I am terrible at New Year’s resolutions. No matter what I resolve to do, I seem to have failed by the second weekend in January.
Planning for the future of your business requires a strategy, a budget and resolve
I’m sure that’s not unusual, and I can prove it. Have you ever been to a fitness club in the first week of January? Every machine is occupied, you can’t find a locker and the parking lot is overflowing. By the end of the month though, it’s just back to the regulars. In fact, I know people who are fitness freaks who resolve to take a little break from working out in January just because they don’t want to fight the crowds.
Now, not working out is a resolution I can get behind.
A couple of years ago, my very smart cousin gave me a piece of advice one New Year’s Eve when a group of us were sitting around talking about our resolutions for the new year. “Don’t make a resolution about something you can’t control,” she said. “You have to be able to achieve it.”
In other words, resolve to work harder, not win the lottery. (Although, that second one is a resolution I could get behind.)
Do you have resolutions? Personal ones? Ones for your business? Have you resolved to use more metal building products in all of your projects? That’s one the folks here at MCN could get behind.
Last month, I talked about strategic plans, which are nothing more than resolutions, but there is a key to making a strategic plan the kind of resolution you can control. The work-harder kind, not the win-the-lottery kind.
The key is simple: budget. It’s one thing to have a strategic plan that lays out goals for your business. And for many small businesses I know, especially family-owned ones, the foundational goal for the business is to identify that amount of income the owner would like to get for that year, whether it’s as a salary or a return on investment. After all, if you spend all year in your business, and hit all the goals you set, but never bring home the bacon that you should, you have wasted your year. So, begin your budgeting process with your personal income goals. From that flows everything from the average margin you need on a job, to the total job cost, to the number and types of leads you need. Because, to hit your personal financial goals, you have to hit those intermediary goals.
It’s like training for a marathon. You can’t run 26.2 miles without doing lots and lots of shorter runs over time. You have to hit those goals before you can accomplish the big goal.
There’s another part of establishing goals and budgeting for businesses that often gets overlooked. You have to share them with your employees. You don’t need to tell them what your personal financial goals are, but how are your employees going to hit any goals if you keep your resolutions secret? These aren’t wishes you make when you blow out candles.
It’s easy to share sales goals. You set up your compensation for your sales people for the year, making sure that when they hit their goals, they’re achieving company strategic goals. But what about your marketing and production people? Do they understand that you need to achieve a certain number of leads every month so the sales people can hit their goals? Do they know that they need to deliver the project on a budget with a certain margin so that you can hit your company financial goals?
Lots of companies don’t do this kind of planning and budgeting process, and even fewer share it with the people who can make your resolutions come true. And even fewer give the resources and accountability to their people that will help you achieve your personal resolutions.
Your business success all begins with your resolutions. But if you never do the next steps— strategic planning, budgeting and employee engagement—you’ll never achieve any of your resolutions. In other words, you’ve made resolutions you can’t control, and you might as well resolve to win the lottery.