Sometimes running a business can feel like you have been thrown overboard from a ship. If you just tread water to stay afloat and maintain daily operations, you will not make any progress toward the shore. After a while you will get exhausted and sink. However, if you set a destination and start swimming to it, you will eventually get there and survive.
We have a saying here at The Covenant Group that we try to impress upon every one of our clients: “The future drives the present.” That means how you plan for the future of business and the goals you set will dictate the actions you take today.
Have you detailed your objectives for the coming year? Are you aware of how the tasks you complete today will move your organization forward tomorrow? If not, then it is definitely time for you to establish goals for your one- and five-year revenues, expenses and profits.
Set objectives that are measurable, limited to a specific time frame and contain hard numbers. They should address three factors: How much, of what, by when.
The future holds solutions for the present
It may seem counterintuitive to talk about your five-year goals before addressing your one-year objectives. However, by establishing what you want to accomplish within the longer time frame, you will be able to decipher what needs to happen over the course of the next year.
Determine how much you are making currently and what you want that figure to be in three years.From there, you can calculate the annual growth rate necessary to bring in that revenue, something that is also covered in The Entrepreneurial Journey.
Set up benchmarks for cash flow, retained earnings, revenue growth, profitability and how much you want your personal income to increase annually for the next three years.
Determining your current standing will allow you to make a more informed decisions analysis of your situation, highlight any strengths and/or weaknesses and will give you insight on exactly what must be done to hit your one- and three-year targets.
List your current sources of revenue and your revenue totals. Also cast a critical eye upon your existing marketing strategies. Will they be robust enough to carry your business through the next three years. This activity is known as a SWOT analysis (strengths, weaknesses, opportunities and threats).
With your SWOT analysis in hand, you can devise a strategy for driving your business to the one- and five-year objectives. Write out a summary of your situation today.
What aspects of your existing operations will you continue for the next 36 months? Consider what will be required to sustain those efforts. Now think about what needs to change and what you have to do to overhaul operations.
In building a business, there are Four Cornerstones that represent the foundation of a successful and sustainable business.