PKF Francis Aickin Limited, Far North, New Zealand
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30 Jan 2020
Even though 2020 is only 4 weeks old, I have already seen a number of new businesses being set up. There is no shortage of businesses changing hands or people setting up new initiatives.
Whether you are new to business, or an old-hand you should have a plan of what you would like your business to achieve over the next year or so. These goals will undoubtedly include some financial targets, but should also include personal goals, such as working less hours, spending more time with family.
This is the first part of strategic planning. Don’t get scared off by the jargon, it is simply knowing what you want to achieve and developing some ideas of how you want to get there.
When you leave the house in the morning, you normally have an idea of where you want to head to. If you are organised, you have a good idea of how you are going to get there, and if you are really organised, you might have a detailed map.
If you don’t know where you want to go, you can wander around aimlessly taking in the views, and possibly end up in the middle of nowhere, or perhaps just back where you started.
Operating a business follows the same principles. If you have no idea where you want to head, why is it surprising that you don’t get anywhere and seem to go around in circles.
When you are setting goals, you need to be specific which will help you identify when you have achieved it. For example, “I want to increase sales” is too vague. A better goal is “I want to increase sales by 10%”. This way you’ll be able to celebrate when you have hit the target.
Make the goal challenging but realistic. Achieving a goal is like scoring a try or netting the 10kg snapper, it makes you feel good. Make your goals achievable and once achieved, it will motivate you to go forward to the next goal.
But you must set deadlines. Otherwise you will just try and get around to it, perhaps tomorrow, but unfortunately tomorrow never comes. If you don’t set a deadline to achieve things, don’t be surprised when you get to the same time next year and realised nothing has been achieved.
The hard thing is that it takes time, especially when you’re already too busy working in your business. Solve this by diarising a meeting with yourself, your partner or your business adviser.
Using another person helps the process a lot. Not only does it force you to commit to the meetings, it also provides someone who you can bounce ideas off.
A person external to the business can help by seeing the obvious, as when you are working in the business it can be difficult to see the woods for the trees. They may also be able to offer different ideas from their own experiences. One of the things I love about accountancy is that you get to work with many business owners, and you learn something new from all of them. For that reason, an enthusiastic business accountant is a good person to use as a planning companion.
Now you have set your goals, you must monitor your progress. Surely you can spare just one hour a month (less than 2 working days over the year) to reflect on what you have achieved to date, how you are progressing against your goals, and what you need to do next month to help progress further.
If you don’t take the time to plan where you want your business to go, don’t complain when it doesn’t get there.
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