Great. Good. So-So. Bad. It’s been quite a year for all of us. As I look back on this year and think about my clients’ results – determining wins and losses with hard, comparable data on sales, margins, efficiency, and profitability – it is sometimes still hard to quantify a year as a great year, good year, so-so year, or bad year. Or perhaps a combination of all of these. Let’s look at a fictitious, but very possible scenario, for a business experiencing all four.
Great Year – We gained some new, big customers!
As you wrap up your 2023 planning, make sure you take the time to reflect to recognize and celebrate your wins. Did you land a major client? Solidify relationships with current clients? I talked about this before in my year-end planning post, but recognition and celebration of wins is one of the things high performers tend to forget to do. It’s so easy for us to magnify our failures, but not our wins.
Good Year – We kept steady customers.
Look at your historical data. What is your profitability by customer, segment, and revenue stream? You may find that while you have some significant accounts, you might also enjoy smaller but steady sales that feed profit every month. This is worth celebrating and cultivating too. You never know who your smaller accounts know, and if you treat them well and they speak highly of you, there could be some significant downstream sales coming your way.
So-So Year – We tried some new tools and got distracted.
Maybe this year you tried some different technology, and it wasn’t always a smooth ride. New technology like DataRails, Asana, Monday.com, Loom, Bill.com, and older technology like NetSuite, 3PL’s, LEAN, remote work and outsourcing can go long way to making your business more efficient. But you can also experience bleeding edge, always looking for the “latest and greatest,” and getting caught up in “shiny object syndrome.” I have done this several times with technology, never maximizing the expected improvements. The man who chases two rabbits, catches none. Don’t overthink (and overspend) on improvement tools and experience paralysis through analysis. Look at the options, decide, and move forward – with efficient growth always the goal. Ask yourself “Will this tool help us improve the process to get to timely and excellent deliverables? Or will it take more time and energy from our staff and get us behind – and end up in the same place we started?”
Bad Year – We made mistakes. We lost some money. We had to let people go.
No business has a perfect year. Some have terrible years. Maybe you lost (or had to lay off) key personnel. Maybe you made a major mistake on a client deliverable and had to redo the work for free. Maybe you overspent in areas that you should have kept a better eye on.
EVERY business makes mistakes. The key is to learn from them, change processes or get help/training to avoid the same mistake again, and most importantly, learn to truly let go and MOVE ON. Failures can be expensive lessons but dwelling on them will only drain your mind and pockets even more. Put the past where it belongs – in the past.
Questions to ask at the end of the year:
As you try to evaluate whether your year was great, good, so-so, or bad, here are some questions to ask. These will also help you prepare for the future.
What technology served you well? Do you need to make a change? Add features?
What does your team and personnel plan look like? What are their metrics? How are you measuring their contributions to workload, culture, and profits?
What is the work culture like? Are people enthused about working here?
Is the team improving its capabilities regularly? Are team members always learning and improving?
What business segments are most profitable? Which are not?
What is the volume for your top 10 customers? Do we expect the same or better next year?
How could you improve the sales process and customer onboarding?
What one process could you improve to at least double efficiency? What one process could you eliminate?
How can you improve the back-end processes in accounting, payroll, accounts payable, and accounts receivable? (Ask the people who do the daily work in these areas.)
What are our top three goals for next year?
I can help!
Whether you had a great, good, so-so, or bad year, I believe Verbeck Associates can help any business be better. I’ve seen so much as a full-time fractional CFO for the last 16 years. Many businesses wish their net income was better. They are experiencing scarcity in the supply chain, more competition for qualified team members, and rising interest rates/inflation. You are probably feeling the effects too. But you still have choices and power to fix some leaks, institute better processes (like consistently going over a Weekly Scorecard), develop strategy, pick the right team and technology, and move forward. The choice is up to you, and I’d love to help. Contact me for a free conversation and a basic evaluation of what we can do together to make the end of 2023 reflection contain more of the “Great/Good” elements than the “So-So/Bad” ones.