Empower Your Business

Accounting is Just the Beginning

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The Key to Success in Business Planning

I really like the quote from British business guru Sir John Harvey-Jones “Planning is an unnatural process; it is much more fun to do something. The nicest thing about not planning is that failure comes as a complete surprise, rather than being preceded by a period of worry and depression”. This sums up the inherent problem with business planning, which is the difficulty and uncertainty involved in thinking about the future in business beyond a few weeks.

It’s much easier to deal with today’s issues which we can do something about and just drift along from day to day taking each day as it comes. The problem with this approach is twofold:

  • If disaster strikes we will totally unprepared whether another recession or an earthquake:

  • We will still be where we are today a year, 5 or 10 years from now.

The key to success in business planning is to set goals and objectives and this is the single most important thing to understand about the planning process. Without goals we just drift along like flotsam on the tide, carried wherever the currents or winds take us but with a goal or goals we have something to aim for, a defined objective upon which we can focus on reaching. Heard the saying that “If you aim for nothing you’ll hit it with remarkable accuracy every time”. Or the village idiot that throws a dart and then draws the target around the point of the dart after it’s landed?

Not just loose goals, that you carry around in your head, but defined, specific, measurable, attainable (but not too easy), relevant, time bound and most importantly WRITTEN goals. Writing your goals down on has been proven to be the best way to achieve your goals. At Harvard University in the US a survey discovered that in one particular class, 3% of the students had written goals. 10 years later it was found that the net wealth of the 3% was greater than that of the other 97% combined.

Your goal might to retire at a certain age, to double your turnover or profit or to sell your business for a $1m. Whatever your goal, to ensure success you need to make sure you can achieve tangible benefits by achieving the goal, you will be excited if you achieved the goal and that you have a real desire to achieve the goal otherwise it will so much harder.

Having set your goals, the next thing to do is to work out where you are now and secondly, how are you going to bridge the gap between where you are now and where you want to be. I shall cover these next time.

If you need help to set goals in your business contact Nick on 0800 ASK NICK or email nick@abac.co.nz.