Strategic planning, regardless of the size of your business or practice, is essential to achieve your financial goals. The planning process doesn’t have to be complicated or excessively time-consuming, but it does require thoughtful consideration and collaboration.

With over 30 years of experience in the wealth management industry, Kim Thompson, Chief of Staff at Harbourfront Wealth Management. In her career, she’s been responsible for organizational successes across varying business lines.

Kim’s strategic thinking brings clarity to making choices and validating the day-to-day work in businesses of all sizes. Consider how you can use this formula for developing and executing a strategic planning program for your business.

Define Excellence Through the Eyes of Your Clients 

The planning process can be very engaging and inspiring for participants. Consider striking a planning team including different areas of your practice or business. Having diverse perspectives and encouraging healthy objections will most definitely yield a thorough plan. With your planning team, envision what excellence looks like from the perspective of your clients. Set aside perceived limitations and create a compelling vision for your business to aspire to.

Aspiration is what drives excellence, so strive to be great, not just good enough. At Harbourfront Wealth Management, for example, our leadership offsites are where we generate and re-validate our execution plans. We include cross-functional and business development teams to ensure we obtain a comprehensive cross section of ideas and perspectives.

Encourage healthy debate and grow comfortable being in a healthy state of friction.

Determine External Impact Factors

Identify the external forces that impact your business, such as interest rates, market volatility, demographics, and consumer expectations. Intimately understanding these forces will help you anticipate and respond to changes in the business environment. Some factors will create positive business opportunities and others will require shifts from how you operate your practice today.

Create a Candid Attribute Assessment and Identify Capabilities

With your defined state of excellence, generate a candid reflection of how well your business is delivering on the most important attributes for your clients. Determine the level of importance for each attribute and evaluate your performance.

Aim to be a 10 in the attributes that truly matter. A seven may be enough for the rest.

Identify the skills and attributes your business needs to win and retain clients. Differentiate between capabilities (what you need) and initiatives (how you achieve it). For example, superior client service is a capability, while reducing account funding times is an initiative contributing to the capability of client service excellence. Another example would be declaring product innovation as a required capability, corresponding initiatives might include launching specific products exclusive to your clients.

Prioritize and Focus, Focus, Focus

There is not a business or practice at a loss for identifying lengthy lists of initiatives. All too often lengthy lists of initiatives promote inertia, with too many competing priorities or unrealistic delivery dates. Most companies strive to do too much and fail to execute.

Identify your team’s capacity limits and which initiatives will have the greatest impact on advancing your required capabilities. To overcome this common pitfall, create your list of initiatives sorted by capability. Focus on high-value, easy-to-execute initiatives and avoid overwhelming your team with an extensive list. Understand your team’s capacity and celebrate accomplishments along the way.

Measure Execution

An obvious outcome of a thorough strategic plan is meeting or exceeding financial goals. However, financial outcomes often are delayed indicators of success, its critical to identify interim key results for each major initiative. Consider implementing the Objectives and Key Results (OKRs) framework to measure the progress and effectiveness of your strategy. This will help you stay on track and adjust course if needed.

It’s not uncommon for larger firms to build strategic plans with a three-year implementation plan. This time horizon for smaller businesses would be challenging. Consider planning with a shorter time horizon and look to build an execution plan over 12 to 18 months. Be realistic about your time to execute.

Communicate and Revisit

Be sure to take time to step away from the day-to-day operations of your business and evaluate the execution of your strategy. Consider any changes or external factors that may impact your road to success. Communicate the strategy clearly to everyone in the business, connecting their daily work to the overarching goals and reasons behind them.

Common Mistakes in Strategic Planning

Strategic planning can be a galvanizing process and if done correctly, will generate a blueprint for business success. However, the process also has the potential to produce negative outcomes and may even create discouragement and business silos. Here are a few common planning snags to avoid in your planning program.

• • A Board-Only Plan – Don’t let strategic planning become a checkbox for the board without proper follow through from management.

• • One and Done Strategy – Ensure the strategy is not created and then forgotten until the next planning season. Regularly review and adjust as needed.

• • The Voice of Few Strategy – If the strategy is the voice of one individual, the other team members will struggle to rally behind the plan. Be sure to involve a diverse group of individuals in the strategic planning process to gather different perspectives and expertise.

• • Confusing Strategy with Objectives – Be sure to differentiate between strategy and objectives. A strategy is about determining what needs to be true to achieve the desired outcomes, while objectives are the outcomes themselves.

• • Ignoring Talent Assessment – Do you have the talent to deliver on the required capabilities? If your business has a human resources area, get their active participation in strategic planning to ensure the organization has the right skills and resources to execute your strategy.

• • Establishing Unrealistic Timeframes – Plan for a realistic timeframe, typically 18 months to 2 years, instead of aiming for a distant 5-year plan.

• • Make Time – Dedicate sufficient time and resources to strategic planning. It should not be rushed or neglected.

By following this formula and avoiding common pitfalls, you can develop and execute a simple yet effective strategic planning program for your business.

If you’re looking for a tailored roadmap for your business or financial planning, connect with a Harbourfront Wealth advisor.

Disclaimer:
All comments are of a general nature and should not be relied upon as individual advice. The views and opinions expressed in this commentary may not necessarily reflect those of Harbourfront Wealth Management. The asset classes featured in this piece are for illustration purpose only and should not be viewed as a solicitation of buy or sell. While every attempt is made to ensure accuracy, facts and figures are not guaranteed, the content is not intended to be a substitute for professional investing or tax advice. Always seek the advice of your financial advisor or other qualified financial service provider with any questions you may have regarding your investment planning.