Understanding the advantages of strategic planning is on its own a step ahead of the park. So many fintech startups have failed simply because they fail to understand the importance of strategic planning. I previously wrote about the uses and importance of budgeting to fintech startups and this article should be read in conjunction with that other article.
Strategic planning is all about looking ahead and scanning your environment for clues that will help shape an organization’s future activities. This article is not to written to teach you how to do strategic planning but to tell you why you must have some sort of strategic plan blue print for your fintech company.
- Know when to hire
Hiring can make or mare a starting business especially fintech companies due to the huge salaries that are paid to financial technology companies. Hiring too quickly or too late will surely have adverse effect on the bottom line of an enterprise.
Strategic planning helps decision makers identify when to hire and the type of workforce that is required; full time or part time for example.
- It forces fintech entrepreneurs to think ahead
Thought provoking questions are invoked during the process of strategic planning that often gets managers thinking about the future. Questions like ‘what will be the fate of our business if government decides to make X change to the current legislation?’ will no doubt force fintech entrepreneurs to start making plans for the rainy days.
- Better coordination
Different parts of a business are better coordinated when there is a clear strategic direction that has been in place from the beginning. The R&D department (laboratory for fintechs) for example will benefit from information supplied by the marketing department concerning the outlook of things for the next five years.
- Better use of resources
Strategic plan will help identify areas that need more resources. More resources will be allocated to training of staff members on how to use a particular technology if there are indications that this is where the trend has shifted to or is shifting towards.
- Helps identify risks
Risks are identified and mitigated against through a well structured strategic plan. The nature of business and transactions that fintech businesses get involved in can be quite risky. Things can easily go wrong without proper risk management in place.
- Targets to which all can work towards
Based on information that are collected through the application of strategic planning, a fintech can set the right target that all will work towards for optimal results.
You will agree with me that things will easily go wrong without targets- the kind of target am talking about is the type that is flexible enough to give room for dynamism.
- An opportunity to influence the future
A major advantage of strategic plan to fintech startups is that it provides an opportunity to influence the future of a business startup business especially those in the finance info tech world.
- Provides for consistency
A well documented strategic plan will help ensure that all actions are consistent with the overall mission and objectives of the fintech company. A fintech company with a strategic plan of becoming a differentiator will not be too bothered with cost of building that feature that is really valued by its customers that are willing to pay the premium.
- Removes ambiguity from objectives
Ambiguity will not take you to the desired place. A clearly written strategy go a long way in taking away guess work from the activities of striving companies like financial technology businesses.
- Overall can translate into positive customer experience and referrals
The whole point of having a business is to provide valued services to customers. True implementation of a robust strategic plan will always aim at adding value to customer experience.
An agile fintech company that anticipates the needs of a customer and provides it even before the customer asks for it will always have a special spot in the heart of its customers.
- Holds out the premise of better times in the future after initial hard work
You will enjoy the benefit of seeing the end from the beginning through the lenses of your strategic plans. One of the main features of a strategic plan is that it includes an exit strategy. This will allow a fintech entrepreneur know when it is time to sell the business for example.
In this article, we have highlighted and discussed the importance and advantages of strategic planning to fintech startups, but the advantages of strategic planning that are discussed in this article is applicable to any kind and type of business- big or small, all you need is a little tweak to suit your specific needs.