Business is business and many times we forget that we need to stay focused on our financial goals when we are involved with patient care. Steve Pohlit, CPA, MBA, reminds us how to get back on track in his continuing roadmap series. This week he asks us to Stop and Revisit Your Plan. You Do Have A Plan Don’t You?
Reminder: This series is for people running their own business, thinking about going into business or working for someone and wanting to make a valuable contribution to the success of that company. There is a sequence to these reports. For maximum value, please start with Issue 1.
Plans Are Meant To Be Used Which Means They Are Modified As The Passage of Time and New Events Provide More Information.
In the last issue I mentioned I would be addressing how to create your own information site that has the potential for an income flow. I realized that I have not addressed the importance of planning and measuring actual results against plan. This is so important that this issue addresses the planning process.
Plans Are Useless Unless….
The majority of companies doing business today do not plan next week yet alone three to five years from now. This is a mistake in business and it is a mistake if you are not planning your personal life as well. Companies, like people need a clear definition of what, they want and then a plan on how to achieve that.
Proper planning is practical planning. Having said that, most people do not equate stretching their thinking with a practical planning process. As a consultant, I usually have experience with business performance that serves as examples of what is possible. I also have the benefit of knowing what people in other industries are doing that have broader application. As a result, a company that may be planning on a 10% growth rate could realistically be planning on doubling this size of their business in 12 months or less. Actually that is what I find to be practical in many cases.
You will achieve practical targets if they are clearly defined in measurable terms and you have a plan of action with milestones expressed in specific financial terms. For example, let’s say you operate a medical practice with annual revenues of $2 million. In your planning process you conclude your next 12 month goal is $2.5 million. Your plan now must be expressed in terms of what your business must do each month to achieve the $2.5 million goal. Furthermore, you need actual results on a very timely basis that tell you how you are doing against plan.
In one of my first articles in this series I explained the principles of preparing a cash flow and financial flash. Now the beauty of this report is that when you link your $2.5 million plan to this report you actually have a weekly report card on how you are doing against your plan. This all ties together and is very logical. Furthermore the numbers tell the truth as to how you are doing.
Let’s use another example on the personal side. Let’s say you have a goal of losing 20 pounds. Now the very best way of starting this process is to create an image (picture) of a trim, healthy person that is 20 pounds lighter. Maybe you have a picture of yourself as a thinner person or maybe you have to find a picture or two of someone out of a magazine with the physical profile you want. Now I have to tell you, I can cut a picture of Brad Pitt out the magazines and it ain’t gonna happen. That gets back to the practical part of the goal. Once you have this image then you can begin to take action on the things you need to do different in order to accomplish your goal. The scale each week plus the image in the mirror is your progress report. A business is no different: create the image, define it in measurable terms, review the performance on a weekly basis and make adjustments as necessary.
Planning without a clear picture of the intended results and the frequent feedback of actual vs. plan is a waste of time and paper. Now that you know the components of a successful planning process and that this is a fundamental requirement for operating a successful business, it is your responsibility to act.
For those of you that have read this far I have a bonus. This is not part of the lecture on planning. But it is part of the process for achieving your revenue goals. Just last week, I finalized the components of a program I call Local Retail Marketing. Now, I recognize the readers of this information at Diabetes In Control are most likely medical professionals. Let me say this “your business is not different.” Your patients are customers who buy a service and some products and expect value for their time and money. So if you want to build your practice pay attention to the Local Retail Marketing model. To further help you, please do this starting tomorrow morning: when you are updating your patient records, ask them for their email address. Assure them that their address will not be sold, leased, rented, or given to anyone else for any purpose. Start there and then read the content at www.LocalRetailMarketing.com It is very easy to follow and you will be able to understand how this process will help your business. Yes you can do it yourself, but you probably won’t get around to it.
Until the next time,
Be well and prosper
About the Author:
Steve Pohlit is the President of Exec Net Consulting, and the Chairman of the Diabetes In Control Advisory Board. His career includes, more than 10 years experience as a CFO for companies ranging in size from $40 million to $1.6 billion. Steve has owned and operated a chain of drug stores with pharmacies and has developed a number of Internet based businesses. He is currently writing a book titled Consulting Secrets Revealed, which provides all the details of the processes and procedures he implements with his consulting clients. Steve offers an initial complimentary consultation and is available as professional speaker on “Build Cash Profits or Close The Doors”.