It’s a rote truism that every business needs a business plan, although that necessity may not be obvious. Alan Gleeson offers an example from Lewis Carroll’s famous book Alice’s Adventures in Wonderland to illustrate the importance of business planning.
At a fork in the road, Alice asks the Cheshire Cat:
“Would you tell me, please, which way I ought to go from here?”
“That depends a good deal on where you want to get to,” said the Cat.
“I don’t much care where–” said Alice.
“Then it doesn’t matter which way you go,” said the Cat.
David Ronick agrees. At the very least, a business plan provides direction. Regardless of the reason you established the business, as the head honcho you’re obligated to lead it. A business plan prevents you from losing sight of reality amid the passion and excitement of launching your new business. If you don’t know where you’re going, then you won’t know how to get there.
Another excellent reason to craft a business plan is to secure investor funding. Banks generally require that a business plan be submitted with loan applications in order to determine whether the company’s leadership has a solid plan that will lead to the recovery of their investment. Banks and other investors won’t fund your business unless you can convince them that doing to will earn them a profit.
A solid and persuasive business plan outlines the path you’ll tread in leading the business to profitability. The best business plans allow for flexibility to maneuver around obstacles and even backtrack if necessary to regroup and reconsider alternate ways forward. It anticipates challenges and sets processes into place for confronting them.
Of course, you can’t predict everything unless you have a crystal ball that actually works. You can’t predict the tornado that might wipe out your building and equipment, but you can purchase insurance that will enable your business to recover physical assets and resume operation. You can’t predict your star employee’s sudden absence because he fell off a ladder while cleaning the gutters and broke both legs and arms, but you can ensure that other employees are cross-trained so they can pick up the slack while the poor guy’s taking the necessary time to recuperate.
Business plans help leadership develop and communicate a course of action. It will help your company assess future opportunities, develop a process for action, and then commit to that action. It can help you identify benchmarks for the company as a whole and for specific individuals in key positions to enable monitoring of progress. Circulated among staff, the business plan can also be used as a launching pad for employee questions and concerns. Their feedback will let you know where additional thinking and tweaking will help with comprehension and follow-through.
The benchmarks identified by your well-thought-out business plan further assist in making decisions when it’s time to quit. Sometimes a venture doesn’t work out. Sometimes a project just isn’t worth the time, resources, and sheer aggravation of its potential profit. Sometimes leadership makes the decision to retire. A proper business plan considers common exit strategies, such as an initial public offering of stock, acquisition by competitors, mergers, management succession, employee buy-outs, etc.
The best business plan in the world, however, does nobody any good if no action follows. Inaction leaves the business vulnerable to the whims of outside forces without any recourse for recovery or map forward.
The Heggen Group analyzes the big picture, breaks it down into coherent and finite goals, and helps businesses develop feasible steps to achieve those goals. We’ll assist in crafting a flexible process that will guide forward progress, accommodate unexpected challenges, allow for changes in direction, and establish accountabilities all with an eye toward your success.
In business, there’s little so exciting as landing a new client. Signing that contract results in celebration, which can quickly turn sour if the company throws the new account upon unprepared employees. The following tips will help you integrate new clients into the staff workload.
1. Write down an onboarding process. Spontaneity is all very nice, but a clearly defined process for integrating new accounts into your business not only shows clients that you’re prepared to undertake the work, but that your company is their best choice. The new process doesn’t just manage client service, it also provides a structure to build a client relationships.
2. Build a timeline for benchmark tasks. The process tells you what to to, the timeline tells your staff when those tasks must be done. Just as you appreciate being treated promptly and with courtesy, so do your clients. Impress new clients by ensuring all staff assigned to the new accounts have a foolproof checklist of benchmark tasks and dates to keep them on track.
3. Schedule and implement employee training. Now that you’ve got a new client, you have to perform the work to service that client’s needs. Don’t assume your employees have the precise capabilities needed. Identify who does and who does not, then ensure that those who don’t receive the training they need. Employees should also understand why, how, and when to use their new skills in conjunction with existing business processes and systems.
