Every January, as consumers, we are bombarded with ‘new year, new you’ messages. The setting of new year resolutions can divide opinion, with some people embracing the idea of a fresh start, whilst others feel they inevitably fail so the only resolution that should be made is to not make any resolutions. Personally, I prefer the ‘back to school’ feel of September and combined with the fact that my focus in January is usually on a client’s year-end, means there is limited time for personal growth.
As I write this, England is in its 3rd lockdown due to Covid-19, and with schools closed once again, a lot of people’s new year resolution will be to just get through the next couple of months. However, for those who are not bogged down with Pythagoras’ theorem or Fronted Adverbials, then I hope this article will provide useful advice on where to focus your business at the start of this new year.
Review the last year
The first step is to take some time to review this last year. Whilst 2020 was not a conventional year for any of us, it is still important to look back because as Maya Angelou said, “If you don’t know where you’ve come from, you don’t know where you’re going.” Questions to consider include –
What were the KPIs for last year and were they achieved? If not, do you know why not?
What changes did you have to make and were they a success?
What worked well and what are you proud of?
What mistakes happened over the last year and what did you learn from them that could help you in this coming year?
Where are you now?
Next, take an honest look at the current situation. As an accountant, I will naturally suggest you look at the financial data, however, it is also important to consider non-financial data such as your subscriber list, customer retention, new customer growth, website traffic, conversion rates, etc to get a good picture of how things are. These non-financial insights will provide context for the financial information, helping to fill in any gaps.
Spend some time looking at the typical day-to-day to see if any activities are taking up too much time and see if they could be streamlined, automated, or outsourced. If you are finding that the same problems keep cropping up, it could be that you need to find someone you can trust to act as a sounding board and help keep you accountable (which is one area where I can help my clients. Please get in touch if you think you need help in this area).
Targets for the year ahead
Spend some time considering what it is that you would like to achieve by this time next year. By setting your focus and intentions, it enables you to work as efficiently as you can in a limited time (which is especially important for those dealing with childcare and other lockdown challenges at the moment). Many goals will be quantitative, such as turnover, or the number of new clients, etc but also consider your qualitative goals such as using ethical suppliers, offering flexible working for staff, and crucially, improving the environmental impact of your business (on this point I can highly recommend Sir David Attenborough’s book ‘A Life on Our Planet’ to give you some thoughts to consider).
Remember to make your objectives SMART and to avoid feeling overwhelmed, break the year down into 3-month blocks, giving each block smaller objectives that come together to achieve the overall goal/s of the business. Assess what processes need to be put in place and what budget needs to be allocated to achieve the objectives.
Once you have outlined your plans for each quarter, and the year overall, ensure the plans are communicated throughout the organisation. Outline expected start and completion dates, with individual KPIs and prioritised actions to avoid any ambiguity. The more widely a plan is communicated, and the greater everyone’s understanding of their role within the plan, the more likely it is to succeed.
The Business plan
Having carried out the above actions now is a good time to update the business plan. Any business plan is never complete, so remember to review your plan regularly to ensure it is still relevant and that you are serving your customers in the way they need now and not when the plan was first drafted.
Planning during times of uncertainty
Whilst everyone is hopeful that 2021 will be a better year than last, there is still a huge amount of uncertainty. Business owners must be prepared to be flexible and continue to adapt in areas such as strategy, technology, and even products, in the same way that was required this last year.
In this article, I outline ways to help protect your finances during the pandemic and if you haven’t already, then I’d strongly recommend you take action, to ensure your finances are in the best shape possible for the coming year.
I believe every business, regardless of size, should have a risk assessment plan in place. This is where a business identifies possible risks or problems before they happen and establishes procedures to mitigate or eliminate potential issues. I recently wrote an article on how to create a risk management plan to help in uncertain times.
Another area to focus on during this challenging time would be forming strong business relationships because when things are difficult, support from peers and partners is invaluable. Consider joining a new networking group to widen your business circles and take some time to connect with existing contacts.
Finally, keeping up to date on news and developments within your industry and the wider market will help reduce blind spots and contextualise your business’ situation. I hope this article has provided some ideas of where to focus as we enter this next year.
As a Portfolio Finance Director, I aim to simplify finance for business owners by tailoring my experience within large corporates to benefit SMEs. I have a passion to help business owners achieve their potential and would love to hear from you to see how I can help your business to thrive.