Year End Planning Opens the Gate to a Better New Year

This post marks the start of a new series for this blog. The goal of the series is to work through the planning process for small to mid-sized businesses and entrepreneurs, in the hope that I can help sort out some of the more beneficial ways to go about this planning process so it will actually show a return on the investment of time and effort.

I’m going to presume that if you were interested enough in the title of this post to read further, you’ve already heard at least one variation of the old saying that “some people get so busy working in the business, they forget to work on the business.” You’ve also likely heard another one: “you can’t manage what you can’t measure.”

In my mind, there is as much truth and importance for entrepreneurs in the above quotes, as in a fortune cookie insert I’ve kept under the glass on my desk for decades which says: “Some people spend their lives trying to climb the ladder of success, only to find that it is leaning against the wrong wall.” (Variations attributed to Thomas Merton and Peter Drucker) 'Ladder goes up' photo (c) 2010, Jinx! - license: When I got that in my fortune cookie at dinner one night and later spent a little time reflecting on it, I actually decided to take a better look at the “wall” I’d been spending a lot of time and effort climbing. After doing some soul searching and research, I decided to take a different approach to my business, and to some extent, a different approach to my life.

If you read my earlier post, All I Want for Christmas is the Perfect Business Start-up Checklist, you know that I love to make and use business checklists. I find them particularly useful if you have ADD or are simply too busy working in the business to work on the business. Like Santa, (believe me when I tell you the only similarity between me and Santa is a beard) I try to check my checklists at least twice before I use them and, like a good carpenter, as the old saying goes, I also try to measure twice and cut once. I’ve learned that not all templates and checklists fit every situation, and like everything else, they can become out of date to the point of being misleading. Following them blindly can lead to disaster. Finding one you can use and tailor to your specific situation, however, can grease the path to achieving better results at a greater velocity.

There are lots of checklists available for those who want to do year-end or start-of-year planning. Many of these are wonderful and very useful for almost any type of business. What I’ve found with many of my clients over the last few decades is that some of them sit down with a checklist of some sort and give it an effort, but don’t realize their ultimate goal in doing so. This is particularly true with the rush most of us probably experience at the end of the calendar year.

When I organize a business for a client, whether the form is a corporation, limited liability company, or some other type of legal entity, I typically create a company record book for them. In that record book are annotated, tabbed dividers for documents such as articles of incorporation, corporate by-laws, or an operating agreement for a LLC, minutes of meetings, tax filings, contracts, and other significant company records. Additionally, however, I specifically include what I consider a wealth of basic strategic planning material, such as a customized SWOT analysis document, an opportunity assessment worksheet, life dashboard planner, and a variety of other tools I’ve developed for my clients over the years. 'Wood Shop Class Tool Box' photo (c) 2013, HeatSync Labs - license:

One of my favorite tools relevant to the planning process is what I call my “360° Small Business Audit Checklist.” This is a pretty lengthy document I created years ago to help my clients with a single source to review, analyze, and improve their performance and achieve their goals. The document is divided up into sections, such as legal issues, accountings, competitive analysis, marketing, disaster planning and other areas of risk management, insurance, cost saving measures, and succession planning.

Each of the sections has numerous questions. The legal sections, for instance include determination and applicability of a dozen Federal laws as well as a separate subsection on intellectual property asset protection, legally required postings, contract formalities, and record keeping. Another section on employment issues, which seems to be constantly growing, includes non-compete and non-disclosure agreements, employee policy manuals, non-discrimination policy, social media policy, etc.

Learning to work in the business, as opposed to working on the business, is something that doesn’t come easily to every entrepreneur. It is usually helpful to either have prior experience or to find instructions before using any complex and powerful tool. Using a tool, such as my 360° Small Business Audit Checklist, is likewise something that can be done with minimal experience and results, or can be a game changer if used as designed.

I know very few new or experienced entrepreneurs who really understand how to best address all the needs of their business. Business and the vast multitude of laws, regulations, policies, procedures, required postings, reports, and other filings relating to it have just become too complicated for a single person to understand on the minute-to-minute basis in which they seem to be created. As a “pop quiz,” can you even write down all the government required postings relating to your business right now, without doing at least some research? Would you be willing to bet a thousand dollars that you would get the answer absolutely correct? Please let me know if you’d like to try it!

My point is that, in my humble opinion, every business owner can benefit from a group of “trusted advisors” to help them through the maze (some would call it an “obstacle course) of “stuff” effective entrepreneurs have to plow through every day, related to the various aspects of running a business, so they don’t either get in trouble or miss an opportunity. In my case, as a lawyer, I like to get my clients’ accountant, insurance agent, financial planner, marketing person, and others together in the same room (or at least via Skype), so we can help our mutual client with a multi-disciplinary review and strategy session. The cast of characters can certainly vary, such as for a service business vs. a manufacturing business, but a certain core group is pretty much universal. Others can and should be invited as needed. 'Difficult meeting' photo (c) 2008, Simon Blackley - license:

These trusted advisor meetings should be held no less than once a year and preferably more often. I’ve never seen one fail to render a positive ROI for the client and many of them really are game changers. The give-and-take of these real time meetings is much more efficient than a series of individual meetings for several reasons. It saves time for everyone. Even more importantly, it also facilitates an exchange of ideas between the entrepreneurs and the “trained professionals,” who may have different perspectives and opinions, as well as fresh ideas. Even when these advisors confirm something, it can be helpful for the entrepreneur to know they do. If they don’t agree, the entrepreneur is left with options he or she might not have otherwise considered, and this facilitates an opportunity to work on the matter further until the best answer becomes more apparent.

The way these meetings are conducted is obviously important, including agreement on written agenda, time allotted, and who is invited. Thousands of books have been written on business planning techniques. What is most important is that the entrepreneur be able to identify the issues and understand how to get help in dealing with them, whether those issues are emergencies, possible problems down the road, or potential opportunities.

'The Design Process * Analysis' photo (c) 2009, Jordanhill School D&T Dept - license: The process starts with setting a date for the first meeting, doing an initial scan of issues, and then coordinating those trusted advisors best qualified to contribute help to the entrepreneur to get the issues successfully and efficiently resolved. Although I prefer to have these meetings at my client’s place of business, so records are available and the “trusted advisor team” has an opportunity to look around, sometimes the meetings are more appropriately held away from the office for more privacy and fewer interruptions. There is no hard and fast rule about this. It is simply a matter of picking what best works for the entrepreneur and the circumstances he or she is facing at that stage of the entrepreneurial life cycle.

The second step is to accumulate the appropriate information about the business, and to make as much of it available in advance to the team of 'Gates, Pool Road, Melbourne, Derbyshire' photo (c) 2013, Eamon Curry - license: advisors. This is a critical issue, and an opportunity to provide a segue to the next post in this series, because making the initial decision on what is important to review and work on, as well as what data pertains to it, is an opportunity for success or failure of both the process and the business itself. This process helps close the gate on what has been and provides the foundation as well as the starting map for what is to be.

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Posted in Applied Entrepreneurship, entrepreneur, Growing a business, Intellectual property, Law, Planning for a business
One comment on “Year End Planning Opens the Gate to a Better New Year
  1. Mark Carroll says:

    Very good article, Stuart. I like it.

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