This is the time of year when we reflect on the past and plan for the future. However, I’ve found that many business owners are so busy with the day-to-day activities of running their business that they often times fail to plan. In a recent survey of Utah business owners, fully 89% of those surveyed indicated that being too busy with their day-to-day activities was the primary reason for their lack of planning.
Running a business without a plan is liking driving a car without a destination. Can you imagine taking a road trip by just hopping in your car and driving down the interstate without any idea of your destination or the route you wanted to follow? At a minimum you would want to know your destination, what route you would take, and how long it will take you to get there. You may even want to identify some alternate routes to take if your preferred choice is closed. Effectively running your business deserves the same kind of attention to planning. There are three key steps to this planning process.
Determine your Destination
Your destination might be a certain level of revenues, cash flows, owner compensation, increased net worth, or some combination of all of the above. These destination might be expressed in terms of dollars, units, hours, subscribers, or some other key performance driver for your business.
Choose the Route
Once you have completed the step of determining your destination, you next most choose the best routes to take to reach your goals. These strategic planning routes might include product mix, pricing strategies, marketing strategies, financing strategies, staffing levels, technology strategies, and infrastructure planning. The routes you take with your business are reflected in the choices you make as you move toward your destination.
Make Course Corrections Along the Way
As you would on your road trip, you must constantly re-evaluate your assumptions, routes, and destination. Your business plan should be a living document, you should create it, use it and revise it as often as needed on your trip to success.
In our modern technological world we have a wonderful instrument called a GPS (Global Positioning System) that can be a great aid in helping us in planning our road trips. All we need to do is plug in our destination and the GPS unit aided by a satellite high overhead can detect the best routes to take to reach our destination. It can even make course corrections for us along the way if we happen to make a wrong turn. In a similar manner you need a GPS on your business team. This business GPS is a proven financial professional aided by years of experience who can help you evaluate the best routes to take to reach your desired destination. They can also help ensure you stay on course by constantly re-evaluating your plan and prescribing the necessary course corrections needed to keep you on track.
Our consulting CFO’s have the business background and experience to be the GPS on your team and help you arrive at your desired destination. Contact us today so that you can take advantage of this great tool in aiding in your planning process.
by Scott Boman