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  • Dr. Andy Schell, Ph.D., DBA, CPA, CMB

How to Design a Strategic Plan

By Dr. Andy Schell, CPA

All Rights Reserved, © Copyright 2021


What is Strategy?

A strategy is the road map a company follows to achieve success. A company's strategic plan includes several elements. Each element is carefully created and contains a values statement, a vision and mission statement, a list of objectives, a self-assessment document, and a market-assessment. Each component of a strategic plan is part of an interrelated continuous feedback loop that results in the constant adjustment of strategic elements. For example, a firm with an efficient production operation and a dynamic marketing plan may fail if the product becomes obsolete. What happened to the buggy whip companies when the automobile replaced the horse-drawn carriage as the primary means of transportation. A strategy that was successful last year may not be successful in the future. There is no assurance of continuity. There is an assurance of constant change. A successful strategy includes adjusting direction and changing tactics based on updated information about market dynamics. A firm's market assessment process within the strategic plan feedback loop should identify the risk from technological innovation as the car replaced the horse. A responsive buggy whip manufacturer would have adapted to produce automobile seats. A company's continuous feedback loop will adjust to the changing market conditions.

A strategic plan includes a company's overtly planned actions to improve its market share and profitability through a series of tactical responses to changing market forces. It is difficult to anticipate how macro-economic forces will impact a company. A strategic plan should be sufficiently dynamic to embrace the adjustments identified during the feedback loop process. A strategic plan that is able to adjust to the changes in market forces is known as an adaptive strategic plan. An adaptive strategic plan is essential to enable a company to achieve success. Business is never static. The dynamic nature of the US business environment is considered when preparing the strategic planning elements. Failure to have a strategic plan requires managers to guess about how to respond to market dynamics. An adaptive strategic plan will identify the tactical response to most challenges, given the feedback loop's perpetual nature.

Thinking again of a buggy whip maker, the sales objective may be to increase sales by 15%, the manufacturing objective may be to reduce cost by 10%, and the financial objective to increase profit by 20%. What happens if the price of leather changes? What happens if the workers go on strike? What happens if a new competitor enters the market selling whips at a lower price? What happens when the carriage is replaced by the car? Each of these risks addresses both internal and external forces and impacts the ability to achieve the firm's objective. These and other forces are transferrable to any business at any time.

Why have a Strategy?

When a person with an idea for a company starts the company, they become a business owner. The business owner knows why they formed the company. Will the reason to start a company lead to long-term financial success? The Small Business Administration (SBA) reports that over 95% of new businesses fail within 5 years unless they have a robust financial and strategic plan. The primary reason for the reported failures is a lack of financial management. If sales are less than expected or costs are more than expected, a business will likely fail if the dangerous circumstance is not corrected. When a business owner may have a winning strategy but cannot explain the strategy to the employees, the strategy is likely to fail. If the owner's personality inhibits information transfer, the strategy is likely to fail. These statistics suggest that successful businesses have a strategic plan and a leader capable of communicating effectively with the staff.

A strategic plan supports two essential elements of success. 1) the strategic plan components will analyze the business purpose to confirm that the effort leads to a customer value proposition delivered in a manner that supports financial success. 2) the strategic plan creates the mechanism to communicate the anticipated actions to others. If a one-person company wants to borrow money from a bank, they must describe how the company will generate a profit. If a one-person company becomes a 50-person company, the manner by which the company's actions are performed will be communicated via a strategic plan. How the strategic plan actions result in delivering a customer's value proposition and achieve the profit formula are explored in the firm's business plan, which incorporates the strategic plan components.

Every company has a strategic plan, even if the plan is not documented. When a business owner forms a business, the reason why they created a new business is the strategy they intend to implement. The classical method of structuring a strategic plan with the elements identified above helps to bring consistency, order, and a structured process to enhance the strategic plan. When there is a single person who operates the business, the strategy is known by all employees. A strategic plan structure creates the foundation to gain alignment among employees and communicate the plan effectively to all employees.

Strategic Plan Components

Vision, Mission, Values, Objectives, Self-Assessment, Feedback loop.

Values: A values statement identifies how a firm treats its customer, employee, vendors, and capital partners. Values are unchanging and, ideally, are personally embraced by the staff generated from each person's worldview, and not solely as a means of compliance. A list of values may also reflect ethics and is tailored to identify how a specific firm conducts its activities. An example of a list of values statements may include, we do not lie, cheat or steal. We treat each other with respect, which means employees never yell at or harass another employee. At our firm, we listen when others speak and do not interrupt each other. An internet search result of "values statement" will provide many examples.

Vision: A vision statement identifies where it is going. A company's vision statement casts the long-term view of the company's destination years in the future. A company's vision is generally a stable element that does not change quickly.

Mission: A mission statement identifies what a company does to provide a value-added product to a customer in a fashion that results in a positive experience for the customer and a profitable business result. A mission may require periodic adjustments based on the content of the strategic feedback loop.

