There is so much heavy lifting and energy invested in developing annual strategic business plan and then getting it out into the world that it’s easy to exhale and let the plan run its course.
This is an enormous mistake that can devastate your business.
And this is why implementing a mid-year business review is an imperative for all businesses, regardless of size. An annual business plan must be treated like a living, breathing organism that requires caretaking.
Rarely is the road to success straight as an arrow and clear of obstacles; the road will wind and collapse, trees will fall across it, unexpected, massive rainfall will wash it out, traffic will clog it up, and new side streets and pathways will emerge if one pays attention and thoughtfully deviates from the original path from time to time.
A mid-year business review is a critical part of a plan’s nurturing.
It’s important to remember that every business, every industry, and every market is different. Whether strategic business plan reviews are conducted monthly, quarterly, or annually — or all of the above — creating analysis and adjustment touchpoints that fit your organization’s needs and bake in flexibility is key.
In order to maintain flexibility and team engagement, it’s important to keep the review process manageable. A cumbersome business review regimen could become a bottleneck while an end-of-year business review could be too little, too late. It’s a delicate balance, and achieving it could take some experimentation and trial and error.
For many businesses, taking a step back mid-year to review what’s worked, what failed, and what needs to change moving forward makes the most sense. Where “mid-year” lands could differ from business to business, however; regardless, executing the mid-year review consistently and adjusting accordingly is a hallmark of sound strategy.
A mid-year review should focus on the Key Performance Indicators (KPIs) that measure your organization’s health across a variety of factors. For the most part, however, a mid-year business review should focus on the following areas:
The Human Factor, Inc blog frames the importance of the mid-year review this way: “Keep in mind that the primary goal of the mid-year review is to focus on what you can do over the remainder of the calendar year to reach your destination. Too often, when companies fall behind, their primary strategy is to push everything into November and December and hope to end the year with a bang. The further out we look, the more we think we can get done even if we have made no progress to date.”
Breaking down your mid-year review findings into measurable actions that are designed to reap rewards across the remaining six months of the year is critical. This is the whole point of the middle of the year reflection: To make the most of the final two quarters. The worst error when it comes to mid-year results analysis is inaction or procrastination.
There are five primary determinants to the successful execution of a mid-year business review: (1) Preparation; (2) Presentation; (3) Transparency; (4) Collaboration; and (5) Follow-up. Let’s take a quick look at each determining factor.
In a recent blog for Entrepreneur, guest contributor Tim Berry wrote, “You have to realize your business plan is wrong. All business plans are wrong. Plans are about the future — and nobody gets the future right very often, so keep the plan fresh and watch closely as reality moves forward. A planning process constantly watches the difference between the plan and actual results. Reality swallows our assumptions and we need to keep track of where, why, and how we were wrong. This kind of tracking becomes the key to management.”
The process of business planning never, ever ends. Managing a business never ends. Market conditions never stay the same and every business plan is simply wrong or outdated or both every week, month, and year.
Perhaps it’s helpful to look at the mid-year business review through a fresh lens: There is no business plan; there is just an unending procession of fleeting tides to success. Successfully riding these temporary waves to shore requires agility, perseverance, and the willingness to head back out into the surf in search of new waves to carry your business forward. There is no static business plan; there is only the skillful adjustment to constant change.
In a recent Forbes article, contributor Bill Conerly sums up the importance of the mid-year review: “Every business plan reflects a tension between planning and flexibility. ‘Plan your work — work your plan’ is famous advice from Norman Vincent Peale. The wisdom is illustrated by the many failures due to ‘chasing rabbits’ or being distracted by things crossing the desk. However, slavish devotion to a plan may cause missed opportunities or even fatal pursuit of a flawed strategy. So business leaders need to find the balance...Don’t be a slave to the plan, but don’t ignore it. When a new opportunity or threat arises, deliberately consider how that relates to the overall plan.”
As exhausting and overwhelming as that sounds, it’s reality; the sooner you and your team accept it, the better. Creating an annual, strategic business plan and executing a mid-year business review to adjust to changing conditions is critical to the health and sustainability of your business.
Creating a strong, strategic business plan and executing on it consistently is a sign of a maturing organization. Investing time to stop, reflect, and conduct a mid-year business review amidst a frenetic fiscal year is maturity becoming wisdom.
All businesses can create an annual strategic business plan. Some businesses execute it consistently. And only a handful are adept at monitoring the plan and adjusting it to throttle losses and amplify wins.
Boardview offers some interesting business planning statistics to consider:
Businesses that succeed and grow don’t just execute consistently, they execute thoughtfully, adjusting the plan and reallocating resources to overcome new market challenges and capitalize on emerging opportunities.
So many businesses and executives achieve two important and hard-won milestones — creating an annual plan and executing it — only to fail when it comes to being agile in the face of the unexpected.
“Adaptability is about the powerful difference between adapting to cope and adapting to win,” according to behavioral strategist Max McKeown.
Stop coping and start winning by executing a strong mid-year business review process. Adaptation is the name of the game.