Strategic Planning For Dummies®


by Erica Olsen




About the Author

Erica holds a BA in Communications and an MBA in International Management from Thunderbird. She’s frequently tapped to lecture at the University of Nevada in Reno and the University of Phoenix in Reno on management and planning topics. She hosts workshops and has spoken at conferences nationwide.

As one of the developers of MyStrategicPlan, Erica has stripped strategic planning of its fate as a static document. With her online strategic planning system, any organization, regardless of size and budget, can build a plan in a matter of weeks (or even days). Once completed, the online system actually helps organizations execute the plan instead of just shoving it on a shelf.

MyStrategicPlan is just one of several services offered by Erica’s company, M3 Planning. M3 also does onsite strategic planning facilitation and retreats as well as market research consulting. Over the last several years, M3 has developed and reviewed hundreds of strategic plans for organizations across the country.

In addition to Strategic Planning For Dummies, Erica has co-authored Strategic Planning Made Easy: A Practical Guide to Growth and Profitability, and contributes regular columns to local, regional, and national business publications.

When Erica is not lecturing, writing, or planning, she’s alternately kayaking, backcountry skiing, rock climbing, biking, running, or bagging peaks around the Western Hemisphere with her husband Gregor.

Erica always enjoy hearing from her readers. If you have questions about your strategic planning or if you have a success story to share, please contact her through any of the methods below:

E-mail: Web site: Blog: Strategically Speaking,



To all the business owners, executive directors, and managers in this world who have a big vision. May you successfully reach that big, hairy, audacious goal.


Author’s Acknowledgments

My sincere thanks and appreciation goes out to everyone who had a hand in putting this book together. The journey was an amazingly wonderful and enlightening experience, and I am grateful for the remarkable opportunity to author this book. I must recognize a few specific people.

To my book brain trust, who provided ideas, recommendations, and suggestions at every turn — thank you for making this book as good as it could be. I want to specifically thank Carol McClelland, Tim Gallan, Michael Lewis, Carrie Burchfield, technical editor Ann Bastianelli, and Jan King for all your help. I would also like to thank the graphics and layout teams at Wiley Publishing who made this book come to life and the marketing teams who brought this book to business owners and managers everywhere. And a special thanks to Howard Putnam, author of The Winds of Turbulence, for his kind words.

To our strategic planning clients, who’ve all contributed to this book through their examples, questions, suggestions, and experiences — thank you for the opportunity to work with your organizations. Working with you is a pleasure and gift to everyone at my company.

Thank you to my great friends for sticking by my side even when I was buried in my writing. You’re a continual source of encouragement. Special thanks go out to my friends and colleagues who gave me creative inspiration when I got stuck, specifically Greg Fine, Michael-Anne Hougland, and Chris Champagne.

To my family, who’s the best family in the world, thank you for supporting me in everything I do. My brothers Ryan and Brett, you provided needed distractions in between my deadlines. Grandma and Grandpa Olsen (aka G & G), you instilled the entrepreneurial spirit in our family; to you I am eternally grateful. Aunt Marlene, you’re an amazing mentor; thank you for sharing your knowledge and wisdom with me. Mom, you’re a one-of-a-kind business partner and mentor; thank you for taking care of the business and our clients when I was facing looming deadlines. Dad, you added needed clarifications, answers, and content ideas whenever I needed them; thank you for dropping everything to help me. You are as much the author of this book as I am. You’re the best.

Most importantly, I want to thank my husband, Gregor. Your unfailing support for everything I do doesn’t go unnoticed. I couldn’t accomplish any of what I do without you.


