It is that time of year – the end of the year when we review our successes and challenges from the previous year and vow to make the next year better. In our personal lives, we enjoy the holidays and make New Year’s resolutions to improve ourselves and seek new accomplishments for the next year.
From a business point of view, we look back at the measurable results of our performance – typically financial results, product releases, new customers and other metrics that are important to our business. We then craft a strategic plan, operating plan, budgets, and goals and objectives to achieve our strategic objectives.
It is Simple…Right?
Many individuals and businesses do not know how best to plan for the next year and establish reasonable, achievable goals. As a standard practice, large corporations typically have a formal, three to nine month process where all the department heads and managers compile their operating plans and budgets based on the strategic goals and objectives of the company. Literally thousands of hours can be spent in preparing detailed planning and documentation. This requires thought, discipline and planning.
On the other hand, entrepreneurs can be just as effective at their kitchen table on a Saturday night outlining their plans for the next year. In either case – the process is similar, and the results differing only in a matter of scale.
Start with where you want to be in 3 years. Be honest. Be specific. Be realistic about what can be achieved with the resources and time you have. With that longer term goal in mind, work backward and divide the time between then and now into annual chunks of time, and then divide the next year into monthly, weekly or quarterly time increments.
The next step is to determine what must happen in order to achieve those goals. You should answer the question of resources: how do I (we) need to allocate and use our resources of time, money and people in order to accomplish the goals? And, when do we need those resources?
Now work the numbers. You know what it costs for facilities and people. What does it take to generate revenue and how much? Do I need to add people? When? It’s really all arithmetic. At the end, you have a plan. BUT it is important that you review that plan regularly throughout the year in order to make adjustments and react accordingly. (Note: Your financial reporting must be timely and accurate, and management oversight is critical in order to be successful).
Goals and Objectives
If you have done all of the above, then Goals and Objectives are easy. They should be obvious for each department and team member and be perfectly aligned with the Budget, Operating Plan and Strategic Plan of the company.
Of course, the goals also must be SMART. That is Specific, Measurable, Achievable, Realistic and Time-based.
Execution is the Key
Whatever you plan for – you must execute! Whatever plans you have – make them useful working plans, and not just good ideas that you store on the shelf until next year. You must communicate those plans to your entire company (even if you are a sole proprietor). You must follow up, measure and compare actual results to the plans. Then – be willing and prepared to make adjustments.
I’ll close with a quote from Success author Paul J. Meyer. “Productivity is never an accident. It is always the result of a commitment to excellence, intelligent planning, and focused effort.” Good Luck!