Human Resources: Activities, systems, processes, tools required to track and document HR activities – selection, performance development, training, compensation system, and benefits.
Business Plans only work if you keep at it
In many ways, running your business from a plan is similar to keeping fit through regular exercise. We all know its good for us, but keeping up the habit can be a challenge.
And like exercise, keeping your business plan alive and well is easier if its done in small steps rather than trying to tackle every aspect of your business at once.
A big challenge for most business leaders is finding the time to plan. Calendars fill up quickly. One way to ensure you take the time to plan and think about your business is to make an appointment with yourself. Schedule dates to review parts of the plan fairly often, every month or so. Log in and review and update the section or sections that need attention, or that have become a priority for you.
Remember you can edit your plan at any time as events occur and new ideas spring to mind.
We suggest a full review of your plan with your management team each quarter or season. These dates should be scheduled yearly in advance, and placed on everyone’s calendar.
You may want to consider using a coach.
In order to stick with an exercise program, some of us work better with a partner or a coach. This same approach may be necessary for your discipline of business planning.
A business coach can hold you accountable to stay on track with your planning process and also help you work through the various sections of your plan.
Of course, involving your leadership team and employees is the best way to get committed to, and maintain a planning schedule. Once your team is engaged, an internal accountability will kick in. If you are the not the best person in your group to keep the program on schedule, find a process champion in the company who will follow through to keep the rest of the team on task.
A regular business plan work-out will make your company healthy and strong. Hey, you’re doing great, keep it up.
Now that you have completed your narrative business plan, there are three more things to consider to ensure the plan remains relevant and the planning process gains momentum.
Once the action plans are completed, it’s a important to review how you track your progress and how your company is organized.
First, a brief work about Key Performance indicators:
We all like to know how we are doing, from the CEO to the sales team, the service reps or the admin group. The business plan provides the reference point to measure your progress
Take a look at what you are tracking. Is it relevant and meaningful? Look for the activities that drive the business, that have the most impact on results. How are you tracking those activities?
Make a list of these “key performance indictors” and review the list on a regular basis. You will soon learn what is important to your success and what isn’t.
A word about Organization Structure:
As you assign responsibilities for the action plans, questions may arise around how the company is organized and what people or other resources may be needed to get the job done. This is a good time to review your organization chart, and make changes that will support the plan.
Once you are clear about your goals and the action plans, planning future changes to the organization structure is a fairly straight forward task.
One way of doing this is to draw the current org chart, and then a second one that reflects changes you may need to make over the next year.
Even the smallest companies should have an org chart, although the names in the boxes may be repeated because of share responsibilities. It will help you visualize the importance of balancing the need to drive new business concurrent with working on existing projects.
Now, The Final Step:
Schedule your Business Plan quarterly review sessions and put them in the corporate calendar.
Make this information public and stick to the schedule.
I’ve learned that 90 days is the natural cycle for refreshing your plans. Our world is constantly changing. If your plans are left beyond 90 days, clarity turns to confusion and energy starts to be wasted.
Get into a 90 day habit. Each revisit to your working business plan will add more insights. You will soon get very efficient at this work and begin to look forward to it.
In today’s segment I would like to talk about company Values, which is part 2 of your business plan.
Value Statements, we’ve all seen them, typically posted on the walls of the reception area, and elsewhere around the office or plant. So why do companies do this, what purpose do they serve?
A friend of mine calls them the “Rules of the Village”. I like this analogy.
Value statements are most helpful when written in a form that describes key behaviours and attitudes that you require from all employees as a condition of their employment. They are important because they help everyone understand how to “behave” on a day to day basis under any circumstances and changing situations.
As your company evolves, these values influence the culture of the company and add to your overall brand.
Unfortunately, most of these Values documents are written in terms that are vague, unclear, and open to wide interpretation, which is not at all helpful to your employees. And mean nothing to your customers.
At best they are simply ignored or seen as irrelevant. At worst they can lead to conflict within your company, as each employee may have a different interpretation of what is expected of them.
So the key to building a widely understood set of values is being crystal clear what they mean. I also suggest you start with a few, maybe three, that really matter to you, and add as needed over time.
The “Values” section of Plan Genie will help you do this.
