The difference between the businesses that just run to survive, and those that grow and thrive, is planning. You want your business to be a success in 2016? Then make a plan and stick to it! Focus is the key to success and we hope to help you unlock yours with our 4 point plan.
1) Set some goals
The most successful businesses are those that have a clear objective and a clear goal to work towards. In order to start setting goals for your own business, you first need to determine your destination. What is the most important thing to your company? Is it money in the bank? Is it profits? Is it customer satisfaction?
Once you start creating your list you will notice that some of your goals will be short term ambitions for the coming year, whereas other goals will be more long term aims. It is important to know where you want to take your business in both time aspects.
- To clear the business overdraft by the end of 2016.
- To have profits of £80,000 by the end of 2020.
- To have a customer rating of 5/5 by the end of 2022.
2) Make a plan to achieve your goals
So now that you have decided your destination, you need to figure out how to get there. Making a plan will help you realise whether the goals you have set are realistic and achievable. There is no point in trying to reach unachievable goals because all that will do is destroy your business morale.
Let’s use the example mentioned above “to clear the business overdraft by the end of 2016”. In order to do this you must first note down how much your current overdraft is, and then split that out over the 12 months of the year. Now you know each month how much more money you need to put into the bank to start clearing the overdraft.
Once you know this you can then determine how this is possible. Can you cut back your spending? Can you tighten up your credit control procedures to get customers to pay quicker? Can you gain more sales by marketing better?
Write all of this down in a plan and refer to it during the year for focus and inspiration. Your plan is tailored to your goals, so that should give you the drive to make it happen.
3) Regularly measure your performance against your plan
Making a plan is only worthwhile if you are going to take the time to measure your actual performance against the plan on a regular basis. You can determine for your own business whether it is better that this is done on a weekly, monthly or quarterly basis, but it does need to be done in order to make a difference.
Plot actual results against the planned results and make a note of the difference (aka “the variance”). This will help you see whether your plan is working or not.
4) Review your plan and make amendments to achieve your goals
At the same time that you measure your actual performance against your plan, you also need to be mindful as to whether the results being given are helping you to achieve your goals, and if not then maybe you should try amending the plan, or amending your goals.
For example, if a company needs to increase their cashflow by £500 per month in order to eliminate their overdraft by the end of the year, but they are only managing £300 per month, then either the plan is not being implemented properly, or the target is unachievable. In which case the plan and/or goal needs to be amended.
There is no reason why 2016 can’t be a very successful year for small businesses. So long as we know where we want to go, and we have a plan to get there, then nothing can stop us!
Here’s to a very positive and very fruitful 2016!