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FORMAT FOR A STRATEGIC BUSINESS PLAN

There are many books and articles that suggest formats for a written business plan. Most of these suggest that you include a business mission statement, discussion of product/service lines, sales projections, and more. Unfortunately, such plans too often become financial/numbers exercises. While we think that a solid analysis of the numbers and your expectations for return/profit and so on are important, in our opinion a good business strategy should go far beyond tables, charts, and numbers. Here are the major components of a business strategy that will give you not only financial and sales targets to meet, but a complete plan for running your business.

Statement of Basic Values and Fundamental Beliefs
Often overlooked in traditional business plans, this statement spells out the fundamental principles upon which your company is based. By developing and living by such a statement, you will go a long way toward making your company something that is truly special for your employees, customers, and the community itself.

Mission Statement
This should be a clear and concise statement that can serve as a guide you follow in making decisions about the products/services you will offer and the markets/customers you will serve. No business should try to provide every possible product or service to every conceivable market or customer. Every business - if it is to be successful - must focus on some segment of the marketplace where it can compete because it has special capabilities or a special advantage. Your mission statement should spell out clearly the business you are in and should be your guide to new products/services to offer and new markets/customers to serve.

Analysis of Your Competition
As we said, you always have competition or the potential for competition. In this segment, you carefully examine your competitors - who are they and what are your strengths and weaknesses when compared to them?

The Key Areas in Which You Choose to Compete
Essentially, all businesses compete in one or more of twelve basic areas including such areas as cost, quality, and customer service. We will describe each of these areas and show you how to pick the areas where your business can successfully compete.  Deciding how you will compete is a critical step since by doing so you are deciding how you will take the fight to your competition.  Obviously, you are looking to compete in the area(s) where you have the advantage.

Your Key Capabilities
Once you decide how you are going to compete, you will immediately see that you need to acquire and maintain certain capabilities or assets. These could be human resources, financial resources, or a particular technology, for example. Regardless, once you have determined how you will compete, you have to plan for obtaining and maintaining the assets, capabilities, and resources you need for success. You spell these out in this section of your plan.

Assessment of Return/Profit
This is the numbers/financial section of your plan which is based upon the decisions you have made in the first five sections. In working through this section, you may discover that you must go back and revise previous sections because the numbers just don't work.

Plan for Communicating and Implementing Your Strategy
This is the action-oriented section of your plan. It spells out what you and your employees will do and when you will do it.  Without this section and your execution of the action steps you identify in this section, your strategy is nothing more than wishful thinking.

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