The lack of strategic planning in the smaller sized companies can often be attributed to a lack of time and understanding. Owners and company executives tend to become absorbed with the daily operations of the company; focusing on the immediate and not the long-term. Contrarily, some company owners may recognize the importance of strategic planning yet are hindered by a lack of understanding of the processes. Although vast volumes of books have been written on the subject of strategic planning, many address the needs of a large corporate entity and speak of complexities that are not applicable to the smaller organization.

Strategic planning does not necessarily need to be a complicated process involving elaborate planning tools. In its simplest structure it can be described as the development of a long-term company positioning based on that which provides value to customers and shareholders. It requires knowledge of the fundamental industry shifts and how customers and competitors are responding to those changes. Flexibility is an inherent characteristic, required for continuous change and adaptation. Evaluating strategic options is based on identifying those choices that are most capable of providing value for all stakeholders and aligns with the organizations’ vision and core competencies.

Therefore, the best place to start is to develop an awareness of the fundamental changes occurring within the industry and begin to align those changes with the organizations’ core competencies. To this end, answering the following three questions can provide any sized organization with a starting point.

(1) What Business are we in?

(2) What changes are occurring in the industry?

(3) How do we make money?

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