By Mitch Rice
Action plans can be created on timelines of any type, from a daily task list to a 30-year retirement plan. This is useful because every objective requires a different amount of time, energy, resources, and effort.
But in business, the quarterly action plan appears to be the most relevant and effective, regardless of the industry or the types of goals in question.
From Etsy stores to chain restaurants and multinational banks, everyone uses the quarterly scheduling to make sense of the business cycle and track key metrics.
The benefits of going “quarter to quarter” are clear, but stepping up and creating quarterly action plans every three months is a challenge in itself. We talked to business leaders who know what a strong action plan looks like, and how to create one that will set a path to victory for every quarter to come.
The Power of a Plan
In all aspects of life, we know that planning is a prerequisite for success. Still, we somehow manage to forget why it’s so important to plan, even in the complex business environment.
Know the benefits of a quarterly plan, and you’ll be more likely to execute with conviction.
“It’s the beginning of another quarter and I am guessing that your quarterly business plan may not be very effectively constructed,” said Business and Executive Coach Dave Schoenbeck. “Most entrepreneurs usually have a strong sense of where they want to take their business, but a tactical plan is not written down or very well defined. The benefit is clear. If you have a clear understanding of what your goal is, and then apply strategies and tactics to accomplish the goal, amazing achievements will be attained. I know because I have helped hundreds of leaders do it.”
Just in case you think your business is exempt from making a quarterly plan, think again! Skip this step and your competitors will be the only ones benefiting.
“I can understand the appeal of ‘winging it’ and going strictly off intuition if you’re a young entrepreneur, and quarterly planning seems a bit over-the-top,” said George Fraguio, Vice President of Vaster. “This is just a sign of stubbornness, of course, because even the most brilliant business ideas need an on-the-ground gameplan to fully develop and thrive. Besides, making a plan gives you that extra confidence and peace of mind you need to succeed.”
No more waiting – now is the time you start forming quarterly action plans and sticking with it!
Look Back on Last Quarter
This is one of those rare cases where it can help to look in the rearview mirror. Reflect on the last quarter to gauge performance in all areas of your business before you form a new plan.
“Wade through the data and piece together a story about the previous quarter to inform your priorities for the next one,” said Katie Lyon, Co-Founder of Allegiance Flag Supply. “This goes beyond just sales, expenses, and obvious issues. A thorough analysis will reveal the true health and functionality of your business and allow you to develop a substantive plan for the future.”
Don’t rely strictly on analytics as you look back on quarters past. Gather qualitative information from team members, clients, and marketing results to get a big-picture perspective.
“At the end of each quarter, you should be meeting with key people in all departments, talking with employees, and following up with clients for direct feedback if possible,” said Ted Toledano, Founder of Modloft. “People have personal goals for themselves and their teams that can’t be conveyed by numbers alone. These qualitative points need to be worked into your action plan as well, because that’s how you make big improvements that impact the bottom line.”
Set Financial Goals and KPIs
At the heart of every quarterly action plan is the financial realities of your company. Get a firm grip on financials so that you can set forth your new initiatives with ambitious yet realistic expectations.
“Because we’re drowning in financial data these days, you really need to be precise and pinpoint the metrics that you believe matter most,” said Ely Khakshouri, CEO of Retrospec. “This could mean whittling down debt or stretching the profit margin by another percentage point. It could also mean cutting out unnecessary expenses or outsourcing certain parts of the business for greater efficiency. The important thing is to be specific and practical.”
High-energy entrepreneurs must remember that growth is not always the main goal in every quarterly plan. Sometimes it’s better to simply stay the course and focus on fundamentals.
“Some quarters are more about expansion and development, while others can be focused on consolidation and playing it safe,” said Max Tuchman, CEO and Co-Founder of SnackMagic. “Both are completely legitimate, and there’s never an exact right or wrong approach. This is the essence of a good quarterly plan, because it requires knowledge of the market, your business, your people, and what is best for the long term. Avoid thinking it needs to be 100% growth and revenue gains every single quarter.”
Plan with Templates and Examples
Not sure where to start with your next (or first) quarterly action plan? It’s totally acceptable to use an existing template to understand best practices and get the gears in motion.
“You can easily find tons of useful templates online to give you an idea of what works,” said Benjamin Meskin, President of Cabrella. “The best part is that you can just fill in the blanks like any other type of form or document. It’s also a good mental exercise and a study in self-reflection about your business. You have to ask yourself tough questions that might otherwise go unasked. The templates may not be perfect, but it’s way better than going into a new quarter without a written plan.”
After a few quarters have passed, you can start to leave the templates behind and map out your own actions plans as you see fit. Every business can (and should) put its own twist on it.
“A lot of these business plan templates are a bit vague and unimaginative, so you need to customize them or use them as inspiration for your own plan,” said Akhilesh Srivastava, Founder and CEO of Fenix Commerce. “Once you figure out the format that fits your business best, stick with it until more changes are required.”
Consider Risks and Disruptions
Risk management is an overarching theme in all business pursuits, and it can’t be overlooked when creating quarterly plans.
“It’s important to be optimistic and infuse your quarterly plan with ambition, but acknowledge the risks that face your business as well,” said Tirzah Shirai, CEO of Blink Bar. “Maybe there are issues with the workforce or the environment of your industry. Competition could be heating up in your niche. Consider all those possibilities and plan out ways to overcome them before they ever show up and cause problems.”
Don’t neglect the possibility of disruptions – small and large – that may hit your business hard when you least expect it. While 2020 is still fresh in mind, proceed with caution and always have contingency plans in place.
“With the disruption we saw with COVID-19, every business should also do a business impact analysis,” said Producer and Marketing Expert Paul Dughi. “It’s important to identify potential disruptions to your business operations and the financial impact that can result. While you couldn’t have predicted the massive disruption to supply chains caused by the coronavirus or the enormous shift to remote working environments, you can measure the impact of other disruptions. For example, what happens if your point-of-sale system goes down for more than a few hours?”
While most risks and disruptions will never occur, you will definitely thank yourself in the future for having a plan and the resources to overcome obstacles.
Follow Up and Improve Next Quarter
Your work as a business owner is never done, and quarterly action plans reflect this reality. Be grateful, however, because there’s always room for improvement and advancement.
“As the years go by, you can look back upon that big stack of quarterly plans and realize how little you knew at the time of their creation,” said Seb Evans, Co-Founder of Banquist. “This is an ego check, for sure. But you also realize how much wisdom you gain from pure repetition and accumulation of life experience. These are what help you form better action plans and execute properly.”
We’ve been discussing quarterly action plans from the start, but keep in mind that other plans and timeframes are also on the table!
“Plan short term, long term – whatever is going to benefit your business.,” said Ryan Rottman, Co-Founder and CEO of OSDB. “You need to be planning on multiple levels and following through with the full support of your team. We all have the same amount of time, but how we structure and utilize that time is very different depending on our strategy or lack thereof.”
Embrace the habit of quarterly planning and you’ll never be without a strong course of action for your employees, customers, and your own financial future.
