With Christmas fast approaching and – dare I say – your new financial year not that far away; it is important that you take time to ‘come up for air’ and consider planning requirements.
In a separate blog – “Business Planning – Unplugged” I have gone into a fair amount of detail about business planning; the rationale, process, template, etc. So if you don’t have a business plan, please have a gander at this blog.
For those of you that work with an annual business plan, supported with associated budgets – but have not recently undertaken a strategic review – I suggest that as we move closer towards Christmas it will be beneficial to ‘dust down your current business plan’ and take a good look.
The aim of the audit will be:
- To provide an objective assessment of where your business is at in achieving the short and longer term goals stated in the business plan,
- To evaluate how appropriate your business strategies are, and how well you are positioned to execute it.
- Provide the information needed to decide whether a change in strategies is necessary and what changes should be made.
The audit review should assess:
- The current/actual direction of the business, compared to what has been proposed in the business plan (i.e. let’s look at fact as against fiction and take a snapshot on what the company is and is not doing!).
- How well the company is internally aligned to support proposed strategies, including an evaluation on how each functional part of the business is aligned with the goals
- How viable proposed strategies are now – when compared to external market, competitor and financial realities.
- Any strategic risks that may jeopardize your stated goals: e.g. decline in demand for your core product or service; a key person departing to a competitor; un-protected I.P.
- Any need for resource adjustment: the audit will allow you to map your goals to your resources and check for any discrepancies. When there is a mismatch, either the goals need to be realistically adjusted or the resources must be changed.
So pull out your calendar and consider when the 2014/15 Business Plan and budget needs to be in place, ‘owned’ by the wider team, and ready to roll out.
Think about running a strategic audit/review before Christmas with your team. You can then close for the Christmas break with a number of the hard questions asked and the thought processes widened.
Fresh from the break, you can then pull together the team in the New Year to review the audit findings. With a solid platform covering what has actually been happening, you will be able to sensibly brainstorm and revigorate; adjust your operations; and capture a realistic 2014/15 Plan to maximize progress toward the goals.
While I am urging a strategic audit over the next month or two as a basis for developing your 2014/15 plan, clearly the strategic audit is an ongoing process, and one that needs to be visited regularly. Particularly for a small business, periodic strategic audits can mean the difference between a road map that has been updated for success, and a drift into financial struggles caused by a poorly thought-out or outdated plan that doesn’t reflect changing market or internal conditions.