by Dr Greg Chapman
Previous small business best practice benchmarks articles covered the need for a Five Year strategic plan and an annual business financial and operational plan. Obviously important, however, General Truman once said:
Planning is essential but plans are useless
He was of course referring to a battle situation where the enemy has its own plan which is, naturally, to prevent your plan from succeeding. This means that plans must be flexible and responsive to changed circumstance.
The planning process enables you to consider the possible outcomes but not to identify which of the possible outcomes is likely to be the reality. A good planing process will also have identified contingencies.
To achieve success the plan must continually be compared with actual outcomes. Best practice is to have monthly business performance reviews against the plan which will allow the adjustments to the next month’s plan to recover lost ground or take advantage of new opportunities.
Weekly reviews should also be undertaken of those key performance indicators that are relevant to that time frame. In some businesses where operational costs are high, even daily reviews of the relevant activities are necessary.
Without performance reviews, there is no connection between the plan and the outcome.
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Dr Greg Chapman is the Director of Empower Business Solutions and The Australian Business Coaching Club and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success and Price: How You Can Charge More Without Losing Sales.
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