Peter Switzer interviews Dennis Mattiske, from accounting firm HLB Mann Judd, to provide helpful and practical tips for capturing and leveraging your big ideas.
Dennis Mattiske is the small business expert at accounting firm HLB Mann Judd. He laments that many holiday-inspired good ideas vanish when business-owners get back to the office.
“It doesn’t take long for business owners to get caught up in the day-to-day issues and priorities concerned with running a business”, he says. “It means that all those great ideas, developed while the owner had the time and leisure to think about them during the holidays, are likely to be forgotten or put aside.”
He sensibly suggests bringing these thoughts together in a plan to add significant value to a business. Mattiske suggests you put your big ideas in writing now as part of your overall business plan.
Why do they need to be put into print? He lists the following reasons:
Mattiske gives us five tips for making it happen and making it work for your business.
Business plans can be short-term or long-term and include personal, marketing or any other more focused goals. (Incorporating personal goals into the plan is an interesting idea, but it makes a lot of sense.)
While short-term plans are more relevant to day-to-day operations, Mattiske recommends having some form of longer-term business plan - five to 10 years - no matter how brief. The long-term plan deals with where the business is going and the broad strategies of how it is going to get there.
“This acts as a guide for the focus of the short term plans, which then detail the objectives for that year that are in line with the long term objectives”, he says. “The plans do not need to be long-winded, and don’t need a great deal of background to be effective.”
Mattiske says that every plan should follow the same basic format, covering:
This can be reduced to as little as one page, or more often one to two pages, for each topic - now, where and how. Real estate guru John McGrath told me years ago that he operates off a single A4 page business plan. He likes something that can be referred to easily, rather than a weighty document that never gets used except for impressing bankers.
The old cliché always applies, especially in business: if you can’t measure it, you can’t manage it. Objective indicators are a great way of working out what is working for the business and what is not.
“The ultimate measurement of business objectives is usually a financial measurement - the profit or loss earned or balance sheet balances achieved”, Mattiske advises. “But shorter term objectives should be measured with non-financial measurements.”
Here’s a simple example. You might want to boost sales and decide you need to make more calls or do more face-to-face visits. You can count these and compare them to other weeks or months. Linking these to sales performance could give great insights.
Customer satisfaction surveys are another important non-financial measure you can look at to get a handle on how your business is performing.
Once the business plan is laid out, an action plan is needed to make it happen within a desired time frame. Actions should be ranked according to overall importance. Mattiske points out that the time frame must take account of the fact that the actions are usually in addition to other daily tasks and will therefore take more time to complete.
Okay, so now you have a great plan - but what’s to say that you will stick to it? Day-to-day dramas and old habits can get in the way. Mattiske says a formal process should be implemented to ensure all actions are fully completed and objectives met. He has another suggestion which I reckon works. “An independent party who is privy to the business plan is ideal”, he says. “Or alternatively, use a formal report-back process to others in the organisation.”
Which brings us to another great cliché, which I get caught out using all the time: small businesses don’t plan to fail, they fail to plan! Get into to it and - in the words of the dad from The Castle - “Feel the serenity”.
As this advice has been prepared without considering your objectives, financial situation or needs, you should, before acting on the advice, consider its appropriateness to your circumstances. All products mentioned on this web page are issued by the Commonwealth Bank of Australia; view our Financial Services Guide (PDF 59kb)