Publisher’s Acknowledgments

We’re proud of this book; please send us your comments through our Dummies online registration form located at

Some of the people who helped bring this book to market include the following:

Acquisitions, Editorial, and Media Development

Senior Project Editor: Tim Gallan

Acquisitions Editor: Michael Lewis

Copy Editor: Carrie A. Burchfield

Technical Editor: Ann Bastianelli

Editorial Manager: Christine Meloy Beck

Editorial Assistants: Erin Calligan, David Lutton, Leeann Harney

Cartoons: Rich Tennant,

Composition Services

Project Coordinator: Adrienne Martinez

Layout and Graphics: Claudia Bell, Lavonne Cook, Lauren Goddard, John Greenough, Denny Hager, Stephanie D. Jumper, Barry Offringa, Heather Ryan, Erin Zeltner

Proofreaders: Brian H. Walls, Aptara

Indexer: Aptara

Publishing and Editorial for Consumer Dummies

Diane Graves Steele, Vice President and Publisher, Consumer Dummies

Joyce Pepple, Acquisitions Director, Consumer Dummies

Kristin Ferguson-Wagstaffe, Product Development Director, Consumer Dummies

Ensley Eikenburg, Associate and Publisher, Travel

Kelly Regan, Editorial Director, Travel

Publishing for Technology Dummies

Andy Cummings, Vice President and Publisher, Dummies Technology/General User

Composition Services

Debbie Stailey, Director of Composition Services




About This Book

Conventions Used in This Book

Foolish Assumptions

How This Book Is Organized

Icons Used in This Book

Where to Go from Here

Part I : Laying the Foundation for Your Strategic Plan

Chapter 1: What Is Strategic Planning Anyhow?

Clearing Up the Confusion about Strategic Planning

The Strategic Plan’s Key Elements

Tips for Better Strategic Planning

Warning Signs That You Need This Book

Chapter 2: Why Strategic Planning Impacts Your Growth

Reason #1: Strategic Planning Is the Leading Management Tool

Reason #2: Failing to Plan Is Planning to Fail

Reason #3: The Best of the Best Do It

Reason #4: You Get Better Results (I Promise)

Putting Planning into Action Today

Chapter 3: Getting Set Up for Successful Planning

The Elements of a Strategic Plan

Before You Start, Are You Ready?

The Step-by-Step Strategic Planning Process and Timeframe

Selecting Your Planning Team

Going It Alone or Hiring a Facilitator

Futurecasting: Visualizing the Future

Part II : Looking Backward to Move Forward

Chapter 4: Taking Lessons from the Past

Reviewing What Happened Last Year

Evaluating Your Products and Services

Putting Your Portfolio Together (In the Matrix)

