Business, like everything else in life, has its own rhythm. Every organisation needs to fit certain key activities and decisions into each 12-month cycle. These include:
- Annual budget & operational plan
- Annual accounts filing
- Talent management review
- Annual General Meeting (especially for public companies)
- Risk review
- Strategic plan
Now, the complexity naturally varies by size. The bigger the organisation, the more involved the process, but the basics remain the same. Even for quite small organisations, it's worth putting some rigour and discipline around these processes. The Board or Partners should take them seriously, for they're an opportunity to develop a strategic edge over the competition, to bring the members of the organisation together around a common vision and to ensure that people have a voice, their own input into the future direction and success of the business.
Done well, the annual rhythm binds and drives the organisation forward. Done badly, of course, it can become bogged down in a bureaucratic swamp, sapping the energy from the business and hacking everyone off! It's a smart idea to run these things professionally and get the best out of them.
What time of year should you do all this? Consider a business with a December year-end (like 65% of large quoted companies). The budget and operational plan are best split into two parts, with a preview in November or December, giving the Board the opportunity to direct management, and a signoff in January once the full-year figures are in. A well-run business will want to file its annual accounts by March. Talent management is often underplayed; it's worth investing time and effort into this process which is best done in April. If yours is a quoted company, the AGM will be an important marker in the annual calendar, best planted in May. The risk review can then be done in June/July, just before everyone goes on holiday. This all leaves space for the Board to review the all-important strategic plan in September/October. And this in turn means they go well-prepared into the budget preview.
Once you have this 'operating system' for your organisation running smoothly, you'll find it makes everything run that much more effectively. And that in turn will give you an important competitive edge – which is what it's all about.
If you've found this blog useful, you can find out more with Patrick's CPD courses here.
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