Start with a statement about the value, then clarify the value by adding the words, “which means that…..” and add details about specific behaviours or attitudes that people can understand. Think in terms of behaviours that are observable.
Describing values in terms of specific behaviours allows you to easily acknowledge and encourage employees who demonstrate behaviour that is in the company’s interest and to reprimand those that don’t meet your standards.
Here’s a couple of examples:
A value statement may look something like this
AT ABC company our focus is on our customers, or, we are a customer focused company
This statement in it’s own doesn’t mean much. Here’s how you might add clarity:
At ABC company our focus is continually on our customers
Which means that:
- in conversations with our customers, we seek first to understand, then be understood
- we put our customer’s needs first: we will interrupt the task at hand to connect with a customer, and ensure their needs are being understood and addressed
- we use an outside-in perspective – growth comes from looking at opportunity through the eyes of our customers, our partners and alliances
- we see through the eyes of those whose lives we affect, identifying unmet needs and producing innovative and lasting solutions. We bring to this task all our experience and knowledge as the unique individuals we are
Your values don’t need to be complicated. Here’s a simpler version of a value statement:
At ABC company:
- We do what we say we’re going to do. It’s about action, not talk
- We show up on time
- We say please and thank you
Or you may have a value statement about teamwork. You can clarify the term “teamwork” by adding
Which means that:
- When confronted with a problem or new opportunity, our natural instinct is to collaborate with others whenever time and resources allow.
- we support and respect one another
- team success means individual success
Or communication
Which means that :
- we like clear conversations.
Here’s an interesting one I saw recently
AT ABC co we believe Success is a Choice. If you write 4-5 clarifying statements attached to this idea I think you would have a very powerful value statement for you business
There are countless ways of writing your values. Start with a few that resonate with you that reflect how you expect others to behave in your company where these core behaviours will contribute to your long term vision for your company.
Once you have a set of values that you are comfortable with, we suggest you review them from time to time. You will find that the descriptions you use will improve in clarity and understanding with each revision. Publishing a refreshed version from time to time will also keep this aspect of your business plan top-of-mind and relevant for all employees.
Thanks for listening. Please let us know if you have any questions about the Values section of your business plan.
We will review Step 4 of your business plan, completing the detailed action plans.
Step 4 is where you can fully tap into the talent and resources of your employees. The approach you take will depend on the size and structure of your company.
If you are organized around traditional departmental lines, such as marketing, sales, operations, and finance, the action plan format in the workbook will work well for you.
In smaller companies, these departmental responsibilities are shared and individuals may have several roles. However, following the workbook will ensure you cover all areas in a coordinated set of action plans.
Let’s start with something I call Critical Impediments:
Before jumping into the specific action plans, we suggest you spend a few minutes listing your “Critical Impediments”.
This can be done on a corporate level, and in larger companies, by any other organization lines, such as division, department, region, business line, etc.
Try brainstorming without limiting the ideas. This will help “prime the pump” as you begin more focused discussion under each Action Plans section.
The Action Plans section of the Workbook is designed to guide the creation of “to do” lists in all sections of your business.
If you are working with a team, this, again, is where brainstorming techniques work well, and then distil the ideas into a manageable priority list
Notice, the format for documenting the action plans has 4 columns (see Marketing Plan,:
The key to success in executing the plan is to ensure that each activity has a “person responsible” for it’s completion, and a completion target date.
Bear in mind, the person responsible may not be the person who performs all the tasks within that action item, but is the ultimate “owner” of the project, and must report out on the result at the next plan review session.
1st column, Discussion/Action Item – Here you capture a short description of the activity, perhaps with the rationale. You want enough information here to easily pick up the discussion at a late review, but stick to the headlines, not the full story.
2nd column, Person responsible – the individual who is accountable for ensuring the action item is carried out and will report back at the next review period. Remember, this person doesn’t necessarily do the work, but ensures it gets done, calling in any other resources, internally or externally, as needed.
3rd column, Completion date: although we recommend quarterly reviews, not all action items may need to be competed each quarter. As you assess your priorities, and resources, you will find some activities will need to wait until later in the year. It’s better to record the items needed to be done, then defer to a later completion date, than leave them off the list. This is where the “sanity” part kicks in. It’s a huge stress reliever when you see all the work that needs to be done, scheduled over a realistic time frame, that everyone understands.
