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Strategies for Building Business Success

6BE 002

Guidelines for writing the

Strategic Growth Plan for an Existing Small Business

This guide to writing your strategic growth plan is, as you will see, quite comprehensive,
however given the diversity of organisations that students may select, it should not be seen
as a definitive guide & you are encouraged to use other sources in considering the structure
of your report.

The main body of the report is your discussion of the significance and interpretation
of your analysis of the industry/ sector & business and specific strategic
recommendations for the future strategic growth of the organisation.

Your own reflective learning experience statement on undertaking this module,

tables/ charts etc; PEST Analysis, SWOT Analysis for example should be put into
your appendices & do not count towards your word count. Do NOT just describe
these analytical tools in the main body of your report, you MUST highlight the
significance of the analysis, what does it mean for the company?

When you are finished writing the first draft, you will have a collection of sections on the
various topics of the Growth Plan. You will then need to edit them into a smooth flowing
report.

The real value of entrepreneurs doing a strategic growth plan is not just having the finished
product in hand; rather, the value lies in the process of research and thinking about the
business in a systematic way. The act of planning helps you to think things through
thoroughly, study and research when you are not sure of the facts; to explore ideas critically
takes time, but avoids costly, perhaps disastrous, mistakes later.

The plan outline given is a generic model suitable for all types of businesses. However, you
should modify it to suit the particular circumstances. The quality, structure and appearance
of the work as well as the ideas expressed within are all important. It will take a number of
weeks to complete the plan. Much of that time will be spent in researching the company,
industry & competitors, often re-thinking ideas and assumptions. As you do this, different
opportunities and ideas for possible future growth and innovations will start to emerge you
need to research & think these through from an early stage. Remember the primary
purpose of this report is to develop a holistic growth strategy for the business over the next
1- 5 years consequently your recommended growth strategies represent 40% of the
overall grade for the report.

You must, as with all assessments, provide a list of references at the end of your
report.
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Small Business Strategic Growth Plan

Table of contents

I. Table of contents........................................................................................... 2

ll Organisation Strategic Position ..5

III. Strategic Industry/ Market Analysis/ competitor analysis .6

lV. Recommended Growth Strategies 8

V. Managing the Growth.. 6

Vl Appendices (Including Reflective Learning Experience Statement).. 9

PART 1: Organisation Strategic Position

(Suggested word count 750 - 1000 words: This represents APPROX 10% overall grade)

This section should briefly introduce the organisation & provide some analysis of the overall
strategic position.

Many companies have a brief mission statement, usually in thirty words or less, explaining
their reason for existence and their guiding principles. If the company has a mission
statement, this is a good place to put it in the plan you should comment on this.

Whether they have a mission statement or not you must identify the sector they compete
within, who do they market their products/ services to? (Briefly here - you will do a more
thorough explanation in the market analysis section).

Is it a growing business? What changes are happening in the sector and how might the
company position itself to take advantage of them? Briefly Identify key competitors.

Highlight the most important company strengths/ Weaknesses of the company

What significant challenges the company faces now and in the foreseeable future.

What are the plans for the future of the business? Growth?

In your appendices you should include an appendix on some factual information on

the organisation or company background. Avoid making this just a potted
history of the business, but refer to; years in business, short bio of lead
entrepreneur, reputation (if known) in the business community, sales and
profit history (if available), number of employees.
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PART 2: Strategic Industry/ Market Analysis &
Competitor Analysis
(Suggested word count 1500 words: This represents APPROX 30% overall grade)

Overview & trends in the industry:

An overview of the sector/ industry & trends of the sector/ industry. Trends in target
market(s) in consumer preferences, and trends/ innovations in product
development. How are things changing in the sector/ industry? Who are the key
markets/ customers & what do they value?

You MUST refer to industry data & market reports for this this is important to
demonstrate a proper understanding of the sector/ industry.

Use PEST analysis for macro environmental analysis & identify the likely impact on the
sector/ industry & the implications for the business. You should include a PEST analysis
table in your APPENDICES. In the main body of the report should be your analysis/
discussion of this.

Use SWOT Analysis to undertake an evaluation of the companys strengths & weaknesses
related to factors such as finance, marketing, management, production or service levels.
You should also provide a clear identification & discussion of opportunities and threats
present or emerging from the external environment eg: changes in legislation increasing
market demand, access to new international markets, competitor activity, new distribution
channels, supplier problems You should include a SWOT analysis table in your
APPENDICES. In the main body of the report should be your analysis/ discussion of this.

Your discussion of the analysis part of SWOT is where you can demonstrate how you think
the company might build on strengths, limit or overcome weaknesses, capitalise on
opportunities & protect the company from threats.

Competitor Analysis:
List the organisations main competitors:

Do they compete with the company across the board, or just for certain products, certain
customers, or in certain locations?

Compare the products/services with competition (see table below for full basis of
comparison)

The Growth strategies you recommend in the next section should reflect your
findings in the Industry/ market analysis & PEST/ SWOT & competitor analysis.
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Use the table below on Competitive Analysis to compare the company with the three most
important competitors. In the first column are the key competitive factors.

Since these vary with each market, you may want to customise the list of factors for your
particular company. In the cell labelled Company, state how the company is perceived in
their customers' minds, then tick for each factor whether it is a strength or weakness.

Then analyse each major competitor. In a few words, state how you think they compare in
the final column, estimate how important each competitive factor is to the customer.
1 = critical; 5 = not very important.

