SMART Business planning
What is SMART business planning?
When did you last sit down and look over your business plan? We all start out with an idea of the main objectives of our business. But these will change over time as we develop and grow our businesses.
So why make a plan? Well, it will help you define the direction of your business, which will provide you with a disciplined approach to future activities. It will provide you and your team with a clear understanding of your business objectives and how you will achieve them together.
One of our favourite models for marketing and business planning is the SOSTAC® Plans model, created by P.R.Smith. It provides a clear structure, which is simple to remember.
In this blog we briefly go through the 6 stages of the SOSTAC® model, to give you more of an understanding of how it can guide you through your planning process.
Situation Analysis – Where your business is now.
You need to identify the current situation of your business, where you are now and if you are meeting your current business mission, vision and objectives.
Use SWOT Analysis, to identify the Strengths, Weaknesses, Opportunities and Threats to your business. You will need to look at the internal and external factors that can affect your business.
Start by asking yourself:
- Who are your customers?
- Have you got a defined target market?
- What is their buying behaviour?
- Do you have different target markets for different products or services?
- Who and where are your competitors?
- Why are they your competition?
Threats are normally the most uncontrollable of the four elements of the SWOT analysis, as this is an external factor. This could be a political, economic, social, technological, ecological, legal or ethical factor. This is why it is always important to monitor your external environment and see when you can turn these threats into an opportunity.
Objectives – Where you want your business to be.
When making decisions about the future, you need to set your business objectives so you have set targets to reach. But when setting your objectives, it is important to make sure they are SMART.
SMART stands for:
Specific, Measurable, Achievable, Realistic and Timely
To increase our online sales by 10% by the end of September
If you do not set yourself achievable objectives, they won’t be realistic to your business. Think about specific small steps, what do you want to achieve, how you can measure it and when do you want to achieve this objective by.
Strategy – How you going to get there.
Now you understand where your business currently is and what you want to achieve, you can plan how you can get there. By using your SMART objectives, you can now build a strategy to reach each of these.
You need to look at the results from your SWOT analysis, what are your businesses current strengths and how can you apply these. What are your organisations weaknesses and how can you turn them into your strengths? How can these new strengths provide you with new opportunities for your business?
Also by knowing where your business is positioned in the current market in comparison to your competition, you will know where the gaps in the market are. Can you turn this into an opportunity? Can you learn from your competition?
You might find that your employees have not got the training or experience for a new product or service you are looking to offer. You could look into providing them with the training, or find the right expert to support your team. This will help create the opportunity for your business to expand and provide a new product or service that your competition does not offer. By using an external expert, this also gives you the opportunity to trial this new product or service, before having to commit finance to providing full training.
Tactics – The details of your strategy
This is where you look at the tools you are going to use to reach your objectives. This is where you start to look at how you will market your business products or services. Looking at the marketing mix, this would traditionally be the 4 P’s: Product, Price, Place and Promotion, but now can include People, Process and Physical evidence.
What is your product or service? Looking at your SMART objectives, what do you want to achieve? If it is increased sales, you need to know what price you want to sell it at, where you want to sell it and how you will promote it. Who and where is your target market? What is the best means of communication to reach your target market? How easy is the buying process for your customers and how long is their customer journey?
If it is increased visitors to your website, you might be focussing more on awareness and promotion of your business. Take a look at your SEO, social media and where your target market is interacting with your industry.
It is also important to look at the People who work for you and their understanding of your product or service. Look at your customer service, do all of your staff understand the branding of your company and the way they should represent your business.
One of the most important parts of your strategy is to integrate your communications, make sure that all of your stakeholders are on the same page. If you have a new product, make sure your staff know it inside out. If you are launching a new promotion, make sure everyone is aware of what this involves.
Action – Implementation of your plan
Once you know you will reach your objectives, you need to look who will be implementing the actions you have outlined in your strategy.
This looks at the questions of: Who, Where, What, When and How?
The key ingredient to the implementation of your plan is its communication! Make sure everyone knows what the objectives are and who is responsible for which element. The better informed your team is of the business plan, the more likely you will reach your objectives.
Control – How you measure, monitor and review your strategy
When you set your SMART objectives, you also need a way to measure they are successful. Having looked at the situation of your business, you will have all your current sales figures and statistics to look back on. Set a Key Performance Indicator (KPI) for each objective, so you have a set target for each one. By setting a target to increase sales, you can compare the actual figures and your KPI to see if you have reached your target.
If you have not reached the target, find out why. Was there an unforeseen element that affected the results? If you measure and monitor your objectives throughout the time period you have set to reach them, you can make adjustments along the way. Always record these changes and why you have made them, as this will help you learn how to adapt in the future.
So this is just a short guide to starting your business planning. To create a successful business plan, you will need to know your business and where you can take it.
Always keep an eye on your competition and always keep an eye on how your business is performing against your objectives.
As part of our service packages, our team of VA’s can help support your business planning process. This might be a little guidance on where to start, taking on the research for you at the start of the planning process, or creating your final business plans in a well presented document. Having an external pair of eyes support you with your planning process, can help identify factors that you might not see from working inside your business.
Get in contact with the team to find out more about how we can support you with your SMART business planning.
SOSTAC® is a registered trade mark of PR Smith. For more information on SOSTAC® Planning &
becoming a SOSTAC® Certified Planner visit www.SOSTAC.org .
1. SOSTAC® Video (4 mins from PR Smith) www.PRSmith.org/SOSTAC (scroll to bottom)
2. SOSTAC® Guide to your Perfect Digital Marketing Plan (2020) book
3. SOSTAC® Blog (posts from PR Smith): www.PRSmith.org/blog
4. SOSTAC® Groups are also on Facebook & Linkedin
5. SOSTAC® Instagram https://www.instagram.com/sostac_planning/