The difference in results between a business that has a well thought out business plan and one where the plan is only in the head of the owner is obvious. Businesses with a plan outperform, those without a plan. It is that simple.
A business plan is a key strategic tool for entrepreneurs who want to run great businesses that consistently perform above market average.
How does a well-crafted business plan help business owners?
Firstly, it helps create a clear focus on what actions are needed to ensure their business ideas succeed. It also helps them achieve their short-term and long-term goals quicker.
Many of the businesses I deal with are family owned, which means they often require even more careful planning to ensure that family dynamics and needs are accommodated. For example, family businesses need to create an environment where business systems create a positive environment where both the family and the business thrives, especially if the business is growing.
Balanced business and family systems creates a high level of trust, ensures commitment, drives business effectiveness, and fosters family harmony.
With the calendar and financial year-end upon us regardless of whether you have a family run business or not, NOW is the time to do your annual business plan. Putting it off until next month or next year will not help – in fact, it will only make it more difficult to make changes and implement systems.
Without a business plan how will you prioritise what needs to be done and what needs focus and attention?
There are three basic pillars to a solid strategic plan that will help businesses effectively support their growth goals:
- Strategic Priorities
These are higher-level business goals that define the actions required to achieve the business’s quarterly activities. Part of defining these priorities should be a review of the business’s core values and reason for being. Once the five largest quarterly goals have been identified they must be allocated to an accountable party.
- Resource Allocation
The primary concern of resource allocation is to ensure that those who are allocated the various goals have the necessary skills to execute them. It is also critical to measure productivity and performance on a daily, weekly and monthly basis. To do this KPI’s should be developed. This will also help ensure employees are aligned with the company’s vision, mission and strategy.
- Financial Feasibility
Identifying the key financial drivers of the organisation enables business leaders get a better understanding of what is driving the business’s bottom line. Understanding key financial drivers like gross profit, profit margin, cash flow, accounts receivable days, inventory days and revenue per employee, will assist executives in determining strategic priorities and how to allocate the companies resources to maximise profit.
Some of the questions your strategic plan can help you answer include:
- Is your mission, and vision clearly defined?
- Why does your organisation exist?
- What does your business look like when it’s finished?
- What are your priorities and financial goals over the next three to five years?
- What are your Key Performance Indicators (KPIs) for this timeframe?
- What are the objectives that everyone needs to focus on, and be accountable to, in the day-to-day operations of the business?
Get out of the office and plan. GrowthCLUB 90-day business planning sessions are aimed at assisting business owners to get a clear focus and understanding of what is urgent and the importance of acting immediately.
Consider running an inhouse planning day for you and your team where you can map a path that everybody buys into. Team members who are involved in developing a business plan are more aligned with the vision and mission of the company and will take ownership in helping achieve them.
A detailed business plan will ensure that you and your team know what is expected of everyone and what they need to deliver! It helps create accountability.
A day out of the office may not seem necessary but it can help save time in the future. It comes down to weighing up the benefits and ROI of investing time and money in such a process.
ActionCOACH Inspire believes in developing a proper business plan as it helps clarify the company’s objectives and creates focus on key priorities. Planning helps an organisation to achieve its business goals by focusing energy and prevents wasting time on unnecessary activities.
Lastly, planning can also be used as a team building process. It’s the ideal process to get everybody’s input and to create a sense of commitment.
As Allan Laiken said: “Failing to plan is planning to fail.” Just a few hours of hard work can lead to a healthier stronger and better future.
Connect with me today to discuss your business planning and strategy requirements.
Let’s start growing your business together!
Yours in great business,