The beginning of the year brings an opportunity for reflection and growth. Businesses of all sizes take the first quarter to assess what is working and set plans for success moving forward. However, the best-laid plans can still steer you wrong if those plans don’t keep the big picture in mind.
Strategic plans and business plans are often used interchangeably, but they are different and both are important for a successful business. Do you know what the differences are between a strategic plan and a business plan? Does your business use both?
When planning for the new year, businesses can benefit from determining the long-term strategy and the annual tactics. While long-term and tactical plans are different, they work hand-in-hand to execute the big picture vision.
A strategic plan is used to describe the company’s mission, decide what to accomplish over the next 3, 5, or 10 years, and then set priorities to make the vision a reality. It is the high-level and long-term vision for the company that defines the mission, purpose, and goals for the organization.
Through strategic planning, you can assess the company’s strengths and weaknesses as well as plot a thoughtful path forward for the organization.
The strategic plan is important as it provides a common vision that governs the activities and duties of every person working for the company. Instead of having the individuals work separately on their own goals, it’s a uniting factor that allows all work to serve the strategy.
A business plan is a roadmap for executing the strategic plan. While the mission, vision, and goals are stated in your strategic plan, the business plan covers the tactics, logistics, resource allocations, and timing.
A business plan relies on the strategic plan for guidance and priorities but then clearly defines the path forward and sets milestones along the path, assigns the resources to work towards goals, and ultimately defines success.
Your business plan should be created annually and assessed quarterly, or even monthly, to accommodate changes in the organization, the industry, or the economy. Ideally, you’ll check in monthly to verify you’re on track or to make adjustments as needed.
While the big picture is important, equally important is the understanding of how to accomplish the goals and all the milestones along the way.
A good business plan should include:
- Clearly articulated goals
- Current situation analysis
- Market research
- Key targets or opportunities
- Current tools and resources
- Achievable tactics and deadlines
You can think of the strategic plan as a destination setting and the business plan is the map that allows your organization to get to the destination. While you likely won’t need to do create a strategic plan more than once every couple of years, your business plan will need to be updated annually with quarterly check-ins to ensure your organization is on track.
If you are in the process of developing an annual business plan for your business, our team at mConnexions can help you stay focused. Reach out to our strategists to learn more about how we can help.