Looking at Your Financial Performance

Chapter 5: Focusing on What You Do Best

Knowing Your Competitive Advantage

Uncovering Your Advantages

Pinpointing Your Competitive Advantage

Using Your Advantages Now

Chapter 6: Refining Your Mission, Vision, and Values

Assessing Your Mission

Evaluating Your Organizational Values

Visioning: Focusing in on Your North Star

Finalizing Your Strategic Foundation

Part III : Sizing Up Your Current Situation

Chapter 7: Assessing Your Business and Its Capabilities

Identifying Your Strengths and Weaknesses

Assessing Your Capabilities

Examining Your Resources

Process: Connecting Your Capabilities and Resources

Checking Your Profit Margins

Chapter 8: Seeing Your Business Through Your Customers’ Eyes

Getting to Know Your Most Valuable Customers

Digging into Why Your Customers Are Your Customers

Uncovering How You Deliver Value to Your Customers

Kicking Your Value Up a Notch

Chapter 9: Assessing Your Strategic Position in a Dynamic Environment

Identifying Opportunities and Threats

Seeing the Future

Finding Opportunities in Your Operating Environment

Monitoring Your Industry

Analyzing Your Competition

Analyzing Your Market

Summarizing Your Opportunities and Threats

Finishing Your SWOT Analysis

Part IV : Moving Your Organization into the Future

Chapter 10: Growth: It’s Not Just for Kids Anymore

Strategizing How to Grow

Executing Your Growth Strategy

Evaluating What Path to Take

Chapter 11: Finding New Customers

Researching New Markets

Defining Your Target Markets

Targeting the Most Attractive Markets

Standing Out from the Crowd: Your Positioning Statement

Reaching Your New Target Markets

Staying Market-Focused

Putting It All Together: Organizing Customer Information

Chapter 12: Establishing Your Strategic Priorities

Evaluating All Your Opportunities

Choosing the Best Opportunities

Balancing Out Your Strategic Priorities

Turning Priorities into Strategies, Objectives, and Goals

Pegging Your Measures

Part V : Creating and Making the Most of Your Plan

Chapter 13: Putting Your Plan Together

Assembling Your Strategic Plan

Getting Down to Business and Taking Action

Ensuring Your Plan Makes Cents

Evaluating Your Strategic Plan

Making Your Plan a Living Document

Chapter 14: Putting Your Plan to Work

Getting Ready for Implementation

Communicate, Communicate, Communicate

Holding People Accountable (Including Yourself)

Keeping Score of Your Progress

Keeping Your Plan Working for You

Chapter 15: Contingency Planning: Your Plan B

Facing Up to Real Business Risks

Keeping Your Business Humming Along No Matter What: Continuity Planning

Scenario Planning: What If . . . ?

Chapter 16: Planning Considerations for Entrepreneurs and Department Managers

Planning Issues for Entrepreneurs

Planning Concerns for Department Heads

Chapter 17: Planning for the Social Sectors

Moving from Profit to Sustainability

Getting Your Board on Board the Planning Effort

Planning for Governmental Entities

Planning for Nonprofit Organizations

Part VI : The Part of Tens

Chapter 18: Ten Ways to Keep Your Strategic Plan from Hitting the Shelf

Getting Everyone Involved from the Start

Deleting the Fluff

Appointing a Strategy Engineer

Creating a Strategic Plan Poster

Hooking Achievement into Incentives

Using a KISS

Holding a Monthly Strategy Meeting

Using a Scorecard

Leading by Example

Celebrating Your Success — Whenever You Feel Like It

Chapter 19: Ten Ways to Ruin Your Strategic Planning Meeting

Refusing to Use a Facilitator

Neglecting to Conduct Any Research Before the Meeting

Inviting Everyone

Holding an Annual Retreat

Getting through the Agenda No Matter What

Forgetting to Explain the Process

Assuming Everyone Thinks Like You

Ignoring the Elephant in the Room

Ending on a Low Note

Overlooking Life After the Meeting

Chapter 20: Ten Shortcuts to Getting Your Plan Done

Focus on Your Top Five

Remember That Something Is Better than Nothing

Start Implementing Soon Because No Plan Is Ever Complete

Eat the Elephant One Bite at a Time

Knock Your Plan Out in One Day

Get Out of Town

Outsource It

Leave Perfection to the Accountants

Get Everyone to Pitch In

Just Do It


Basically, you have two choices when it comes to running your organization: Be intentional about the path your organization follows or turn on autopilot. Turning on autopilot is kind of like hopping in your Hummer, turning on the satellite navigation system, and following the directions from your home to Las Vegas. Computers aren’t the best at making decisions, so you may get to Las Vegas eventually, but are you going to Las Vegas, New Mexico, or Las Vegas, Nevada. If you plot your course before you set off, you’re a lot more likely to get to your destination.

Many people deliberately plan their personal lives, but when it comes to business, they don’t take the same approach. If you’re running your organization without a plan, you’re just using the navigation system. This concept may seem rudimentary, but the facts state that 90 percent of businesses are running without a plan. Ninety percent is hoping that the navigation system doesn’t fail. But because you’re reading this book, you’re ready to run the show, and you’re close to joining the elite ten percent that know a strategic plan is important.

About This Book

This book is about getting from Point A to Point B more effectively and efficiently and having more fun along the way. Part of that journey is the strategy and part of it is the planning, development, and execution.

Strategic planning isn’t about taking on additional work; it’s about taking all those numerous daily decisions and making them part of an integrated process. Whether you want to be more effective and efficient or you want to make more money, have a bigger community impact, or move your company from good to great, this book is for you! No more thinking that strategic planning is daunting. This book makes the process easy, straightforward, rewarding, and fun. Did I already mention that it’s fun?