4th column, Cost – this column can be used to flush out potential capital cost investments or added resources. The intent here is to identify potential cost areas, not to focus on actual numbers. You will find this a helpful tool for budgeting.
Remember, your action plans need to relate to the general strategies listed in the BP summary.
They can be organized directly from the broad strategies list in the BP Summary document, or you can follow the Workbook format, and , each department can create action plans that support the larger strategies listed in the Business Plan summary.
For example, the Sales Manager and sales team will have a major contribution to the marketing and sales plans, but could also have some action items that relate to improved customer service, or financial controls.
Similarly, those working more on the operations side of the business, may have action plans to support the sales or marketing goals of the company.
Needless to say, you want avoid “silo-ing” and keep everyone working collectively towards the corporate goals.
Let’s take a look at the Marketing Plan as an example,
For this work book we distinguish between marketing and sales activities as two different but related processes
Your Marketing Plan is any activity that:
- Builds the company brand, and
- involves communication with your existing clients and new prospects
With the ultimate goal of generating new business opportunities for the company
The Sales Plan addresses all activities, processes, and tools to manage an unqualified lead through to the close of a contract, sale, and beyond, into a long term relationship (these customer for life that we all want)
The workbook is designed to help you target specific goals within each business area, that are meaningful, and practical for each business section, and also support the larger corporate goals.
For example, the marketing plan may have its own 12 month goals:
- increase the number of new leads from x to y (use quantifiable language whenever possible)
- Develop a social media component to our marketing program
- Launch marketing campaign in new region
- ??
Again, there is a thin line between a goal and strategy, the “how to do” it part. Don’t spend a lot of energy on the semantics. The key is creating a “to do” list, select a champion to lead the project, and set a reasonable completion date.
Once you compete this section of your work book, you will have a compete set of action plans that address all aspects of your business.
You also have the tools you need to help everyone understand their contribution to the whole picture, and how their fellow employees are involved in moving the company towards its goals. The stage is set for collaboration between departments, as everyone has a clear picture of what needs to be achieved.
The last step is to consolidate your actions plans into a single list and identify the priorities for the next quarter.
Now return to your work book and draft your action plans for each section of your business.
Today, I want talk about some of the things that keep business owners awake at night.
Let me start by relaying a story I heard a number of years ago from Peter Schutz, the former CEO of Porsche, the German car manufacturer. He told this story to me and a group of CEO’s a number of years ago.
The allies were flying supplies into war torn German airports immediately after the WWII. The weather was abysmal, near zero visibility. The ground crew was able to guide the pilots onto the runway through their crude radar equipment. It required constant communication from the tower to the pilots. Coincidentally they were part of a study and were being monitored for heart rates. As long as the ground crew kept constant and steady contact with the pilots, about the plane’s coordinates, every 10 seconds or so, the pilots remained perfectly calm.
However, if the radio went silent for even the smallest extra delay, the heart rates rose rapidly to extreme levels; a clear indication that when communication stops, or is ineffective and sporadic, trust plummets and stress increases.
How effective are you at communicating the company coordinates to your staff so they can safely land your plane, while remaining calm and under control?
For many CEO’s , the relentless challenge of communicating effectively with employees, business partners, and financial investors is high on their list of stress factors.
How can you improve the communication and trust in your company without spending unproductive time in meetings?
A good place to start is your business plan.
Your narrative business plan is the foundation for effective communication. It provides context and a reference point that allows you to be clear and consistent so others understand your business and how they can contribute to its success.
When your business plan is fully written down and shared, it touches all parts of the organization- marketing, sales, customer service, and finance and helps all employees understand where they fit in and how they can contribute
Revenue without profit is a dangerous thing.
Every business plan has financial targets in the Goals section. How do you feel about sharing financial information? Many business owners are concerned about sharing their financial goals with their employees. A common refrain we hear – “If my employees know how much money the company makes they will expect more. I’ll have a line up at my door of staff looking for a raise.”
My view is that withholding relevant parts of a business plan from employees blocks the communication, and adds to the mistrust.
Lower trust affects the company culture in a negative way, which can be seen in employee behaviour such as absenteeism, higher turnover, dissatisfaction with compensation, and overall lower performance.
