2018 is coming to a close and managers across small and medium enterprises are scrambling to put together the business plan for 2019. It’s the time of the year while the world is ready to celebrate Christmas and making plans for the New Year Eve party, lot many CEOs and GMs across the city are burning the midnight oil putting together a credible plan that will meet the aspirations of the team and the scrutiny of the board.

In the early years we have set targets using different approaches till we hit upon BHAG.

A Big Hairy Audacious Goal (BHAG) as the name suggests is an audacious goal set that can be achieved in the not-so-far date. Our BHAG put us on a 10-year journey. The benefit of a long-term goal is that at the time of making the plan you are not limited by the knowledge of the market in the distant future and hence not discouraged by the negative factors affecting the goal. You feel bold enough to tackle the issues as they emerge. Once you set the BHAG you split it into shorter milestones and each year based on the yearly results you adjust your strategy and tactics to stay on the path towards achieving the BHAG.

Unless your organization has set up a BHAG like we have, you may have to set up your Business targets each year using one of the approaches mentioned below.

Year Plus
You know your current turnover and your resources and you do a year plus projection for the year to come. Your projections may be based on the reality of the market or your appetite for growth. The Plus percentage depends on the age of the organization as a new company may have a 100% year-on-year growth easily, while a more mature company may be content with a 10%. You have to decide the percentage that is just below the impossible for your team.

Zero-Based
You forget the past and start with a clean slate. You do a deep SWOT analysis and then come up with a top-line and bottom-line number that you would like to achieve.

The benefit of the zero based approach is that forces you back to the drawing table, makes you challenge your assumptions, re-examine your costs and your supply-chain. It also forces innovation.

Market Share
You have been in the market for long and know its size and your current share of the market. You can make a conservative increment or a bold capture of the market share and arrive at the top-line number. You then plan to retain your bottom-line margins by reworking your costs.

The benefits of this approach forces you to think big. It’s a growth mindset. However given the scant market data available in the region, this approach may not work out so well, unless you make some calculated guesswork.

Hope everyone had a great 2018, as close or beyond expectations and wish you a growth-oriented 2019 plan.