What’s the goal of any business? To make money—and we all know the phrase “Money doesn’t grow on trees.” This concept is very familiar, but to be a profitable business you will need a sound strategic approach.
While this is true for all businesses, the construction industry has a slightly different view. In building/construction, the workers and leaders are on nearly equal playing grounds, regarding how they impact the business.

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What is a strategic plan?

Construction workers are self-driven. They are known to have independent motives, goals, and views. These aspects are great. They’re what make your staff stick out from the competition. Yet at the same time, it can be challenging to keep everyone on the same page. Fortunately, a simple strategic plan can be formulated to ensure that everyone is working in the same direction, helping to increase profits by addressing underlying concerns, and opportunities.
A strategic plan is designed to document the goals of your company and outline many of the steps you’ll need to take and milestones you need to achieve to get there. In this two-part series, we’re going to explore the strategic planning process. We think after reading, you’ll be able to develop a solid strategic plan for your construction company.
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Create a mission statement

Often, businesses start the strategic planning process by defining a mission statement. This mission statement is usually written to be “high minded.” For example:
“Acme ABC Construction will position itself as a dominant new home building company in Texas. We will field a team of construction experts and contractors to build the finest homes in the area while delivering tremendous value to our clients.”
It’s perfectly fine to start with your mission statement. However, this mission statement should always be viewed as a living, breathing, asset. As you outline your strategic plan, you will likely adjust your mission statement numerous times. Just make sure your strategic plan continues to align with your goals and ambitions.
So let’s move forward by examining goals. Every strategic plan should be goal driven. What those goals should be will depend on your company, situation, and ambitions.
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Set construction-focused business goals

Goals can be viewed as the “bread and butter” of a strategic plan. There are many different types of goals to set, for example:
  • Organizational
  • Financial
  • Human Resource
  • Leadership
  • Marketing
  • Sales
Your strategic plan, mission statement, and everything else should be defined by your goals. The more specific you can be, the better. Don’t stop with “we’ll increase profits.” Be more exact. “We will grow profits by 10% in year one and an additional 15% in year two.” The same is true for organizational, financial, and other goals.
You don’t have to have every goal outlined when you start your strategic plan. Indeed, your goals will often shift as you go about planning your strategy.
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Conduct SWOT analysis

Next, you need to get a good grasp of where your company stands right now. Having outlined goals, you’re already well on the way towards building up this understanding. You can expand your understanding, however, by conducting a SWOT analysis. A SWOT analysis focuses on the environment and your company’s place in it. These aspects, in turn, can have a tremendous impact on your company and its success or failure. A SWOT analysis centers around four elements: Strength, Weakness, Opportunities, and Threats. Let’s look at them individually.
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Strengths & weaknesses for your construction or trade company

Strengths and weaknesses are internal, which means your company has a lot of control over them. Be proactive, take control.
Strengths: What are your company’s strengths? Where do you excel? Don’t overstate things, be honest. If you mischaracterize weaknesses as strengths, you’ll only hurt yourself. Pick a few areas that you are really good at. Leverage them.
Weaknesses: What are your company’s weaknesses? It’s often best to be a bit critical when examining weaknesses. If you’re doing okay in a certain area, but there’s still a lot of room to improve, it’s still a weakness. Address them. Both strengths and weaknesses can include:
  • Resources, such as money and equipment
  • Human resources, including the talent sets ofyour team
  • Access to customers
  • Ability to finish projects on time and under budget
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Opportunities & threats for your construction or trade company

Opportunities and threats are external factors. They exist outside of the company’s direct control. However, proactive engagement can give companies input and an ability to respond to both.
Opportunities: An opportunity is a distinct advantage that a company can leverage to gain a leg up in the market. For example, maybe your construction firm specializes in installing solar panels as well. Can you leverage that to gain new opportunities?
Threats: External threats are factors that could damage your company. For example, is a competitor simply much better at roofing than you are?
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Action planning
The business world is fast-paced and data-driven, but standing out in a competitive market requires more than cutting-edge technology and a strong marketing platform. Be it on the back of a business card, on conference room walls, or in a television advertisement — many firms will dedicate enormous amounts of time drafting a vision, mission, or value statement that will lay the foundation of what they are striving to become.
With opportunities and threats constantly emerging, however, sustaining a business in today’s fast-paced marketplace requires company leaders to not only place emphasis on the vision, mission, and value statements behind their strategic plan — but also live by them. Let’s outline out how to create an action plan that will balance your company’s short, and long-term operations and goals with your overarching mission statement.
Your action plan will document many of the steps you have to take. You’ll need to outline them in a logical manner. What needs to happen before a goal is accomplished? What steps do you need to take to support further actions? For example, do you have to hire a key tradesman, such as a plumber? Do you need to acquire certain equipment? Once this is done, how do you progress? Remember not to make your goals too large and overarching.  Breaking large goals down into bite-sized pieces will help you achieve these goals quicker every time.
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Delegating actions
As you outline your action plan, you need to determine who is going to do what. Don’t be beholding to job titles. Focus on skills and capabilities instead. Identify various stakeholders in your construction business. Many of these stakeholders will be internal, such as your employees. However, external stakeholders, such as subcontractors should also be considered.
Inclusion is empowering, so try to be inclusive throughout the process. The more people you have
working on your strategic plan and towards your goals and vision, the better. Of course, you shouldn’t burden people with responsibilities that they are not ready for.  
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Utilizing fact-based analysis

Your strategies should revolve around the “four Cs”, meaning your company, climate, competitors, and customers. You could add a fifth “C”, as well, “contractors.”  
Each component must be analyzed both separately and in conjunction with one another. It is important to respect the individual factors with each, while also connecting them to the big picture. Minimize assumptions. When considering your company, do so
objectively.
When looking at internal factors, it often helps to pull in an objective view, such as a coach or consultant. This can also be helpful when examining competitors. A neutral mind can help you see and understand things that will most likely be difficult, given your close proximity to your construction business. An outside party might see things differently than you. Also, talk with your customers. Surveys, customer studies, and other actions can be enlightening. Likewise, understanding your customers will shed light on your climate. Every company is impacted by the climate it operates in. Make sure you understand this climate.

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Take your time with tough decisions

Some companies try to rush through the strategic planning and decision-making process. This can be detrimental to your efforts, especially for small construction firms. You shouldn’t dally or spin your wheels, but at the same time, you shouldn’t rush to make a decision for the sake of making a decision. Instead, take your time.
Patient, fact-based decisions will help you meet your milestones and long-term goals. This produces “attainable actions”. It also helps ensure that your decisions are well-informed and will produce results for your business.
Talk is cheap. Eventually, you have to put your strategic plan into action. This is, without a doubt, the more important step. You need to bring your strategic plan to life. Your strategies and actions should become part of the DNA of your company. Employees and managers should see and feel the impact of your strategy planning day-to-day. This is one of the best ways to measure the performance and impact of your strategic plan.