Year-end planning - 1
It is getting toward the end of the year and for most of you this involves an annual review of 2007 organizational performance and planning for 2008 and beyond. As you go through your planning process, this year is probably a good one to take extra care. This industry may be heading into tougher times and in these situations good planning becomes even more important.
Before forecasting the future, you need to review past organizational performance. Here the focus should be on “why” not “who”. The goal is not to assign blame (or credit in those good situations), rather the goal is to learn. Why did this work? Why didn’t this? How can we take this knowledge and use it to help us in the future. This should be your goal anytime you review some action. The initial reaction in far too many organizations anytime anything bad happens is to race to assign blame. WHO DID THIS?! This is a significant organizational mistake. Think about it… the organization races to assign blame, the blamed party takes their whipping (whether earned or not), and we all feel better and move on. But what did we learn from the problem? And how will this help stop this mistake, whatever it was, from ever happening again? It won’t.
Anytime I do a re-organization I let people know early on to love problems… to love it when something doesn’t go the way it should. Why? Because there will always be holes in our plans. People will do things we never thought they’d do. As they say, stuff happens. That some problem happens once generally causes me little concern (I often shake my head and drink a couple extra beers but other than that…) As a side note, the same is true in sales. You should teach your employees to love objections, more on that in a later post.
Think of the universe of potential problems your organization may encounter. Each time you encounter one, you have the opportunity to solve that issue. One less potential problem out there! Over time, you will cross off more and more potential problems from this list until pretty much all of the “normal” issues have been addressed. Then you will have a very smooth, well-run organization. Far too many organizations don’t solve these problems when they occur and thus they occur again and again and again… these situations do drive me crazy. As I’ve mentioned before in my posts on the concept of organizational time management (go here for more on this concept), you purchase only so many employee-minutes each and every day. You can use these minutes driving your company forward, achieving goals… or you can spend them dealing with issues that should never have occurred in the first place. I know what my choice would be. In tough times, and this industry may be heading into tougher times, getting the most out of every minute purchased becomes even more important.
But what about your employees? You may find that many of these “whys” lead back to the same “who”. This also tells you something. If many successful “whys” lead back to the same “who”, perhaps you need to examine how to give this person additional resources and responsibilities… i.e. they are a keeper. On the other side, if a lot of problem “whys” come back to the same “who”, perhaps the person needs additional training… or a handshake and good bye.
Also, in the review and forecasting process, don’t practice wishful thinking. We can all collectively lie to ourselves but I don’t see how this helps. This is especially true for owners and senior managers. You cannot make good decisions if your people either can’t or won’t tell you the truth (go here to read more on this). YOU have to be open for this… whether you like what they are saying or not. In fact generally the stuff you don’t want to hear is the stuff you need to hear. Kick the doors down on the status quo. Kick the consensus view out the door. Challenge every thought. Challenge every action. Ensure there is complete agreement in everything your organization plans; remember, something can’t be both big and small at exactly the same time. Ensure complete consistency of thought and action.
Many wholesalers bring me in for their annual planning process just for this. To get an outside view and opinion on their business… to bring a fresh set of eyes and ears to their issues… to have someone with the freedom to question everyone and everything. One of my clients puts it this way…
John Conlin will question every foundation and belief you bring to your business. He will make you support the validity of every business decision you make. He will explore every avenue of every strategy you have. After this exhaustive process, this thinking will become a part of your overall business strategy, and as a result, your business will be on more sound footing.
Next post – more on the planning process