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Making strategic planning work for your business Strategic planning
is essential for all businesses that want to improve their long-term
financial performance, and a recent survey suggested that over 75% of SMEs
have attempted planning in some form. It is vital to take time out from the
day to day running of the business to focus on the future, and external help
and constructive feedback can help you to avoid some of the potential
pitfalls. Traps to avoid
There are some
common traps that many businesses fall into when it comes to strategic
planning. These include: · being too concerned with general
objectives, without addressing the practical questions of how they are to be
achieved · having an overly simplistic vision,
which is not necessarily grounded in a tangible, competitive advantage and
the real-life demands of the market · being controlled exclusively by too small
a number of individuals, with too little input from the business and staff as
a whole · basing goals upon inaccurate or
wishful financial projections · focusing too narrowly on particular
areas, such as sales measures, rather than taking a holistic approach which
factors in all of the elements that create profitability. A new perspective
To avoid these
traps, it is useful to take a fresh perspective on the business. You should
look at the wider picture, including such things as the ‘PEST’ factors
(political, economic, social and technical); the actions of your competitors;
the efficiency of your systems and cost management; and the factors that
drive growth in your business. A good external adviser can often
help in achieving this perspective. He or she can do this not just by coming
up with imaginative ideas for growth and strategy, but also by facilitating
discussions, helping you to evaluate options, and by asking you searching
questions about your business to stimulate creative thinking and help you
find your own solutions. Practical measures
Above all,
strategic planning must result in practical measures which ultimately benefit
your bottom line. Strategies should be broken down
into step-by-step processes, deadlines and responsibilities decided upon, and
project management guidelines put in place so that ideas can be implemented.
Measures that will enable you to track success should also be established. As your accountants, we can help you
with much more than just preparation of your financial statements. We can
assist in many of the areas that will enable your business to achieve
long-term financial success. These include such things as preparing cash-flow
forecasts and business plans, minimising your tax burden and helping you to
maximise the opportunities for raising finance. Contact us, and we
will be delighted to discuss these issues with you.
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