Strange but true; of the 1200-or-so SMEs I've met and trained, I'd estimate that around 95% had no strategy. For those of us who think that strategy is - almost by definition - a requirement for organizational survival and success, how can this be? One answer is that firms find strategy hard. Just starting a useful strategic conversation can be challenging.
If strategy is so darn difficult, this raises the question of how to make things simpler. What is a "minimal set" of strategic answers a typical firm must have to get most of the purported benefits of strategizing? Well, ignoring the outliers (eg the outrageously lucky or unlucky organizations), here's my stab at an answer...
1. you must know where you are going.
In other words, there has to be an "end-point" wherein you've "arrived" at success. You might want to sell a business for $5million, win an award, or just create a stable, useful passive income. You decide but if there's a team then you'll want team "buy-in" to this end-point.
2. you must know how you'll get there.
You have to consider (at least in outline) what people do what things at what time for what customers with what resources (eg machinery) and how much cash is needed to set and keep things in motion. Without this you won't get much done, never mind survive and thrive for the long-term.
3. you must know how you'll compete.
Strategy can be defined as your theory of how you gain advantage. It might be your strong contacts, specialized expertise, superb team, great reputation, cool innovations, exclusive assets,..., but it has to be something (or some blend of things) that mean you can both deliver better/cheaper, and deliver in a way that's tricky for rivals to replicate or exceed. People buy because they perceive that you offer value and they keep buying from you because they can't meet or beat that value elsewhere.
That's it. By my reckoning, if you're a SME and you have semi-solid answers to these three questions then you're in an elite of the top 5% best-strategized SMEs in the world.