We often get asked these questions- When is the right time to create a yearly business plan? How do we create a successful business model?
The answer to the former is December. The right time to create a business plan is December. January should be used to validate it and February-March to make the required changes. On 1st April, the plan must be on the floor. By this we mean, your entire team needs to be aware of what needs to be done and execution should begin. Now let’s focus on the latter that is the ‘how’? Below are the five steps that need to be taken to create a successful business model.
- Determine the Direction
The most common mistake business owners make is to create the new business model all by themselves. Get your entire team together and propose your ideas to them. Spend some time brainstorming and take each of their suggestions into consideration. Determine what is it that you want to achieve with this plan- increased turnover/ higher sales/ better customer service etc. Once you have determined the direction, take suggestions from your team to pave the way further. By doing so you are not only creating a better plan but also preparing your team for the changes to come.
- Strategize Effectively
Strategizing is all about determining the action plan. Based on the direction that has been decided, create an action plan. This plan must include details like the lists of people that will be involved in the process, machinery required, prospective suppliers, methods to be used, etc.
- Create a Timeline
When it comes to execution, giving each milestone a timeline is absolutely necessary. Decide the timelines after you have strategized your action plan.
- Train your People
Train your team and make sure they develop the necessary skills required to perform the tasks and to achieve the required goals.
- Plan your Cash Flow
You cash flow needs to be planned once everything else is decided upon. There is a simple method called the ‘Power of One’ that is extremely effective- think of a way to increase your profit by 1%, reduce your cost of procurement by 1%, collect payments 1 day before, postpone payments to vendors by 1 day. When all this is taken care of, you have successfully created a bankable proposal.
Celebrate every small victory and on every small occasion. Celebrate buying a new machine or an addition of a new employee. When you celebrate often, you start ‘feeling’ successful and that by itself doubles your chances of being successful.