Strategic Planning Articles

Cheat Sheet / Updated 06-30-2024

Financial risk management can be very complicated, which can make it hard to know where to begin thinking about it. This Cheat Sheet distinguishes some of the key concepts such as risk versus danger and opportunity, probability, volatility, normality and uncertainty. It discusses how to manage the seven major types of financial risk in financial institutions including asset managers, banks, insurance companies and dealers. These aren’t exclusive; in fact, a common mistake is to fixate only on one type of risk. Most risks cross boundaries and present issues of several, or even all seven, types. The seven types are market risk, credit risk, operational risk, liquidity risk, funding risk, reputational risk and political risk.

Article / Updated 07-10-2023

If you plan on starting a virtual enterprise, you will need to account for a fast-changing climate in your business plan. Many observers are convinced that virtual companies will become increasingly common as advances in technology make it even easier for employees to work wherever they are. Transformative innovations will continue to yield new opportunities and new virtual business models. To take just one example, virtual reality is already making inroads in the information and entertainment sector. Chances are good that virtual reality will soon be used for hiring and training remote employees and as a tool for allowing potential customers to try out a product or service before buying it. No one — not even so-called futurists — can accurately predict where technological change will lead. But if you’re already on the cutting edge as a virtual business, it’s smart to stay as informed as you can about new breakthroughs and changing trends. Some advice: Keep an eye on business and technology news. Attend technology conferences relevant to your business, such as QCon, AppSphere, CIO, ITEXPO. Listen to your virtual team members (as remote workers, they’re often the first to hear about some cool new file-sharing or teleconferencing platform). Schedule regular sessions with key managers to review your IT operations and suggest areas for improvement.

Article / Updated 07-10-2023

Planning for your virtual business means accounting for the technological necessities. At the heart of every successful virtual company is a flexible IT network that allows employees, clients, customers, and subcontractors to interact smoothly and efficiently. Teleconferencing, videoconferencing, and groupchats allow participants from around the country or around the world to connect from far-flung locations. File-sharing programs allow group members to review and edit documents, passing them back and forth through digital transmissions instead of handing them off in person. Collaboration and project management apps provide a centralized place online where all project information is stored and accessible. Supporting your virtual team with IT solutions Technology is the key to virtual business success. If you’re a small virtual company, you may be able to assemble the IT components for group communication and collaboration by yourself. Or, you can turn to a long list of readily available and often free collaboration tools and software solutions that you can stay on top of by opening your browser and searching for “virtual team collaboration tools.” Among the many options, you can find the following tools: Collaboration tools that direct group communications through a central hub, such as Slack, which is free, and Huddle Project management tools for planning, scheduling, assigning, tracking, and managing tasks through a central hub, for example, Microsoft Project, Basecamp, JIRA, and Asana Document creation, file storage, and sharing tools, such as Dropbox, Google Drive, and Box Virtual meeting tools, for example, webEx Meetings and GoToMeeting Videocall and conferencing tools, such as Skype and Google Hangouts Realtime talk and chat tools, for example, Skype, Facebook Messenger, Google Hangouts, and HipChat, to name a few Plus, you can turn to experts for customized solutions, including companies that help artists or craftspeople build and manage retail websites, software programs designed to enable lawyers or other professionals to work virtually, and tech wizards who help you put together your own IT network. The bigger your enterprise is, the bigger your IT component is likely to be. The specific technology tools you’ll need will depend on the kind of virtual business you plan to run. Whether you’re planning a one-person business or a sprawling international company with distributed workers around the world, your business plan should specifically address the kinds of technologies you’ll use to conduct your business virtually. Using technology as a team-building resource One of the most difficult challenges for a virtual company is creating a strong sense of teamwork among employees who never lay eyes on one another. The chief complaint we’ve heard from people who didn’t like working virtually is that they felt isolated and, well, remote. Successful virtual companies find clever ways to use technology to motivate and inspire employees. One firm set up a group chat room, dubbed “The Water Cooler,” which allows remote employees to interact informally, sharing personal stories and funny videos. Another company asked employees to create online bios that combined both professional information and personal stuff like favorite hobbies and most embarrassing moments. Another encouraged remote employees to interact by creating a virtual book club and an intranet travel site that allows employees to post photos and descriptions of their vacation outings and take advantage of group discounts. Other strategies to inspire and motivate remote employees and to foster teamwork include Posting your mission statement and values statement prominently on your website and on key internal communications with employees Creating an online newsletter or blog that includes vignettes of remote employees Offering awards and contests that allow remote workers to compete against one another, either individually or in teams Holding in-person or virtual annual retreats or summits where remote employees get together — in real-life if possible and in real-time if not.

