Your Next Steps

The last few articles before Thanksgiving reviewed the concepts that planning is not optional  and that placing priorities on your goals can distinguish needs from wants and how they incorporate into long-term strategic planning for your family business.  Let’s now explore the basics for long-term strategic planning.

(Select the "Read More" link below.)

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The process for long-term strategic planning for your family business can be as comprehensive and detailed as you desire.  Generally, the larger your business, the more detailed, specific and comprehensive it will be – with time and resources helping enable that luxury.  With larger family businesses, there are more moving parts and getting more detailed with your planning will often provide more clarity and momentum for your entire team.  In general, a comprehensive, long-term strategic planning process will often include the following steps, some of which we have covered in the past.

1. Vision – where do you want to be in in 3, 5, 10 years.  What do you aspire to?
2. Mission – how do achieve your vision, what do you do, who are your customers, why do you exist
3. Core Values – what are the beliefs and philosophies guiding your business
4. Value Plate – understanding your operating structure.  Your primary and supporting activities – inputs, operations, marketing/sales, any service, firm infrastructure, available resources, technology, etc.
5. SWOT analysis – strengths, weaknesses, opportunities and threats facing the family business
6. Goals – what are the measurable things to accomplish in the next several years
7. Performance – how do we measure success
8. Strategies and Initiatives – what are the action plans to meet these goals, understanding our SWOT, sticking to our core values, to achieve our vision
9. Implementation, monitor, review and revise

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Wow Jim !  Nice academic, text-book, pie-in-the-sky, management consultant fluff! 

Well, kind of…but not really.  On a serious note, think about your family business and where you could go and how things will look if somehow you could take the time to get your key stakeholders (owners and senior management) to come together to seriously discuss and decide on all the above areas.  Well…it can happen.

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“Long term strategic planning is simply determining WHY you do what you do and HOW you are going to do it.  Annual operating planning is simply determining WHAT needs to be done by whom and when."

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For a smaller family farm under $5 million, or if you are tackling strategic planning for the first time, a more basic approach is well-advised.  It might be something as simple as:

1. Understanding your current position – financial assessment and structure
   
2. Understanding your history – financial trends, recent successes and failures
   
3. Where do you want to go – short-term and long-term goals
   
4. What might prevent you from getting to where you want to go
   
5. What strategies will you use to get you from where you are today to where you want to go

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Now this doesn’t appear too intimidating or unrealistic, does it?  Nope Jim.  Got it.  Now maybe it is easier for you to envision the planning process with your team and how this simple approach can foster an atmosphere where planning is not a dreaded word in your family farm business.


The next hurdle then becomes a way for you to blend your annual operating planning process with your strategic, long-term planning.  In other words, determine annually “what” you do and how it is impacted by “how” and “why” you do it.