Two of the biggest mistakes people make when setting out their plans for the year, is not reviewing all the stuff they’ve achieved in the last 12 months and not stepping outside the situation (normally it’s easy to do this if somebody helps you) to have a real understanding of exactly where your business is.
Reviewing all the stuff you achieved and writing it down is important for a few reasons, one we forget everything we’ve achieved and it’s important to understand how well you are doing and how far you have travelled. It also enables you to reflect on some of the lessons of the previous 12 months (commonly known as failures) so that you can improve and avoid making the same mistakes.
Also as a species we tend to focus on the negative forgetting all the good, this was really handy when we lived in caves and there was potentially a sabre toothed tiger lurking in the bushes but in modern life where were being constantly bombarded by negative information from the media, it can be extremely stressful, so we have to make a conscious effort to focus on the positive.
Also removing yourself from the situation and reviewing exactly where you are as a business is essential to formulating any plan that will work, if you don’t know where you are it’s a bit like having a satnav with an end destination, however the satnav doesn’t know where is to start with so there is no way it can plan an effective route. This is why it’s important to get somebody outside of the situation to help you evaluate where you are and then the best route forward.
FTSE 100 companies as part of their corporate governance have to have external non-exec directors on their boards, because they are exactly the same as every other business, typically we can’t see the wood for the trees or to give you another analogy no golf pro can see his own backswing.
I originally developed my DEPTH© model because what I saw were people producing ineffective business plans that were doomed to failure DEPTH© stands for:
- Destination: As a business owner this is about having a complete understanding of what you’re trying to achieve lifestyle wise, so where you live, what you want do, how many days a week you want to work, how many holidays and where you want to go. You really have to nail this down in as much detail as you possibly can.
- Exploration: This is about understanding exactly where you are as a business and then having a complete understanding of all the options open to you to drive your business forward. This is where a lot of businesses fall down, they are unaware of the best marketing options open to them, or ways of doing things more efficiently, so driving costs down and profits up
- Plan: Now you have a complete understanding of what you’re trying to achieve and all of the options open to you to drive your business forward, now you can build an effective working business plan. And this isn’t something that’s a 50 page document, I’m talking a maximum of three or four pages that you can keep referring back to ensuring that you’re on track.
- Tactics: You have now got the plan so you can start to implement the tactics, these are the important actions to push your business forward and you have to focus on them, because what typically happens is the urgent day-to-day things within your business get in the way, however what is important should never give way to what is urgent.
- Health: there will be some key KPIs that will be important to your business, it’s not about understanding your P&L sheet but about finding out which figures are important to your business and monitoring them on a monthly basis as a minimum.
As the saying goes “Failing to plan, is planning to fail” although if your planning is flawed, it can be as bad as having no plan at all.
By Alan Adams The Clinic Coach