Keeping the farm business going in the right direction is not as easy as following the yellow brick road to the Land of Oz. Although strategic planning can easily get a bad reputation, especially if one has had a poor experience with it, and ended up with pitfalls such as:
• Getting bogged down and debating terminology or the strategic planning process itself.
• Approaching it as a linear process, having to complete step one before proceeding to step two.
• Completing a strategic plan to meet someone’s criteria and not using the process to communicate goals and objectives only to have the document collect dust on the shelf.
Dwight D Eisenhower probably summed it up best by saying “Plans are nothing. Planning is everything.”
One method of setting business direction is to use traditional strategic planning ideas to create the road map of the business future. Strategic planning differs from other types of planning because of the detailed evaluation of both external and internal business conditions. A strong understanding of forces shaping the agricultural industry is critical for strategic, and the most effective plans are brief and focus on a few key concepts for the business. In general, strategic plans are guides that assist in decision making and not a detailed list of specific activities.
While there are a variety of approaches to strategic plan development, these factors are generally present:
• Define the mission and vision for the business
• Understand the internal and external environment often referred to as a SWOT analysis
• Defining a few key areas that are likely to enhance business success based on the SWOT analysis, available resources, and other factors important to the business (labor availability, management capacity, etc).
Another method of strategic planning is to use a systems thinking approach. A systems thinking approach avoids the earlier mentioned pitfalls and makes strategic planning what it should be; an important, interactive, and adaptive process. This approach really centers around five steps, each represented by a critical question. They are:
• The Future Situation: Where do we want to be?
• Key Success Measures: How will we know when we get there?
• The Current Situation: Where are we now?
• The Journey: How do we get there?
• The Shifting Landscape: What will/may change in our environment in future?
Is it that simple? It gets a bit more complicated as we move from strategic planning into business, operational, and financial planning and then to implementation but the secret is to bring as much simplicity as possible to these complex processes. While there is a range of formats for strategic planning, the trick is to keep it simple and readable in the final form. A few strategic business directions and the values might be sufficient. If the plan is short, clear, and allows flexibility to meet changing conditions, it is more likely to be used. For more reading on strategic planning components go to http://ohioagmanager.osu.edu/resources and select the following fact sheets under Farm Transition Planning Fact Sheet Series: Whole Farm Planning Model; Developing a Useful Mission Statement for Your Agricultural Business; Developing Goals for the Agricultural Business; and Conducting a SWOT Analysis of your Agricultural Business.