Financial well-being May 8, 2023 By
Most companies have a business plan and strategy that help them map out their annual plan. But what happens when unforeseen factors like interest rates, working capital, and inflation impact company goals and require pivots? With market dynamics changing, it's important to understand your options and remain flexible. Flexible Growth Planning enables businesses to stay agile and adapt their strategy quickly in response to unexpected shifts while remaining focused on achieving.
Flexible growth planning is a strategic approach that allows businesses to create a roadmap for achieving their growth objectives while considering unexpected changes that may occur along the way. This type of planning involves developing a strategy that can adapt quickly to changes in the market, competition, or economic conditions. Flexible growth planning enables businesses to stay agile and responsive to changes while remaining focused on achieving long-term goals.
When inflation and interest rates put pressure on working capital, take the following steps to make mid-year adjustments to respond to the market changes and keep your business growing:
Step 1: Review KPI Achievement
Every business has metrics they track to measure progress toward annual goals. Aligned with the annual plan, these figures help monitor where the business is and isn’t meeting objectives. So, the first step in Flexible Growth Planning is to see how well the company is performing against set goals. Whether the KPIs measure revenue generation, operating costs, or production efficiency, knowing how well (or poorly) a business is meeting goals help identify some potential gaps and some potential high-performance areas.
Step 2: Conduct a SWOT Analysis
The next step in creating a flexible growth plan is to conduct a comprehensive SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis. Based on the company’s achievement of KPIs, business leaders can assess where the company is succeeding and where improvement is needed. The SWOT analysis helps businesses identify their strengths and weaknesses, as well as external opportunities and threats. It provides a clear understanding of the company's current position in the market, and direction for future growth.
Step 3: Set Goals & Objectives
Next, businesses can prioritize their goals based on importance and resources needed to meet them. Based on the SWOT analysis and KPIs, businesses can set realistic and achievable goals and objectives for their growth plan. Goals should be specific, measurable, attainable, relevant, and time-bound (SMART).
Step 4: Develop Strategies & Tactics
Once goals and objectives are set, businesses can develop strategies and tactics to achieve the goals. Strategies are high-level plans that outline how the business will achieve its goals. Tactics are specific actions that support the strategies. For example, if the goal is to increase revenue, a strategy is to expand the product line, and tactics include market research, product development, and advertising.
Step 5: Implement, Monitor & Adjust
Once the growth plan is developed, businesses need to implement it, monitor progress regularly, and adjust the plan as needed. This means tracking the KPIs, analyzing the data, and making informed decisions based on the results. If the plan is not achieving the desired results, learn what may be the direct contributor(s) to performance and make changes.
Flexible growth planning is critical for businesses looking to succeed in today's fast-paced and dynamic business environment. Being able to pivot from your original growth plan in response to unexpected factors like working capital, interest rates, and inflation is essential to achieving your growth goals. By staying agile and adapting to changing circumstances, businesses can stay ahead of the competition and achieve long-term success.
