Be Different or be dead

September 15, 2011

Why revenue targets should determine what your business plan looks like

Source: Unsplash

Why revenue targets should determine what your business plan looks like.

My business plan creation process involves answering 3 basic questions.

▪️ How big do you want to be — revenue growth goals;

▪️ Who do you want to serve — customer groups to target;

▪️ How will you compete and win — competitive differentiation strategy.

The answer to the How BIG question starts the process.

Your revenue growth goals determine the character and risk level of your strategy. A plan to grow revenue at 10% per year, for example, will look different than if your plan was to grow at 50%.

To assume that the 50% plan would be the same as the 10% plan would be folly; you simply can’t change the growth numbers and expect the plan profile to remain the same.

The latter could require, for example, more resources, new target markets and customer segments and an acquisition to get the 50% growth required.

The traditional approach to planning is to first develop the strategy and then determine the financial impacts — the numbers are set at the end of the planning process.

This has always been a problem. Typically the growth produced by the strategy is unacceptable by leadership, so the assumptions are tinkered with to produce new numbers rather than adjusting the inherent profile of the business plan.

This is a problem — you can’t change the growth targets without changing the strategy to deliver them.

The boldness of your business plan is governed by your growth goals.

Get your thinking straight on HOW BIG; then create your strategy to achieve them.

Cheers,
Roy
Check out my BE DiFFERENT or be dead Book Series

• Posted 9.15.11 at 09:00 am by Roy Osing
• Permalink