Many builders approach strategic planning the way some people train for their first marathon: They rush out and buy new shoes and off they go, running every day that first week. The second week they only run twice. And by the third, good intentions turn into distant memories.
Why do so many of our long-range business plans turn out the same way? Most often it’s because we implement these ideas the way we try to run our first marathon. We just grab some shoes and start running without committing to a strategy for reaching our goal.
So how do businessowners turn plans into working practices? I’ve found the following five steps greatly improve your chance for success in implementing long-range objectives and changing your business. These five rules are:
- make it a group effort
- use the coaching method
- start with the end in mind
- establish mini-milestones follow through.
Group effort
No matter what size your business, involving your employees greatly improves your chances of implementing change. Some owners may cringe at the idea, but it’s critical to have your team buy into your plan. I suggest starting with a one- or two-day strategic planning session that at a minimum key managers attend.
A while ago I facilitated a one-day strategic planning session for a custom home builder client and his four key managers. The meeting culminated in identifying all the areas in which the company could improve its operations and in prioritizing these items. The group came up with 17 areas that needed improvement, and decided that over the next year, they could implement the first seven items. The key to keeping the team focused on this goal is in the next four steps.
The coach method
Once you set key objectives for your company, you need to establish a coach and team for each objective. The coach is the owner or leader of the objective and can be anyone on your staff. He or she only needs to be willing to take the lead for that specific goal and, like any good coach, also be willing to take responsibility for failure and to share praise for success with the team.
A secondary benefit of this process is the opportunity for cross training; employees who aren’t involved in one area of your business can become knowledgeable (even if only briefly) as a coach or member of the team responsible for making a change in that area. Another benefit, as our client discovered, is that the businessowner needn’t be a coach for any of the strategic goals. The coaches for all seven goals he established were his four key managers. Our client’s role was merely to monitor the process, just like an owner of a professional sports franchise.
Start with the end in mind
It’s important to establish the finish line. If you don’t set at least a preliminary deadline and outcome, the task may drag on forever and eventually fade away as its importance diminishes to your team. People are very goal oriented. Unless you define what success will look like, the chance of achieving it is small.
In the case of our client, we set a goal to develop written procedures for, and improve the efficiency of, the scheduling process. The coach felt that it would take about six months to accomplish this task and so that was the temporary end date. The coach also established a time and date for the first team meeting.
Establish mini-milestones
At the first team meeting, the group needs to break the long-term project into smaller pieces and establish timelines for them. The next step is to add the mini-milestones together and establish a firm date for the completion of the larger task. Then the group decides who will be responsible for each of the smaller tasks and how often they will need to meet to keep everyone up to date on progress. The coach monitors the progress of the smaller tasks and the owner and coach monitor the progress of the overall strategic objective.
The monitoring process must become a critical part of your weekly staff meetings. The good news is that it’s much easier to hold someone’s feet to the fire when they’ve established their own timelines. In the beginning, you may find it necessary to be more hands-on with this process until you are comfortable that goals are being met consistently.
Luckily for our client, his team grasped the concept quickly and truly took ownership of the key objectives. The team leaders updated the owner weekly, and slowly but surely, when enough mini-milestones were completed, the owner and the teams knew they were going to accomplish their key objectives.
You may be with me so far, but the last step is the difference between theory and practice.
Follow through
The hardest thing about making change within a business is time; most people are already inundated with daily tasks. The time you and your team need to accomplish your goals won’t appear like magic. You have to make these goals a priority. It’s true that change comes easiest from the top. If you don’t make it clear to your team that you expect these goals to be accomplished, what incentive do they have to make a change?
You may want to make the accomplishment of strategic goals a part of every staff member’s job description and discuss strategic objectives during reviews. Some of our clients structure bonuses or profit sharing around the accomplishment of these goals. Remember, they were trying to make these changes to improve their company’s performance, so sharing in some of the rewards was well worth it.
The real key to accomplishing any of these goals is to make this process a part of your company culture and daily routine. If you can accomplish that, process improvement will become a continual part of your company culture.
That is what has happened with our client. Over the last seven months, four of the seven goals have already been met. With little prompting from the owner, four new objectives from the original list of 17 are now underway with new coaches and teams. The owner has had to do little of the work and has seen noted improvements in the company already, and the financial results have been great.
The strategic plan is a key component of the planning process. Without it you can have the best business plan but no way to implement it. Complete the planning circle by working with your team to develop a strategic plan to go along with your personal plan and business plan.
Steve Maltzman, CPA, is president of Steve Maltzman and Associates in Colton, Calif. Visit Steve at www.smacfo.com.
Clarification
The January/February Strictly Business column stated that a contractor should “…always be ahead of the customer and maximize the use of your client’s funds by taking a deposit and front-loading your draw.” The article ommitted the fact that some states have laws that make it illegal to be ahead of the customer, particularly on home improvement contracts. Check with your individual state for the legality of front-loading your draw.
