Ready, set…plan! For most businesses, a plan that produces action produces results
Funny thing how we all assume we have a plan. Everybody throws the “plan” word around like it just happens. But the plain fact is it doesn’t. Because if we don’t have a plan – a written plan – with specific goals and specific action steps to achieve those goals, we don’t have a plan. We have a wish. I for one am not big on wishing. I like to have a plan that I can check regularly. So even if I don’t achieve the ultimate goal, I’m able to check the progress I’ve made towards it.
There’s a fascinating story from the book “What They Don’t Teach You in the Harvard Business School” by Mark McCormack whereby the author recounts a study conducted on students in the 1979 Harvard MBA program. The students were asked, “Have you set clear, written goals for your future and made plans to accomplish them?” Turns out only 3 percent of the graduates had written goals and plans; 13 percent had goals, but they were not in writing; and a surprising 84 percent had no specific goals at all.
Ten years later, the class members were interviewed again. The 13 percent of the class who had goals were earning, on average, twice as much as the 84 percent who had no goals at all. Moreover, the three percent who had clear, written goals were earning, on average, ten times as much as the other 97 percent put together! Obviously, it’s well worth it to write things down.
So, exactly what’s a plan? Simply put, a plan makes clear what you’re trying to achieve; that is, what your objectives are. How much do your want to grow your company financially in the New Year? How are you going to position your company for growth, e.g., a low-cost provider, or as the high-cost provider who also delivers the best service? Whatever it may be, your objective needs to be clear. You also need to define your targets so once you identify the market you want to grow in, you can determine the clients that you’re going to go after. So right there you basically have an objective of where you want to take your company, exactly what it is you’re selling, and whom you’re planning to sell to.
The next part of your plan is setting goals. The majority of goals need to specifically deliver quantitative results that lead toward the achievement of your overall objective. I talk to many of my clients about SMART goals because I believe in them – and they’re an excellent device for setting goals. SMART goals are:
* Specific. Get right to the point and avoid broad, grandiose wishes.
* Measurable. “A 20 percent increase in existing clients’ total revenue.”
* Agreed upon. Everyone involved agrees that the goal is achievable.
* Resources available. Manpower, marketing, etc., will be made available to help support the achievement of the goal.
* Time dated. A calendar commitment to when the goal will be reached.
Another effective tool when setting goals are Key Performance Indicators (KPI). I call them critical activities. These are measurements that help chart and monitor the progress being made toward the goal. For example, you might set a goal to land 100 new clients. And you might commit to getting ten new clients a month. But, how?
Maybe it’s done through telemarketing work. Consider this scenario: Historically for your organization, it’s been shown that you can generate one appointment for every 30 phone calls made. Moreover, your track record also shows that for every appointment made, “a third” of a client is achieved. Bottom line is, every three appointments produces one new client. If you do the math, you’ll need to generate 9,000 phone calls, or about 750 calls per month. Definitely doable, if you’ve got the right resources. Naturally, the calls need to be followed up by the next critical activity: your proven sales process, and making the close.
So that’s an example of how to go about laying out a plan. A plan that’s, in fact, an action plan. Because that’s the only type of plan I believe in. Naturally, there are plans that offer great reading in the Harvard Business Journal. But when it comes to most small-to-medium sized businesses, a plan that produces action produces results.
So make sure you’ve got a plan this New Year. And see how good things can happen for your business.
That’s Q from the Street.
Anthony Quaranta is the president of Q Group, Hauppauge, N.Y.