I'm going to start by making a bold statement, but it's one that I fully believe.
Yet, How many of us actually have a well thought out documented business plan? Now, in my view, a business plan isn't a, a massive 50 or a hundred-page document with different scenarios mapped out and history of the business and all of that side of stuff because I feel that, such a document like that just gets written once often, a highly painful process, and then you just lock it away maybe in a drawer and it just never sees the light of day again.
What I'm talking about creating is a clear, clean-cut plan that fits onto one or two pages of A4. It's got to be easy to read. You must be able to use it to check on your progress with ease and to then be able to adjust for specific short-term targets. That's it simple, and if you're wondering what's the point? then good. But if not, well, I'm going to tell you what the point is anyway. So, I would like to highlight the importance earlier of making your plan work on paper. That's the absolute number one reason. Second, is that what got you to this level likely won't get you to the next. Therefore, you are going into uncharted territory.
So, see point one, right? So, what I'm going to talk you through now is my easy-to-follow process for a strategic plan. And by the way, right, the financials, they're not part of a strategic plan in my view. They come next, they're part two. And you can hear all about that and how to build a robust budget and financial plan in my next episode.
So, back to the strategic plan, right? First things first. What you've got to be able to do is put aside time to ensure that you can't be disturbed and that you can do some really good quality thinking. Now, high quality thinking isn't easy. I know we probably think it should be because yeah, I can think, you know, that's not a problem.
But you need to be able to avoid distractions. High quality thinking needs you to be paying a hundred percent attention. You need to be able to question things in your mind to be able to really focus on decisions and go, am I missing something? is something not feeling right? So, turn off your phone, and or at least put it on silent and at a reach.
Make sure you stop any email notifications. Make sure that you're not going to be disturbed, right? Because if you want to get good quality results, you've got to do some good quality thinking. And that doesn't happen on Facebook, right. Now, the first step. From that point, when you've got that good environment, the first step then is to write down what your personal goals are.
Not business, personal. Because what's important to you and what you really, really want to achieve needs to be in your personal life. That's why you started the business. That's why you are pushing things forward into those next levels, and we often forget that. Now, it might be financially motivated, or it might be the hours that you work, maybe even a combination of the two, or maybe it's something completely else, but you need to focus on what your personal goal is.
Now, you need to consider then what would your business need to look like in order for you to achieve this goal? So, if for example, you wanted to continue to earn a hundred thousand pounds a year, but you wanted to lower your working hours from 50 hours a week down to 30, then what is it that actually needs to change?
So, let's run with that example a bit more, right? If, your business is currently generating, let's say 500,000 pounds worth of sales per year, and that's giving you that a hundred thousand pound that you can. and you realized to step back your hours from 50 to 30 hours, then what you're actually going to have to do is you're going to need to hand off some tasks.
Yeah. You can't, still do everything you do already and do it in less time. Unless you can get somebody else to do those tasks the way you would do them. So that could be something like maybe the marketing, the finances, sales, admin type tasks. But in order to be able to afford to outsource some or all of those, and maybe to hire some internal help, you're going to need some money.
Maybe another 50,000 a year. So, let's say your gross margin is actually 50%. So actually, right in order to get 50,000 pounds worth of income or 50,000 pounds, suppose worth a free profit. In order to pay those, outsource or hired people, you're going to have to make a hundred thousand pounds in sales. Yeah.
Cause a hundred-thousand-pound times 50% of actual delivery costs gives you 50,000 profits. That 50,000 pounds of profit is what then can be used to pay off or pay to offload those tasks.
So, if you're going to outsource say the financials to an expert, as well as the marketing, but then hire maybe a part-time salesperson and a VA, right? That's a big outline of roughly the plan. So generates some more income so that actually you can start offloading and outsourcing and stuff. You can't do everything at the same time. Yeah, you need to work a balance type.
So now we've got that high level sort of view. The next step is then you need to run through a four-step classic process, a SWOT analysis. Now we've probably all done them, probably learnt them in secondary school, high school, whatever you want to call it, right? It's simply a key way to look at. I was going to say business decision, but maybe only any key decision. And if you don't know how it works, here you go. So, versus your overall strategic plan of where you want to, in this case, keep maintain an income of a hundred thousand, but reduce those working hours from 50 hours to 30, then you need to look at the SWOT areas and they are strengths.
What strengths do you or the business have to be able to make your goals happen? Weaknesses. What weaknesses do you or the business have that are going to prevent you from making your goals happen? Opportunities. What opportunities exist within you or the business to make the plan happen? What other opportunities is it going to create. And then threats. Does the plan present any threats? Is there something that could stop it from happening? Now, you really need to take your time to think only consider one area at a time. You can't be thinking, “Oh, I'm thinking strengths and weaknesses all at the same time”. It, it doesn't work, right? Our brains were clever, but realistically we can only think one direction, one area at a time, right?
So go for strengths. List your strengths, and there's an absolute golden nugget question that you should keep asking yourself. And that is, “And what else?”, right? What this does is it gets you below the surface level answers. You know, you start coming up with the first things on your mind and we all go, “Yeah, I've done some thinking, this is great”. No, no, no. That surface levels. It's a gut reaction. You need to keep going. “What else? What else, what else?”. And eventually you'll get down and you'll get to something really key and you'll be going how you hang on. Like there's some real golden nuggets in here, right? So, with that sort of under belt, now you've got to get into some really good quality thinking.
So where is that previous stage it can be done on your own. This little bit of challenge now to make it into a deep-thinking type area. It's much, much easier if you've got another person who knows that their role is to basically challenge you. To challenge you on what you believe to be true regardless of their thoughts, beliefs. It is possible on your own, but in my experience, it's much harder.
