Wednesday, 8 January 2014

Happy New Year

Here it is, 2014, and we’re already over a week in. So, did you make any New Year’s resolutions this year?  After the excesses of Christmas it is the obvious time to take a look at your life and resolve to do something different in order to make life better, a new start I suppose.  So what was it? Healthier diet?  Drink less? Exercise more?  And how are you doing?  Still going strong? Or fallen at the first hurdle?

Now whether you’re doing well or whether you only managed to stick to your resolution for 3 days, that’s still 3 days more than you would have managed had you not resolved to make the change in the first place.  It’s always good to have aims and targets as, even if you don’t achieve them, you will do better than if you’re not aiming for anything.
This isn’t just true in your personal life, it’s also true in your business.  It is good practice to take time out on a regular basis to objectively look at your business.  What are you doing that is working well?  Could you do it more?  Or better?  What isn’t working so well?  Is this something you could stop doing?  Or something you could improve?  It’s when you take a step back from your business, away from the hectic day to day running, that you can see clearly where the business is going and whether it’s going where you want to go.
When I worked as part of the management team for a medium sized company, as a team we would annually take the time to meet together, away from the business, and look strategically at how to move the business forward.  The best question, in my opinion, is, “If we were starting again today, what would this business look like?”.   Now, in order to answer this question properly, you will need some information from your business. For example, do you know which is the most profitable area of your business?  Do different areas of your business carry different levels of risk?  Are there any costs which could be easily eliminated?  Are you wasting money on any of your overheads?  Although don’t forget to consider what you do and don’t like doing.
Once you know what your business would ideally look like, the next question is, “How do we make get there?”.  This is your opportunity to make a plan.  It needs to be clear, achievable and measureable.  Do you remember that business plan you wrote when you first started your business?  Well, why not dust it off and give it a read?  How have you performed compared to your original plan?  You may even find there are some pearls of wisdom in there that you had forgotten all about, maybe something you could implement in 2014.  Could you update your business plan?  What do want your business to look like in 12 months, 5 years or even 10 years?  As an accountant I always find the numbers really easy to work with, but it’s also important to set out how you will achieve the numbers you’re aiming for.
But this isn’t the end of the exercise.  The next step is to block some time out in your diary, maybe in 3 months, 6 months or 12 months, so that you can review your plan and make sure that you’re still on track.  You may or may not achieve your business goals, but by making a plan you will have achieved more than if you hadn’t.
The saying is true, if you fail to plan, you plan to fail!

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