We all have dreams of where we want our businesses to be, but unless we plan it and put that plan into action, it will remain a dream.
A solid planning, budgeting and forecasting process is a key tool in keeping your ship pointed on the right course.
The first step to achieving your financial success is to take those dreams and put them onto paper, creating a clear pathway to your goal – your Plan. The plan connects the dots from where you are now, to where you aim to be in your future. It defines your goal, taking into consideration all the inputs – internal, external; economic, legal, social and otherwise.
Once the plan is in place, the next is to create a budget. The budget takes that plan and defines it in numbers.
- In corporates, the biggest challenge here is finding the balance after the push and pull between the dreams of all stakeholders. With the right corporate vision and culture, there is less push and pull and a greater alignment.
- For small business this means having all parties, including owners, embrace the vision, culture and plans required to achieve those goals and to follow them with absolute dedication.
The budget is ultimately a negotiated middle ground that once complete, should leave all parties equally satisfied.
Once the budget is agreed, the next step is to track your performance against the budget and make the necessary adjustments to keep you on your path. Accurate forecasting is critical to allow time for management to make the right adjustments to reach those short and long-term goals.
Without a strong Planning, Budgeting and Forecasting process, it becomes easy to waiver from your vision and your goals. But with the right tools, you will have a clear and constant picture of where you are and what you need to do to get you where you want to be.