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It's Only Common Sense: Preparing for 2014

Editor's Note: To listen to Dan's weekly column, as you've always done in the past, click here. For the written transcript, keep reading...Can you believe that it’s time to start preparing for next year already? It’s time to begin developing your strategy for next year, including your sales tactics, your marketing plan, your social media plan, and, most importantly, your account plans and sales forecast. You have a little more than three months left if you want to hit 2014 running.

Sit down with your management team and review how you did this year: Were you successful? Did you meet your forecast? You did have a forecast, right? Please tell me you have a forecast.

First, develop your strategic direction for the coming year by taking a look back at the previous 12 months and deciding what worked and what didn’t. Build on that knowledge to develop 2014's strategic direction. If something is working, expand on that; if something didn’t work, change it. The important thing here is create and maintain your strateg by meeting with your key people, talking about the company and its future direction, and creating a plan all agree upon.

How often do you meet with your key people and talk about where your company is going? I’ll bet it’s not too often or, at least, not often enough.

Make sure you listen to your sales team while developing your strategic direction. If you can’t have them all there in the room with you, plan a special phone meeting and ask for their input. This is so important because these folks are on the front lines--they know and understand your customers best.

And when I say sales team, I mean the entire team and that includes inside sales and customer service people because, in many ways, they often have the closest day-by-day relationship with your customers. They're the ones who probably know better than anyone (even the outside sales people) what's going on with customers. Make sure you get their input.

Once you've set the company’s strategic direction, it’s time to communicate it to the rest of the team. Make sure everyone knows what you're selling.

The next step is to develop your forecast. The best way to do this is, again, through your salespeople. Develop a simple, one-page account plan and have them fill it out on every key customer in their territory--from the largest customers down to newer customers with great potential. These account plans should also include one or two what I call "investment customers," those up-and-coming companies with a great product. These are the most important customers to examine because they could represent the future of your company.

Account plans should include key information about customers, including what business they're in, how they're doing in their own market, what their product is, how much of your kind of PCB business they have, and how much are you getting and what can you do to get more. Sccount plans also should also include a month-by-month forecast for each customer for the coming year.

Account plans are then turned over to the sales manager who develops the company’s sales forecast, month-by-month, for the coming year. It will be her job to put this all together in a way that is logical. She has to make sure the forecast makes sense. She has to look at the way the company’s bookings are trending the last quarter of this year and coordinate that with the first quarter of next year. If, for example you've been booking at an average of $2 million a month, that’s where you have to start next year as well. If you' e been trending up, you can institute that up-trend into next year's numbers. The sales manager also has to look at each month and the number of booking days in that month to make sure the daily bookings average will be attainable each month. This especially applies to months with holidays. If the information is available, she should look at past actual bookings to see if there are any actual month-by-month, quarter-to-quarter, year-to-year trends she can discover.

Once the forecast is complete and blessed by management it should be turned over to the operations people so they can plan their year including headcount, equipment, and technology. They need to know what to expect for business in the coming year to plan accordingly.

The next step is where many companies fail. You need to measure your progress to that forecast throughout the year. I want everyone to know how you are doing compared to the forecast. In fact, I recommend that the salespersons’ compensation be linked to achieving the forecast on a month-by-month basis. I would insist they track their actuals to forecast in their weekly reports--that way there's no danger of losing track of how important the forecast is and how they compare. The forecast, and how you are performing against it, is your only scoreboard and I don’t know how you can possibly play the game if you don’t even know what the score is.

If you are not doing the things listed above, this is the perfect time of the year to get started on them. The discipline will be invaluable, the communications will be critical, and the measurements will be vital. As I have been saying the past few months, things are getting better and it looks like 2014 could be a very good year, especially those who hedge their bets by doing a bit of planning. It's only common sense.