June is the ideal time to complete a health check on your business plan. With six months gone, you only have six months left to achieve your business goals for the year.
With the end of the Australian financial year, you will wind up your accounts for the 2009/2010 year and can plan your budget for the next financial year. This is the perfect opportunity to dust off your business plan and complete a health check of your business.
Many people will put the completed business plan in a drawer and forget about it until the end of the year when it is time to draw up the next year’s plan. However, six months into the year is the perfect time to check how your business is performing and to check whether you are on track to achieve your business goals. Even if you do not have a written business plan, you should take some time to ask yourself about how your business is going and consider what you want to achieve in the next six months.
The following questions can help you to complete a full health check on your business plan, just as you would have a doctor give you complete check up once a year.
Heartbeat Check (Customer Base)
Your customers are the heartbeat of your business. Without your customers, you have no business. Look at your goals for increasing the customer base in your business plan. If you wanted to increase your customer base by ten per cent in 2010, then you should be close to showing a five per cent increase by the end of June. If you are only showing a three per cent increase, you may want to review your goals and review your action plan to increase your marketing or networking activities over the next six months to reach your goal.
Circulation Check (Cash Flow and Finances)
Using the analogy of a body, the circulation system draws oxygenated blood from the heart to the rest the organs of the body, making it possible to for the organs to work. Your financial system within your business makes it possible for every other department to work. With a good strong cash flow, you can draw the finances from your customers to pay for your operational costs, without relying on borrowing upon interest. Look at your financial situation as you close your accounts for the financial year. Do you have cash flow drains that are not aiding your business? Are you making enough sales to create your projected business income at this point of the year? Are you reaching your financial targets? If not, consider why not and what you can change on your action to fix the circulation of funds throughout your business.
Fitness Check (Operations)
Look at your business for marketing and operations goals. Is your business working like it should? Are you on track to meet your operating goals? Have there been situations in the past six months that have caused reductions in operations capacity or performance? How can you avoid these situations in the future? Will you meet your operational and marketing goals for the year? If not, what will change in your action plan for the next six months to make sure your business meets the operational goals?
Immune System Check (Competition and Risk Analysis)
When you complete a business plan, you complete a SWOT statement and a risk analysis plan to mitigate the risks you face in your business. Just as your immune system in your body works to prevent illness, knowing your business’ risks can help you to mitigate those risks. Take a good look at the current market situation. Have any of your competitors got a new product that will threaten your business? What risks does your business face for the next six months? Did any of the risks you thought threatened your business not happen after all? Are there new risks you must analyse?
Brain Check (Planning)
Finally, check on the brain health of your business. Consider your business plan as the brain – this is document which sends out the signals to every other department in the business (as the brain controls the body). Update your action plan for the business. Use this ‘health check’ to review and change your goals and objectives, especially if they were too ambitious. Refine the signals you send out to the rest of the business and you will find it easier to achieve your goals in the next six months.
Completing a health check on your business plan mid way through the year is a wise investment of your time and resources. You can check you are on track for the year and make adjustments if you are not going to meet your goals by the end of 2010 if your business continues on the same path.
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photo credit: Lars P.
