When starting a business, it is important that you have a roadmap to guide you. The business industry is very competitive and if you don't have an idea of what to do or where to go, you can easily get lost along the way. So whether you are starting a new business or planning to grow and expand your existing one, it is essential that you have a business strategy to focus your activities.
But how do you create the most effective strategy for your business?
Here are the steps that you need to consider:
Step #1 - Research, research and research
Research can be perceived as a boring activity. Often aspiring business owners don't want to waste time reading and researching a bunch of things. Instead they may be eager to go ahead and launch their business idea straight away. But they must not. Research is a very critical factor when it comes to achieving success. It is the foundation of your business strategy.
When doing your business research, you should be able to gather facts that tell you about the industry you are trying to enter and where your future business may sit in that industry.
There are techniques that can help you to gather and make sense of data for your future business. One is the SWOT analysis. SWOT stands for Strength, Weakness, Opportunities and Threats.
If you are still not sure how to effectively conduct research for your business, you can talk to a business mentor or business advisor in Auckland.
Step #2 - Establish your vision
Once you understand more about the environment you will be operating in you should have an idea of where to position yourself or your business in the industry. You should be able to decide which direction you want your business to go in the future. This should be a long term perspective as it forms the vision of your organisation.
Step #3 - Develop your mission
Your mission refers to the purpose of your business. This refers to what needs to be done in both the short term or the long term, depending on the needs of your business. In developing your mission, you should be able to answer questions like, "What do we do?", "How do we do it?", "Whom do we do it for?", "What value do we bring?", among others.
Step #4 - Identify your objectives
You should be able to set specific targets for your business. Your target objective should be SMART (Specific, Measurable, Achievable, Realistic, and Time-bound). They should also include KPIs (Key Performance Indicators), resource allocation and budget requirements, among others.
Step #5 - Create a strategy and tactical plans
These are short-term plans that will help you to achieve your objectives. These include jobs or tasks that are often delegated to your different business departments. You can also include in your plans the suppliers and other resources that will help you to achieve your business goals. This is the core of your business strategy.
Step #6 - Establish your financial plan
Also core to your business strategy is the financial plan. Financial planning can be a bit difficult, especially if you don't have any background in accounting and understanding financial transactions. That is why, business owners hire business advisors to help them understand and interpret their numbers.
As trusted business advisors in Auckland, we, at Paul Martin Chartered Accountant, assist clients create their financial management plans. We teach them how to effectively manage their cashflow and grow their business. Aside from that we can also attend regular meetings to discuss and review the results and provide customised monthly financial reports.
Step #7 - Performance review
Your business strategy is not complete just having a plan and ways to execute it. You should review performance and analyse results and achievements. This performance review will help you identify if your strategy is effective for your business or not, and help refine the ongoing business strategy.
These seven steps are the main things that you need to cover in developing an effective business strategy. As a trusted business advisor and an accounting firm in Auckland, we help businesses to create strategies that are applicable to their business requirements.
We are also tax accountants who help businesses set up and prepare tax returns, annual accounts, GST and more. We use high-end accounting software in NZ, to deliver best and accurate results.
If you need assistance with business and financial planning, you can talk to us on (09) 576 4166 for more information. You can also book an appointment with us online.