René Moolenaar is a Senior Lecturer at the University of Sussex, Chief Financial Officer at Crunch, and has extensive experience in marketing, strategy, and business.
René is connected to a lot of businesses so we thought we'd get his take on some of the issues around strategic planning for SMEs...
Hi René! What do you see as the current state of strategic planning across SMEs?
Sadly, I believe that strategic planning is not very high on the agenda of many SMEs, perhaps more so with smaller companies than medium sized organisations. Not to say that it is not considered but the process is often incomplete and/or stakeholders are not fully engaged in the process and/or not very well communicated and/or not very well implemented.
Why do you think so many SMEs “don’t have a strategy”?
For the smaller organisations it is often a lack of expertise around boardroom table and for medium sized organisations it is often because business is kind of doing ok, but when there are changes taking place in, for example, customer behaviour or competitive behaviour they are unexpected and then there is no plan to deal with such changes.
What do you observe as different approaches to strategy as a business grows?
It is often too internally focussed and not sufficiently taking into account the external changes and emerging opportunities.
Do you have any employee engagement tips regarding strategy?
Involve them from the beginning. But not just employees but also shareholders, strategic partners and possibly even certain key suppliers.
What would you say the main benefits are of strategic planning?
The biggest benefit is that the day to day decision making is done within an agreed strategic direction.
What differences do you notice when comparing SMEs with and without a strategy?
They are often more profitable for longer and are able to cope better dealing with unforeseen situations.
Once they have created a strategy, how often do you suggest SMEs review it?
Elements of the strategy need to be reviewed and updated perhaps weekly but the whole strategy needs to be reviewed at least monthly. Executing it is clearly a daily task and needs to be tracked against set objectives.
What would be your single strategy tip to SMEs?
Strategy development is a dynamic and continuously evolving process of analysis, execution and review.