4. Share your business processes with the new client. While your company must cater to each client’s expectations to a certain extent, remember that the new client hired your company because you provide a service or product they need. Share the internal processes relevant to your client. You cannot completely disrupt your business in service to just one client.
5. Review your communication plan with the new client. Your client deserves to know–and will want to know–the progress on the work they hired you to do. Be sure to include staff in the communication plan so everyone is aware of expectations and can be reassured about work performed.
Once your staff has integrated the new client into the existing workstream and delivery of those services and/or products is consistent with regard to both timeliness and quality, it’s time to propose adding new services and/or products. Be cognizant that you do not simply agree to perform additional tasks under the existing contract. Without fully defining the contract and/or scope for the new service, you set the stage for client disappointment and employee distrust.
Bringing additional work onboard requires careful evaluation of existing staff capabilities and their workloads, as well as negotiating increased compensation for performance of the work. Will the additional services you have agreed to provide require hiring new staff or can existing staff handle the work within normal business hours? Are they agreeable to working overtime and will they be compensated for the additional time spent? Valuable employees might shift their priorities for the short term, but taking them for granted quickly results in disgruntled attitudes and employee turnover.
The beauty of a thoughtful process to manage onboarding of new business is that it matches capacity with delivery and can provide for the increase of skill and capacity. In short, it helps your company refrain from the “over-promise and under-delivery” scenario and keeps clients and staff happy, which yields higher satisfaction and better productivity.
The Heggen Group specializes in developing processes that facilitate and expedite the integration of new business. Keep the honeymoon going by ensuring that your company can deliver on its promises.
Business news is rife with reports of mergers and acquisitions, companies being sold for millions or billions of dollars in deals that make shareholders squeal with joy and c-suite executives give praise for their golden parachutes. The M&A strategy has become commonplace, Strategy+Business reports that 51.3% of mergers have demonstrated that such actions result in underperformance and reduced profit, which likely results from planning the way in which they execute implementation after the deal.
Once the decision to merge has been finalized, it’s important to stack the deck in favor of success.
● Create value greater than the purchase premium. The merger itself is not the business goal, but a step on the way toward achieving that goal. Leverage the value of the merged companies by combining their strengths, whether that be depth of market penetration, management team capabilities, or other factors.
● Develop a post-merger process that captures well-defined sources of value and guides sustainable exploitation.
Just because buying the competition appears easier than organic growth doesn’t mean that it’s the best direction. However, once the deal’s made and money has exchanged hands, it’s too late for employees. They will benefit–as will your shareholders and customers–from a thoughtfully prepared vision of the newly merged business enterprise. That vision will need leaders from both the acquiring company and the acquisition target who can lead the combined enterprise through the process of integration. Before the merger breaks down before it’s had a chance to function and thrive, leaders may consider hiring a navigator to lead them through the post-merger sea.
Best practices for post-merger integration consist of the following elements:
● Change architecture
● New company structure
Navigation of post-merger process requires detailed planning. It builds a model for timing, cash flow, and resources. It establishes human resources policies that will be applied evenly throughout the combined company. It mandates frequent, honest, and clear communication to both employees and vendors. The post-merger architecture may not resemble what was planned, but the plan will help achieve the goals that the merger was supposed to accomplish.
Part of those goals includes identifying sources of value. Growth-oriented sources encompass new products or services, increased speed to market, improved efficiency, increased sales force, etc. Efficiency, while laudable in itself, cannot be defined as a concrete goal. Efficiency must be improved through other factors: supply chain, procurement, production, distribution, sales force, consolidation, etc.
Regardless of the architecture, the principals of the merged company must act. A thoroughly vetted process focusing on post-merger integration provides the analysis that yields the information management needs to make informed business decisions to act or not act. Action may entail walking away from a deal, testing assumptions, evaluating the organization’s competitiveness. Both action and inaction may result in improving or reducing shareholder value, which further necessitates a thorough planning and analysis process to ensure the merger’s success.
The Heggen Group has successfully guided diverse companies through the post-merger and acquisition process to capture increased market share of their industry niches and improve shareholder value. By combining two entities into one cohesive and functional business, we enhance the profitability and success of the companies we serve.