If you’ve started your business, made it work and now are looking to expand to a larger scale, then it is likely that your strategy needs a boost.
What do you need to think about when deciding on your strategy and how much would it need to change in line with this new chapter in your business?
Evaluate your previous business strategy
The best place to start when developing a new strategy is to evaluate your current strategic direction, and one of the best tools to start with is SWOT analysis. This may be a familiar tool to your business, but it is good practice to use SWOT regularly in your business’ life cycle to see what gains and improvements you can make as you enter the scale-up phase.
You can visualize this exercise through a grid divided into four; each box should have a separate heading. These headings are strengths, weaknesses, opportunities and threats. In the strengths and weaknesses boxes, brainstorm with your leadership team as many ideas as possible about what does and doesn’t work about your current strategy and your business as a whole. Note that strengths and weaknesses are internal to your business.
You may be taken by surprise what your strengths and weaknesses are when you analyze your business, but it is crucial to be honest when doing SWOT because that’s the only way the tool would be used effectively. Knowing your business’ weaknesses is actually a real strength because, then, you are aware of issues that you need to solve as you create your new strategic direction.
In the opportunities and threats boxes, you need to brainstorm the positive or negative external factors that could affect your business. This is hugely important, as a company looking to scale up, because you’re aiming to take a big step and you need to be prepared and ready to take the most effective route.
For example, an opportunity may come up with a funding avenue that you’re aware of and are able to take advantage of. And a threat could be the current example of the coronavirus pandemic and potential restrictions that could place on your business.
Before creating your plan to scale up, it is paramount that you evaluate your business so you are in a position to create an informed and successful strategy.
How to create your new strategy
Once you have evaluated previous strategic directions, you now will have the basis to create a new actionable strategic plan.
A brilliant and simple way to create your strategy to scale-up is by using the MOST analysis tool. This breaks up your strategic direction into four steps and leaves you with an actionable plan.
This asks the question, “Where do you want your company to be after you have scaled up?” Your answer should be kept to just turnover and profit because these are measurable factors that you then use to evaluate from once you have completed your new strategy.
While it’s important to always have your company Vision in mind, this can be hard to measure, and that’s why for the MOST analysis to work effectively, you must keep it to turnover and profit. You should also give your mission a timescale, i.e., a year, because this, again, adds a level of measurability that makes it easy to evaluate.
This is where you, as a team, decide upon events or achievements you believe your business will have to reach in order to succeed in your mission. For example, an objective may involve raising business funding.
When creating your objectives, remember the “which will” rule. This means that for each objective, add the words “which will” at the end of it, and go on to explain what the objective will allow you to do. For instance, “an objective of ours is to raise funding which will allow us to grow and scale up.”
This part of the MOST analysis is where you begin to come up with general ways you could achieve your objectives. You don’t need to have the details worked out at this point but just potential routes that might reach your objective.
Carrying on with the sample objective to “raise funding,” a strategy may be to approach and pitch to investors. You should have at least two strategies for each objective to give your business options. That way, you’re not putting all your eggs in one basket.
This final section of the MOST analysis is where you create your actionable plan. You must decide, with your team, who is doing what and when in order to implement your strategies.
This needs to be clear and written down so that everyone knows each other’s roles and responsibilities. Keeping with the funding example, you would have to decide who is putting together the pitch deck and who is organizing the financial details.
To sum up
If your business is looking to scale up, it’s likely because you’ve created a strong and high potential start-up. It’s important to not make a scale-up mistake to rest on your laurels and assume that the strategic direction that has worked in starting your business will continue to be as effective as you scale up.
Before you scale up, you need to complete a focused evaluation of your business and its previous and current strategies. Using the SWOT analysis you will be able to see what has worked for your business and what hasn’t, as well as prepare for external threats and opportunities that might come your way.
The evaluation will give you a great basis to develop your business’ actionable strategy plan through the MOST analysis. With this tool, you can set your scale-up mission of where you want it to be in a given period of time and then the tool helps you create the plan that will get your business there.
When evaluating your current strategy and developing your new one, it is important to do this with your leadership team as you can pool all your knowledge and experience to create the best route for your business to take.
To use the SWOT and MOST analysis tools mentioned in this article, download this FREE Business Strategy Toolkit and you can start today.