So often, for small business owners, the idea of functioning according to a set business strategy seems like an unobtainable ideal. The demands placed on small businesses generally result in them being more reactive to what is happening around them in order to keep the business going rather than taking the proactive step of planning ahead. As effective as reacting to your environment may be, we’ve all heard the saying that the success of a business is determined by the strategy that it follows.
Literature tells us that there are three different levels at which strategies are used; namely the corporate level, the business level, and the functional level. But what happens to small business owners who are required to wear several different hats in order to make the business work? If the saying really is true and the success of a business is really determined by the strategy that it follows, does that mean you need to take the time to first organise your activities according to different levels and then set strategies for each level? Well, kind of.
In this post, we look at what strategy means for small businesses and how can make sure you follow through. Let’s begin!
What does strategy mean for a small business?
One of the main reasons why strategies are an absolute must for any business is the fact that it offers a clear direction moving forward. It is easy, however, for small businesses to fall into the cycle of making it from month to month or year to year and for the planning to simply stop there. After all, small business owners already spend so much of their physical, mental and emotional energy on fulfilling their many roles, that the thought of planning in advance is just too much to even think about. Unfortunately, without planning, there can be no growth. Yes, keeping your business going might be enough, but you will then forever be where you are now.
What’s great to know, however, is that formulating strategies for small businesses isn’t actually that intense - if you approach it in the right way.
Strategies are a way to plan for the future by leveraging strengths and mitigating the impact of weaknesses and threats in the environment as you try to exploit opportunities (notice the ever-important SWOT acronym there). This can essentially be said for all businesses and all levels at which strategy is used. This is a bit of an oversimplification, so if you are interested in reading more about how your SWOT factors affect your strategies, have a look at this article by Martin Heubel.
When we look at the way in which small businesses function, we can see that the different levels at which strategy is used are very much intertwined. So, to understand what strategy means for small businesses, we first need to look at what strategies are made of.
It’s important to understand that strategies are NOT to-do lists.
As basic as this may sound, if you don’t remind yourself of this, you could easily fall into the habit of simply writing down what you’re going to do instead of where you want to be. Strategies are made up of goals/objectives and tactics. Basically, what do you want to achieve, and what are you going to do to get there. Let me explain this with an example. Let’s say that your goal or objective is to increase leads. Your tactics could then be to post more often on social media with messaging geared towards generating leads, it could be to launch a competition, make use of paid advertising that directs the user to a landing page with a lead generation form, it could be to add an exit intent pop up on your website to encourage users to sign up for your newsletter, and the list goes on. Do you see how easy it is to get confused between tactics and strategies? No, you did not implement a social media strategy, no you did not implement a competition strategy, nor did you implement an exit intent pop up strategy; those were merely tactics to help you achieve your objective of increasing leads.
What to remember when formulating your strategies:
They should speak to your overall business goals. In the example above, the business goal could have been to increase profits, one of the strategies to achieve this goal could be the lead generation strategy with the tactics explained. This brings me to the second point…
You can have more than one strategy per business goal. This one's quite self-explanatory.
Your tactics are not set in stone. They should be flexible and should be reviewed regularly to see if what you are doing is actually achieving your desired result. If not, use the information you have at hand and try something new.
They should have time limits. Because we are essentially working with goals and objectives, you need to set a due date or period over which you would like to achieve these goals.
They need to be realistic. This one might seem obvious, but it’s so easy to start dreaming of where you want to be as a business and forget that getting there requires you to go through a series of steps (or building blocks).
That’s great, but how do I do this?
A wonderful quote by Gary Vaynerchuk says that “All your ideas may be solid or even good... But you have to Actually EXECUTE on them for them to matter.” I know this is easily one of the most frustrating elements of being a small business owner. You have so many great ideas and often start out strong with their implementation, but with all of the responsibilities that come with owning a business, you generally find it increasingly difficult to keep the momentum going. You may have read through this whole post and thought “that’s great, but I just don’t have the time.” Unfortunately, the saying at the beginning of this piece is true - the success of a business is determined by the strategy that it follows. What’s great to know, however, is that it’s easier to follow through on the implementation of your strategies than you may think.
I forget who said it, but I grew up with a quote that went something like this “doen eerder wat voor die hand liggend is as what vêr in die toekoms lê.” Roughly translated to English, this means that you should rather do what is obvious than what lies far in the future. Now, you might think that this saying goes against the idea of formulating strategies. After all, the very nature of a strategy requires us to plan for the future. But I have always interpreted this quote to mean that you should have a firm understanding of what needs to be done now to achieve your goals in the future - and it’s as simple as just planning ahead.
What I hope has become clear to you throughout this piece is that your strategies have tactics and your tactics have steps. Each of these steps has its own place in the process and understanding which steps need to be completed today in order to get to the next step, and the next step, and ultimately completing the task that leads to you achieving your goal is key to keeping your momentum and following through. Do what you need to do today - that’s it! Don’t worry about the next step, or what needs to get done next week, or think that everything you do should have incredible business altering results. Doing a little bit each day adds up to a whole lot over time as long as what you are doing is focused on achieving your goal.