Article / Updated 07-05-2023

You need to include your remote team as part of your business plan. At the heart of the virtual business model is a radical new relationship with employees. Instead of punching a clock or showing up at the office, employees work remotely, often when they want to, and their only contact with management may be via phone, email, videocall and groupchat apps, or other project management and digital technologies. The freedom and flexibility is a strong draw for many employees and can make it easy to tap top talent. But it also requires team members with the right temperament and talents. The best people for a virtual company organization are Self-motivated Well-organized Good communicators Flexible about their working schedules Sold on the benefits of working virtually Comfortable with evolving technologies Willing to buy into the culture, mission, and goals of the business Many virtual companies conduct the hiring process virtually, evaluating and interviewing applicants without ever having a face-to-face conversation. Traditional HR folks might see that as a disadvantage. But if prospective employees will be working remotely, it can actually be an advantage to interact with them during the hiring process in the same way you’ll work with them — by email, videocall, chat rooms, and whatever other technologies you employ. Because employees in a virtual company work more independently than traditional employees, having a solid and detailed job description for each position is critically important. With a comprehensive job description in place, the job candidate will be clear about expectations. Having a detailed job description also provides the basis for reviewing an employee’s performance.

Article / Updated 06-28-2023

You need a consistent set of policies in your virtual business’s plan. The virtue of a virtual company is that employees have tremendous freedom in their working lives. Managed well, a virtual company can be more flexible and efficient than a traditional nine-to-five, office-based enterprise. But with employees working as free agents distributed around the country — and sometimes around the world — virtual companies must establish specific standards and policies for operations and procedures, so that employees know how the business runs and what is expected of them. The specifics will depend on the kind of business you plan to run. In the area of human resources, policies range from how prospective employees are hired and trained to how and how often their performance will be reviewed. If your business involves contracts with clients or customers, you need policies in place to establish who is authorized to sign on behalf of the company. Plus, you’ll need policies for how products are produced, how and when outside supplies or services are purchased, how timelines are created and tracked, and more. The online company Etsy provides a marketplace for artists and craftspeople to sell their wares. Sellers are essentially distributed employees who create the products sold on the company’s website. Etsy’s claim to fame is that it is a marketplace for handmade or individually designed products. Recently the company came under criticism because some people were hiring others to make the products and in some cases even selling (and sometimes reselling) manufactured goods. In response, Etsy established specific standards — “Our House Rules,” the company calls them — for what constitutes “handmade” goods and manufactured products. Your business plan won’t include every standard and policy relating to how you do business. But definitely give some thought to the most important standards and policies you’ll need in place to run your operation. Those that are essential to defining your business and how it will operate should be described in your plan.

