Don’t underestimate the importance of getting everyone involved in the business planning process and then sharing that plan with all.
If you ask most owners of A/E firms – especially those who have achieved any size and scale – if business plans are a good thing to have, the majority will say that they think “business plans are good.”
That said, I don’t think many of these same people have ever really stopped to consider WHY business planning is important for their firm. As a result, they don’t get all they can out of the investment of time it takes to do a new business plan, or revise the one they already have at least once a year.
The “lack of why” can also result in minimizing the involvement of their entire staff in the planning process and just doing it at the top with their BOD, principals, or executive team. And when that happens, it most certainly reduces many of the benefits they could get out of the whole thing. The plan is done and there’s little evidence of that provided to the rank and file employees beyond their sense that a budget has been prepared and maybe some financial goals have been set that some, but not all, employees will see.
That’s a shame. Because aside from the necessary tasks of creating a budget and goals, there are so many other great reasons to get everyone in the firm involved with creation of the plan, along with reasons to share the whole thing with everyone in the firm once it is done. Here are some of them:
- You can help instill a real sense of purpose in your people. When people have that sense of purpose, your voluntary staff turnover rate goes down. Your people will also work harder and tend to do more of the right things that will enhance your long-term reputation as a business. This is important stuff! When we talk about “purpose” in this business, it’s usually pretty easy to find a worthwhile one because A/E firms do such meaningful work. You DO actually make the world a better place, something that certainly can’t be said for a lot of other types of businesses. So take advantage of that fact! The business planning process is a great time to establish and communicate that sense of higher purpose for the work of your firm to every team member.
- You establish a context for everything that the business is trying to do to improve itself. Again, this is super important and crucial to your success. Does every employee know that there’s a bigger picture and how what they do fits into that? They should. They should also realize that their own efforts contribute to the success of the whole, and that if the whole firm does well they will benefit. Just making changes in the business without establishing the context can lead to a greater probability of failure in implementation.
- You train your people in the business aspects of our business. We know that somewhere around 70 percent to 80 percent of the employees working in A/E firms have had no formal business training. That means they have had no schooling on important subjects such as finance, accounting, marketing, promotion, HR, selling, management – I could go on, but hopefully you can see why that’s a big problem. On top of that, a large portion of the staff probably hasn’t worked at a better-managed firm in this business than yours. Where are they supposed to learn this stuff if you don’t teach them? Building a broad base of people in the firm who understand your business is crucial to your ability to operate profitably and withstand staff turnover, not to mention your longer-term efforts to set the stage for a successful management (and possibly ownership) transition. The business planning process should contribute to the business knowledge of every employee on your payroll.
- You build trust with management. You want every single employee to trust that management has their best interests at heart because IF people feel that way they will (hopefully) tend to do more of the things that help the company be successful. If they DON’T trust management, they will tend to think only of what betters themselves. The business planning process should lead to more transparency and more trust because there are fewer secrets. Everything is out in the open.
- You create “psychological ownership.” I will admit in the past I have been hesitant to use this term because I truly believe that real ownership – even if it’s just a tiny piece of a much larger enterprise – can be used as a motivational tool much more than it is in many A/E firms. But without getting into a debate on the merits or problems associated with that, we can all agree we want everyone to THINK like owners even if they aren’t actually owners of the enterprise. Bringing them into the planning process – even if all you do is give them a chance to express their opinions on the direction of the firm and what it does well or does poorly – is one way to help them feel like it is THEIR firm, too. That’s not only motivational for them – it also influences every single decision they make on a daily basis.
- You create greater accountability. When everything is out in the open – and the goals and action items along with a clear idea of who is responsible for what is committed to writing, AND then results are shared with all employees over the course of the year – you establish greater accountability. Peer pressure to perform results, along with a tendency toward greater cooperation between all to achieve those results. That’s a good thing.
I’m sure I could go on here. I realize that many firms in this business go off-course with their business planning efforts. Some people have a tendency to overcomplicate things and as a result, many of the positive outcomes that could be achieved through the process are lost. Don’t let that happen to you. And don’t underestimate the importance of somehow getting everyone involved in the business planning process and then sharing that plan with all, either!
Mark Zweig is Zweig Group’s chairman and founder. Contact him at firstname.lastname@example.org.Click here to read this week's issue of The Zweig Letter.