Are You on Target?
Conduct strategic business planning and ask key questions -- especially if your company is missing its year-end goals.
By now, you should know the answer
- By Ken Thoreson
- August 01, 2007
to that question. In fact, with the year's end just a few months away, you really need to know the answer to that question -- and to some related ones, such as:
- Are you achieving your revenue/margin goals?
- Have you increased your number of net new clients?
- Are you achieving your sales quotas?
If you're on track to achieve your goals for 2007, great! If you're coming up short, it's time to stop and conduct an evaluation before you look to the last quarter and begin planning for 2008.
When we conduct strategic business planning with clients, we often create tracking metrics for month-to-month evaluation and graphical trend analysis for quarterly use. (For more on this topic, see my July 2005 column, "Planning for Profit and Growth," available at RCPmag.com.) By measuring your progress against specific objectives, you can begin to gauge your organization's ability to execute.
But before you start measuring, step back and consider these three questions:
- Were your original objectives realistic?
- Did you create plans or programs designed to achieve those objectives?
- If so, how effectively did you execute on those plans?
Let's look at each issue in more depth.
Reality Check: In working with partners, we often find that unrealistic objectives prevented them from hitting their targets. Typically, the objectives were unrealistic because they didn't anticipate adverse "environmental" factors. Such factors might include unfavorable market conditions, vendor offerings that missed market timing or failed to meet market expectations, or internal issues such as having an unqualified sales team or insufficiently trained technical staff.
Here's an example based on that last factor. With the release of a new Microsoft product, you might anticipate that a certain percentage of your client base would want to upgrade. But if you didn't have enough employees trained to use or sell the new product, you'd have missed the market opportunity. In that case, an internal issue is preventing you from reaching an important goal. Keeping such issues in mind is important for developing realistic objectives.
Action Plan: In other cases, entrepreneurs have their visions and goals clearly in mind and understand their environments as well. But they, too, sometimes miss the mark, often because they haven't developed specific action plans.
Successful partners know how to convert their visions and goals into written, tactical, executable programs. They also ensure that all their employees understand the objectives and their own roles in achieving them. In our strategic planning process, we call this "building commitment," and it's also a critical component for hitting your targets.
Effective Execution: In still other situations, companies have realistic goals and excellent plans for achieving them -- but fall short anyway. While environmental reasons could be to blame, we often find that the real problem is management's failure to execute on those excellent marketing and sales plans and other initiatives.
Here's the solution: During strategic planning, these companies should define key milestone dates to review how effectively they're executing their plans and, if necessary, to set new objectives for fine-tuning their course toward their targets. The plan should also build in accountability at every level of the organization, with each phase including solid metrics that define success.
Carefully considering these questions will not only help ensure that you're on target, but greatly increase your chances of hitting a bull's-eye.
Ken Thoreson is managing director of the Acumen Management Group Ltd., a North American consulting organization focused on improving sales management functions within growing and transitional organizations. You can reach him at email@example.com.