Written by Ty Kiisel, editor at OnDeck.
At the beginning of the year, you set goals for your business. At roughly halfway through the year, it’s a good time to revisit those goals, evaluate how you’re doing and decide whether you’re on track or if you need to revise your plan.
Annual goal setting is usually based on assumptions about the market, the products or services offered in the market and your ability to deliver. Sometimes, assumptions made at the first of the year don’t pan out, and this can impact your ability to achieve your objectives.
Armed with six months of data, you can make a better set of assumptions for the remaining part of the year. If current conditions closely mirror your original prognostication, stay the course. If not, you make an adjustment—what many entrepreneurs call a “pivot”—to either take advantage of opportunities or overcome challenges you might not have expected.
Keep in mind: Staying the course doesn’t mean going down with the ship. It takes courage to look at your situation, evaluate the effectiveness of the current plan and make course corrections mid-stream. Learning, making adjustments and moving forward isn’t giving up. It’s adapting to the market so you can offer a product or service potential customers will buy. It’s how you help your business thrive and grow.
As you conduct your midyear review, here are three questions to ask yourself:
- Are revenues where you thought they’d be? Regardless of whether they are higher or lower than expected, can you determine why? Has the market changed? Do you have a better product? Is your product priced right? Did you underestimate the challenges of going to market? Now is the time to honestly evaluate where you are and consider whether or not you should keep pushing forward.
- Can you capitalize on your unanticipated successes or overcome the unforeseen challenges? If you see unexpected opportunities, are there investments in your business you can make today that will keep the ball rolling? Do you need additional inventory? Machinery? Or employees? On the other hand, do you need to change direction because the market has changed? Sometimes the strategies and tactics that worked in the past lose their effectiveness.
- Do I need a new plan? In the same way you made assumptions at the beginning of the year, you need to make an educated prediction of how a change in approach will benefit your business. Weigh the costs against the potential gains and decide whether or not a pivot makes sense.
As you evaluate your strengths and weaknesses this year, be wary of overcorrecting or fixing the wrong issues. It’s critical to first identify the source of a problem before creating a solution. I once worked with a CEO who made five major pivots in how his company did business in one year. The regular shuffling of objectives confused customers and employees—and ultimately didn’t generate the profits he anticipated. A change in direction should address your company’s ability to meet your customers’ needs, not compensate for a weak business model.
If your business model has a problem and limits your ability to grow, there are times when you need to walk away, regroup and start again. Thomas Edison famously said, “I have not failed. I’ve just found 10,000 ways that won’t work.”
With over 25 years of experience in the trenches of small business, Ty Kiisel shares personal experiences and valuable tips to help small business owners become more financially responsible. Ty Kiisel is an editor who specializes in small business financing at OnDeck, a technology company that’s solving small businesses’ biggest challenge: access to capital. OnDeck can be found on Facebook and Twitter.
Categories: FINANCES Goal Setting