Employees want to work for a profitable company. Companies that consistently make money offer job security. Employees can plan their future, buy a house, a car, save for children’s education.
So employees like to know how the company is doing, and equally importantly, they want to know how they can contribute to that success, and therefore, their own future success.
Sharing financial information with employees brings with it a responsibility to educate employees about business fundamentals. For example, employees may not understand what happens to company profits – the need to pay down debt, for capital investment in growth, dividends for shareholder investors, and increased benefits for them. (If we do really well bonus money for the employees.)
This isn’t difficult to do, and only takes a few minutes at a meeting or even in a memo
Let’s talk a bit more about trust.
Trust in a company can be a very powerful force. When I think of trust, I am reminded of a high school physics lesson. Newton’s 3rd Law of Motion: “For every action there is an equal and opposite reaction”. This holds true for trust. In order to get trust we need to give trust, to be trusting.
If you find that sharing financial information with employees is well out of your comfort zone, and preventing you from openly sharing your business plans, you can present your company goals in other terms, such as, increasing our market share from x to y, or expanding our customer base, number of units sold, or any other metric that reflects financial success in your business
The challenge with this approach is that it can be more difficult to connect the relationship between the top line revenue goal and bottom line profit goals. Employees who are striving to reach the revenue goals without the counterbalance of profitability will not have as strong a commitment to cost control
If revenue and profits are clearly connected in their minds, their contribution to creative, cost effective, action plans and other day- to-day problem solving goes way up.
I encourage you to see your business plan as your most important and useful communication tool in engaging your employees and your business partners. Update it regularly and share it frequently and openly with anyone who has a stake in your company’s success.
You will sleep better.
Thanks for listening.
We will look at Step 3 of your Business Plan; gathering some baseline information and documenting where you are now.
This is information about:
Your Customers – who you sell to, who is your target audience
Your Product and Services, and how you charge for these
Your partners, alliances and influencers
And
Your Competitors
Documenting this information in specific and clear terms provides a reference point for the action plans that follow.
For example, your marketing and sales plans start with a clear understanding of your target market, those individuals or companies who will have the greatest need for your product and services.
This may seem obvious, but I find that many organizations do not have this information readily at hand and in a format that everyone in the company can understand
As you review and revise this information on a regular basis, you and your teams will better understand who your best customers are, and what changes you need to make to your products and services to continuously add value for them.
This document will become a useful record as you evolve your business over time.
Let’s start with Your Customers.
The intent here is to clearly articulate the criteria of your target customer. Depending on the size and scope of your business, you may have a relatively short criteria list or it may require a matrix or spread sheet to clearly explain your current situation.
This is a good place to involve a wider circle of employees to put this information together.
The test of this document is when everyone in the company can recognize a potential new customer and know how to categorize a new lead. – and to know who isn’t a likely prospect, so you don’t waste time and effort there.
Next, Products and Services/Pricing,
Look at the array of products and services you currently offer, and how you charge for these.
Again, put this information in a format that is easy to understand, both internally and, more importantly, for your current customers and prospects.
Are there any immediate changes you need to make to your current offerings, or pricing strategy? If so, make a note here and transfer an activity to the action plans section later in your business plan.
By the way, when was the last time you asked your customers about their changing needs?
A disciplined, quarterly review, of your business plan, will keep your service offerings fresh, profitable and ahead of your competitors.
Partners, Alliances, and Influencers.
This section captures important information about the companies and individuals you rely on to run your business and deliver on your promises to your customers. These may be your suppliers, or other service providers who have an impact on your business.
The intent here is to assess these relationships and build more productive ones in the future.
We start by looking at the criteria for a productive partner or business alliance, What do you need from a business partner to ensure successful results?
For example,
- Are their business needs aligned and complementary with yours?
- Are they open to sharing information about clients?
- Do they have the same or similar corporate Values?
What other criteria can you use to identify a solid business partner or alliance to ensure your company is successful?
In this workbook, the distinction between partner and alliance is a matter of degree – a partner is a much stronger connection and usually will have a contractual arrangement
An alliance is less intimate connection, and may be seen as a potential future partner
Influencers are people or organizations that can “influence” potential or existing customers – both in a positive or negative way. It’s helpful to recognize these sources, and from time to time, invest some energy in building these relationships.
