As this year draws to a close and we get ready to ring in the new year, it’s a very good time to develop your plan for the upcoming 12 months so that you hit the ground running in the new year.
The purpose of your Annual Plan is to align your team and everyone in the business around a handful of priorities that, once completed, will move the business closer to achieving its 3–5-year targets and, ultimately, the long-term vision you have for your business.
Your annual plan will provide an inspired focus for your people and will serve as the foundation of each one of your quarterly plans.
There are five steps that you and your team should take to ensure that your annual plan effectively connects your strategy to execution.
Step 1: Reflect on the Last Year
A retrospective view of our past is one of our best sources of insight into how we might want to do things differently in the future.
The basic steps of a retrospective review that I like to follow are:
First, start with collecting data. What are the highs? What are the lows? How did we do with our objectives and key results? What did we complete? What did we not do? Why?
Once you have the data, you can develop some insights. What are your observations, and what are your inferences? What patterns do you see? What do you notice? What surprises you? What do you see that’s missing? What questions do you have?
Then, the third step is to start thinking about ideas. At this point, you’re still talking about possible actions, possible ideas, and possible changes for the future. Things you may want to do in the future based on your observations of the past.
Step 2: Define the Current Landscape
A SWOTT analysis is a useful tool to define the landscape. Evaluate the strengths, weaknesses, opportunities, threats, and trends that relate to our business.
- Rising interest rates
- Recruitment challenges
- Supply chain issues
Each is influencing businesses significantly right now.
Your strengths are your internally competitive capabilities. Weaknesses are your internal liabilities or shortcomings that make you vulnerable.
Trends are the micro & macro trends that might impact the future. They may be as simple as what’s going on in your market, in your geography, in politics, economics, or technology trends.
Step 3: Review Strategy and 3–5 Year Targets
In order to plan for a successful year, you must have a good idea of the strategic direction you are moving in. Where do you want to be in the next 3–5 years and beyond? Because strategic thinking is a process, not an event, you will need to think ahead about how to use this time most effectively. Here are a few strategic decisions you should have nailed down or be working on:
- Core Values
- Core Purpose
- BHAG: Big Hairy Audacious Goal
- Brand promise
You want to figure out where you want to be in the next 3–5 years and beyond. Once you have ideally figured out your long-term view, your vision, and your purpose, you need to set out our three-year targets.
Step 4: Envision a Great Year and Set Your Goals
Before you can start working on the specific details of your annual plan, you need to have a vision of what a great year looks like.
Consider how the business will be different a year from now, how life at work may change, and how you will celebrate your success.
Then, based on your three-year targets, what do you need to be focused on over the next year? What are your annual goals?
Step 5: Determine Your First Quarter Priorities
Now that you have set your annual goals, what are your objectives for the first quarter? What are the 3-5 key actions or results you need to deliver?
Think through people, process, and finance. In order to deliver on this objective, what are the key results I need to have from a people, process, and finance point of view?
Just like the annual plan, the quarterly plan should include 3-5 top priorities that can be achieved in a 90-day period. Most importantly, it must identify who is accountable in your team for ensuring the delivery of each priority.
This is all about the choices you’re making, the things that you’re choosing to do, and the things that you’re choosing to focus on to implement the strategy. Because if you don’t have these priorities clarified, it means that you’re only really going to be working on the urgent all the time. You’re never really going to get to what’s important.
Those first 90 days are a critical time for your business; setting the tone of success and knuckling down for the long haul is a must!
These five steps set out a process for how you move from the highest level of thinking down to the strategy implementation level.
If your past track record shows that you don’t follow through, you might want to add “get a business coach” to your plan.
A coach can help you stay accountable and ensure you deliver on the things you say you want to achieve for your business.
You can book an initial 15-minute call with me at timewithshane.com.