Article written by Harry Welby-Cooke (ActionCOACH – Country Partner)
If your year is anything like ours it’s started with a bang. All of a sudden the flood gates seem to have opened and everyone wants to now do everything. Whilst it’s also only the start of March, you may already be looking forward to a break, a holiday or maybe just to find the ‘pause’ button to try and catch up.
Fortunately for most businesses, 1 March 2022 is actually the true start of the year. The financial year for most businesses starts on the first of March and therefore this is the critical time to take stock, refocus and realign before going full speed ahead for the next 12 months (to 28 February 2023). We’ve truly got the benefit of a ‘Tweede Nuwejaar’ (a second new year) and arguably for business, the most important new year.
To help you out I’m going to use the metaphor of driving a car. I know you’ll be able to relate and hopefully, it will help compartmentalize your thinking and approach a bit more. We’re going to focus on seven key areas:
- Check your vitals
- Look in the rear view mirror
- Pick a final destination
- Focus mainly on looking through the windscreen at the road ahead
- Glance regularly at your dashboard
- A healthy average speed is important
- Refuel and repeat
1. Check your vitals
Before any long journey in a car, you’d check your vitals. Do you have enough fuel, are your tyres at the correct pressure, are the fluid levels in the engine correct, etc?
In your business, the end of the financial year-end provides those vitals in the form of your financials. Where did we end the year? What was our final turnover, expenses and profit levels? What are the comparisons year on year? What are the key ratios telling us? Where are we in respect of stock, debtors, creditors? Budgeted versus actual. Income statement, cashflow statement, and balance sheet.
Information is your friend. If you don’t know your vitals, how do you know what to top up? Know your vitals, even if they’re not perfect, and you’ve got the comfort of knowing what to focus on and prioritize versus what is okay for now.
2. Look in the rear view mirror
The smallest glass in your car is often the rear view mirror and the side mirrors. Whilst they’re not your main focus when driving, and definitely not the biggest, they are important focus areas.
Review the past year. What worked? Did we celebrate our success? Are we even aware of it? Is our team? What didn’t work? What lessons were there? What challenges did we overcome and what challenges are we yet to overcome? Is there anything from last year creeping up on us that we need to be aware of or perhaps even avoid taking action?
A client a few weeks ago gave themselves a 6/10 score yet they’d grown by 60%. Interestingly their budget was only 10% so perhaps they should have scored themselves an 11/10. Perspective, true perspective, only comes from a proper review of the past.
3. Pick a final destination
Most important journeys in a car start with a final destination in mind. Even when I trick the family into a road trip to ‘nowhere’, I normally still have an idea where I’d like to end up.
For your business, what is the final destination for this next financial year? Is there a longer, multi-year destination and is this one at least taking me closer to the final destination? Is it a destination on its own? Have I unpacked what that destination looks like? Will I know what it looks like when I get there? Have I explored multiple routes to get there? Have I purposefully selected the best one?
Then most importantly, don’t just select the final destination but share it with those on your team – those going on the trip with you. The more clarity there is on the final destination the better. If I know exactly where I’m going, I’ll happily take any detours, deal with any potholes and challenges. If I don’t know the final destination, every little unforeseen bump can derail the journey or sap the energy required to get there.
4. Focus mainly on looking through the windscreen at the road ahead
Once I’ve set the final destination, I focus most of my time looking through the windscreen in front of me. I balance looking straight ahead towards any immediate dangers whilst also lifting my head more to the horizon; to make sure I’m on track and foreseeing any bigger issues early on. I still look in the rear view mirror every now and again just to make sure there are no warning signs. I only briefly get distracted by the radio, cellphone, dashboard, or anything else. My main focus is however always on the road ahead.
For your business, your final destination for the 12 months, broken up into four quarters, 12 monthly cycles, four weeks per month, five working days per week, and then my daily activities need equal attention. Balance what needs to be done today with looking up at the horizon for the long-term prize.
It’s so easy to get distracted, because I’m not focused on the road ahead. So, you get distracted by every little opportunity, struggle, challenge, bright shiny object, new idea, issue, or pretty much anything else. Focus mainly on looking through the windscreen at the road ahead.
5. Regularly glance at your dashboard
If I’ve checked my vitals before my journey started I only need to glance at the dashboard every now and again to make sure everything is still okay. Check speed, distance, and progress but also plan for the next fuel stop by keeping an eye on the gauge, listen out for a flat tyre or dashboard warning light, etc.
For your business, what is your dashboard? What information do you need to make sure you’re on track with but also to ensure you’re pre-warned of any problems? Here a detailed budget is critical. Compare your budget versus actual regularly. Have key performance indicators (KPIs) for all staff? Focusing on leading as well as lagging indicators. It is your business; so you get to decide what’s important for your journey.
Too often we’re trying to run our businesses in the dark and we’re attempting the journey without even the lights on. Your dashboard keeps you in control and gives you critical information before it’s a train smash.
6. A healthy average speed is important
Speeding whilst fun, costs more money in fuel, can be dangerous, has higher wear and tear, requires more energy and attention, and is generally quite taxing on all the systems.
Perhaps fine for the short-term but difficult to sustain over the long-term. Much better to get into a rhythm and maintain a healthy average speed pace.
For your business, think of the tortoise and the hare story. What is the right rhythm for your journey? Do you need to slow down and be more consistent? Is your pace perhaps too slow and therefore your average speed isn’t quite going to get you there on time? Do you then change the destination and time of arrival or speed up? Normally the destination doesn’t change but the route and plan might have to.
No different in your business. More stable and consistent over a long period is often better than short,fast bursts of speed that are expensive and cannot be maintained. Business is a journey.
7. Refuel and repeat
Then my journey to my final destination might require multiple fuel stops. Some may just be for fuel only and may be relatively quick stops. Others might require longer stops for comfort breaks, bathroom visits and substantial meals. At some, I’ll recheck just the minor vitals, whilst at others, I’ll re-check all of them. If I’ve gone off-track, for whatever reason, I’ll also re-evaluate the route and take the necessary corrective action.
For your business, because you know the final destination that becomes the prize. Anything in-between is merely on the way and then no longer in the way. You will need to refuel. You will need to rest. You will need to review and adjust. Then repeat the process all over again.
If all else fails, sign-up with ActionCOACH Business Coach to help you do just this.
Business is relatively simple but it’s not getting easier. In fact, with the complexity increasing every day, my firm belief is that you cannot do this on your own. You’ve been gifted a second chance, a ‘Tweede Nuwejaar’. Use it wisely.