Business Review Time: 4 Steps to Success!
Can you believe we are already well into February? I have just started writing 2015 on things and nearly two months are already gone. That is exactly how an entire year can go by without creating a business plan for the year. One day you realize it is December and that you have spent the entire year just reacting to the market instead of proactively planning how to grow your business. Don’t panic yet… the good news is that it is only February. Check out my 4 step business review to ensure you're on the right path all year long.
1) Review
Unlocking a business opportunity in 2015 will take planning and action, however any worthwhile action plan begins with a review of where you are and how you got there. As you gather materials for filing your business taxes for 2014, review your expense receipts and your income to remind you of all you did last year. Think about what worked well for the business and what did not work so well. Remind yourself of how you generated income and consider why those clients chose to do business with you. It is also a time to consider what expenses might have been avoided. Tax time can be very enlightening!
2) Become Intentional
Many times as we struggle to keep up with the pace of our business today because we end up reacting to the “crisis of the day” or responding to potential opportunities that pop up. Each day we show up to accomplish our to-do list only to be distracted by the small activities that keep you from accomplishing what you need to do: make a profit. We all need to identify what specific activities make the most profit for the business and fight to keep that as your main focus each day! Your business review should have provided you with a good idea of where you make the most money and what made that happen in the past. Then you need to concentrate on doing that every day! Some “important” things may have to wait until after hours or on the weekend. We need to devote our business day to focusing on what makes a profit (not just sales) for the company. Decide right now to focus on what you know is important and not to be sidetracked by the activities of the day. That is being intentional about your day, your plan, and your business success.
3) Determine your SWOT
SWOT is a common business analysis to determine your Strengths, Weaknesses, Opportunities and Threats.
Do you know what your strengths and weaknesses are?
Mostly you know pretty clearly what you do well and what you struggle with, so if you can spend more time doing what you really do well, the path may be that much more productive. However that means you might have to delegate some of the tasks you don’t do so well to others! For me personally it has always been bookkeeping. I knew how to do it, but I didn’t particularly enjoy that task. So I found a company that performed accounting services for small companies. Yes I had to pay for the service however, it freed up a significant amount of time for me to bring in sales, which more than paid for the services! Getting to know your strengths and working to strengthen your weakness sounds pretty simple, but it requires being intentional to make progress!
To complete this analysis of your business you also need to look around you for opportunities that you might have missed, and what threats may be on the horizon:
If you step back from your business and take a look at what has changed since you started, you might discover that there is opportunity that has sprung up that you didn’t see before. Maybe it is just contacting your past customers to ask them if they need your product or service again! They have already done business with you and so they are the warmest potential that you have. Additionally, you need to take a fresh look at any threats that might negatively affect your business. Has legislation changed? Are there any new products on the market that might affect your business? Just ask Blockbuster what happened when Netflix entered the market. It is critical for every business to step back from the daily grind and look around. You have to really see what is happening around you and take the time to consider what might make you more money, and what might take your business out of business.
Remember, a SWOT analysis does not have to be long and involved. It must be done thoroughly and thoughtfully. Be honest with yourself, make a plan and then put your plan into action.
4) Mentors & Advisors
When you have reviewed your business, understood how it works, where you make the most profit, and completed a SWOT analysis, then it is time to get input from others. I am not talking about all the relatives who love you the most, telling you what you want to hear. I do mean finding an outside person that will tell you the truth about your plan and take the time to evaluate your ideas. There are many local support organizations like SCORE and the Small Business Development Centers who provide free coaching. Visit one of those organizations and ask for guidance. They also offer low cost seminars in a variety of topics that might help you strengthen any weakness you might have uncovered. Consider asking a local entrepreneur that you admire to grab a cup of coffee with you and ask for their advice. Establishing a group of advisors or attracting a mentor is an easy way to get quick feedback on an idea or a strategy before you implement it. Who knows, they may need your advice too!
It is a new year and this is a perfect time to do a business review and a personal review of your strengths and weaknesses. This process will uncover the areas of focus and identify the skills you need to polish. It is a critical step in forming your action plan, which I will discuss on this blog next month.
Until next time…