Strategic Planning For Dummies brings everything business owners, executive directors, or managers need to take their organizations to the next phase of business growth. The book presents a practical set of strategic planning tools and guides you through an integrated strategic planning process. Each part contains relevant content, real-world examples, and useful worksheets. Discover how strategic planning is the key element to your growth through this no nonsense approach.

Strategic planning is a subject that has been overcomplicated by jargon, competing semantics, and consultants of the world (me included!). In reality, strategic planning is a business concept that’s useful to all businesses and organizations, no matter its size or resources. Strategic planning is incorrectly positioned as a tool only available to big businesses. With the help of a practical and realistic approach to strategic planning, Strategic Planning For Dummies helps you reap the benefits of strategic planning, whether you’re a big boy or a small fish.

Conventions Used in This Book

The following conventions are used throughout the text to make concepts consistent and easy to understand:

bullet All Web addresses and e-mail addresses appear in monofont.

Some Web addresses may break across two lines of text. If that happens, know that I haven’t put in any extra characters (such as hyphens) to indicate the break. So, when typing these addresses into your Web browsers, type exactly what you see in this book, pretending as though the line break doesn’t exist.

bullet New terms appear in italic type and are closely followed by a definition.

bullet Bold is used to highlight the action parts of numbered steps.

bullet The text in gray boxes, what the Dummies folks refer to as sidebars, is optional reading. I use sidebars to go off on tangents or present extended examples. You can skip them if you want.

Foolish Assumptions

As I wrote this book, I made some assumptions about you, my reader:

bullet You’re a decision maker. You hold the position of business owner, manager, executive director, department head, or team/group leader.

bullet You can influence change in your organization. Whether you have the final say, you have a strong enough position to influence the course of your business.

bullet You want to see your organization grow! Growth is different for every organization. But the underlying premise is you want your organization to do more.

bullet You can see the edges of your strategy, but you need to fill in the detail. Most organizations know what general direction they’re headed in, but they need to turn the generalities into specifics.

bullet You have a plan, but it’s sitting on the shelf gathering dust. Or you have a plan, but it’s half-way completed.

bullet You want to get everyone on the same page. I hear this phrase with almost every client I work with, so I assume this applies to you too. The need to get your whole company focused and pulling in the same direction is a great motivator to do strategic planning.

Although all these assumptions may not apply to you, am I at least close? I wish I could predict the future of your business, but alas, I haven’t been granted that power. A strategic plan helps to take out the uncertainty and allows you to shape the future you want. And I’m here to help you with your steps along the way.

How This Book Is Organized

Strategic Planning For Dummies is divided into five parts. A quick review of the Table of Contents and the following description of the parts gives you a solid overview of the entire book. If you want information about a particular topic, the Index can also help you locate it.

Part I: Laying the Foundation for Your Strategic Plan

The chapters in this part are packed full of who, what, how, and why you should care. You look at a number of concepts in this part:

bullet The strategic planning process

bullet Who should be involved

bullet How long the process takes

bullet How you facilitate a strategic planning process

bullet When the right time for planning is

bullet The differences between business plans and strategic plans

bullet When your organization shouldn’t embark on strategic planning

If you’re looking to convince your boss or team members about the importance of strategic planning, look no further than Chapter 2.

Part II: Looking Backward to Move Forward

Hold on a second. Don’t move past this part too quickly. I know you want to. Whether your organization has been around for two years or 200 years, you have important knowledge to build your strategic plan on. I like to call that knowledge tribal knowledge. Chapter 4 asks you to bring that tribal knowledge into the forefront of your planning. Chapter 5 digs into the hard subject of what you do best and is about identifying, developing, and sustaining your organization’s competitive advantage. Additionally, Part II provides you with advice on making sure that the foundation of your business is solid. Chap- ter 6 includes a discussion about mission, vision, and values.

