Smallbizlady: Why does planning even matter in today’s fast-paced world? Can’t I skip it and just start working hard?
Laura Posey: You can always work harder, but don’t you want to work to live instead of living to work? Don’t you want to enjoy the fruits of your labors?
That’s what having a plan does. It gives you focus and direction so you take the shortest path to your highest vision and goals. A plan tells you definitively what to say “yes!” to and what to skip.
Let’s face it, running a successful business is really just about making the right decisions every single day. A solid strategy (or strategic plan) helps you make the most profitable decisions with the least energy.
Smallbizlady: What are the keys to doing a strategic plan the right way?
Laura Posey: The first key is to keep it simple. You don’t have the time to create a huge, in-depth plan and you certainly don’t have time to use it. Who wants to sift through a giant three-ring binder trying to figure out what to do? You need something you can use every single day that fits into your busy life. That’s why we recommend doing it all on a single sheet of paper.
The second key is what we call “backwards planning”. Most people start their planning by looking at last year and then adding a little bit more to this year to get their goals. For example, if you made $50k last year you might thing 10% is a good growth goal and shoot for $55k this year. But that severely limits your growth because you aren’t getting creative. You are just doing more of what you’ve always done. If you want to grow BIG, you have to start with your ultimate business in mind and plan backwards to what you need to do today to move towards that. I’ve seen company grow 50-100% a year using backward planning.
The third key is to use your gut. Trust your intuition to help you set goals and know the right thing to do. Building a plan using your intuition (the smart part of your brain) is much more powerful than using just logic.
Smallbizlady: How do you know what to put in a strategic plan?
Laura Posey: There are five basic parts to a simple strategic plan.
The first is to establish your foundation on which the business is built. That is your values and your vision.
Next you look at your long term targets which are about 3-5 years from now but in alignment with your vision.
Then you start looking at the next twelve months. What do you need to accomplish in the short term to move significantly towards your vision?
Of course, you will want some measurement or metrics in place so you know whether you are on or off track for your goals.
Finally, you want to have an annual theme that keeps you focused and motivated.
All of this fits on a single sheet of paper if you keep it simple.
Smallbizlady: How do you figure out your values?
Laura Posey: Your values are the guidelines for behavior in your company. They are part of the foundation for making decisions. Ask yourself, what are the rules I want to live by for my company? What kinds of behaviors do I want to see in my employees? If you had to write a list of commandments for your business, what would they be?
For example, our values are spelled out by the word “WORTH”. We believe in “Wholeness” – you can’t be one thing at home and another at work. You have to be your authentic self. “Opportunity” – we see opportunity in every situation and strive to maximize it, even if the opportunity is just to learn what not to do next time. “Relationships” – these are the reason we are here and we work every day to improve our relationships with clients, each other, our vendors and our community. “Truth” – we always tell the truth even if it means losing a customer. “Habits” – we believe habits are the key to success. Good habits = a well-run and profitable business.
Smallbizlady: How do you figure out your vision for your company?
Laura Posey: Your vision is the picture of the best company you could possibly imagine building. Ask yourself, in my perfect business, what do I want to have accomplished? What do I want to be doing day to day? How much do I want to earn? How much do I want to give?
For example, in my vision for my company we are generating $12million per year (there is no reason for that number, I just picked it because I liked it). We give back 10% of everything we earn to animal rescue organizations to end euthanasia. Laura can work from anywhere in the world with an Internet connection and she has no more than five people reporting to her at any time.
Get very, very specific with your vision. Remember, the pictures you have in your mind today are the pictures you’ll have in your scrapbook tomorrow.
Smallbizlady: How do I figure out the long term?
Laura Posey: Think about how far along you will need to be in the next three years in order to be on target for hitting your vision? What are some milestones that you will want to have accomplished in three years? Choose 3-5 that are meaningful to you and that are in alignment with your vision.