Article / Updated 04-14-2023

Leave room in your business plan for branding your virtual enterprise. Your brand is the set of beliefs that people associate with your business name. It mirrors the overall image and tone of your company, your employees, your product, and your customer service. Branding is reflected through everything from your name and logo to your business offerings to how product manuals are written and how employees interact with customers. Branding requires consistency in message, tone, interactions, and the promise you make and keep with customers. And branding can be a challenge in a virtual enterprise, with far-flung employees operating independently. To insure consistency across all areas of your operation: Draft a clear and concise brand statement and communicate it to everyone. Design a logo and establish exactly where and how it should appear. Create stationery, business cards, and a format for the block of text used in email signatures and make sure all virtual team members know to use them in any official business communications to project a consistent company look. Establish style guidelines for all formal written communications. (Search online for “brand style guidelines” for plenty of examples.) Consider hiring an editor who oversees all official company documents, from instruction manuals or product FAQs to marketing materials. A poorly written document reflects badly on the quality of the products or services you offer. Develop a set of customer service guidelines to establish the quality of customer interactions you expect your employees to provide. Ask your customers and clients for feedback. Follow a sale with a customer survey or telephone call, for instance, in order to get a sense of how your remote team is performing. Because branding is so important to a company’s image — and because it’s a challenge for many virtual companies — your plan should specifically describe how you intend to develop the communication consistency that’s essential to strong brand management.

Cheat Sheet / Updated 01-11-2023

A strategic plan is essential for a successful business, and creating a strategic plan that you can actually use is key. Your plan should include certain elements, like mission, values, and vision statements. It should also avoid common pitfalls, like neglecting the specific needs of your organization, so it becomes your road map for success.

Article / Updated 08-16-2022

In strategic planning, benchmarks are surveys and assessments that help determine how well your company performs compared to other companies in your industry or business size. Following are just a handful of benchmarking tools available: BizStats: Visit the BizStats website for instant access to useful financial ratios, business statistics, and benchmarks. BizStats has effective and understandable analysis of businesses and industries. You can benchmark a business in five seconds for free. BizMiner: Check out BizMiner to produce a granular industry statistical report for your industry. The site offers industry financial analysis benchmarks for more than 5,000 lines of business and industry market trends on thousands more. Report access requires an affordable subscription fee. Fintel: This organization has both free and paid access to a financial benchmarking database of privately-held companies. Two products to help your benchmarking include an industry metric report and a business scorecard. For more information, check it out their website.

Cheat Sheet / Updated 04-28-2022

The best way — make that the only way — to achieve business success is to have a solid business plan. A business plan is critical to finding a successful course through turbulent times. If you have a really great idea for making money (or doing good with a nonprofit), an effective business plan will help you make the most of it. The following can guide you through some important aspects of putting together and assessing your business plan.

Article / Updated 08-26-2016

If you plan to operate a virtual business, you need to compensate for working without headquarters. A headquarters or home office is more than a bunch of rooms and corridors. The space also reflects the hierarchy of a business and how it operates. For example, in the Washington, D.C., headquarters of a well-known magazine, one floor is devoted to editorial, another to photography, and another to art. One entire floor is devoted to captions that accompany the photographs. The top brass reside — you guessed it — on the top floor. The headquarters, in other words, reflects and reinforces the magazine’s operational structure and priorities. A virtual business must find other ways to establish and convey its management structure and its way of doing business. Several of the foundations of solid business planning — creating a strong mission and vision statement, setting a clear strategic direction, and describing management and operations are especially important for virtual companies. In our experience, successful virtual companies have the following in common: The right leadership: Top managers are committed and even passionate about the benefits of a virtual structure. A strong team spirit and shared sense of business culture: Everything the company does is aligned around common business vision, mission, values, goals, strategies, and brand. The right team members: In the absence of face-to-face interaction, virtual companies succeed by developing detailed job descriptions and having systems and standards in place that cover everything from working hours and work quality to performance reviews. They hire people who work well with little supervision and who also have a clear sense of how they fit into the organization. Good communications systems: Because people aren’t running into one another in the hallway or at the water cooler, successful virtual companies institute formal ways for people to stay in touch. They make smart use of a variety of online communication and document-sharing tools. If operating as a virtual business is key to your competitive strategy, your plan should emphasize the benefits and challenges of operating virtually. Explain why a virtual organization is well suited to your goals and strategy, but also be up-front about the challenges of operating virtually, and detail how you plan to address them. If your business will combine some virtual operations with some traditional facility-based operations, describe how each will operate and interact.