Planning – the Key to the Future Success of Your Business
Every business book, mentor and coach will tell you to have a plan. But when you are in the muck of it – it can go all out of the window! We often forget to plan and live day-to-day surviving in our business, thinking if we make it through another day maybe we can address the future of our business.
STOP! Take a deep breath. You NEED a plan!
Planning is essential to ensuring the success of your business.
There are many great quotes about planning:
“Failing to plan is planning to fail” – Alan Lakein
“Planning is bringing the future into the present so that you can do something about it now” – Alan Lakein
“Let our advance worrying become our advance thinking and planning” – Winston Churchill
Whether it’s a 5-year plan or a one-year plan or just the next 6 months having a destination to work towards is always helpful so we encourage you to have a plan.
There are many variations of planning, here are some that we will be discussing in this blog:
1. Vision planning
2. A business plan
3. Annual planning
a. Quarterly Objectives
b. Monthly Targets
d. Daily actions/tasks
Some planning is long-term such as a business plan or vision planning; other planning is more short-term such as annual, quarterly, monthly planning.
- Vision Planning
Vision planning is a long-term look into the future of your business. It corresponds with the vision of your company. A vision is a long-term outcome of how you want the world to look because your business exists in the world. It’s a fulfillment of your business. Visions usually span 10 to 100 years. The vision planning document that corresponds with the vision is a Future History Document. This document is a powerful story of what will happen in the near and far future. Not only does it lay out how your business will operate in the world but also how YOU and the people around you will operate.
Our own future history document is over 65 pages at this point. It took years to build and from time to time we go in there and review and modify it.
Be careful what you write in there because of its strong intention and the written word, whatever is in the document will come true!
- A Business Plan
Oftentimes when you do any type of business mentoring program or course, the first (and often the only) thing the program instructors will have you do is a business plan. Oftentimes people get caught up (unnecessarily) in trying to produce a business plan before they take any other actions.
When you are starting out, a business plan is not necessary. Most of the time people tell you that you need a business plan – now I am going to say something revolutionary…YOU DON’T!
I am not saying that you don’t need planning. Heck this whole article is about that and I have seen proof over and over again that good planning leads to success!
So what is a business plan good for? There is a point and purpose to having a business plan when you are looking for investors or applying for a bank loan.
A business plan is a lot of time and effort so it has to pay off in a big way (such as an investor, loan or grant), rather than sitting on the shelf collecting dirt.
- Annual Planning
A much more sensible approach to planning the future of your business and what most people in your business can actually work with and use is annual planning.
This is a much simpler process where
- You start with what your annual revenue will be for your business and work your way backwards.
- That annual revenue is further broken down into quarterly objectives such as revenue for Q2 will be $150K and we will sign on 12 new clients.
- These quarterly objectives will be further broken down into monthly targets e.g. April revenue is $45K and we will bring on 3 new clients.
- The monthly targets will be broken down into weekly targets,e.g., week 1 in April will be a marketing week where we will meet 20 new potential prospects, week 2 will be a qualifying week where we will qualify 7 prospects, etc.
- All the weekly targets are then further broken down into daily activities such as attending networking events, putting out promo videos, etc., whatever your marketing activities are.
Planning leads to a step-by-step process of breaking down future projections into daily actionable tasks that can be started today!
What is necessary is having a financial sense of where you’re headed and what your upcoming costs are going to be. These future projections can be based on previous experience i.e. you know every January there is a dip in sales and you plan for that or they can be created (because this is a new thing that you have never done before). Expenses can be based on historical expenses and any future expenditures that you are aware of.
What I have covered here is only the tip of the iceberg. If you Google planning, the list is endless. And there are other types of planning such as succession planning and financial planning which are their own subjects.
All in all, planning can be a fun activity that can take the worry out of where you are headed. We have our clients do an annual planning session every year and then review that plan at least on a quarterly basis.