Why Businesses Should Plan
This article is about business planning and the power of putting a team on a clear pathway to success. It was written by David Ayling, the former owner of Straightpoint (pre-Crosby acquisition), and now president of FAD Equipment Store.
Where do you start your plans? At the beginning? You’re in the wrong place.
Seriously, if you want to make a successful plan, start at the end. Think about it in terms of a sat-nav in your car—you put the destination in first and then it calculates a route. You might have to turn right at the top of the street, and stop for gas along the way, but the end destination is there all along. The time of arrival might change, but it’s there from the start.
When I first sat down with a gentleman called Gary Mullins, master coach at Action Coach, it was circa 2014 and I was owner of load cell manufacturer, Straightpoint, which had been (a huge part of) my life since I bought it on April 15, 2002.
“When are you going to get out?” Gary asked.
“It’d be good to be retired at 50,” I quipped.
“Ok, let’s plan for that,” Gary said.
What I really meant is that I wanted to be in control of my destiny by then. In other words, I wanted to work for who I wanted, when I wanted, and not make money my motivation for getting out of bed in the mornings. I think Gary understood that and we set the sat-nav. We’ll find out at the end of the article if we ever arrived, and on time, but what’s important to accept for now is that to take a business from good to great, you must start at the end.
Where business and road trips are different, however, is that you need a plan instead of a GPS. Before we put pen to paper, Gary gave me a book to read: ‘Mastering the Rockefeller Habits’, by Verne Harnish. I guess it became the special sauce for our first plan.
As Verne writes, every business should find its optimal cadence—the perfect rhythm at which it should trade. Look at a runner’s stride pattern even in a long race; it isn’t slow or labored, but economical and full of bounce. Verne is founder and CEO of Scaling Up, a global executive education and coaching company with over 200 partners on six continents, where Gary is also a master coach. Again, one of the pillars of the organization is planning.
To really get this stuff, it helps if you’re already a planner to a point. If your response to ‘plan’ is ‘no way, man’, this concept, and probably this article, aren’t for you. If, however, you like to make lists or set targets, this will serve as valuable fine-tuning. I was lucky: I liked to write things down; I was good at communicating; and brevity was my bestie. I loathed bullshit too. Gary and I were kindred spirits.
"This way out," says Gary Mullins (left).
Get yer Bee Hag out
“Let’s talk about your Bee Hag,” Gary said one coffee-fueled morning.
“Come on, Gary, I know we’re getting on, but…”
“No, Straightpoint’s Big Hairy Audacious Goal… your BHAG.”
He explained that the term was coined in the book, ‘Built to Last: Successful Habits of Visionary Companies’, by Jim Collins and Jerry Porras. A big hairy audacious goal is a clear and compelling target for an organization to strive for. It’s the end-point we’ve been talking about and another way of looking at it. It’s especially useful if someone is struggling to find an ending to their story. Do you want to top $1m revenue? Achieve $500k EBITDA? Sell up? Whatever it is, make it Big, Hairy, and Audacious.
Here at FAD Equipment Store, we’ve got a Bee Hag, and a one-page business plan. I practice what I preach, damn it. We know where we need to be. We know that simplicity, quality, value, and service are important to getting there. Working back from our Bee Hag, we have a yearly plan, which we’ve broken down into monthly plans that are assessed with one-hour calls (no more) with the team. At Straightpoint, we had 90-day plans too, but I don’t want to get side-tracked by the minutiae of planning strategy—that’s not the point of this article.
Plan to progress
The first plan might be the hardest you put together, particularly if this is a new experience for a team of people. You’ll probably find that it gets the least buy-in and support too. But that’s even more reason to do it. At Straightpoint, we found that planning became an efficient way of weeding out people that weren’t necessarily bad apples, but they just didn’t fit our culture. What repeat planning does is bond a team of like-minded workers together on a mission. Eventually, there’s no need to tell employees what to do, everyone just starts doing it together. And they love it. The more success sticking to the plan generates, the more committed to it people will become.
A good business plan is available for everyone to see.
Straightpoint’s single capacity BlueLink load cell was a direct result of a planning meeting in Camarillo, California, where I was joined by Wayne Wille and Aaron Orsak, both then technical sales managers; and Jeff Miller, who was general manager, a role he holds at FAD Equipment Store today. The 14,300 lb.-capacity product was literally created out of recognition that we needed a tool that could compete with Dillon’s (a competitor) mechanical force measurement product. We targeted BlueLink at end users that remain loyal to traditional equipment but who might be receptive to enhanced technology and the inherent advantages of reading data on an iOS or Android smartphone installed with a free app. Everyone embraced it. Without a planning meeting it would never have been conceptualized.
Just like new products and solutions can be found this way, so too can greater automation and systemization. Customer service can improve. Lead times can be cut. Every challenge and hardship are overcome with the Bee Hag, or at least completion of the next annual or periodic plan, in mind. Culturally, this is the opposite to cleaning, sweeping, stacking, ordering, selling, etc. just because it says in your contract that you’ve got to do it. It’s chalk and cheese when compared to operating month by month because there are invoices to be sent on the last working day of January, February, March, and so on. Ugh. That’s just big and hairy.
Bee Hags can be scary, at first.
Forget the customer
Don’t let the customer spoil a good plan.
Obviously, we spend a lot of time in business thinking about the customer. Our thought processes are governed by what we can give them and what they need for them to give us their money. However, a plan, or Bee Hag, doesn’t really involve the customer, beyond the fact that their custom is likely to be a given in achieving it. Also, they might not benefit from it. In fact, it could be to the detriment of the customer that your plan involves rapid, global expansion. That’s ok—it’s your goal, not theirs.
That said, I think this equipment store’s customers are gaining from our plan and the team’s ability to stick to it, as last week’s February review proved. We’re providing a good customer experience and they’re coming back to buy more product. We’re also constantly updating our content, increasing contact with vendors, and automating what processes we can. As Austin Helton, vice president, application sales and market development, says, we’re Pacing Hot, which is just where Verne Harnish, Gary Mullins, Jim Collins, and Jerry Porras would want us to be.
What repeat planning does is bond a team of like-minded workers together on a mission.
Some people say to me that they’ve been just fine without a plan to date, so why start planning now? Why waste the paper? And, true enough, this concept isn’t for everyone. Honestly, it doesn’t matter to me if you implement these strategies or not. What I would urge you to consider, though, is are you settling for good when you could be great? Are you a middling business steadily banking a moderate profit each year, when triple-digit, gazelle growth, is just a plan away? Do you need to get your Small, Hairless, Irresolute, Target (SHIT) in order?
You remember my conversation with Gary… “When are you going to get out?”—“It’d be good to be retired at 50,”—…
On January 2, 2019 news broke that Straightpoint had been sold to The Crosby Group, the largest lifting, rigging, and material handling hardware company on planet earth. I finished a handover contract with Crosby on March 21, 2020 and celebrated my 50th birthday (albeit on Covid lockdown) on April 4, 2020.
Gary, we were two weeks early.