Competitive Analysis

Importance
FACTOR Company Strength Weakness Competitor A Competitor B Competitor C
to Customer

Products

Price

Quality

Selection

Service

Reliability

Stability

Expertise

Company
Reputation

Location

Appearance

Sales
Method

Credit
Policies

Advertising

Image

Having done the competitive matrix, you are required to write a short paragraph stating the
competitive advantages and disadvantages of each competitor.
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PART 3: Recommended Growth Strategies
(Suggested word count 2000 words: This represents APPROX 40% overall grade)

This section of the report requires you to develop a holistic growth strategy for the business.
It is recommended that you present this as three integrated stages.

Stage one discussing short term strategies over the next 12 month period

Discussion should begin to justify why you are using the strategy; it should involve a
definition of the strategy chosen ; you may even highlight a similar company that may have
used the strategy with success ; make assumptions on the possible benefits of the strategy
and highlight the challenges that the strategy can or is likely to face. Note. Make sure to
reflect upon your findings as your finding must continue to justify why you have
used this strategy / strategies

Stage two from the end of year 1 to end of year 3

Stage 2 can be discussed in the same manner as well BUT you must justify using this in
line with other strategy. It must be logically linked to previous. So for example, market
penetration might be followed with market diversification, as a contingency to increase
profits and so do something different from what competitors are doing. Note. Make sure
to reflect upon your findings as your findings must continue to justify why you have
used this strategy / strategies

Stage three end of year 3 to year 5.

In your initial overview of this part of the report, you should make reference to the basis on
which the company will compete, e.g. Focused Differentiation and why you believe this is
appropriate.

It is very unlikely there will be just one strategy, rather a number of strategic initiatives that
work together over the 5 year period to achieve the growth. Your report should demonstrate
how the different facets of strategy work together and make long term strategic sense over
time. You should place particular emphasis on issues of innovation and competitiveness.

It is important that these growth strategies should make sense in light of the analysis in the
previous sections of your plan i.e. capitalising on what the organisation is good at,
responding to market changes, looking to take advantage of new opportunities, overcoming
looming threats or developing new innovative services, products or ways of working. You
should make appropriate references to your analysis in this section.

Your growth strategies will be a combination of som

e of the following (You must prioritise these)

Market penetration of existing markets

New Product or service Innovations

Market Development/ International Market Development

Diversification into other sectors & products (possibly related to existing business)
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These may be achieved through one or a combination of:

Organic growth - Joint Ventures/ alliances - Acquisitions/ mergers with other firms

Each strategy needs to have a clear strategic rationale linked to specific strategic
objectives for the company. You need to explain the strategy, why do you think these
strategies are appropriate? Discuss the details of each option considering where
appropriate such issues as;

Marketing implications, Development of innovative technical processes to increase

competitiveness, Cost containment or reduction, Capital investment requirements,
Overseas market growth, Improving supply chain management efficiencies, Quality control,
Outsourcing of activities to improve cost efficiencies, Evaluation of suitable JV partners,
Potential acquisitions & related benefits The list could be much longer!

Please take note of these points above in your write up as they all can influence
your strategies as well. For example, if you have supply chain issues, it can
influence your use of vertically backward integration to help improve the inputs
upstream and so on. Further, quality control can be improved by outsourcing to
provider who can do it better than you and if you want to improve your innovation,
mergers can also be a sensible inclusion in your list of strategies. So you might
merge with company who is technologically sound to help build your innovation.
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PART 4: Managing the Growth

(Suggested word count 1000 words: This represents APPROX 20% overall grade)

In light of your strategic options identified in section 4 on growth strategies you need to
consider the following issues:

Timing schedule for Growth Plan: A timeline with projected completion dates of strategic
objectives over the 3 stages of the plan. This should illustrate how the different strategic
options fit together It is best to present this in a chart format.

Projected Sources of Finance - How will the strategies be funded? Loans/ venture
capital?

Leadership/ Structure Who the key management team to manage the growth strategy
will be? If a single entrepreneur, how will their management style need to change in light of
the growth. Does the organizational structure need to change?

How might the new structure influence leadership style and management style? How might
the new structure from the growth of the organization impact on culture? What culture is
likely to exist at the early stages of development, for example, when the organization was
run by a single entrepreneur?

Support/ Networks What Government initiatives/ support e.g: Business Links/ Mentoring/
Consultancy could assist in helping deliver the strategy. Will the business need to develop
particular networks?

Premises - Are they big enough for the proposed growth? Where will the business
relocate? This item is an operations management issue

Technology - will existing systems cope? Would new software or equipment ease
pressures? Improve efficiency? Quality? Customer service? Supply Chain Management?

This is an important discussion. You can also speak about the cost implications. Does the
company have the capital to purchase a new software? Do we need a new software? How
will the technology help or contribute to the strategy? Who else might be using this
software or type of technology and what are the strengths and weaknesses of it?

Operations management focus: will existing inputs be increased or reduced? For example,
will we need more staffing? Will we need more staffing or a new building? Will we need
improved quality control? What about the existing capacity? Will the capacity we have
currently, be able to handle the volume

You must include a list of references at the end of your report

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Appendices (not part of the word count)

Provide a reflective learning experience statement (250 word max) on what you believe
you have learnt and how you have developed in terms of

1. Understanding the processes of small business growth

2. Skills development whilst undertaking the research project.

3. Your reflections on the module as a whole, what might you do differently if you took it
again?

Where available: include in your appendices details & studies used in the Plan; for
example:

Industry Statistics

Market Research

SWOT Analysis

PEST Analysis

Competitor Analysis Table

(Where appropriate) Revised Organisational structural diagrams, who is responsible for key
functions?

Any other materials needed to support the assumptions in this plan.