Last month, we discussedLast month, we discussed how many business owners have the very best intentions, but somehow never quite get around to making plans for the future. Whereas, when a significant event, such as a wedding or holiday, is on the horizon, we launch ourselves into planning with meticulous detail.
One reason why people do not plan for their business is because it seems like a huge job and the challenge is knowing where to start. For those of you who read last month’s column, you will have hopefully grasped the idea of starting the process and clearly defining or reviewing your over-arching purpose for the business. Doing this and setting out your values makes the next step, defining your strategic priorities, a simpler task.
What is strategy?
Whenever I run a planning session with a group, I always start by asking them to say what strategy means to them. This throws up several different answers, which just reinforces the fact that defining strategy is tough because it can have so many iterations, depending on your business size, the market in which you operate and the complexity of the business.
When I was in practice, I would define strategy as ‘the way we go about achieving our goals’. Hence, I always found it hard to set the strategy without first deciding on what those goals were. I also felt that I needed to understand what our customers and patients were looking for from us, what products and services would be useful to them and what additional things we could offer to solve their problems or enhance their lives. Hence, I also found it hard to set the strategy without first being very clear about who our customers were and what niche demographic we were going to be focusing on.
A simple model
As small business owners, we do not have the same resources as larger companies. So, it can pay to simplify things to make them easier to manage and communicate. Thinking about strategy in this way leads to a simple three step model:
- Who are my ideal customers?
- What are my goals?
- How can I achieve my goals in a way that will be profitable for the business?
This may not be the same as a classic definition of strategy but for me it was more important to have something that worked and was practical, rather than having something complex that would prove too time-consuming to deal with.
Defining your customers
We understand in business that trying to be all things to all people is not possible, so defining the various types of customers you wish to serve will help you to understand your business. This links back to your vision and purpose where you have likely described why you went into business and who you wanted to help by doing so.
What are your goals?
Your goals may be defined in a number of ways, which may include but are not limited to:
- Financial goals linked to the business
- Customer goals in terms of the service levels you wish to achieve
- Staff goals in terms of training and development
- Lifestyle goals in terms of your own work-life balance
By setting out what you want to achieve in terms of goals, you can start to build a picture of how you wish to achieve these goals and, for me, that is the definition of strategy.
Strategic priorities
Armed with what you want to achieve and who your customers are, you can now set about describing how you are going to go about it, within the framework of your values and purpose. Getting hung up on the management speak and jargon can easily de-rail this process, so using simple language will help.
After spending some time working through what is possible, you can prioritise the most important things to focus on. The fewer you choose, the more likely it is you will succeed. I generally find three to five is plenty to focus on and typically this would look like this:
- How do I recruit, develop and coach my team to deliver our goals?
- How am I going to attract more of the types of patients I have described as my ideal customers?
- How should I use the right financial indicators and measures to ensure my business delivers on the financial goals I have set out?
- How is the practice going to introduce new products and services to remain and become more relevant to our customers?
Simplicity is key
As you can see, these strategic priorities are not sophisticated or complex ideas. They are practical and, to be frank, some are obvious. But, there is something about having these written down and shared that helps keep the plan on track. By going through your strategic priorities, you can then define the tactical ways in which you will approach each of these. The more straightforward and simpler you keep it, the easier it is to communicate it to the team.
I hope this has helped you to get a flavour of how to go about setting your strategy for 2023. If you need further help, please feel free to message me at mentoris58@gmail.com.