Uncertainty remains in every business owner's mind after the shakeup from the financial crisis in mid-2008. Many surviving businesses operate differently today. One thing in common is that everyone was able and willing to change as the crisis occurred. However, following this change, it seems that no one believes in planning anymore.
''If you've spoken to your financial advisor lately, she probably told you to "plan for the worst and hope for the best." If you've been talking with your business coach, you probably were told that "long-term planning does not work anymore." Books like Repositioning by Jack Trout, The Age of the Unthinkable by Joshua Cooper Ramo and How The Mighty Fall by Jim Collins all point out that uncertainty can't be planned for, but we must remain flexible to make the effective change from either the macro or micro crisis we face. But there is still a certain level of planning involved here.
At a recent monthly meeting of the Women Presidents' Organization, 17 businesses all expressed the same concern. Which battle do you pick? Do you spend time on price wars, beating the competition, finding new ways to distribute your products/services, encouraging your sales team, creating new products/services or mounting a new advertising campaign? The answer depends on how and what you think. You can be 1. A pioneer 2. An early adapter 3. A follower or 4. Get left behind. If you want to succeed in business, you don't want to be in the last category. If you want to capture the opportunities, you'd better position yourself in one of the first two categories.
Consider strategic pull marketing and intentional innovation. Both require some planning to get your business in the right place. Look into the following:
Look for problems in your industry. Yes, problems--not solutions. Your team can help you identify the problems. Intentional innovation. Take the problems you identified and do a "mashup"--or combine some new and old solutions. Come up with something innovative for your industry. Build alliances toward pull marketing. Your ultimate goal is to create crowdsourcing for your business. According to The Extreme Future by Dr. James Canton, by 2020, the majority of sales will occur via the internet. Think twice about hiring your next big sales team.
We are successful in business not because we are chaos queens, meaning that we manage chaos well. We are successful because we intuitively know which strategic path to put our business on. If that isn't planning, I'm not sure what it is.
Since I got a big screen GPS in my hybrid, I'm no longer confused about where I'm going. It's easy for me to follow directions and drive with confidence. Your business needs a GPS, too--that is, a road map to help you steer your business. This is strategic planning; it's intentionally moving your business to the next level so you can be equitably compensated by the amount of risk you take to create and build your business.
On your business journey, do the following:
1) Know where you're going. Look deep inside and ask yourself, are you a purpose-driven organization?
2) Set your GPS or CWM (Company Wealth Map). If you don't have one yet, consider creating one. You may want to consult a business advisor.
3) Be proactive, be flexible and be prepared for the following:
3.a) Problems: Listen to what your customer/client is telling you.
3.b) Roadblocks: Let's say your bank pulls your line of credit.
3.c) Weather: You might face an economic downturn, fluctuating interest rates and inflation.
3.d) Gridlock: You could encounter inactivity from businesses, consumers, etc.
You can't plan ahead for everything, but long-term planning is not dead. What is the underlying ROI you ultimately want to walk away from your business with? Without proper planning to get you there, you'll become a chaos queen instead.
Chia-Li Chien, CFP, CRPC, PMP; CFO for Women Entrepreneurs. She is chief strategist of Value Growth Institute dedicated to helping private business owners increase the value of their firms. She is the award-winning author of Show Me The Money and faculty member of American Management Association. Her blog is named a top small business resource by the New York Times. http://valuegrowthinstitute.com
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