Just typing out that small yet significant phrase almost causes my brain to fog over.
Back in my corporate days, business plans and projected cashflow spreadsheets where part of our weekly activity and monthly management meetings. It was expected that we focus on our 12 month revenue goals, knowing exactly what sales were chalked up on the board, as well our pipeline and promised contracts.
Every monthly meeting I had with the other Directors in the area spent at least half a day going through our figures and reporting back what was going well and what wasn’t. And it was expected that the same agenda was followed when I gathered my managers together for my monthly meeting too.
Remember this, too? If you’ve come from the Corporate World (it deserves capital letters, don’t you think?), following budgets, monthly sales targets and 12 month cashflow projections was probably part of your working week, too.
So why is it when we start up our own businesses and decide to “go it alone”, that business planning goes completely out of the window?
I did try. I promise I did! And you probably tried too, didn’t you?
You opened up a new spreadsheet, put the months of the year across the top and then probably stared at the empty fields wondering what on earth figures to put there. What prices do you charge? How many clients are you expected to have a month? What happens if you get a big contract that comes in? How many of those do you add to your projections?
What seems initially as a simple and basic business principle to follow, when you try to apply good old corporate business planning principles to selling “you”, the fog can easily come down before your eyes and you end up frowning at your spreadsheet as you have no idea what figures to pluck from the air.
And even if you do manage to guestimate what revenue and costs you intend to have over the next one to three years, how helpful is that document in helping you understand what has got to be achieved today, tomorrow and the next day?
Traditional business planning can be a waste of time for small business owners …
You see, I believe traditional business planning for businesses like mine and yours can be a waste of time. Completed cashflow projections and sales forecasts can make you feel it’s the right thing to do but often these spreadsheets and documents remain hidden on your hard drive or in the top drawer of your filing cabinet because they don’t help you with your day to day plans.
Now before anyone jumps at me shouting, “Ha! Fail to plan and you plan to fail! How can you possibly run a successful business without knowing where you are headed?” … I totally agree. I am not for one moment recommending that you start up a business and simply meander through the months without a plan.
But if you are like most entrepreneurs and small business owners, creating spreadsheets and ten page documents just to tick off the box that says “business planning” are just not going to provide any useful guidance for your day-to-day activity.
Here’s how I break my own business planning down and help my clients to do the same.
You have to have a “big” vision; a mountain that you want to climb, to stick your flag on top of the summit and claim as your own.
Whether it’s a two, five or ten year plan, that’s up you and how far ahead you can see. You may want to pay off your mortgage or you want to put your kids through private education. Both these may need a longer vision and focus for you.
However, technology and innovations in today’s world mean that the way we do business changes rapidly. The king of the market place is really the consumer and they can be a right fickle bunch! The product or service that is hot this year, can be dead and buried the next. So be aware of this as the target client you decide to work with may not allow you to plan more than 18 months at a time.
But you’ve got to have your reasons why. Without digging deep into your soul (I know, you don’t expect me to get all spiritual, do you Ha Ha) and understanding your true motivations behind what it is that you do, you could end up wasting your time of half-baked ideas and chasing a passion that never turn into profits.
The mountain that you climb needs to be quantified so you are absolutely clear on what it is you are after. Whether you use a vision board, create a vision movie, write your own affirmations … it’s up to you and what you respond best to.
The trick to getting this to work is having your mountain defined in a way that you can instantly recognise and feel what it is you are after.
[features_box_paper_white width=”75%” + border=”2px”]Your big vision has to be emotionally charged; it has to have the power to turn duvet days into power days.[/features_box_paper_white]
OK, you’ve got your mountain. But trying to climb a mountain every day is bloody hard work. In fact, it’s impossible. (Well OK .. not really impossible. The record for climbing Mount Everest is 16 hours and 45 minutes, but for most “normal” people the journey is planned across two or three weeks.)
If you sat at your desk every day just focusing on your mountain to climb, it’s just too overwhelming. Where do you start? What do you right now?
You need to break you mountain climb into several hill walking expeditions. How long each one is will depend on the size of your mountain. However, I work with clients to break down the “big” goal into three monthly chunks; usually three months, six months and twelve months.
It’s a great exercise to do and I love starting with the vision and being able to work backwards, making decisions on where the business needs to be at particular points to make sure they are on track.
It’s also a great reality check as it allows you to realise what else is going in your life and how much time and energy you will need to make those longer hills walks.
Your Daily Constitution
This final part of the business planning process is what really makes it all work. And it’s exactly why those spreadsheets and twenty page documents don’t.
You need to know what to do today, tomorrow and the next. You need your daily constitution to keep you on track, as well as fit and healthy.
This is not about creating daily to-do lists. But simply giving yourself three or four daily, weekly and monthly actions to take that, if done every day, week and month, will ensure you stay focused and achieve your “big” vision.
So, business planning is important. Critical, to your success even.
If you fail to plan, you plan to fail.
But if you stick to the traditional corporate-style spreadsheets and forecasts, you may find you end up meandering through the next twelve months ending up in a place that wasn’t where you intended to be, usually poor and bereft of clients!
OK, now your turn. What do you think about business planning? How do you approach this area of your business?
In the comments, I would love to read your thoughts and ideas on how you go about setting goals and keeping you on track for success.
[features_box_grey width=”75%” + border=”2px”]P.S. For more information about Karen’s business mentoring programmes and how you can get your mountains, hills and daily constitutions clarified, click here.[/features_box_grey]
Photo Credit: LillieCam