Does crafting a strategic plan sound like a waste of time? Do you associate it with a binder on your bookshelf? If you view a strategic plan as a one-time project, it isn’t worth your time. But, if you make it a simple and living document and process, it can create new opportunities and added revenue for your farm.
“Where are we today? Where do we want to be in the future? That’s the gap to close with a strategic plan,” says Allan Gray, Purdue University ag economist. “Don’t make it any more complicated.”
Also, don’t confuse strategic planning with running an effective business. “Operational effectiveness is assimilating, attaining and extending best practices,” Gray says. “You are running the same race faster.”
Conversely, strategic positioning is creating a unique and sustainable competitive position. “You choose to run a different race,” Gray says.
To determine the path between where your business stands today and its future position, list your values and the goals you can achieve, Gray says. “Strategy is where you find alignment between those two lists; strategy is about what are the most important things we can do something about.”
An effective strategic plan will provide you direction for your farm, says Mark Faust, business author of and columnist for AgPro, a sister publication of Top Producer. He says a smart strategy consists of three pillars: vision, focus and divergence.
What are your goals for the farm? Start there and work backward.
Once you have a clear vision, make it your operation’s focus. “Your people, capital and time will get more leverage when you direct your limited resources in distinctive ways toward one area where you have the most impact compared,” Faust says.
Finally, what amplifies good strategy into great strategy is innovative divergence. “Continuously refining your approach to the market, your offerings and even your culture will differentiate you in powerful ways,” he says.
Strategic planning is not easy. As a result, farmers who continuously refine their strategy have a great competitive advantage and don’t suffer from a stale business focus. Commit to revisiting and refining your strategy, Faust encourages.
“Strategy is a process, not an event,” Faust explains. “It’s a dance, not a sculpture.”
5 Pillars of a Strategic Plan
Strategic planning combines long-range thinking with short-term goals, says Sarah Beth Aubrey, CEO of Aubrey Coaching and Training and Top Producer columnist. To help farmers and business leaders succeed in strategic planning, Aubrey created a system called the “Strategic Plan On A Page In One Hour Or Less.”
Assemble your team along with supplies. Use a timer and stick to the hour-long deadline and divide your hour into discussing the five sections below.
- Values: Define core values for your life and farm. What motivates you? (5 minutes)
- Vision: What are your aspirational goals for the operation? (10 minutes)
- Analysis: Identify your strengths, weaknesses, opportunities and threats (SWOT). Go through each of these quickly. (20 minutes)
- Goals: Set short- and long-term goals that are specific, measurable, ambitious, realistic and with timelines. (20 minutes)
- Priority: Now, set a single top priority. Remember, priorities and goals are not synonyms. (5 minutes)
Learn more about Sarah Beth Aubrey’s guide for creating a strategic plan in an hour or less at bit.ly/quick-plan