It’s that time of year again – the first half of 2022 is already over. We’re at half-time, just like in a football game. This is when the coach takes the team to the locker room to examine how they’ve performed so far, give some leadership inspiration, and reinforce the plan to regroup and outperform the other team in Q3 and Q4.
In a similar way, I just wrapped up Q2 reviews with a couple of my clients, and I tell you it’s eye-opening. It’s an opportunity to increase performance with a solid plan and to make adjustments as necessary based on more realistic and better data now available to us.
Here’s the simple process I use for a mid-year review:
- Do a solid close for June and get the reporting package completed asap. I like to close the books in 2-5 days.
- Lay out monthly income statements for the last 18 months on a spreadsheet. Format to print on one page.
- Breakout revenue in COGS (Cost of Goods & Services) by significant business segment.
- Develop a revised monthly sales plan if your sales results differ significantly from your initial budget for this year. Solidify the plan and lock it down.
- Examine your org chart with actual monthly data by department. For some businesses, this is easy – for others it is cumbersome.
- Re-forecast your operating expenses based on current levels aligned with the next six months’ expectations.
- Develop a 2nd Half Year Business Plan (2HYBP) – one page with monthly summary income statements.
- Make necessary changes to the personnel plan – review all accountabilities and ensure all are aligned with the revised plan.
- Review and communicate the plan with the team.
- Review at least monthly.
This process becomes easier if you have a rolling forecast versus a static budget – meaning as one month completes another month is added to the forecast. I use a rolling forecast for all of my clients.
I have a client in the professional services consulting business that lost a large customer in May. The sales plan needed to change significantly because of this loss. The team developed a revised sales plan; if they achieve it, they will be strategically much stronger. Difficult changes were necessary, but with brief stutter-step, they were nimble enough to make the change.
You can do this too. You can’t always control what clients and customers will decide. But YOU are in charge of running your organization with a best-practice approach. This habit positions you to handle storms and be ready for potential new business. I can help. Contact me!