Today’s market conditions are anything but “normal.” So, it’s important to take the time this summer to revisit your company’s plan. A comprehensive mid-year review can help determine whether your business is on track or your plan needs some adjustments.
These four pillars will help create a solid foundation for your business plan.
1. Adjust for the present
Your firm must consider its current situation to develop a plan for the rest of the year. This requires a thorough analysis of the marketplace to identify potential risks and opportunities.
Start with the quantitative results from the first half of the year. Evaluating budget-to-actual figures can help determine whether you need to adjust your sales expectations. Performance that differs from the projections you made in December or January may require an adjustment.
Next comes a realistic qualitative assessment of your situation. Many manufacturers are currently reporting labor shortages, increasing costs and delayed deliveries. And there’s mounting concern about increased government regulations, inflation, interest rate hikes and less favorable tax law changes in the second half of the year. Brainstorm with your management team ways to address and hedge against these trends.
2. Evaluate potential opportunities
Predict future growth and profit opportunities based on market trends and the industry outlook. Your management team should suggest innovative ideas to grow the business and operate more efficiently. Examples include:
- Conducting virtual meetings with clients, suppliers and vendors,
- Implementing ways to increase cost efficiency,
- Finding innovative ways to attract new customers,
- Responding to customer and employee input gathered during the pandemic,
- Discussing expansion and creation of products that are easy to sell online.
Based on lessons learned from the pandemic, you might decide to continue remote working arrangements to promote job satisfaction and productivity. Likewise, you might continue to rely more on virtual meetings (for sales, procurement, business acquisitions to help reduce your business travel costs.
3. Address contingencies
The pandemic has taught business owners and managers to expect the unexpected. It’s important to incorporate contingencies into your plan while also positioning your firm for success.
In case your future operations are disrupted, install backup procedures and protocols to protect your business interests. In other words, don’t simply develop “Plan A” mid-year. Come up with “Plan B” and even “Plan C” for worst-case scenarios.
4. Adapt your plan for new developments
After you’ve adapted your mid-year plan for the present, future and contingencies, ask your team, “What’s new?”
Through interactions with customers, lenders and suppliers, members of your management team might have insight into these new aspects:
- Sales or distribution methods,
- Marketing strategies to attract a novel or changing demographics,
- Credit practices to encourage more timely payment,
- Technological innovations that can enhance product quality, streamline production or safeguard data that’s stored electronically.
Business operations need to evolve with the times. Successful firms embrace change. Although business disruptions may bring dark clouds, innovative firms find silver linings that add value over the long run.