The blog below is a repeat. It was first published two years ago, along with two companion pieces that will also be re-published in the two postings following this one. Combined, the three postings offer a template for developing a 2020 Plan. We are re-publishing these now because developing an Annual Plan is a critically important activity for any small business to undertake, and now is the right time to do it. If you don\u2019t remember seeing these before, perhaps they will encourage you to get serious about creating an Annual Plan. If you do remember them, then maybe they serve as a good refresher. Either way, plan well.<\/p>\n\n\n\n
About this time every year . . . somewhere around the\nbeginning of the 4th<\/sup> quarter . . . is a good time to begin planning\nfor next year. Unfortunately, planning\nis not an activity that most small businesses engage in . . . at least, not in\nany meaningful way. The owner may have\nin mind some sales and profit targets, but no real plan for how to achieve\nthem. The prevailing attitude seems to\nbe, \u201cWe\u2019ll just work real hard and hope we get there.\u201d But as they say, hope is a poor\nstrategy. Or, as author and explorer\nJeff Rich tells us, \u201cA goal\nwithout a plan is just a wish.\u201d Yet\nplanning does have its detractors. Mike\nTyson has famously said, \u201cEverybody\u2019s got a plan . . . until they get punched in the\nmouth.\u201d And Woody Allen weighs in with,\n\u201cIf you want to make God laugh, tell him about your plans.\u201d So if you\u2019re in the same camp as Mike and\nWoody, and believe that planning is a waste of time, you should stop reading\nhere. But if you\u2019re willing to be\nconvinced that putting together an annual plan just might have some merit,\nplease continue reading below.<\/p>\n\n\n\n \u201cThe nicest thing about\nnot planning is that failure always comes as a complete surprise and is not\npreceded by a period of worry and desperation.\u201d<\/strong> ~ Richard Palmer<\/em><\/p>\n\n\n\n If you truly have no expectations or\ngoals for next year and are content to take whatever results fate chooses to\ngive you, then fine, don\u2019t plan. Under\nthose circumstances, what would be the point? \nBut if you do have aspirations and goals for next year (and of course,\nyou do), then to claim that you can achieve those without at least a rudimentary\nplan is indefensible.<\/p>\n\n\n\n To be honest, it\u2019s amazing that there\u2019s\nany resistance at all to planning in a small business. After all, we do plan for all sorts of other\nstuff. We plan for vacations. We plan for weddings (ugh, down to the last\nnapkin). We use financial planners to help\nus plan our future. Yet, even though a\nbusiness is usually the owner\u2019s largest asset, many still resist the idea of an\nannual plan. Yeah, it takes time and it\ntakes effort, but done correctly, the result is a roadmap for where you\u2019re\ngoing and how you\u2019re going to get there.<\/p>\n\n\n\n The first step is to identify the major\nstrategic goals you want to achieve next year. \nSet SMART goals . . . goals that are S<\/strong>pecific, M<\/strong>easurable, A<\/strong>chievable, R<\/strong>esults-oriented, and T<\/strong>ime-based. Vague goals that don\u2019t include\nmeasurements or deadlines are doomed from the start. Consider limiting yourself to three. If you undertake more than three, you risk\nstretching yourself too thin. It\u2019s\nbetter to achieve the results you want with three goals than to achieve only\nso-so results with five. And don\u2019t set\nthese goals all by yourself, locked away in your office. Involve the managers on whom you will depend\nto implement these goals. They probably\nhave their own ideas about what the company should be undertaking next year, and\nyou should hear those ideas. Besides,\nthey will be more supportive of goals they helped to set than they would be of\ngoals in which they had no input.<\/p>\n\n\n\n Make sure your goals are focused on the\noutcomes or results that you expect. For\ninstance, \u201cBuy and install a new computer system\u201d is not a goal. \u201cDeveloping more detailed, timely business\nintelligence,\u201d is a goal . . . it may be necessary to buy a new computer system\nto achieve this goal, but buying a new computer system is only the means to an\nend, not a goal.<\/p>\n\n\n\n Commit the goals to writing, taking care\nto word them clearly and concisely. \nConfirm everyone has the same understanding of what we\u2019re trying to\nachieve with each goal.<\/p>\n\n\n\n Next we have to do a little number\ncrunching to make sure there\u2019s an acceptable ROI for each goal. That is, we need to identify a benefit to the\ncompany in terms of improved productivity, reduced cost, or higher profit. If we can\u2019t prove such a benefit (or if the\nbenefit is significantly less than we hoped it would be), we either re-work the\ngoal in a way that will achieve a better result, or we toss it out and\nsubstitute a different goal.<\/p>\n\n\n\n Now comes the hard part.<\/p>\n\n\n\n Each manager who has helped craft your\ngoals must now present them to his or her direct reports and solicit their\nreactions\/feedback. Just as you needed\nyour managers participation in the goal-setting process to secure their\nsupport, now you need the support of everyone else. You can\u2019t fake this. You can\u2019t go through the motions of being \u201cinclusive\u201d\nin this goal-setting process if you have no intention of listening to what\nanyone may have to say. So you need to\nmake an honest effort to get people to voice their questions, concerns, opinions,\nand suggestions. We\u2019re not running a\ndemocracy here, so you\u2019re not obligated to act on what they say, but you are\nobligated to listen, to hear, and appreciate what they are telling you. Besides, these are the folks who are immersed\nin the nitty-gritty details of your business every day, so it\u2019s just possible\nthey will spot something in your proposed goals that you and your managers\noverlooked.<\/p>\n\n\n\n Finally, we need to put metrics on each\ngoal so they can be tracked and measured (remember the M in SMART goals?). No question, some goals are easier to measure\nthan others, but if a particular goal defies measurement of any kind, then it\ndoesn\u2019t really qualify as a goal. After\nall, if we can\u2019t measure it, we won\u2019t know if or when we\u2019ve achieved it.\n\nIf\nyou think all this planning stuff is a waste of time and would prefer to \u201cjust\nwork real hard and hope for the best,\u201d that\u2019s your choice. However, if building an annual plan makes\nsense to you but you haven\u2019t done one before and don\u2019t quite know where to\nstart, email or call me. I\u2019ll be happy\nto help. The blog below is a repeat. It was first published two years ago, along with two companion pieces that will also be re-published in the two postings following this one. Combined, the three postings offer a template for developing a 2020 Plan. We are re-publishing these now because developing an Annual Plan is a critically<\/p>\n
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