A good example of an influencer is your industry association groups and key players within these associations. They also might be opinion leaders in the media, either the traditional media , or social media.
In today’s world of exploding social media, the affect “influencers’ have on your business will surely grow.
Getting clear on who your “Influencers” are, will help you formulate strategies and action plans in the Marketing section later in this workbook
Next, Competitors,
The Competitors section is designed to capture information and bring some attention to your competitors.
Although I am not a big fan of spending a lot of energy or focus on competitors, it is helpful to keep track of who they are, and, over time, learn as much as possible about them and from them.
We start with a simple list of who they are, a somewhat subjective “risk rating” and a comment on what they do better than you do – what do they, or their customers, say is their competitive advantage?
If you have the inclination and resources you can dig into more detailed Business Intelligence data on your competitors over time. Keeping this document current on each review period will remind you to pay close attention to your changing customer needs, and help refine your target market for future growth.
Keep in mind, a competitor, depending on your perspective, may be a potential future partner or alliance.
The intention for this section of your business plan is to document the behaviours and attitudes that form the basis of your corporate culture. These are the “ Rules of the Village”, that everyone follows. Once these rules are clearly understood and supported throughout the company, all employees have a reference point to make independent decisions.
Your company values are another foundation piece of your business plan. All companies and organizations have a set of values, but they are rarely written in a format that is clear and easy for everyone to understand.
The most common flaw with Values Statements in business plans is they are too general, or ambiguous, and, therefore, open to wide interpretation.
To help make your values clear, we suggest for every value statement you make, you add 3-5 clarifying points, to move from the general to specific.
“Less is more” is a good rule of thumb here. 3 or 4 clearly articulated values are far more useful than a page of words that few people understand and therefore pay little attention to.
Now take a crack at writing a Values Page for your company- Again don’t be too concerned about getting it right the first time. This too will get clearer each time you review and update you plan
Note: if you are running an existing business, that is, not a start-up, most of the information you need to write your business plan is likely already contained in various documents in your company. This work book will help you organize this information into a practical tool that you can systematically update over time.
Before you start to complete the workbook, I suggest you gather up all your existing material so you can “cut and paste” some of it into your business plan.
A word about how the workbook is designed.
You have the “working” section where you jot down your thoughts, using the prompting questions to guide you.
This page is followed by a formatted page for you to transfer your ideas into a finished product.
The Genie will produce your Business Plan when you have completed all 4 steps
Step 1, Your Business Plan Summary
You will find this document to be the most useful communication tool available to you in running your business.
It captures the essence of the business, and sets the foundation for planning the details, and
It will give you a deeper understanding of your business
Don’t worry about getting it perfect on the first try.
It may require several versions over time
To put this in perspective, I like the quote from a letter Mark Twain wrote to a friend:
He starts the letter with: “please accept my apologies for the length of this letter. I would have written a shorter one, but I didn’t have time”
Your narrative business plan will get clearer, and shorter, as your return to this document each quarter
As you get started, consider how and when to involve other employees.
We know that employees are much more committed to completing action plans they understand and have a hand in creating.
As a general guideline, Steps 1 and 2, the Business Plan Summary and the Values sections, are leadership responsibilities and should be written by the CEO with assistance from other senior staff.
As you get into Steps 3 and 4 we suggest you involve a wider circle of employees. Your company size and how you are structured will affect how and when you engage the others.
The first two steps need to be written, at least in draft form, by the CEO, with input from the senior executives.
There are a couple of ways of doing this:
2 options
The CEO can prepare a draft document for review and critique by the senior management team
Or
The executive team can create these documents together
From a practical perspective, we find the first method works best, with the CEO outlining his/her aspirations for the business and bringing this to the senior team for critique and changes. A colleague of mine, Doug Bouey, who has been coaching CEO’s for many years, put it this way:
“Presidents have 3 missions:
- set the game
- staff the organization
- keep the edge on
At the top of the house is where these happen. Nowhere else.
The Business Plan Summary contains 5 pieces of useful information. They are:
- What is Your Unique Business Proposition – This is a basic description of your business- who you are, what you do, perhaps where you are, and what is unique, special or different about your company? What are you really good at, your special area of expertise? Why attracted customers come to you in the first place, and why do they return?
