Many entrepreneurs create a plan for the year, set it on the shelf, and then look at it a year later. Invariably, some of their assumptions are wrong and their goals are unrealized, but they don’t realize it until it’s too late. When you get away each year with your management team to gain perspective and focus ON the business, you probably perform a SWOT analysis (Strengths, Weaknesses, Opportunities, Threats). During this process, it’s critical to “face the reality” of whatever situation your business is in and move from there. If you and your team aren’t brutally honest with each other about the reality of your business situation, the market will be brutally honest with you soon enough, and the consequences will be more severe than if your team was courageous and proactive.
“Don’t begin until you count the cost. For who would begin construction of a building without first getting estimates and then checking to see if there is enough money to pay the bills? Otherwise, you might complete only the foundation before running out of funds. And then how everyone would laugh at you!” (Luke 14:28-29).
Adding one step to your planning process can make the difference between managing the business ahead of the curve or simply reacting to missed results. Add ongoing measurables and assign the task of checking them regularly to yourself or another trusted teammate. If you document your assumptions and track the indicators that monitor them, you can get an “early warning” that they’re no longer valid and make changes to avoid months of missed results.
Without having the team’s assumptions documented, you’ll not likely remember them. Then you’ll be less likely to be able to pinpoint the faulty assumption(s) and adjust the plan for the remainder of the year, given the “new reality.” You’ll also be less likely to have accurate assumptions next year, because you aren’t reviewing assumptions vs. reality. Do you have people that you allow to hold you accountable for creating, monitoring and challenging your business plan assumptions?