Strategic Planning Series
There’s a saying that failing to plan is planning to fail. As competition increases and belts tighten, many food-processing companies are realizing the importance of strategic plans.
A strategic plan often includes developing a business plan and master plan, in addition to a manufacturing analysis and feasibility studies. Areas typically addressed include:
- Safety initiatives for both food and personnel
- Ways to reduce the cost of goods sold including efficiencies in manufacturing and reduction of water and utility consumption
- Changes in manufacturing methods or packaging
- Supply chain revisions
- Growth plans, which may include expanding the business, introducing new products, locations, and market segments
- Asset consolidation/optimization
- Asset preservation / maintenance plans including capital expenditures for meeting current regulations and maintaining the future of existing assets
- Training such as computer and technology upgrades for tracking and traceability, communication, and other initiatives.
Without a strategic plan, companies lack the knowledge, tools and strategies to evolve and adjust to changing market and economic conditions, as well as customer demand.
Here’s what a strategic plan can provide your business:
- Clearly defined mission and vision — Developing a strategic plan requires that a company and its leaders examine, or in some cases, establish, a corporate mission and vision. Every operational aspect of the business will support this mission and vision.
- Objective view — Embarking on the strategic planning process forces your organization and its leaders to take a clear, objective look at organizational structure, processes, and future growth plans. Many companies often get hung up dealing with day-to-day operational issues and fail to effectively take a step back and look at the big picture. The strategic planning process requires an in-depth dissection of the company to ensure that the current structure and processes are an effective approach to meeting the organization’s goals
- Cost management — A strategic plan with clearly defined operational goals and procedures facilitates effective decision-making, especially where plant design and capital expenditures are involved. The plan should address future growth objectives, which will aid in space planning and maximizing the use of available square footage. All of these factors contribute to more effective cost management and budget planning
- Competitive advantages — A company with clearly defined goals and a production optimization plan will be more successful in meeting its business objectives and obtaining market share
- Adaptability — More stringent food safety requirements, new government regulations and changing consumer demands often require food processing facilities to adjust their business models. Food processors are adding product lines, incorporating more packaging options, adjusting ingredients, and expanding product mix, all of which affect people and processes. A strategic plan will account for operational changes and adjustments and determine appropriate courses of action
- Improved communication — A strategic plan that effectively conveys corporate goals can lead to improved communication and cohesiveness among employees. All personnel will have a clear understanding of the company’s direction and their role, which can lead to a more motivated and stable workforce.
Food processing companies can create a strategic plan at any time. Whether you are embarking on a new greenfield project or planning a facility expansion, a strategic plan can be beneficial. Many food processing companies find it valuable to work with an outside consultant who can give a subjective view of the organization’s goals and processes and provide in-depth market knowledge