A five-year strategic plan explains the purpose of the company and how the objectives will be achieved over time. When writing your plan, include captions that. Future planning can often seem overwhelming. Even so, planning just a year in advance doesn't give you enough time to adjust your strategy and you can lose sight of the direction you want your company to take.
And if you look outside 10 years from now, you may end up stuck, unable to see clearly the future so far away. So, while the five-year strategic plan isn't a rule, it's a sweet spot. Once you've foreseen where you want your company to be, it's time to turn that vision into a set of objectives that you'll document in your business plan. A detailed plan requires you to think about the details of your business and how, exactly, you are going to develop your business.
A traditional business plan is usually 10 to 20 pages long and contains details about your product or service, summaries of the market studies you have done and details about your competition. You'll generally determine your 3- to 5-year strategic business plan as part of your annual planning session, which will include your goals and objectives for the year, as well as describing the opportunities and threats your company faces. I'll be honest with you, however, for most companies, long-term business plans that stretch 5 to 10 years into the future are a waste of time. Detailed plans encourage you to think carefully about your business strategy, your target market, and your competition.
A strategy can involve more than one strategic action, varying budgets and the dedication of staff resources. Business owners should use KPI data to expand their successful strategies and dedicate more resources over a five-year period to the most cost-effective strategies. Just don't spend time creating an extensive version of your business plan with metrics and milestones that are too detailed for the next five years or more. With the exception of companies with a high percentage of R&D, most 5-year business plans should look more like vision statements than traditional business plans.
Developing a long-term business plan is really just an extension of your usual business planning process. Learn why the traditional way of writing a five-year business plan is often a waste of time and how to use a one-page plan instead for smarter and easier strategic planning to establish your long-term vision. Your strategy will be the order of the regions you plan to expand to and the reason why you choose certain regions over others. A 5-year business plan should consist of documenting that vision for the future and how your company will capitalize on it.
However, as I mentioned before, creating a fully detailed five-year business plan will be a waste of time. Investors will want to know not only where it plans to be a year from now, but also where the company will be five years from now.