9 Reasons You Need A Business Strategy

This week, I’m coming to you from London. Our family is on vacation for the next two weeks, and I’m absolutely loving all the sights, sounds, and smells of this vivacious city!

Now, you may be scratching your head, wondering why I’m on holiday, when last week, I said, you need to keep moving in the fourth quarter in order to finish out strong. That wasn’t a lie. You do need to take focused action and continue to show up in your business. But this is where having a business strategy comes into play. 

Earlier this year, my husband and I had our annual life date, a day where we go away, reflect on the previous year and plan for the next, and we decided we wanted to take the kids to Europe. As we looked at the calendar, the only viable option was in October, so we plotted this out, put systems in place to help make it possible, and here we are!

Your business has to work for you. That sage advice from my financial coach, Erin Green, has been a constant reminder that when I know what I want in my life and align my business strategy to it, I have the ultimate freedom. 

Every business needs a business strategy, a documented plan (yes, it needs to be written out) for how a business wants to achieve its goals. Your business strategy should include your business’s goals and objectives, the type of services that you plan to deliver, the customers you want to sell to, and key milestones for getting there. 

You may be thinking… “But it’s only me. Why do I need a strategy?” 

I’m glad you asked. Here are 9 reasons why you need a business strategy in order to maximize the freedom, flexibility, and fulfillment in your life and business. After all, if you can’t do the things you really want to do, what’s the point?

Showcases your business direction and reinvigorates your passion

A business strategy defines what the business is, paints a vision for where you want to go and the impact you want to make in the world. Every time I’ve reflected on my purpose, I feel a renewed sense of energy and a deep desire to show up boldly. Your strategy also reconnects you to your business values - aka the way in which you do business - which are critical for differentiating you from your competitors. 

Serves as an internal roadmap

It’s great to have a vision and values, but at the end of the day, you have to know where you’re going and what the waypoints are along the way to let you know you’re right on track. Your strategy documents your goals and objectives, often contains a rough timeline for when you want to get there, and creates opportunities for you to mitigate obstacles that might present themselves.

Aligns priorities and guides decision making

Too often, business owners are scrambling for time. Your business strategy serves as a clear reminder of what your business (and life) priorities are and gives you the nudge you need to say no to opportunities that don’t align. 

Puts you in a proactive position

When you know what you’re trying to achieve, what your financial targets are, and the impact you want to make, it becomes significantly easier to be responsive to changing circumstances. There’s all sorts of VUCA - volatility, uncertainty, complexity, and ambiguity - in the marketplace, but when you know your direction, you can pivot more quickly and with more intentionality.  

Reduces stress and uncertainty

One of the most common laments I hear from business owners is that they don’t know what their next step should be. When you build your strategy plan, you may not have all the answers, but you do know the direction you're going, the way in which you want to do it, and who you want to serve. Those are powerful elements that guide your decision-making, and the powerful byproduct of that is reduced stress and anxiety about your next best step.

Guides your professional development needs

We all know entrepreneurship is one of the best personal growth tools out there. Often, entrepreneurs will invest in certifications or additional learning that while interesting doesn’t actually help them move the needle in their business. Your business goals and a simple gap analysis will tell you where you need to invest your dollars, so you upgrade your personal and professional capabilities.

Sets achievable sales goals

Bill Gates famously said, “Most people overestimate what they can do in one year and underestimate what they can do in ten years.” I see this all the time when business owners set their financial targets. They are extremely lofty, and while I believe strongly in setting big, hairy, audacious goals (BHAGs), when they aren’t grounded in some semblance of reality you set yourself up for failure. The strategic planning process requires a clear assessment of where you are now and where you want to go, which results in a clearer picture of what kind of action is needed - and your willingness to do it - to hit those targets.

Clarifies your marketing plan

One of my favorite parts of a business strategy is that it requires you to identify HOW you’re going to hit those sales targets. This is what I call your Roadmap to Revenue, a 12 month look at what you’re promoting, when, and what needs to happen to hit your identified goals. Your marketing plan clearly documents how you’re going to captivate the attention of new people, connect with and cultivate your relationship with them, and then convert those into paying clients. 

Encourages focused intentional action

Up to this point, your business strategy is just a big plan, but when you document all the above, it allows you to build tangible action plans, so you can take intentional, focused action. This allows you to structure your time, balance working on and in the business, and take a vacation without skipping a beat, while still reaching your goals.

According to a study done by Barclay’s 47% of small business owners don’t have a formal or documented business strategy in place. It’s not enough to just have these ideas in your head. Research consistently shows that having a documented plan increases your business growth by 30%. 

As we move to the end of the quarter and begin planning for the new year, I invite you to join me and my colleague, Becky Clabaugh, for our Design Your Best Year Yet Challenge. Over the course of five days, we’ll help you assess your year, plot out a robust plan for 2023, and help you lay out your Roadmap to Revenue, so you take a vacation when it suits you best while making the money you really want in your business.