Where is my business heading?
Content provided by Sanlam. See Financial Solutions for Business Owners, for tailormade financial advice.
As business owners we are often so busy working in the business that we fail to work on the business. We are chasing the next transaction, dealing with a dissatisfied client, negotiating terms with a provider, or having problems trying to balance the cash flow.
Over the years I have learnt that one should put aside enough time to consider the business’ current results and where it is heading.
Benjamin Franklin was one of the founding fathers of the United States. Franklin, a renowned polymath and also a leading author, printer, political theorist, politician, postmaster, scientist, inventor, civic activist, statesman and diplomat once said that, if you “fail to plan, you plan to fail”.
In the modern idiom – we need the GPS coordinates to indicate the direction of future action.
There are three elements that need attention:
1. The Vision of my business – one productive method I use to help with this, is to ask:
“Within the next five years (the name of your business) will ………………………………… (articulate what you wish to achieve).”
Here is an example of a vision using these principles: “Within the next five years ABC Solar will be the leading provider of eco-friendly energy solutions for households in South Africa.”
Remember to measure your ‘new’ vision against the existing one.
2. The Mission of my business – a mission should answer the following questions:
- Who are we?
- What do we do?
- How do we do it?
- Whom do we do it for?
- Does the mission fit in with the vision of my business?
Here is an example that links up with the ‘vision’ example above: “At ABC Solar we install eco-friendly energy solutions that keep track with the individually assessed energy requirements of our residential clients and that meet the generally accepted ISO standards.”
3. The goals of my business – For me, goals are the building blocks of success.
It may sound complicated, but it is simple to formulate goals if you apply the SMART principles:
- Specific – right to the point
- Measurable – nothing audacious
- Appropriate – needs to “speak” to the specific role
- Result or process goal – a “result-related” goal points to an end goal and a “process” goal to a continuous event – see the examples below
- Time framed – has an end date by which the achievement should be reached
- Start with a verb – action orientated
Examples of goals:
- Realise a profit of R2,5 million by 28/02/2016 (result goal)
- Develop 2 new product lines by 31/12/2016 (result goal)
- Establish a new distribution channel by 30/09/2016 (result goal)
- Identify 1 new way of marketing and selling my value proposition every month (process goal)
- Do a monthly client service evaluation (process goal)
- Identify 2 new clients by 31/10/2015 (result goal)
Note: Ensure that goals are created for all business areas.
I can't change the direction of the wind, but I can adjust my sails to always reach my destination. (Jimmy Dean – USA businessman)
To support business owners with the important task of business planning, Sanlam gives you free access to the book Your Annual Business Game Plan for Success, which provides an easy and straightforward framework needed to draft a well-crafted game plan that will create the positive change and growth necessary for business success. Go to www.sanlam.co.za/gameplan to download your free copy.
Article written by Jannie Rossouw, Head: Sanlam Business Market
Copyright © Sanlam, 2016