Of course the first step to achieve your business plan is to build a well thought out, realistic business plan out three years. The financials (P & L, Balance Sheet, & Cash Flow) must tie to operational plans for all functional areas such as sales, product/merchandising and marketing. Just this week I had three conversations with organizations where this has not been the case! A good support plan including what is required structurally to achieve this plan such as organizational, system, and real estate requirements must also tie into the financials. Key metrics to measure the executions of this plan must be defined and developed during this process by functional area. This process often begins in the third quarter and is completed at year end. When the year is complete the “basis” which originally was a forecast must be adjusted with actual results and then plans must be tweaked to keep the plans realistic.
If not already established, a strong cross functional business team(s) must be formalized. Key metrics need to be included in each team member’s performance plan. The team(s) must have their version (whether bricks & mortar, catalog, e-commerce, or wholesale) of sales, product/merchandising, marketing, finance/planning, HR, and IT on the team and be organized by channel and/or product category. The team must have a leader along with clear roles & responsibilities and regular meeting times.
The next step is to set up a cross functional calendar and process in order to deliver on this plan and adjust as necessary. Each department such as sales, marketing, and product development usually has their own calendar but this is where major milestones come together. This process is managed by a cross functional business team who is responsible for the key metrics identified during the plan development. A senior level ultimate owner of the process helps insure execution. The timing of this calendar must be driven by the longest lead time dates which are often the product development dates, especially if it’s a private label or wholesale company otherwise it might be the marketing dates.
Key milestones include:
Pre-Season milestones such as: Final assortment, purchasing merchandise, finalizing marketing plans, finalizing floorset catalog layout plans, or sales meetings
In Season milestones such as: Executing a floorset in store or getting product on line and taking markdowns on slow sellers
Post Season milestones such as: Cross functional “hits & misses” analysis prior to the next pre-season plan
Each milestone includes:
Sub steps to achieve the key milestone
Owner of each milestone with key input contributor
Completion dates of each key milestone (quarterly or seasonal dates)
Always include a “contingency calendar” to your business plan and process. Things rarely go exactly as planned and the team must be ready to flex and adjust as needed to respond to a rapidly changing business! The contingency calendar should include key dates to read metrics and the business results. These dates should be driven by the ability to affect business dates in the future for things such as product, marketing, and/or infrastructure things such as the org and real estate.
Good luck with your plan. These six steps will help insure your success!
1. Take the time to build a realistic business plan out 3 years and insure that operational plans by function tie into the overall business plan
2. Identify key metrics that are needed to drive the business plan and tie individual performance plans to these metrics.
3. Assign a Senior Level leader/owner to the business team(s) and to the cross functional calendar & process.
4. Establish cross functional business team(s) who are responsible for the execution of the plan. Every team needs a leader!
5. Develop a cross functional business management calendar & process that includes key milestones for:
b. In-Season Execution
c. Post Season Analysis
6. Insure that a contingency calendar with trigger dates is included in the business management process. Things are rarely exactly as planned!
I can be contacted at Janice@JLSearsConsulting.com or 206-369-3726. I'd love to hear about your business needs.