You've learnt by now that planning is an essential part of business. You might have been motivated by sayings like ‘failing to plan means planning to fail’, or perhaps through experience you’ve realised that you need some course of action to guide you through the next little while.
If you find yourself setting up a plan to plan for your plan, however, it’s time to stop and take a step back. If the very thought of creating a 12-month+ strategic plan seems overwhelming, and if the thought of how much time and energy you’ll need to expend on planning seems daunting, that’s because it is. And I’m here to tell you that you don’t need to do it. There is no such thing as an annual strategy plan – the quarter is king.
A year is a long time in business
The problem with having a yearly plan is that there are a lot of unknowns in the future and by planning your actions too far ahead, you’re more than likely to be moving out of context with the business environment when that time comes. Plenty of people will make predictions, but no-one will be able to give you accurate details of what your business will face.
It’s much easier to project scenarios and make moves within a shorter time frame, which is why quarterly goals and plans work much better. While you should have an overarching annual goal, breaking it up into quarterly milestones enables more accurate tracking and a clearer understanding of the business environment over the next quarter. The end of every quarter presents a good opportunity to review the yearly goal and adjust where needed. You’ll have an improved idea of what’s possible and you can also re-prioritise where necessary.
By breaking things down into a quarterly strategy and goals, you can also split up the responsibility among your senior executive team so it isn’t all on one person or too far away to see success (or failure). The senior team can also delegate, as it shouldn’t just be on them to realise the strategy or goals. Their teams can help implement some of the initiatives and drive them. A by-product of this is that it creates accountability for strategy outside the business owners/senior team and secures buy-in from the broader business.
Progress needs to be measurable on a monthly basis, so come the end of the quarter you know very clearly how you are performing. This might entail breaking the quarter down into monthly, fortnightly and then weekly goals and actions to attain a granular understanding of how you’re tracking and what you should be doing, but the most effective first move will always be to split the year into four parts to make an annual goal more manageable.
Digilante has the ‘One-Page Strategic Plan’ by Verne Harnish to thank for making planning straightforward and accessible. The format allowed us to lay out a progression of goals, from one, three and five-year plans, laddering up to our BHAG (Big Hairy Audacious Goal). This structure shows how smaller actions can contribute to overall success. While there is a one-year plan, it is broken down into quarterly strategies and goals that all support and help deliver on the larger strategies and ultimately the BHAG.
One thing we’ve learnt is that a strategy or BHAG should never be revenue focused. Revenue is one way to measure progress, but it should not be the goal. Of course, the outputs of achieving your strategic plan and goals should equate to better revenues and profits but it’s more effective to focus on the aspirational: Where do you want the business to be in X years? What do you want to be known for?
The other warning we have is to avoid analysis paralysis, where you analyse your business to the nth degree and then do nothing about what you’ve learnt. If you find goal-setting and planning difficult, the ‘small steps’ approach of quarterly planning will suit you.
And while having a framework of goals and direction is helpful, you still need to remain open and flexible for positive things that are unforeseen. If your plan is so rigid that it precludes taking opportunities as they arise, then it doesn’t serve you well.
At the end of the day, results are the currency of success. When you instil a culture of making ongoing, iterative improvements to ensure progressively more effective outcomes, you’ll find that every task has a cumulative effect on helping your business achieve what it set out to do.