Part III: Sizing Up Your Current Situation

Part III focuses on collecting information that’s critical for your strategic decision making. Organizations can’t plan without gathering the right data, so Chapter 7 looks at internal data collection and analysis; and Chapters 8 and 9 extend past your business to external data collection on the environmental, customer, industry, and competitive levels. A set of tools is provided for synthesizing the data so it’s more useful in strategic decision making.

Part IV: Moving Your Organization into the Future

The main reason you need to do strategic planning is to look into and plan for the future. In this part, you determine how you grow by looking at the different types of value-creating strategies as well as the more specific strategies surrounding growth, integration, and diversification. Most importantly, you identify and evaluate opportunities and then select a strategy to move in that direction.

Part V: Creating and Making the Most of Your Plan

No matter how good the plan, if it sits on the shelf, it’s going to be useless. In this part, you put all the elements of the plan together in an organized fashion. You develop strategic objectives, goals and tactics, and scorecards. After your plan is organized, you assess the financial viability of the plan, how to communicate the plan, methods to hold people accountable, and how to adapt the plan to an ever-changing environment. This part provides a wealth of information about strategy execution and performance management.

Part VI: The Part of Tens

Need some quick tips, a shot in the arm, or just a good laugh? The Part of Tens is a collection of hints, reminders, observations, and warnings about what to do and not to do. These chapters focus on giving you a quick set of guidelines for three key areas: facilitating strategy meetings, getting your plan done, and executing the strategy.

Icons Used in This Book

Throughout the book, icons appear in the left margins to alert you to special information.


When you see this icon, the text includes an example of how the idea is used in other organizations — big and small.


This symbol marks an important truth that’s worth repeating. Taking note of these ideas can help you make progress with your strategic plan.


The information next to the tip icon always includes a helpful hint to keep your strategic plan moving forward as smoothly as possible. Whether the tips are time savers or step savers, these hints help you move forward.


Any information next to this icon is something you want to be wary about. Watch your step when you see a Warning. The information can include mistakes made by others that you can learn from or moments where you have to weigh the cost of doing one thing over another.


This symbol indicates a concept or work area where the outcome goes into your strategic plan.


Are you an experienced strategic planner? If so, these icons are for you. Take your planning to the next level by employing the ideas highlighted with this icon.

Where to Go from Here

This book is as much about strategy development and execution as it is about the plan itself. If you want to spend time on strategy development, go to Parts II, III, and IV. On the other hand, if you just want to put your plan together, go to Parts I and V.

Another approach to tackling this book is to consider your own thinking and education style. What gets you excited? How do you like to think?

bullet Big picture thinkers: You may love Chapters 5, 6, and 10 because they focus on what’s possible and are future oriented.

bullet Analytical minds: Chapters 4, 7, 8, 9, and 15 are for those of you who always look at the what ifs. These chapters look at how to use data from your internal and external environments to develop a list of possible strategies.

bullet Detail-oriented folks: If you’re thinking, “How are we going to do this?” then head to Chapters 13 and 14 to put the pieces together.

bullet Social butterflies, team builders, and crowd pleasers: Check out Chap- ters 2, 3, and 19 for ideas to build consensus and get everyone’s input.


However you approach your plan, I recommend you start a strategy notebook to capture your thoughts as you move through your planning process. I guarantee you’ll stumble across a section of text or an idea that you don’t want to lose, so if you jot it down in your notebook, you won’t have to go back and find it. In several places, I refer to the notebook as a place to work through some actions and exercises.


Regardless of how you find your way around Strategic Planning For Dummies, I’m sure that you can develop a strategic plan that fits your team’s approach and organization’s style. Please share your stories, experiences, vision, and successes with me and other readers on my blog at I look forward to hearing from you! Happy strategizing!

Part I

Laying the Foundation for Your Strategic Plan

In this part . . .

H aving a strategic plan is the best way to bring focus and direction to your organization. The chapters in this part make you a strategic planning convert. In this part, you discover what strategic planning is and why it’s important. You also dive into the steps of the strategic planning process, including who should be involved along the way.