By Marie Mansheim, Senior Consultant—Growth & Strategy Practice Leader
A well-written startup plan has its purpose. It can open doors, help secure financing, and lay the groundwork for performance.
Once the doors are open, companies can outgrow those early plans as business challenges change. Critical issues quickly migrate from creating a market presence to planning for market expansions; from targeting and establishing a customer base to developing product line extensions for all-new opportunities.
Startups ready to get serious about growth will need a strategic plan. Yet it’s not uncommon for entrepreneurs to question that need. Some believe their original business plans can simply be refashioned and reshaped into strategic plans. Others equate it to following a fixed direction which runs contrary to the agility they feel makes them so successful and thus will be too restrictive.
Make no mistake, without a strategic plan, entrepreneurial companies will only end up managing chaos. And simply relying on a startup plan will not serve up growth.
Growth vs. Startup: Plan Accordingly
There’s a big difference between a startup plan and a strategic plan. An initial business plan is based mostly in creative speculation, with industry observations and perceptions, and educated assumptions about markets and projections within it. It also identifies a general customer base and targets a potential segment.
As a company establishes and moves from exploring ways to get off the ground, to running a business with consistency and purpose, it develops a better understanding of market trends, as well as the demographics of their industries. That information, along with experience, financial facts, and operational success then becomes the foundation for developing a truly focused strategic plan for growth.
Why? Because details and data matter in a strategic plan, and a growing business has something a startup doesn’t have—a track record.
A financial history, market insights, and real operating results give a strategic plan its ability to generate growth more than any startup plan could. It replaces speculation with concrete facts and hard evidence. Information about the competitive environment is no longer supported by guesswork, but instead confirmed by reliable intelligence and experience. Observations are validated, and assumptions become quantified analyses.
A strategic plan further reflects performance lessons and invaluable industry knowledge that a business has gained since its inception. It demonstrates the company’s better business practices, reveals its improvements, highlights productivity measures, and clearly defines how success will be sustained to the next level.
Above all, it establishes direction based on all that data. It’s the direction, action, and measurable goals needed to drive a business forward from where it is now, to where it wants to grow. It helps improve performance, mitigate risk, build market share, and add capabilites. It leverages and prioritizes already precious resources in order to grow revenue and improve ROI.
And it works to build a sustainable competitive advantage, while still fueling that same entrepreneurial spirit essential to the organization’s current success.