The Power of Quarterly Planning

20% of small businesses fail within their first year. There are many possible reasons for this, but poor financial decisions are usually what ultimately lead to the decline of these companies. As someone who strives for success by meeting business goals, having a well-thought-out, realistic, solid financial plan can help your business thrive.

Many business conduct their financial planning annually. However, since it’s difficult to project where you will be 12 months in advance, quarterly planning is a superior alternative. Read on to learn how this strategic planning can help you meet your KPIs.

How Does Quarterly Planning Work?

Quarterly planning is a process where your business sets goals for the next 3 months. It happens 4 times a year. These goals can be financial, marketing-based, production-oriented, or include company expansion methods. Regardless, they must always be straegic.

Many companies rely on the SMART method to set strategic goals. SMART goals must be:

• Specific
• Measurable (have concrete ways that you can visualize whether or not you achieved the goal)
• Attainable
• Realistic
• Time-based (given a realistic timeframe to be attained within the quarter)

Prepping Your Plan

Once you determine what your SMART goals are, you will need to begin preparing your plan for the next quarter. First, look into where your business currently is both financially and practically. Assess how well you achieved goals from previous quarters and establish some context as to where you are starting the journey toward your current objectives.

You will want to talk with your colleagues at the beginning of your planning session to get more insight into bookkeeping and other documents that will tell you your current business status. Remember that employees who are in the thick of day-to-day operations may have some insight that you have not yet considered.

Setting Short vs Long-Term Goals

Quarterly planning needs to include strategic thinking as well as a plan for executing goals. Focus on the former first so that you and your colleagues can project where you need to go. Consider what a realistic goal may be for the next three months and whether or not it is possible. However, you will also want to think of this goal in the greater picture.

How will your goals from this quarter help you to attain long-term objectives? Remember that every decision you make should be a strategic move toward your long-term expansion goals within the next 5-10 years. Everything that you do should be done with purpose.

Creating a Plan for Execution

Next, you should create a plan for executing your strategy. The plan must include clear and specific deliverables by which you can measure success. Identify the order of your priorities and include them in your execution plan based on how important each objective is.

Meet Your KPIs This Quarter

Now that you know the importance of quarterly planning and how you can set strategic goals, it’s time to begin considering how taxes will impact your business. Contact us to schedule a call to discuss our tax and financial services. Our bookkeeping experts are committed to helping you save money and budget for your quarterly KPIs, so we look forward to hearing from you soon.