6 Reasons Why You Need a Strategic Plan

Businesses often hear about writing a business plan. Seemingly every course, lecture, online reference and other resource about starting a business insists that a business plan must be done.

While it's true a business plan is important, especially if you are looking for money, what entrepreneurs or businesses don't often hear about is the necessity of a strategic plan.

One way to think about business plans and strategic plans is this: the business plan is the what, the strategic plan is the how; and if you don't have a plan for how to get it done, odds are your company will suffer. There is a reason fortune 500 companies use strategic plans, and pay significant salaries to chief strategy officers: strategy is important.

Here are 6 reasons you need to have a strategic plan in place, even if you have a business plan:

1. It clarifies the overall vision, mission and purpose of your company.
2. It crucial in prioritizing resource (time, money and people) to operate efficiently.
3. A strategic plan develops your competitive advantage, how you're going to take on the competition.
4. It's where you lay out your goals, a business must know what they are trying to achieve.
5. Strategic plans set out initiatives and objectives, those goals mentioned in #4, you have to know how you're going to achieve them.
6. It's used to actively track the progress your company is making towards the goals by reporting on metrics or indicators designed to measure company performance.

The bottom line is a strategic plan is incredibly important to keep your business on track for future success.