Annual Planning for Founders & Subject-Matter Experts

Does the thought of annual planning send shivers down your spine?

Even if you’re coming off a great year in business, looking ahead and setting goals based on all the metrics you need to consider can be daunting.

I recently helped a colleague with her planning, and once she landed on her overall revenue goal —  part one of the planning process — she thought she was done.

Spoiler alert: That’s just the beginning!

When I asked her how she planned to achieve her revenue goal, she was less than thrilled to discover that good planning goes beyond setting a target to outline how the goal will be met. 

If that sounds familiar, get comfortable, because I’m going to share my best tips for annual planning in this post.  

We’ll start by acknowledging the reasons behind the resistance to planning many founders experience and then move into why planning is essential and how to do it effectively.

Let’s get started — it won’t be painful, I promise!

Why People Avoid Annual Planning

Every seasoned and successful business owner has their area of expertise.

I’m a trusted partner to my clients partly because they are experts with vast knowledge in their specialization — and sales and planning for their businesses are not among them.

Even though this is my bread and butter, I understand why founders dislike planning.

1. Perceived rigidity.

First and foremost, they dislike the perceived rigidity of annual plans. In industries like technology, where the market landscape can shift dramatically in mere months or weeks, a plan extending a year into the future can feel limiting.

2. The time and resources required for an annual plan.  

Resource allocation is critical for growing businesses with modest teams, making planning particularly burdensome. 

On a recent Sales Roundtable, an attendee shared that she considers the time she spends creating annual plans to be better spent on customer engagement and deliverables.

That makes sense in theory but you need a plan for when referrals dry up or engagements end.

3. Annual planning feels hard.

Recommendations for annual planning run the gamut from analyzing every data point to setting one big goal and wishing for it to happen.  

Many founders adopt a one-size-fits-all annual plan that often fails to account for fluctuations in the sales cycle, what the data is telling them or what they have to do to achieve their goals. 

As a result of data overwhelm and oversimplification, annual planning can prove to be a  waste of time. 

So, if you’re reluctant to carve out the time for annual planning, I understand why. 

But I’m also confident that if you dedicate time to reflect, analyze and apply your learnings, you will see trends and patterns in the data that will help you reach or surpass your goals for the new year. 

Annual planning can be eye-opening and inspiring — if you approach it effectively. 

But first, let’s explore some of the most ineffective planning I see so you can avoid those mistakes before we move into a better way.

Ineffective Planning (Cue the rainbows and unicorns)

I affectionately call an unproductive approach “planning by rainbows and unicorns” — meaning, you’re picking a revenue goal based on instinct and optimism alone (no data or evidence suggesting it’s the right goal).

If you’re new to business (under three years), rainbows and unicorns might be all you have to go on — and that’s ok!

You need experience and data to do the type of planning I recommend, but you can always start with what you have and apply research based on what you want your business to become. 

But if you’re at the three to five-year mark, I caution you against planning solely based on any of the following:

One Big Goal – Setting one big goal or revenue target based on instinct or desire,  especially if you have different offers or streams of revenue. 

Lack of KPIs (Key Performance Indicators) – Failing to set measurement markers, such as desired margin, revenue sources, and the number of new customers, makes it challenging to ensure sustainable growth.

No Systems in Place – Without systems to track performance, you’re left guessing at best, and you’ll lack a clear path to reach your goals proactively.

I call out these ineffective annual planning “strategies” because I want you to have the most visibility, clarity and awareness of what is happening in your business so you can plan based on hard data.

So, in the next section, I’ll outline the annual planning approaches that work. 

By doing this work upfront, you create a playbook for how you’ll reach your goals. 

Better yet, you can constantly adjust because you’ll have the information required to pivot.

Effective Annual Planning

As your business grows, year over year, the goal is to have predictable numbers, which means the more you track, the better.

Here’s how I advise clients to approach annual planning:

Set goals based on your offers

Let’s say you sell assessments, strategies and training, but you have one goal of 250K for 2024. I recommend breaking out the numbers for each service. You’ll know precisely how many of each you have to sell and how to allocate your time and energy.

Consider KPIs for sustainable growth

While there are standard KPIs, your indicators should be tailored to your business and goals.  

Your markers could be the number of new clients or the percentage of revenue you bring in from cross-selling. Your KPIs can be anything, but its essential that they support you in growing in the right direction, which brings me to the next point.

Track metrics that matter

Hate looking at the numbers? There’s no reason to go overboard with the spreadsheets! In fact, tracking too many things can be just as bad as not tracking at all. 

If you’re just starting out, I suggest tracking the following:

• Close Rate: The percentage of your proposals that turn into contracts.
• Sales Cycle Length: The time it takes you to bring a prospect through your sales process to a contract. 
• Average Deal Size By Revenue Stream: Especially if you offer bespoke services or consulting, track the average size of your contracts by product or service. 
• Lead Sources: Track how every prospect finds you — then reflect on where your most ideal customers come from. (Hint: You’ll want to spend more time developing those lead channels!) 

These metrics alone will set you up for better planning next year!

Make a plan!

Once you have your goals, consider how much can be covered by your existing customers because it’s infinitely easier to close with existing customers than new leads.

This is a very helpful post for more on selling to existing clients.

And if you have to seek out new leads, your metrics will be invaluable here, too. 

Where did you see the most/best leads come from last year? Was it networking, speaking opportunities, or referrals? 

Tap into your data and double down on what has worked for you in the past. 

Not All Planning is About Numbers

As dedicated founders and subject matter experts, you can easily center your clients in your work, and I’m all for it! 

But, as you are the critical resource to your clients, you need to take care of yourself and your team. 

As part of my annual planning, I’m setting tactical and energetic goals, meaning that I’m creating space for further education, reflection and rest. 

One of my clients is setting a target goal of working hours per week without surpassing it. Another discovered during the planning process that she didn’t want to offer one type of service anymore because she hated it! She’s now outsourcing it, and she’s getting referral fees in return.

The point is that annual planning can and should include taking care of your team and yourself to achieve your goals without burning out.

A New Approach: Annual Planning for Founders and Experts

Whether you love or hate it, annual planning is integral in identifying and reaching your goals. 

It’s not just about crunching numbers or setting lofty revenue targets; it’s a business development exercise that involves understanding market dynamics, managing resources efficiently, and recognizing the importance of flexibility in an ever-changing business landscape. 

By understanding what the data reveals, you can better plan for your year ahead, prioritizing what has worked in the past and letting go of what no longer serves you and your business. 

I encourage you to embrace this nuanced approach to planning and watch as it opens doors to unforeseen opportunities and growth in the year ahead.

Need a strategic thought partner to get this done and then some? Check out the Sales Playbook — an opportunity to work with me one-on-one to attract ideal clients, pitch bigger engagements and sign more contracts!