Working on Your Annual Work Plan
“A goal without a plan is just a wish.”
In the last quarter of each year, it's time to reflect on the achievements of the year, the unmet goals, new needs, and what we wish to accomplish in the near future. Before we start celebrating, it's time to work on our annual work plan to ensure a successful year ahead.
An annual work plan is a simple document that summarizes, in a few sentences, the objectives we want to achieve with our venture over the next 12 months and specifies the proposed plan to turn those objectives into reality.
In truth, a plan can have whatever frequency you want, but it's good practice to take advantage of the convenience of the calendar year and get into the habit of having an annual plan.
Of course, it’s wise to align this plan with your fiscal year-end. So, if for any reason your fiscal and accounting year doesn’t end in December, you can make this plan according to your own dates.
This work plan is different from the Business Plan. It's a shorter-term and much more specific plan.
The Business Plan sets your vision and general guidelines.
The Annual Work Plan allows you to see how close or far you are today from that vision and what you can do in the next 12 months to get closer to it.
Preparation
When preparing your annual plan for the upcoming year, it's important to set aside dedicated time for the task—at least one morning or a full day.
Whether you’re working on it alone or with a team, it's helpful to change your usual daily environment and avoid interruptions. The idea is to be able to concentrate on the task and feel inspired. For example, this could be a different spot in your office or home, a park, a café, the beach, or the mountains. There are no restrictions or limits. Just look for a place that makes you feel good, free of stress, and different from your everyday work environment.
Visualization
Before you start writing a plan, take some time to visualize where you are and where you want to be. Whether you're doing the exercise alone or as a group, it's still important not to skip this phase.
The idea is to answer these two questions with this exercise:
What have been your achievements this year?
Where do you want to be at this same time next year?
There are many resources you can use to inspire this reflection:
To gather your achievements:
Make a list of things you're grateful for in your business—things that have happened or you’ve achieved in the past 12 months.
Prepare a brief, fictional recognition speech you would give your business if it were winning a “Business of the Year” award.
To visualize your business in a year:
Play with the idea of being in a time machine. You get in the machine, and you're exactly one year ahead. Send a letter to your current business telling it what has changed over the past year.
Build a Vision Board. This is an exercise where you visually identify elements that represent the dream you're aiming for. If you're good at drawing, you can do it that way. You can also use all kinds of visual materials—magazines, photos—or do it digitally if you prefer. The artistic quality of the result doesn’t matter.
The goal of these types of exercises is to help free your mind and, through light activities and games, let you list the things you're thinking about that might be hard to put into words.
Your Environment
Your business is not isolated. It operates within a market. In the document My Essential Plan, we define what your market is.
However, that market is dynamic. Things happen every day that change your chances of competing successfully.
So it’s important to look at the current and future situation of your market.
What’s happening in your market now, and what’s expected to happen in the next 12 months?
Think about economic changes affecting your market and your target audience, current or possible changes in your competition, trends affecting the category your product or service competes in—anything external to your company that is beyond your control but could impact you in the next year.
Planning
Now that you know where you want to go, it’s time to set the plan. Visualization alone doesn't work without a plan. The prettiest Vision Board is meaningless if you don't establish a work plan to get there. So the most important part of this exercise starts now. Time to get to work.
For this phase, I’ve prepared a simple template that includes:
Three or four basic objectives to achieve in the next 12 months.
Changes or adjustments you need to make in your business or in yourself to achieve those objectives.
Resources (financial, human, or technological) you will need in addition to what you already have in your business to reach those goals. Don’t forget to indicate how you plan to obtain those resources.
Critical success factors—those things that must happen or you must ensure happen for the objectives to be achieved. In summary, define the events or conditions that must necessarily be met for success. If they fail, success is hindered.
SMART Objectives
I’d like to take a moment to talk about objectives to ensure you set annual goals that you can realistically achieve.
First, keep in mind that this is not a wish list of everything you want to do. It’s a rational plan of priority objectives that will move you closer to your vision.
Try to define between two and four main goals for the upcoming year. If you have more than that, try to group or prioritize them so that you select no more than four.
There’s an approach to working with goals that I find very useful and appealing, and I think it can guide you in completing this section. It’s called the SMART Objectives framework (based on its English acronym). This term was first used in 1981 in an article in Management Review magazine by George T. Doran. SMART goals have the following attributes:
Specific – Measurable – Achievable – Realistic – Timely
So, for example, a goal that says:
“Increase online sales”
Doesn’t meet many of these attributes. A better definition would be:
“Increase online sales of product X by 10% in the first quarter of the year.”
The first is not a goal—it’s a wish. The second is specific, measurable, and time-bound (whether it's achievable depends on the business and market).
If you set 3 or 4 priority goals that are very specific and meet the SMART requirements, your chances of successfully achieving them within the time frame increase.
It’s important that the goals in your plan relate to your Business Plan, your vision, and the core essence of your venture. They should also be consistent with each other. This is not about listing a random set of goals, but about developing an integrated plan where each part works together toward the vision.
Work plans don’t have to be only annual. If you prefer, or if your market is very dynamic, you can work with shorter-term objectives—quarterly, four-monthly, or semi-annual plans. It depends on your business, your market, and how fast your environment evolves.
Monitoring and Updating
Once you get used to doing these plans regularly, you can (and should) use this year’s plan as a tool to evaluate accomplishments and as a foundation for the next period’s plan.
It’s also important to develop some kind of tool to continuously monitor progress toward your objectives so that, if you’re falling behind, you can adjust along the way. For example, if the goal is to increase sales, as mentioned earlier, you should be monitoring sales regularly to track trends and growth rates.
If your goal is a 10% increase in the first quarter and after the first two months you’ve only grown by 2%, it's unrealistic to expect to meet the goal. In that case, you should either adjust the objective or implement stronger, more drastic actions to force short-term results. If you’re not monitoring, it’s very hard to take timely action.
You can download a template below to work on your annual plan. Set aside time to work on your plan, schedule a retreat day if possible, and make sure to complete it (before the end of the year, of course), so you can start the new year with a solid tool.