So, you've got to take each of these four areas, right? Strengths, weaknesses, opportunities, threats, and you have to challenge why any of these statements are actually true. So why do you believe, for example, that you know a great marketing company and therefore you can outsource your marketing to them. But are they really great? Why? How'd you know? Have you got any proof? Can they achieve the results for you? Do they know your market? Okay. If you believe, then a weakness is that you, for example, know your sales process.
And only you know it, then why is that a weakness? How could you actually eliminate it or at least reduce it? Could you maybe build a process? Maybe you could have a new salesperson come and shout at you for a time, and then that's how the process gets built, or what you simply need to do is put all of your original thoughts inside a pressure cooker and test them. Find out if they were just those surface level answers, and I'm pretty confident you're going to have at least a few of them in there. But that's good. It's this level of thinking that's making the plan work. Because if those were the surface level answers and you weren't testing them and putting them in that pressure cooker, maybe when things got tough, that was the answer that you would've come up with and you would've gone down the route off, and maybe that's the reason that business isn't moving forward.
So, once you've got this SWOT analysis nailed, then you've got to get it down to answers that are well thought out, but now you should be able to reflect on all of this against that original plan. Okay. Does that plan still make sense? Does it need some tweaking? Do you need to add some extra key points or even remove them that aren't possible or no longer relevant? Just sense, check the plan. Does the business plan actually achieve your true personal goals? If you want to spend more time with your family, have you made a plan? That means that won't be the case, not even in the long term, in which case it's the wrong plan. Right? And if not, you're going to have to review that plan. If you want to achieve your personal goals, then your plan needs to make those happen. So, assuming you now have an outline of a plan that is realistic and that it helps you achieve your personal goals, then it's time to get the plan down into steps and a bit of a timeframe.
So, first of all, you need to list all of those steps that, at a high level, need to happen. And in my view, it's best to start with the end, right. So, I believe it works like this, right. You start with, for my goal to happen, then this must have happened before, or it must be in place before. And then for that bit to have happened, this bit must have happened just before that. And then in turn for that to have happened, this must have happened just before that. So, use an example we talked about earlier, right. You know, the hundred-thousand-pound earnings so that you want to remain and keep, but you want to drop your hours from 50 to 30. But it may be that to drop your hours from 50 hours to 30 hours, then those various tasks need to be offloaded to somebody else. But however, in order to do that, you've got to document the process and that's going to require a VA maybe, because you don't have the time to go and document the process.
So, first of all, then what you need to be able to do is generate more income. So, you can hire the VA. So, then you may need to do some more hours, or maybe you've got a new hire, some new staff who can do the actual delivery of those services. But remember here that we are looking at a long-term plan and sometimes there is going to be some short-term pain, right.
Maybe the income will drop a little bit and you might have to go from a hundred thousand to ninety, but actually that enables you to invest maybe and bring a part-time VA on board, and that you can now offload some of those tasks and then you start to win back. So now you've dropped your income by 10%, but maybe you've dropped your hours by ten percent.
But actually, as that VA sort of initiates and gets settled in, then you start to win some of it back. You start to maybe be a bit more efficient, generate some more income, and now your earnings go back up, but your hours stay, reduced by 10%. It's all, that's obviously a very basic, simple answer, but you got the idea. Yeah. And what you can do now is you can split this down into shorter term targets. And they're usually 90-day sprints. So, for example, by the end of the first quarter, we are going to achieve X, Y, and Z. And you've got to make these goals smart. Right? And I don't mean they have to be clever. I mean, they are specific, they're measurable, they're attainable, realistic, and they’re time bound. And you can test this with every goal that you set.
If you created a goal, right, that you just went, “You know what? I'm going to get some help with processes”. That's not a smart goal. But a smart goal could be, “I wish I'm going to hire a VA for 15 hours per week to help me document processes by the 30th of September”. That's a smart plan. It's specific, it's measurable. Like did you actually achieve that 15 hour per week? Maybe, maybe not. Is it attainable? Yeah. Is it realistic? It's not like you're asking somebody to work 75 hours and you want to do it next week. Yeah. And is it time bounded? Yeah. 30th September.
So, it makes sense. But having a great strategic plan like this means that what you are now able to do is check yourself regularly against that plan, and therefore you can make sure that you are actually making progress towards your goals. You've documented what your goals are, you've documented where you are now, effectively, you know what the gap is that you are trying to leap across. And now you can check and go, “Do you know what we've put in the first stepping stone and we've reached the first stepping stone. Now there's only three to go. What's the next step?”.
It's also an absolute great foundation for building a robust financial plan, and that's what I'm going to talk to you about in the next episode.
And we find this in our accountancy business, one of the most popular services that we deliver, because it adds so much logic to a business owner's hectic life. We've all done it. I've certainly been there. You get buzzing around and you're firefighting and reacting, and you're in the day to day, and actually this is just that moment of logic where you sit down, you get to offload all the thoughts and processes that you've got in your head, and you can really map out and go, well, this is what I'm trying to achieve. “Am I actually taking steps towards achieving that?” And if I'm not, then there's a good reason why I'm not achieving that. So, let's create a plan using this guidance and this process. One where we've got experience of delivering numerous times, and actually one where we always get amazing feedback on how it's helped a client to get focused to gain and creating excitement and a buzz about what the future now holds.
And I'm confident if you follow this plan and you go through it and you get somebody maybe to hold you accountable and make sure that there's good quality within it, then you are going to have a great process where you can make amazing achievements and you can make amazing leaps forward. So, schedule some time, go away and have fun creating your strategic plan.
Listen to the Podcast Episode here.
