknesses opportunities and threats you need to evaluate them across each other so your strengths can help you capture opportunities your strengths can help you overcome some of the weaknesses or maybe some of the threats but if you have a weakness in an area that is a threat for you but that would be an indicator of an area that you need to walk away from rather than try to fight it okay so try to capitalize on your strengths to capture the opportunities that are out there over or overcome the weaknesses and for and at the end of the SWOT analysis come up with some action plans of how your strengths that you’ve identified can be used to capitalize on opportunities out there or maybe overcome some weaknesses so that you can capitalize on opportunities once you have these action plans right in there try to write some goals based on that these goals need to be either smart using a smart acronym so specific measurable agreed-upon realistic and time and cost bound make sure these are goals that are realistic right specific and can be measured at some point you don’t want goals that don’t have numbers associated with them because who’s gonna know if you actually achieve those so if you said one of your goals would be to have three major sponsors maybe you need to qualify what a major sponsor is right and that way you know when you have the three major sponsors if you stated that your first six locations should be in place within the first six months and you put a date against it then that’s easier to measure so put goals that are measurable if you said your HR should start recruiting specialists in a specific field and you should have five of those resources ready by May of 2020 that is very specific so you want something that you can check later on and confirm that it actually is in place so develop these goals and then now go to the next step once you have all of your goals start thinking about how to develop your strategic plan now other things can also happen at this point your goals will need to be assigned you need to figure who will be responsible or accountable for specific steps who’s going to who’s going to support some of these actions but technically it’s probably too soon what you need to do is evaluate these goals and determine how they fit into your overall strategic plan okay so this is where we come to the balanced scorecard you don’t necessarily have to use the balanced scorecard but it has been used by a lot of the fortune 500 companies and the majority claim that it brings about good benefits and value for them what does it mean to use the balanced scorecard well balanced means that it looks at different perspectives when you develop your goals for the next few years and it makes sure that it’s addressing all of these perspectives and this scorecard is where we represent the the goals and the metrics associated with them against which we’re going to measure eventually so let’s talk about the balanced side of things the four areas you want to look at is the financial aspects which is what matters to the shareholders what value do your shareholders want if you’re in a community service if you’re a government then what do the taxpayers once you get to figure out who your customers are who are the people that are funding your operation what exactly do they want from you the other thing that you need to ask is if we’re going to bring this kind of value to our shareholders then what is it that we need to provide as a service to customers that would help us generate this kind of revenue so that we can satisfy the needs of our shareholders and so the customer side of things is going to require that you provide some value adds alright these are things that customers want from you now for you to be able to provide these customer service or value adds there are internal processes that will need to be enhanced so that’s the third perspective that you need to look at what is it that we need to do internally and change as far as processes and services so that we can prove the value adds for the customer so that we can generate revenues that would please our shareholders right and then now finally what you need to ask yourself is if we’re going to have these internal processes enhanced and so on what sorts of learning and growth are we going to require you might need to grow your team and you may need to educate yourself train yourself so that you can develop these processes that would help you provide good value to the customer to the customers which in turn will also generate additional revenue for your organization so that’s the brief about the balanced and then the scorecard is where you look at the actions that need to be taken and the metrics against these so for example if one of the things that we want to provide to customers is faster service right then what is it that we measure to ensure that we have provided faster service to our customers let’s say your Amazon right amazon.com and to you the faster you can get your products that a customer the better are the more business you will do so what is it that you need to measure to assure that you have provided good fast customer service or delivery let’s focus on delivery what is it that assures that you have delivered your products in a fast efficient manner to your customers well the delivery time from the time that they order to the time that the customer gets their order that would be the cycle or the time that you need to measure so we can say that the delivery cycle from order to product being delivered needs to be less than two days for example or less than 48 hours so that is the metric that you want to measure and the action would be to facilitate faster delivery let’s say via drones okay to your customers or maybe through partner networks that would allow for faster delivery to our customers and the metric or the measure there is less than 48 hours okay so that’s what you’re going to score yourself against and over time once you’ve put this action into place if your strategic plan is executed you’ll be looking for these results that you are able to deliver in less than 48 hours so that’s what it means to have a balanced scorecard okay and that’s how we develop the kpi’s against the balanced scorecard most of the time your your strategic plan is developed in the form of what we call a strategy map and that strategy map as you see here it’s going to have at the highest level the financial expectations or objectives and below that you’re going to have the customer values that were going to give out there so that we can achieve the financial goals for our shareholders and for us to be able to deliver these customer value ads we need to look at what internal processes need to be enhanced and improved and below that you want to look at what learning and growth needs to happen and you see that there are arrows that connects from the bottom all the way to the top and so it’s a cause and effect type relationship that if we do the following learning and growth we should be able to improve our internal processes so that we can deliver the following values to the customer which will help us deliver financial gains for our shareholders all right so the this this this is the foresight perspective the balanced approach for us to develop our goals and these are this this balanced approach is going to be used for the same goals that we discussed previously tied to your SWOT analysis okay so let’s just recap at this point you wanted to develop a strategic plan so you need to know in the next two or five years what actions need to be done for you to be able to achieve your vision right so you identified your values you identified your vision you know what your mission is you did a SWOT analysis to look at your strengths and weaknesses and where dribbble goals were evaluated against the balanced scorecard approach or they were evaluated for how balanced they are so as you execute on your plan to overcome the weaknesses or capture the opportunities on your SWAT so that your vision can be realized you are doing this in a balanced approach you’re addressing what your shareholders want what value what values your customer looking for and what internal processes need to be enhanced and what learning and growth needs to happen mind you once you develop this plan this plan needs to be executed therefore projects will be initiated to execute on the small pieces of your strategic plan the work has to be assigned and you have to make sure people know that they’re accountable for this work that it needs to be done as scheduled because every piece of this is going to be strategic to us and it’s going to have consequences if it is missed and therefore it’s very important that people know they are accountable and in this case I’ll recommend that use a RACI chart RACI to clearly state who is accountable and who is responsible who can be consulted who is informed but the main thing who’s accountable for every piece of that strategic plan as well as being sensitive to the fact that every strategic plan and every enhancement that we do an organization is going to mean changes and people usually don’t feel very comfortable with changes so you also need to address the fact that your stakeholders and your community may struggle with change and so you have to work on easing the impact of this change on that community or on the stakeholders right so if you’re able to manage the change and assign accountability and you have your strategic plan as discussed then most likely you’ll be able to execute your strategic plan pretty well I hope this video has helped you in understanding the concept of strategic planning if you have any questions or if you’d like to share your feedback on how you do strategic plans or if there’s any advice you would like to give please let me know put your comments down below if you like this video or if you would like to see more of these videos please subscribe and hit the notification bell if you think others might benefit please share this with them we look to see you on the next video take care bye bye