Now take a crack at writing your Unique Business Proposition
- What is the Purpose of your business, as seen from the customer’s perspective?
– this is the why of your business, as seen from the customer’s perspective? why you do what you do, what core problem do you solve, or fundamental need do you fulfil for your customers? I invite you to take extra time to think this one through.
This is not about you or your company, such as being the best at this or that, or making money.
It’s about the customer.
If you look in the workbook, I have a couple of examples,
A drill bit company:
Their purpose, “perfect holes every time”, not about great drill bits.
See the distinction? The customer wants perfect holes every time; they don’t much care about how you do that.
The purpose of a bicycle rental business we work with, their purpose , :
“ a unique outdoor experience”, not fabulous bikes, great service, etc
A well written Purpose will inspire your employees, make their work meaningful, and guide their behaviour
The Purpose statement of the bike rental company reads like this:
“Our purpose is to provide our customers with a unique outdoor experience – spectacular scenery, sounds, movement, activity, education, and nature at its best – a sense of well being and a chance to recapture a part of youth that can be shared with family and friends of all ages and physical abilities.
This experience is facilitated and enhanced through our commitment to customer service and quality products “
With that purpose in mind, the young part-time summer staff can get excited about helping tourists and locals alike “enjoy a unique outdoor experience”,
Pontish Yeramyan, CEO of Gap International, wrote in a recent article about being purposeful:
“The 21st Century Organization can also differentiate itself by operating within a bigger context than a vision or mission, something more expansive. It’s not enough anymore to simply have a clear direction – people must be able to throw their entire selves into the game to be successful, with full engagement of heart and mind. We have found that when leaders leverage Purpose, it creates a competitive advantage that’s difficult or even impossible to replicate. Purpose creates the ability for people to care about something much bigger than their personal concerns and fully apply their talent to meaningful endeavours.
If you think about it, Being Purposeful creates the platform for organization success, because it taps into a reservoir of potential energy latent within the organization. When peoples’ orientation to their job transforms from performing work to that of making a difference, they become exponentially more effective at coming together to produce extraordinary results. It becomes possible to consistently produce results beyond what is predictable in the normal flow of business. Powerful strategies can be created and re-created when purpose is present.
Purpose gives people a far more expansive space to create and grow, where creative, purpose-based thinking replaces crisis-based, fire fighting thinking. An organization of people who have connected themselves to something bigger can thrive rather than simply survive –they can move fast together and nimbly adjust strategies and tactics to succeed.”
If you struggle a bit with this, you are not alone. Getting clear about your purpose may take awhile. Talk with your customers. Peter Shutz, a resource speaker for The Executive Committee (TEC) recently reminded us “If you listen closely enough, your customers will explain your business to you”
Now, return to your workbook, and draft a Purpose statement for your business
Next,
- What is Your Destination – this your longer term goal, your picture of success 3 years from now
Be specific, clear, and use quantifiable language as much as possible. Keep it simple and easy to understand, with a limit of 4-5 major results.
Start with your financial goals, one goal for revenue/profit, and one based on improving some aspect of your balance sheet and/or cash flow position
To help you set financial goals, a good place to start is a review of the past 2-5 year numbers, if you have them.
Be realistic in your expectations of future results.
When setting your revenue targets its critical to have the accompanying profit improvement goals. Pushing only for revenue growth, in the absence of profit targets is a recipe for disaster.
We strongly recommend you assess your balance sheet and set a meaningful goal for this part of your business
Other goals may involve changes to your culture, people development, geographic expansion, product innovation, acquisitions, or any goal that would make you happy as the CEO.
Item 4,
- What are Your one year Goals – what do you need to accomplish in the next 12 months? These will be a shorter term version of the items listed under the Destination
And, 5
- What is Your Strategy – how you will achieve these results, in broad terms. We suggest you have at least one strategy for each goal statement above.
Note: goals and strategies may look similar as there is a thin distinction between what is a goal and what is a strategy. Try to identify the 3-5 most important results, put these in the goals and destination sections, and leave the other ideas to the strategy section
Please go to the workbook and complete the Business Plan Summary section now.
In this audio segment, I will explain the 4 steps to writing the business plan.
