Do You Have a Road Map for Your Business?
When I was in high school, the quote I chose to put in the yearbook by my senior picture was “You can’t get lost if you don’t know where you’re going.” I think I had gotten it in a fortune cookie or something and it sounded good for someone heading off to college with no real idea of what I wanted to do with my life. But it was also a mindset that took the pressure off a bit, if you don’t have an end destination in mind, then you can’t fail at getting there, right? Back then, I did everything in my power to avoid failure, I still do sometimes, but I’m working on that because it is hard to accomplish your dreams if you don’t put yourself out there and take risks sometimes.
Always have an end destination in mind
On the flip side, if you don’t have an end destination in mind, how will you know when you’ve arrived? How will you know if you’re headed in the right direction? How will you know you’re not headed off a cliff?
Sometimes in life we don’t want the restriction of having a set destination in mind. We like the freedom of just getting on the road and driving, or seeing where life takes us. Or we have doubts about whether or not it’s the “right” destination, so we just stay where we are rather than risk going the “wrong” way. But just because you have a map with a destination doesn’t mean there can’t be detours along the way, and pit stops to admire the view, rest, and refuel. It also doesn’t mean you can’t change the destination along the way and recalculate a new route, just like our GPS does in the car.
If you’re really planning to actually get somewhere, you need to have an end destination in mind to get started. Just like you need an address to put into the GPS when you start a road trip. It doesn’t have to be the final destination, but you at least need to know the next stop on your journey. If you were driving from California to New York, you wouldn’t put New York into the GPS at the very beginning, you’d start with maybe some place in Nevada that would be the first leg of the trip to get you one step closer to where you ultimately want to go.
The other important piece of information you need, that we often don’t think about, is you need to know where you’re starting from. Your GPS can’t work out the road map for you until it knows those two critical pieces of information – the start and the end. And when you reach your destination you get that congratulatory proclamation from the GPS – “You have arrived at your destination!”
You wouldn’t start out on a road trip without a road map, so why are so many entrepreneurs doing this with their businesses? Making a road map for your business can be critical to your success and can significantly shorten the time it takes to reach your goals. It helps keep you on a focused path moving you ever closer to the destination, rather than doing circles and constantly running into dead ends.
So what does a business road map look like? Like the map for your road trip, there needs to be some mile markers and landmarks along the way so you can check in and make sure you’re not getting off track. When you’re driving your car you don’t focus on looking at all 200 steps that happen along the way, you start out looking at the next 2-3 steps, and then the next 2-3 steps, and so on until the next thing you know you’ve arrived!
Let’s walk through a simple example so you can see how this can work in your business. We have a service based business and our big business goal that we are going to focus on is to have annual revenues of $480,000 within 2 years. That might seem like a weird number but it will make the math easier later.
The first question we need to ask is “Where are our revenues now?” For this example, we’re starting out at $240,000 in total annual revenue. So our goal is to double our revenue from where we are now and increase it by $240,000. That’s a big number! That might seem impossible, but what if we break it down into smaller more manageable goals. At our current revenue level we’re making $20,000 per month, and we need to increase that to $40,000 per month. Still big, but $20,000 is not nearly as scary as $240,000. And that jump isn’t going to happen overnight either. We need to work on identifying some smaller steps that will give us actions we can start doing today. For the first 30 days our goal might be to increase revenue by $2,500, then increase by another $2,500 in the next 30 days, and so on. The idea is that you don’t have to try to do it all at once, but you do have to get on the road and start driving.
Take action toward short-term goals
Now that we have our big long-term goal, and some smaller shorter-term goals, we need to identify some action steps that we can do to move us toward those goals. What can we do today that will bring in new revenue?
Here are some ideas of ways to bring in new revenue in the short-term:
Follow-up on outstanding proposals.
Pick up the phone and call some customers that had expressed interest in our services, but haven’t heard from in a while.
Ask current customers for referrals.
Get out and be visible – go to some local networking events.
Let people know we’re looking for new customers.
Do a marketing campaign – social media, email marketing, advertisements, etc.
Consider picking tasks that will help you get some low hanging fruit so you have some early success to help motivate you to keep going. Also, make sure to focus on things that will have the biggest return on your investment of time or money. If you have two main services you offer and one would generate $100 a month in revenue and the other would generate $1,000 in revenue, focus your efforts on bringing in the customers at the $1,000 level because you don’t need as many of them to meet your goal, although they may be harder to get, so figure out a balance that works.
Once we have our action plan organized so we know what to focus our energy on, we’ll also need to determine how we’ll know if what we’re doing is working and moving us toward our goal. These are often referred to as key performance indicators (KPI) – a metric that helps you understand how your business is performing compared to history or to others in your industry. In this example, our monthly revenue is our KPI we are tracking.
What if you were to put your head down and just attack your to do list for the next 90 days? Then at the end of the 90 days, you look up and find that your monthly revenue hasn’t increased at all. WTF?? Do you think there might have been clues along the way that what you were doing wasn’t working? Probably. But if you weren’t taking a step back and checking in periodically you wouldn’t have known that, so you kept doing things that weren’t getting you results.
How can we prevent this? Put a task on your to do list to check-in every 30 days, or sooner, to see how you’re doing in progressing toward your next milestone. Our first milestone was to increase revenue by $2,500 in the first 30 days. So after about 2 weeks, we need to be seeing some progress, and if we don’t, we don’t have to throw out the whole plan and give up, we’ll simply go back and make some tweaks. Maybe that means changing the actions we’re taking, maybe it means adjusting the goal slightly, maybe it means bringing in some reinforcements.
The important thing is to consistently check in on your progress compared to your road map to make sure you haven’t made a wrong turn somewhere, and even if you have, don’t turn around and go home, get back on track and keep going, you will eventually arrive at your destination as long as you keep moving forward one step at a time.
Do you have a road map for your business? Do you have some big goals in mind, but not necessarily a detailed plan of how you’re going to reach them? I have found that sometimes it can be challenging to do this on our own. It’s easy to get bogged down in the details of the day to day running of the business, and it can be hard to make time to sit down and write out a plan. But as you’ve seen from our example above, it can have a dramatic impact on your ability to reach your goals and the ultimate success of the business.
That’s why I offer strategy sessions and advisory services for clients, so they don’t have to do this alone. It’s important to look at the historical financial information for your business to see how you have been doing and where you’ve been, that gives you a clear picture of your starting point. But it’s critical to also look forward and make a plan if you want the future to look any different from the past. I work with clients to identify their long and short term goals, determine an action plan, implement a method for tracking progress, and provide accountability.
If that sounds like something you’d be interested in learning more about, click the button below and schedule a time on my calendar so we can talk.