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Cape Town - The half-time break for a sports match offers a crucial few minutes for both the coach and players to review and tweak their game plan and, in a similar way, business owners should view the half-way mark of the year no differently, according to Gerrie van Biljon, executive director of Business Partners Limited, a specialist risk finance company for formal small and medium enterprises (SMEs).
He said businesses which do not allocate time mid-year to reflect and plan are running the risk of not operating at their full potential.
“The questions asked in the locker room at half time are strikingly similar to those that a business has to ask from time to time," said Van Biljon.
Questions to ask include:
- Is your business ahead or behind compared to where you wanted to be?
- What worked well and what didn't work well?
- What impact has the competition had on you?
- What opportunities did you miss?
- What competitor weaknesses did you not capitalise on?
- What do you need to do in the second half?
- What changes need to take place and in what area do you need to up our game?
Crystallise the business
“The benefits of such an exercise are hard to overstate as it helps the business owner to crystallise his business strategy for the rest of the year, clarify the challenges that lie ahead, celebrate and strengthen the successes of the past six months and then prompt the necessary changes," said Van Biljon.
The process also tends to unlock ideas, strategies and solutions not previously thought of.
Van Biljon said this kind of formal planning session is by no means reserved for big corporations.
“In comparison to big corporations, it is much quicker for a small business to adapt its strategies in reaction to a market challenge or an opportunity and a mid-year planning session is an ideal method to ensure that the business makes use of that advantage,” said Van Biljon.
While there is no prescribed way in which to structure your mid-year review, he offers the following guidelines:
- The cash-flow forecast should be central to the process;
- Adopt an "all-encompassing" approach: Reflect not only on the sales targets, but also on staff members who may need to be re-motivated, as well as the business’ operations. For example, evaluate what is and is not working, and how the business can improve efficiency;
- Work towards some kind of structure where the team considers the strengths, weaknesses, opportunities and threats facing the business;
- Do adequate research: A half-year planning exercise is pointless if the business owner is not realistic about what is happening – not only in the business, but also in the marketplace;
- The over-optimistic estimation of sales is the biggest mistake entrepreneurs make in their planning as it can have disastrous consequences for the cash-flow of the business.
New strategy plan
Van Biljon said no matter what the output of the session, it is vital that the new strategy or plan is decided upon by the whole team and then developed into a formal plan for the business.
Sometimes a half-year review reveals that just a few tweaks to the cash flow forecast and a couple of email circulars are needed.
Whatever the outcome, it is advisable to document the main points discussed or decisions taken during the review as a point of reference for later reviews.
“The overall purpose of a mid-year review is to ensure that the business owner is still in tune with the targets, the team and the marketplace,” he said.
- Fin24
* Share your experience of setting up a business or simply ask a question. Our business panel can put you on the right path.
He said businesses which do not allocate time mid-year to reflect and plan are running the risk of not operating at their full potential.
“The questions asked in the locker room at half time are strikingly similar to those that a business has to ask from time to time," said Van Biljon.
Questions to ask include:
- Is your business ahead or behind compared to where you wanted to be?
- What worked well and what didn't work well?
- What impact has the competition had on you?
- What opportunities did you miss?
- What competitor weaknesses did you not capitalise on?
- What do you need to do in the second half?
- What changes need to take place and in what area do you need to up our game?
Crystallise the business
“The benefits of such an exercise are hard to overstate as it helps the business owner to crystallise his business strategy for the rest of the year, clarify the challenges that lie ahead, celebrate and strengthen the successes of the past six months and then prompt the necessary changes," said Van Biljon.
The process also tends to unlock ideas, strategies and solutions not previously thought of.
Van Biljon said this kind of formal planning session is by no means reserved for big corporations.
“In comparison to big corporations, it is much quicker for a small business to adapt its strategies in reaction to a market challenge or an opportunity and a mid-year planning session is an ideal method to ensure that the business makes use of that advantage,” said Van Biljon.
While there is no prescribed way in which to structure your mid-year review, he offers the following guidelines:
- The cash-flow forecast should be central to the process;
- Adopt an "all-encompassing" approach: Reflect not only on the sales targets, but also on staff members who may need to be re-motivated, as well as the business’ operations. For example, evaluate what is and is not working, and how the business can improve efficiency;
- Work towards some kind of structure where the team considers the strengths, weaknesses, opportunities and threats facing the business;
- Do adequate research: A half-year planning exercise is pointless if the business owner is not realistic about what is happening – not only in the business, but also in the marketplace;
- The over-optimistic estimation of sales is the biggest mistake entrepreneurs make in their planning as it can have disastrous consequences for the cash-flow of the business.
New strategy plan
Van Biljon said no matter what the output of the session, it is vital that the new strategy or plan is decided upon by the whole team and then developed into a formal plan for the business.
Sometimes a half-year review reveals that just a few tweaks to the cash flow forecast and a couple of email circulars are needed.
Whatever the outcome, it is advisable to document the main points discussed or decisions taken during the review as a point of reference for later reviews.
“The overall purpose of a mid-year review is to ensure that the business owner is still in tune with the targets, the team and the marketplace,” he said.
- Fin24
* Share your experience of setting up a business or simply ask a question. Our business panel can put you on the right path.
