Your strategy is a singular idea of how you’re going to position your company better to create sustainable advantage over competitors and reap solid financial returns. Your plan is the document that tells you how that strategy is going to be implemented.  But it is not the strategy.  It’s quite common to have great plans with no strategic value. Your budget is the costing of that plan and confirms if it can be done. Obviously, you can’t execute a strategy without initiatives, investments or budgeting but once you get this definition into your head and shift this focus off budgets and planning, your strategy will become clearer and your initiatives more coherent.

When defining your companies strategy there are 5 questions to keep in mind:

1. Where is your company trying to get to, long-term?

2. How can your company perform better than your competition in your market?

3. What resources (like skills, assets, finance, relationships, technical competence, facilities) are required for you to compete?

4. What external, environmental factors affect your companies ability to compete?

5. What are the values and expectations of your stakeholders?

This strategy will help you define the length of your plan.  Allow yourself one page per questions as a guide.  If you go over five pages, ensure you are sticking to strategy and not venturing into tactics or budgeting. Your resulting strategy tells you what initiatives make sense and are likely to produce the results you want.  A good strategy actually makes planning easy.

This simplified method of strategic planning may be disconcerting for those who have spent a lifetime generating traditional strategic plans.  But it is important to note that your strategic plan should be used as a guide to your planning and budgeting, not the actual plan or budget itself.

 Adapted from the Harvard Business Review, read the full article here:   http://blogs.hbr.org/cs/2013/02/dont_let_strategy_become_plann.html