The 2012 Planning Process

Posted by Chuck Kocher
On December 20, 2011

It’s good to have a “big picture,” long-range plan for your business. And it’s great to have a strategy to guide your business for the next three years or so. But how do you take specific steps to make sure that you’ll actually act on your strategy? That won’t happen without a plan. Here’s a quick overview of the process I use with clients to help them with their annual planning sessions.

Obviously, I change the specifics to meet the needs of individual businesses, but this will give you an idea of what you should cover. (And if you’re looking for someone to guide you through the process, I know a hall-of-fame business coach who’d be happy to help you out!)

Review 2011

Before moving forward, it’s often helpful to take a quick—and specific—look back at the year you’ve finished. You don’t need to wallow in your defeats or bask in your long-since faded glory. But it’s helpful to review some key metrics.

  • Performance Sales/Profits/Cash: Don’t guess at this. Look at the specific numbers. Don’t embellish and don’t hide. Let the numbers speak for themselves. Acknowledge them and use them as stepping-stones to move on.
  • Top Successes: Sometimes our failures or shortcomings dominate our thinking. Take some time to remember your successes. What can you do to replicate them?
  • Top Learnings: Failure isn’t really failure—unless you fail to learn from it. What were the top two or three things you learned this year? How can you use that, moving forward?
  • Top Challenges: What were the biggest challenges your business faced this year? Did you meet them successfully? Will they continue to be challenges? Were they surprises or did you see them coming?
  • What needs to change going forward: You can’t change the past. But knowing what you know now, what should you change in the coming year? This can be somewhat general at this point—but eventually, you’ll want to get into specifics.

The 2012 Plan

Now it’s time to move forward. What are you going to do differently this year? A successful plan is a mixture of being responsive to market needs and being proactive: shaping the market.

  • Major Trends/Changes in the Industry/Markets: List some of the changes and trends in your specific market. Don’t assume that the market has stayed the same. It hasn’t. Make sure everyone on your team is thinking about what’s different—and what that means for your business.
  • SWOT Analysis: It’s always a good idea to do a periodic check on the Strengths, Weaknesses, Opportunities, and Threats facing your company. Once you identify these things, you can take steps to leverage your strengths, improve yourself where you’re weak, evaluate which opportunities are right for you, and protect yourself against threats.
  • Key 2012 Assumptions: We all make assumptions. What are yours? What are they based on? Just because you think something is true (or want it to be true) doesn’t make it so. What are you going to do to test your assumptions?
  • 2012 Financial Objectives Including Revenue/Profit/Cash/Income: You need to have specific financial objectives on paper that you are committed to. Make sure the appropriate people know what they are—and what their responsibilities for these objectives are. This isn’t about assigning blame. It’s about having measurable goals that help tell you if you’re on track or not.
  • 2012 Top 5 Annual Priorities that will Drive Success: Not everything can (or should) have the same priority. What are your top five priorities? You know the old adage:saying yes to one thing means saying no to another. Having your priorities listed make this much easier.
  • 2012 Top Metrics that will Measure Your Success: How will you know if you’re succeeding this next year? You need measurable benchmarks. Your financial objectives (above) will definitely be part of this, but you will want to include other measurable items, such as number of new customers, percentage of market share, or customer service ranking.

What else do you include in your annual planning?