As you set your 2014 goals, make sure to review 2013's business successes (and failures) by answering these questions.
Most retailers and manufacturers are so busy thinking about tomorrow they overlook the importance of recapping the previous year. We’ve all heard the expression “those who fail to plan, plan to fail.”
A big part of planning is reviewing (scorecarding) and measuring your efforts. Here are some questions you should answer to properly assess the health of your business before you begin planning for 2014.
- Did you achieve all of your goals the previous year?
- If so, were your goals unrealistically simple—should they have been more aggressive?
- If not, what areas can you improve upon next year?
It's a good idea to break your review of the year into several sections. This will allow you to focus on specific areas of your business to better identify the opportunities for improvement and success.
Some examples of groupings include operations, sales, personnel, marketing, brand, broker/vendor relations and consumer connection. These are important functions of any business. If you are achieving or exceeding your goals in each area, you’ll surely hit your overall growth and penetration (your ability to connect with your core consumers) objectives.
Document past success (or failure)
Another famous saying goes, “You can’t know where you’re going if you don’t know where you’ve already been.” You need to review your successes and where you fell short.
For example, really analyze a promotion in which you achieved three of your four objectives. You might want to modify that promotion to make it more effective in the future. This might require that you improve your merchandising as well as having the proper inventory levels to support the event. Planning ahead will ensure greater success in the future. Several of the manufacturers and retailers I've spoken to recently don't have a good understanding of these basic principles.
Also, be sure to consider what’s really happening behind the scenes of your store. Have you seen the show Undercover Boss? There are lessons to be learned by always staying connected to the different groups in your business.
Take score for success
I’ve written a lot on newhope360.com about the importance of scorecarding. This is perhaps one of the single best goal-setting tools. It breaks goals/objectives into bite-size chunks, delegates them to the appropriate people, allocates and aligns the proper resources, and provides the system of checks and balances to measure progress at key intervals. Scorecards can be used in every aspect of your business. They’re also very effective in supporting relationships with outside partners.
Here's an example of how this can be effective. A retailer’s goal might be to increase category profits 5 percent over the next year. To accomplish this, he asks key vendors/manufacturers to submit promotion plans and category assortment recommendations. Brand A submits a plan committing to four major promotions. The retailer decides to use a scorecard to manage the program. The promotions are first scheduled on the retailer’s event calendar. Next, the expected sales increase and the details regarding the promotion including the type of promotion, the duration of the event, incremental merchandising and inventory requirements to support the event, etc. are added. Each of these areas is scorecarded and measured.
The manufacturer and retailer now have an agreement detailing who's responsible and accountable for every aspect of each event. This level of planning will ensure much greater success for all future events. It will also ensure the success of each department in the business and help you meet your overall objectives and goals.