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Developing a Strategic Plan for Your Consulting Business

Written by: Robin Throckmorton

Article Overview: Strategic planning is like creating a map for an exciting journey you are about to take. The map will help keep you on course if you start going in the wrong direction but it isn’t so stringent that you can’t check out different roads along the way. After seven years of consulting, this is exactly what my strategic plan has done for me. Each year, I map out where I am, where I want to go, and how to get there. During the year, my plan is a guide for what I should be focusing on as well as a resource to help me do a "check" whenever I am tempted by something new and different. Sometimes, I rewrite my plan based on changes (i.e. technology, client request, economy, emerging trends) but many times it has helped me realize what is important and make the right decision with various opportunities and threats to ensure my long-term goals are met

Developing a Strategic Plan for Your Consulting Business

Strategic planning is like creating a map for an exciting journey you are about to take. The map will help keep you on course if you start going in the wrong direction but it isn’t so stringent that you can’t check out different roads along the way. After seven years of consulting, this is exactly what my strategic plan has done for me. Each year, I map out where I am, where I want to go, and how to get there. During the year, my plan is a guide for what I should be focusing on as well as a resource to help me do a "check" whenever I am tempted by something new and different. Sometimes, I rewrite my plan based on changes (i.e. technology, client request, economy, emerging trends) but many times it has helped me realize what is important and make the right decision with various opportunities and threats to ensure my long-term goals are met.

There are many formulas or formats used for strategic planning but for the most part they cover the same points and reach the same goals. I’m going to share with you the process that I use personally as well as with many of my client companies. If you like pictures, the flow chart in Exhibit 1 will be a good tool for you to follow as you create your plan. Plus, I’ll describe each step below.

Internal and External Analysis
Remember, you are mapping out your journey. Your first step will be to determine where you are by doing the good old "SWOT" analysis — identifying your internal Strengths and Weaknesses as well as external Opportunities and Threats.

Internally, this includes assessing both the strengths and weaknesses of your human, financial, and technological resources, as well as the culture and values of the organization. The best way to do this is brainstorming. Create two columns — one for strengths and one for weaknesses and begin thinking and writing down anything that comes to mind as a strength or weakness to you and/or your consulting business. For example, one of my strengths is "True change agent — very flexible and adaptable as needed" while a challenge is "Young and female in a white, male profession."

An external analysis requires you to evaluate what’s going on "outside" your business and how may it affect you. As discussed in Christine Keen’s book, Effective Strategic Planning A Handbook for Human Resources Professionals, you should consider issues in the following four categories: economic (i.e. unemployment, interest rates, recession), political (i.e. current or pending legislation or court cases), social (i.e. values, lifestyles, and demographics) and technology. For example, from my external analysis an opportunity was "Volunteer opportunities with complimentary organizations" and a potential threat was "Growth of individuals starting to do human resources consulting."

Gathering this internal and external information will give you a snapshot of where you are now — the starting point on your journey. However, a starting point, by itself, will not enable you to achieve your goals. Like going on a trip, you need both a starting point and a destination. Remember my favorite quote from Alice’s Adventures in Wonderland:

"I just wanted to ask you, which way I ought to go?"
"Well, that depends, on where you want to get to," said the Cat.
"It really doesn’t matter,..." said Alice.
"Then it really doesn’t matter which way you go," said the Cat.

Vision and Mission
We need to determine our destination — in other words our Vision or preferred future. A Vision is a short statement that is quickly and easily understood by anyone and describes something different for the organization. As a sample, below is Lenscrafters’ Vision statement:

"We will...be the best at helping the world see!"

Next, you need to develop your Mission statement or a statement explaining why you exist. Like the Vision, the Mission is also a short statement. But, a Mission statement describes what the organization does which will help it progress toward its ultimate future, the Vision. For example,

"To use e-technology to provide customized research and solutions to human resources management challenges
and needs in business and industry."

As you begin to develop your Vision and Mission, you will find it easier if you again brainstorm. This time think about what’s important to you and to your business — who are your customers, what makes you different, how would your clients describe you, what can you contribute or offer to others, what would you like to do or be tomorrow? Developing the Vision and Mission are the most difficult. Initially, this may take a number of rewrites with input from others, such as an advisory board. However, once you have both of them clearly defined the rest of your plan will fall right into place.

Objectives
Now to answer Alice’s question to the cat...Once you know where you are and where you want to go, you can then map the directions for getting there. In other words, you can identify the key objectives that must be met during this planning horizon to progress toward your Mission and Vision. Generally, your objectives should be specific and measurable. In addition, they need to be ambitious but realistic and only focus on what needs done not how, that’s next. For example, an objective may be:

"Develop a state-of-the art, user friendly web site"

Your list of objectives will quickly grow but you have to narrow down the top four or five that help advance your business toward meeting your Vision and provide you with a competitive advantage. If the list is too long, your plan will quickly become a "dead" document rather than a "living" document that you can use and refer to throughout the year.

Action Plan
For each of your objectives, you will then need to create a detailed action plan or "how" you will meet the objective. I’ve had the most success with this by completing the following formula for each objective:

Desired Results — (What are you hoping will happen or result if the objective is met? How will you benefit?)
Potential obstacles / barriers — (What might prevent you from completing this objective?)
Supports — (What resources, people, or tools are available to help you with this objective?)
Process — (What steps must we take to achieve this objective? Be specific on each step indicating who will do what and when)
Evaluation — (How will we know when we’ve successfully met this objective?)

This may seem like a lot of work for each objective but if you map out the answer to all five of these steps, you will have a very clear and unquestioned plan for how your objectives will be met.

Implementation and Evaluation
The hardest step in this process is the next one — implementation! Don’t let yourself do all of this planning and throw the end product on the shelf until next year. If you do, then where will you be and will you be any closer to your preferred future? To help ensure that you are proactively working toward these goals, you need to check back on things every so often — at least quarterly. Has anything changed? Are you on target? Do you need to modify any of the plans? This plan is a living document so it may change; this is okay as long as you are aware of the changes and make them yourself rather than them being made for you.

This isn’t an easy process and can be extremely exhausting. But, if you create an effective and realistic strategic plan, you will begin to focus resources today toward meeting your goals for tomorrow. Plus, you will have a tool to help you minimize the threats and maximize the opportunities. One of the most important benefits of effective strategic planning is that it provides you with a fresh start by clarifying where you are, where you are going, and how you are going to get there. You should re-evaluate your strategic plan on an annual basis using a planning horizon between 2-5 years. Each year, you may find that a great deal changes but your preferred future will stay status quo until you reach it - and you will!

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Article Tags: consulting business, developing a strategic plan, strategic planning



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