Self-assessment: A self-assessment is an honest and open internal assessment of a company's capabilities. Capabilities may be sub-divided as a group and individual Knowledge, Skills, and Abilities (KSA). Through a capability assessment, a firm's leadership must honestly assess its ability to implement its objectives successfully to achieve its Mission. For example, if a firm's head of IT cannot ensure system access, this weakness must be identified as a skill shortfall. Conversely, if a firm's IT group is able to excel at providing system access, then technology may be a highly developed strength. The firm's strengths and weaknesses are related to internal capabilities as part of a SWOT analysis. The assessment of strength, weakness, opportunity, and threats (SWOT) is a standard tool to evaluate a firm's internal and external capabilities. The internal evaluation explores the first two letters of the SWot assessment process.

Objectives: Objectives are the series of tasks required to implement the Vision and Mission in a manner consistent with the firm's Values. Objectives transform the Vision and Mission into performance benchmarks to measure the company's success by identifying the kinds of actions that must be achieved to fulfill the Mission. It is stated that a company exhibits strategic intent when it actively and perpetually pursues its strategic objectives by directing its resources and competitive actions to achieve each objective. Objectives are most likely to be adjusted based on the strategic feedback loop.

Feedback Loop: The feedback loop creates a circle as the self-assessment and market assessment impacts the vision, Mission, and objectives. It is pointless to be an amazing buggy whip makes when there are no buggies.

Putting it all Together

The Business Model and Business Plan

A firm's business model defines how a company makes money by delivering value to a customer (Dr. Peter Drucker) or a set of assumptions about what a business will or won't do (Dr. Michael Porter). A firm's strategic plan incorporates and articulates a firm's business model. The business model will include several essential elements, including identifying a customer value proposition and a profit formula. The customer value proposition explains how the firm intends to meet their customer's desires by delivering a product or service at a price and quality that the customer perceives as valuable. The customer's impression of value is highly subjective and defined solely by the customer's impression. The profit formula identifies how the company will make a profit while delivering a product or service that fulfills the customer's value proposition. The description of these elements will be included in a business plan.

A business plan is the road map for a business's success. A business plan will explain the business model, the customer value proposition, and the profit formula. The business plan will outline all of the strategic plan elements, including the values, vision, and mission statement, the objectives, the internal assessment supported by a SWOT and CMS, and a market-assessment supported by Porter's Five Forces. The business plan also includes a description of the CMS/governance and the organizational design, a marketing plan, and a financial or profit plan that expands on the profit formula. The business plan becomes a story of a firm's path to success. The who, what, where, when, why, and how of a firm's approach to happy customers and satisfied stakeholders, including employees and the firm's owners. Each of the components of the business/' plan includes:

o Strategic Plan –

  • values

  • vision

  • mission

  • objectives

  • internal assessment

  • feedback loop

o The Business Model –

  • How the firm offers value to customers

  • Marketing Plan - Creating Value Defined

o CMS / Governance

o Organizational design

o Interdependency design

o Marketing plan

  • how will sales occur –

  • what is the sale point of contact, product description

  • who is a qualified salesperson

  • what is the sale process

o Financial and Cash Flow Forecast

  • All revenue and expense drivers,

  • Expected quantity,

  • Resulting revenue, expense, and profit

The complete business plan creates the foundation from which a business may operate profitability and grow. When the strategic plan is complete, the business is then ready to begin operation.

Implementing the Strategic Plan

The difference between a successful company and a company that feels frequently live within its ability to implement a strategic plan successfully and then adapt the plan as needed to accommodate the dynamics of the market forces.

Implementing a strategic plan requires an extensive understanding of human behavior and how to both motivate and direct affectively the activity of people. As a general rule, people do not like change. The tactics to deploy that support getting the employees alignment with the future design of the company that is required to remain competitive in the market or extensive. McKinsey and Company as extensive literature that describes the change management process. The foundation of strategic implementation rest on the work of Dr. Lewin that created the unfreeze move refreeze strategy for change implementation where specific tactics are deployed to create the unfreezing dynamics within an organization, which creates the environment for employees to accept change. The move to the new design is reinforced by extensive workflow documentation of the new design followed by the refreeze process which incorporates mechanisms to stabilize the new design.

The implementation process is frequently underestimated particularly around the extent of communication with the employees about the change, the reason for the change, the impacts because of the change, and how the employees will be supported through the change process. If there is one element of this paper that resonates with leaders it is this topic to thoroughly examine the emotional stress and the human impact from change redesign.


Dr. Andy Schell, DBA (Ph.D.), MSML, MBA, CPA/CFF, CMB

Dr. Schell is CEO, Managing Partner, and Co-Founder of Mortgage Banking Solutions and MBS Financial Services ("MBS"), based in Austin, Texas. He is known for his ability to turn "vision into reality" and "chaos into order" as he finds creative solutions to address his clients' challenges.

He has 4 decades of experience as a leader / manager / coach crafting strategy, defining culture, and directing the activity of small and large groups of employees, including mortgage lending activity at Bank of America. Today, he primarily supports regulated depositories in mortgage finance and sophisticated independent mortgage lenders to address revenue stability, technology enhancement, and workflow efficiency.

Dr. Schell is a finance guy, a CPA, a strategist, and a musician. The combination of his creativity, experience, and education enables him to create business strategies that will lead to his client's success. His 40 years of experience, professional designations including, CPA/CFF and CMB, and his academic credentials, including a doctorate and multiple master's degrees, provide the foundation for him to address the topics presented in this white paper authoritatively. Other white papers and articles by Dr. Schell are available directly at

To find out more information on MBS Services, please click HERE

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