“There is nothing quite as wonderful as money“ – From the Strategic Plan to the Annual Budget

Reading time: 3 – 5 minutes

“There is nothing quite as wonderful as money
There is nothing quite as beautiful as cash
Some people say it’s folly
But I would rather have the lolly
With money you can make a splash”

“The Monty Song”  Monty Python


This is the 10th post in the series on Strategic Planning.  Note that you can subscribe to the blog postings by completing the form in the “Subscribe Free” tab.  Or, you can link with an RSS feed.

Isn’t this true.  “There is nothing quite as wonderful as money.” Maybe I should qualify that and say….there is nothing quite as wonderful as enough money to get the job done.  And, if your experience in business is like mine…it seems like there is never enough.  That brings us back to the focal point of Strategic Planning.  With good planning, you focus your financial resources on the most important activities of your company or your area of responsibility within the company.

You can now transfer your strategies and tactics to a spreadsheet.  The first column of the spreadsheet (column A) will be the listing of strategies and tactics.  The columns to the right will be the months of the year.  Now you can plug in the costs of the various tactics into the month(s) they will be executed.  Total the columns and you have the monthly costs of the strategic plan.  Total the rows and the final column and you have the annual cost.

One could argue that you can take these tactical expenses and put them into the line-by-line chart of accounts in the company wide budget.  This is true.  Eventually, that is where these expenditures should go.  No doubt you have a budget line for trade show expenses.  And, several budget lines related to advertising.  However, if you jump right to this, you will lose the big picture.

By seeing the budget from the standpoint of Strategies and Tactics, you can make tactical financial decisions.  If, for example, the budget seems to high, you can look for a specific tactical area to eliminate to reduce expenses.   It is easier to locate and agree on a low priority tactic that can be cut.  Perhaps it is a series of exhibits at tradeshows in a secondary market.  When the Strategic Plan was originally written, everyone agreed that this secondary market would be good to explore for additional revenues.  However, when costs were associated with the plan, it became obvious that this year it would be too expensive to explore the secondary market.

In earlier posts about strategic planning I made the point that a strategic plan is a dynamic tool.  We just used the example of eliminating a tactical area to bring the budget into line.  At the same time, if in the first quarter or two of plan execution, your team is overachieving revenue goals, you could decide to re-instate this strategy and its tactics.

“I know money is the root of all evil
Do funny things to some people
Give me a nickel, brother can you spare a dime
Money can drive some people out of their minds”

“For the Love of Money”  The O’Jays

My hope is that good strategic planning tied with a budget that is related to real tactics will prevent the money from driving you out of your mind.
Share this:
Share this page via Email Share this page via Stumble Upon Share this page via Digg this Share this page via Facebook Share this page via Twitter

Technorati Tags: , , , , , , ,

Qualitative Benefits of Strategic Planning

Reading time: 2 – 3 minutes

This is the second in a series of posts about Strategic Marketing and Sales Planning

OK….so after the last post you are thinking about strategic planning but may not be convinced.  You have a lot on your plate.  You don’t need more.  BUT, you are beginning to wonder if good planning may lead to increased revenues, more targeted marketing, enhanced sales activity, etc.

Let me quickly share with you some additional benefits of good planning:

Morale builder – You will be involving some employees in the planning process.  We will get to that later.  However, by delegating some of the planning process to your team, you will lift their morale and their commitment to helping you succeed.  Planning requires a little more transparency than a lot of leaders are used to providing.  Your team will like this.  Productivity will go up!

Respect builder – The plan process will only build your team’s respect for you.  Planning is transparency.  Planning is the willingness to listen and debate ideas.  Transparency earns respect.  This doesn’t mean you become a “softy”.  You are still the boss.  You have to bring reality to the idealistic ideas of less experienced people.  The result will be a higher level of respect directed at you.

Commitment builder – When employees participate in the planning process, they begin to take ownership.  They buy into the plan.  This commitment will spread to the employees that aren’t part of the planning team.  Employees that see a plan in place will feel more secure about this small company they are working for.  Perhaps your company is struggling in the wake of the 2009 economic downturn.  Now that the economy is showing signs of recovery and recruiting efforts in the industry are up, you may have some people looking at other jobs.  The more secure employees feel about the direction of their current employer, the less likely they are to leave.

Time saver – Once a plan is in place, you will get fewer questions like, “Should we do this or do that?” “Are we attending this or that show?” “What ads should be place next month? The media reps are calling with good deals.”  All of these questions are answered in the plan.  You don’t want to go month-to-month planning advertising based on this deal or that deal.  Your advertising should tie to a strategy that ties to meeting one of your objectives.

In my next post we will start to get organized for some strategic planning.

Share this:
Share this page via Email Share this page via Stumble Upon Share this page via Digg this Share this page via Facebook Share this page via Twitter

Technorati Tags: ,