How I Do Annual Planning

Many small business owners underestimate the importance of annual planning until they’re feeling overwhelmed with tasks and unmet goals. We get it; the thought of tackling an entire year’s plan can be daunting, especially when you’re caught up in the daily grind of keeping your business afloat, managing team members, and putting out pesky fires.

But what if we told you that a strategic, well-organized annual planning system could help you navigate your business more confidently and effectively?

In this video, ProcessDriven CEO Layla Pomper demonstrates her yearly planning process and shows you how to transform common pain points into strategic pivot points.

Layla divides annual planning into four parts (timestamp 04:15):

  • Thinking
  • Goals
  • Communication
  • Planning

Part I: Thinking

By spending a good chunk of your time thinking about what matters most, you can move forward knowing your goals and planning align with your overall mission (timestamp 05:20). 

Think of your annual plan as a roadmap for a journey from your starting point (A) to your destination (Z). 

Review Your Vision & Mission

Reviewing your vision, mission, and company values during annual planning isn’t just a box-checking exercise. Your vision and mission statements provide a clear direction for where your company is headed and why. Over the course of a year, there can be industry shifts, market disruptions, or internal changes that might prompt a need to realign. An annual review ensures that your business objectives and strategies support these guides.

Define Your Starting Point

Once your vision and mission are clear, it’s time to review the current state of your business, point “A” (timestamp 08:30). Look at your pain points, expenditures like time, money, and other resources, and analyze available data such as reports, time sheets, and budgets. 

Layla also uses annual planning as a time to review a list of internally and externally generated ideas and her quarterly live journals that she records on YouTube. The videos are a quick way to review key moments and concerns that may have been set aside for more pressing matters.

Define Your Destination

Point “Z” is your destination, where you’d like to be at the end of the year. It’s an excellent time to think about what competencies you’d like that you don’t already have. 

Check your impulse to fill up your annual plan with arbitrary tasks and projects you feel you should do and instead ask yourself:

  • What could you do now that would make your six-year plan closer to a six-month plan?
  • What can you accomplish that would make you excited and proud?
  • Are your projects inspiring enough to make you and your team passionate about working on them?

Part II: Goals 

Goal setting can be divided into two buckets: big numbers, like savings, profits, revenue, and expenses, and role metrics, like sales targets, customer service benchmarks, and productivity targets (timestamp 16:05). It’s a chance to take those big numbers goals and break them down for the people or departments who will be tasked with achieving them. The accounting team might take some of the responsibility for reducing expenses and increasing savings, for example, while the sales and customer service teams might tackle projects relating to profits and revenue.

Part III: Communication 

Sharing your ideas and goals with your team ensures everyone is on the same page (timestamp 20:40). It’s helpful to communicate not just your annual goals but also why you chose them. When people understand the purpose and reasoning behind tasks and projects, they’re more likely to feel personal ownership and a greater sense of satisfaction and purpose in completing them.

It’s also vital to get input from the people directly responsible for plan execution. Team members can provide invaluable insights and feedback, opening the door for constructive conversations. This allows you to adjust your expectations based on firsthand experience and knowledge.

Ultimately, sharing the details of your annual plan isn’t just about communication; it’s about building a strong, informed, and cohesive team ready to navigate the challenges and celebrate the successes of the year ahead.

Part IV: Planning 

The final part of the annual planning process is actual planning (timestamp 24:10). You’ve done some analysis and critical thinking, identifying meaningful goals. You’ve shared your vision with your team. All that’s left is to review your commitments and define the growth projects necessary for success.

Take this time to outline your personal and professional commitments. These could be promises you’ve made to your business, your customers, your employees, and yourself, such as finally taking a vacation! Also, consider including repeatable wins. These are projects that you’ve done before, were successful, and you’d like to replicate.

Lastly, outline the specific projects that will move you from point “A” to point “Z.” While your team may handle the actual execution, make sure you define the most significant priorities, such as launching a new product or service, implementing new initiatives, or working within new budgets and timelines.

We hope this look at annual planning has replaced trepidation with inspiration and you’re looking forward to reviewing the past year’s achievements and challenges and setting realistic goals for the year ahead. If we can leave you with one piece of advice, it’s to let go of any arbitrary goals that you feel are uninspiring or draining and focus your energy in ways that ignite the passion of you and your team. 

If you’d like more tips, tricks, and hacks for systemizing your business and increasing productivity, check out our YouTube channel. Why not work with us if you’d like a more personal touch? Learn more about ProcessDriven membership here.

Until next time, enjoy the process!

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