Remember what it is that we need to achieve: "We need to have the Right people, doing the Right things, the Right way, for the Right reasons with everyone in the business fully engaged and aware of their contribution, as their Scaleable business grows within its means."
Here we go about "doing the right things", hopefully using sound logic. Strategy is no different to other tasks we must successfully complete in business. We need to understand what we need to achieve in very general terms, we need to have some plan of attack, we make sure the individual building blocks are all executed well, and then assembled properly. Finally when we're finished we test the output with some simple design principles and then if needed go through the process again, until we have it right. But we're never finished! This is not a quarterly occurrence nor a once a year love-fest. The ownership of the business strategy resides with the business leadership, and in a thriving businesses naturally forms part of daily conversations. Some formalisation and documentation is required to collate various inputs but the required thinking NEVER stops. Read here what Jim Collins has to say on "The Strategy Council'.
One last necessary yet insufficient condition for business health should be this. Every employee should in theory be able to state the business strategy in a short, clear statement. and it should be focused on steady, profitable growth beyond the short term .Everyone should know how they are contributing to the strategic goal.
Everything you need to work through this, is to be found in the remaining pages of the Strategy Home page.
At the end of the day, strategy is about the actions you take. The highest priority of the SME leadership team is to ensure disciplined implementation of key strategic initiatives. The key is to take a disciplined approach when converting strategies into actions that can be incorporated in financial plans and operating budgets. One important capability that companies must develop is the rolling forecast and associated budgeting. This ensures that needed investments can be made in a timely manner rather than waiting for the next annual planning cycle.
In case you need persuading there are lots of good reasons to do this. Not least, are these two that impact every organisation, whether an SME or a Multi-nationals or even a government - bad data, and poor assumptions. As we discussed in the little aside: Reporting and making clear your uncertainty, your action plans and their successful implementation are contingent on two broad areas of uncertainty - risks that might materialize but which you are conscious of and actively managing, and opportunities and obstacles that if overcome can release upside benefits. The difference between the two is that badly managed risk will result in a poorer outcome and eat away benefits, obstacles not overcome just limit your chance of exceeding expectations.
All rolling forecasts have these five core components:
At the same time a rolling forecast is much more than simply adding one period to a traditional forecast and dropping one period of actuals off the other end. It is critical that the appropriate effort is spent on analyzing what has recently happened, why it occurred and what will be done in the near future. The vast majority of effort should be spent on updating periods that were previously forecast, not on the new periods added to the forecast. The further into the future a period is, the more variability and forecast error there is; therefore, it is best to focus the adjustments in the near periods as those are more controllable and predictable. A rolling forecast solution can provide many benefits to an organization in terms of reaction time, alignment of operations, and activities and timelines. It allows management to focus on making decisions that truly matter and have far-reaching implications that can propel the organization towards their strategic goals and overall vision. Done correctly, it will provide true competitive advantage in a constantly and rapidly changing business climate.
See more at: http://www.rollingforecast.com/insights/five-core-components-of-a-rolling-forecast/#sthash.PTqsiJTE.dpuf Now it is time to move on to understanding the forces acting on our business and how we should respond.