The fourth quarter of every fiscal year is a challenge. The competing goals of finishing the current quarter and year out strong while setting up for a successful next quarter and year make for a pressure-filled situation. 

In addition to this inherent duality, most companies encounter other factors that all add up to create a perfect storm: product availability or supply chain challenges, competitive actions, macroeconomic conditions, and holiday vacations, to name a few.

Implementing a simple business planning discipline ensures the team knows What, Who and Where to focus on, as well as the Why and How. 

Surprisingly, some large companies don’t have a consistent process or format for annual strategic planning. That can spell big trouble if someone leaves the organization and takes their institutional knowledge with them.

Not sure why you need a centralized planning discipline? The list of potential benefits is long: 

• Align the entire organization around common objectives and strategies.

• Share common priorities, language, and processes.

• Agree on metrics and performance goals.

• Create a clear line of sight to milestones and deliverables.

• Retain consistency if any key individual leaves the organization. 

• Define a performance “contract” between individuals and their managers.

5-Step Precision Planning Process

Our firm uses a five-step process, which we call the Precision Plan because it precisely identifies the Who, What, When, Where, Why, and How.

Step 1: Assess Your Current State

First, understand your internal and external resources, capacity, and capabilities from both an objective and subjective viewpoint. Ask questions about:

• Company assets 

  • What solutions, people, and investments (sales, marketing, technical) are available? Do we have the right products and solutions for buyers?

  • What gaps need to be filled?

  • Do we have the right team in place with the right future-forward skills?  

• Partner capacity and capability 

  • What roles do / can current partners play?

  • Do we have the right partners, and if not do we have a plan for targeted recruitment?

• Market conditions 

  • What’s going on in the market that has the potential to impact the business (positive or negative)?

  • Do we have a short, mid, and long term play to mitigate negative market conditions?

• Competitors

  • Which competitors are potentially vulnerable?

  • Which existing and emerging competitors do we need to be aware of?

Step 2: Formulate Your Strategic Plan

Next, convene your leadership team to develop a set of shared objectives and strategic priorities. 

When you’re defining priorities, you should agree on:

• Purpose. This is your team’s “why”, and is a rallying point for for everyone to understand the reason you exist.

• Objectives. Objectives answer the specific “what We Will Do”. For example: We will deliver $1M in revenue this fiscal year.

• Strategies. Strategies outline how the objectives will be met. Each objective may have several strategies nested below it. For example, you may decide to target x geography, y industry, or z customer size (thereby defining How and one aspect of Who). Another example strategy could be creating and rolling out one new enablement asset each quarter.

• Tactics. Tactics are the key elements to ensuring the success of each strategy. Tactics would typically include an owner (another who), date (when), and description (what) for each.

• Potential risks and mitigation plans. Identify risks at the executive team level as well as at each cascading level. Of course it’s highly unlikely that anyone can foresee every risk, but each team should list potential risks and develop mitigation strategies for each so they’re not caught completely flat-footed if that scenario emerges. Another advantage to this exercise is that if the need arises, you have plans that have been pre-developed and pre-approved ready to go. We call these Rapid Response plans since they enable immediate response vs. waiting until the stimulus occurs.

• New ideas and innovation. We like to include aspirational goals in every annual plan. How will you stretch, grow, and innovate this year? What are your specific innovation priorities? And how will you reward people who move the company in that direction?

Step 3: Garner Support For Your Plan

These high-level goals and plans will cascade to each group, individual, and partner. Once everyone knows the goals, they can add specificity based on their role. Defining and sharing the goals ensures the entire organization is working from a common set of foundational objectives. 

As you iterate the business plan, share it with internal and external stakeholders. Give each dependent group an opportunity to weigh in with their point of view. 

Sharing your plan transparently builds a sense of shared ownership, allows you to truly understand concerns, and gives you a chance to adjust as needed to secure their commitment before locking down on your plan.

Ask stakeholders for:

• General and specific thoughts.

• What’s missing. What would they add? 

• What risks do they foresee? 

• Do they have the resources to deliver or are there gaps?

• If there are gaps, what resources are needed and how will they be secured?

Step 4: Execute the Plan

This is often the easiest part of the process if the first three steps have been thoroughly completed. In this step, the team will operationalize strategies and tactics, and the organization will follow a disciplined review process to track accountability and progress. 

A few keys to success:

• Over-allocate your budget. Build in a buffer zone wherever you can since the chance of everything running smoothly is slim (see above: market conditions change, competitive situation changes, people change companies, etc).

• Schedule reviews. Get reviews on the calendar ahead of time with all dependent stakeholders so appropriate time is blocked out. To make these sessions valuable, reviews should be action oriented, not a static read-out (which anyone can do on their own). Communicate what will we do, who will do it, when. 

• Make planning a positive part of the year. Don’t make the review process an administrative burden. Make sure the team has actionable information at hand and time to put the plan into action.  

Step 5: Measure and Adjust

To keep your plan “alive” and relevant, you’ll want to know if it’s on track, and adjust as needed. This step is all measuring metrics that support the strategy. 

Check your measurement process by asking about:

• Is there a single, agreed source of data (i.e., one single source of truth vs everyone picking their own data)?

• Is there a single data repository (i.e., tracking is done on a system, not on Excel files, in Word docs, or on the back of envelopes)?

• Do you know the appropriate leading indicators to let you know if you're on the right track — before it’s too late?

• Are you measuring the correct lagging indicators to deliver the results you need?

• Have you built in flexibility? Are you willing to adjust to accommodate changing conditions? You don’t want to change metrics frequently otherwise you risk confusion or worse with a lack of predictability. But you do want to be flexible if the situation warrants. 

Finally, when your business plan is done, consider how you’ll activate it. How can you motivate everyone in your organization to move in the same direction? How can you frame the plan as an exciting roadmap -- not something people are “required” to do?

Keep reading: Case Study: How Kinica-Minolta Implemented a Precision Planning Process