For example, if you want to ultimately earn $250,000 per year, and you are currently earning $50k, you might want to be at $125k in 3 years. That’s a big stretch but totally doable if you focus and make good decisions.
Smallbizlady: How do I figure out the short term?
Laura Posey: This is where the rubber meets the road. This is where you choose the five goals you want to achieve in the next twelve months. Remember, they must be in alignment with your vision.
You might want to choose revenue and profit goals but also consider other things such as staffing or number of client goals. Maybe you have an education goal or even a goal to get some office space. Just choose the five things that are MOST important to move you closer to your vision.
Smallbizlady: You said I need some measurement? How do I decide what I am supposed to measure?
Laura Posey: There are a million things you can measure in a business but there are only a few that really keep your focused on your goals. Choose the five things you will measure on a weekly basis to tell you if you are on or off track for your short term goals.
For example, if you have a revenue goal, you might choose to measure total revenue each week. If you make small sales on a regular basis, that’s a good measurement. But if you make big sales every few weeks, you might want to measure number of sales appointments each week. That way you know you’re doing the activity necessary to hit your goals.
One tip here – graph your measurements each week. We process pictures 66,000 times faster than numbers so seeing your progress in a visual is really, really motivating.
Smallbizlady: What is a theme and why do I need one?
Laura Posey: A theme is just a word or short phrase that becomes a mantra or touchstone for you. It keeps you focused and motivated. It reminds you of the most important thing for the year.
For example, my theme this year is “Deliberate”. I have a tendency to switch gears too fast and not think things all the way through. It drives my team nuts. This year I remind myself continuously to be deliberate in my decisions, to slow down and look at things from all angles. This has been my most effective year as a result.
Smallbizlady: If you had to pick the “secret sauce”, that is, why this planning works so well, what would you say it is?
Laura Posey: I’m a big fan of what we call “areas of focus”. Instead of just breaking your goals down into small bits, we look at what areas of your business do you need to focus on and change in order to hit your goals.
The old way of looking at goals is to take your annual goal and break it into weekly goals, right? So, if you want to make $100k per year, you need to earn $1923 per week to hit that goal. But that doesn’t tell you what you need to do it hit that goal. It’s never a matter of just working harder, doing more of the same.
Instead, think about the areas of your business that you need to invest time, money or other resources in to accomplish that new goal. Do you need to improve your sales process, do better marketing, improve your staffing or open a new location?
Once you have these areas of focus you can chunk them down into projects and the project into goals. For example, if you need to improve marketing, you might have projects like building a new website, learning how to use Twitter to get leads or creating a marketing plan. Once you have the projects, you can create tasks that will change you company and ensure you hit your goals.
Smallbizlady: Once I have a plan, how to use it?
Laura Posey: I recommend you read your plan every day. It keeps you focused on doing the right things and subconsciously reinforces your goals. Doing this taps into your brain’s deepest creative centers and gives you the answers to how you will achieve what you want.
Use your plan to make your decisions. When faced with a new opportunity, ask yourself, “Is this in alignment with my values? Is this moving me significantly closer to my vision?” If the answer is “yes” to both, then do it. If the answer is “no” to either, don’t touch it.
You can use your project and task plans to help you know what to do each and every day to get your goals done.
Smallbizlady: Can you give some examples of plans that have worked well?
Laura Posey: One of my clients, Garret, used to struggle to stay focused. He wasted tens of thousands of dollars on bad marketing and poor hiring decisions. He was working 60+ hours a week and barely making a living.
After doing a plan, he grew 65% in his first year and paid off all of his debt. He says it happened because he was able to make better, faster decisions that lined up with his annual goals and long term vision. He said “no” to everything that wasn’t in his plan.
In three years he grew 400% and now works part-time while his staff runs the business. He spends his spare time as a volunteer firefighter and rescue dog trainer.
You can download our one-page business builder blueprint he used at http://simplesuccessplans.com/lm/blueprint
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