Corrections or additions?
This article by Bart Jackson was prepared for the January 8, 2003 edition of U.S. 1 Newspaper. All rights reserved.
Planning for Profit
If truth be told, most of us plan our vacations more
precisely than we plan our business. We figure out where we’ll be
at each time segment; know exactly how much each day will cost; and
organize various side trips to expand fun, conditions permitting.
We go, have a grand time, and then return to business as usual, taking
one day just as the next, and wonder why the economic downturn seems
to be carrying over into the new year.
Sponsored by the Mercer Chapter of the New Jersey Association of Women
Business Owners, (NJAWBO), “Small Business Planning for the New
Year” takes place on Thursday, January 9, at 6 p.m. at the Harrison
Conference Center on the Merrill Lynch campus on Scudders Mill Road.
Cost: $35, including dinner. Call 609-924-7975. Speakers Margarite
Mount and Sherise Ritter of the Mount Ritter Group work through
a step-at-a-time program for businesses to define goals and plan strategies.
Raised in Hamilton, Ritter earned an accounting degree and a CPA and
joined the Hamilton-based accounting firm of Lee & Sexton. Mount joined
the firm soon after. “Back in the early-1980s, we had several
clients who didn’t even want to listen to us because we were women,”
recalls Ritter. “We got awfully tired of riding that train to
New York to service other peoples’ clients.” Gradually, during
this commute, the women decided that working for themselves was a
better option. Within a little more than eight years, they bought
out the firm’s owners and founded the Mount Ritter Group. Today they
and their 12 employees act as advisory accountants for an ever-growing
clientele, guiding them on issues ranging from acquisitions to humanizing
the workplace.
“Oddly, most businesses are afraid to plan,” says Mount. Planning
invariably involves change, and change invariably is difficult.” However,
both Mount and Ritter feel that without a defined line of attack,
a company is setting itself adrift and almost assuring its own demise.
Planning, as they teach it, is an ongoing process that blends through
all levels of the workplace and through the daily business process.
Gather your strengths. Any good plan starts from the groundup and involves a total re-thinking of your entire company. To decidethat the company produced 10,000 units last quarter and this quarterwill raise that to 12,000 is not a plan. It’s a quota. The Mount Ritterteam insists that planning comes from bringing all your company’smarketable skills to the table and molding them into a profitableenterprise. “You literally need to itemize what skills and assetslie within your firm,” says Ritter, “then decide what youcan do with them. There will doubtless be some surprises, but theplan becomes a natural outgrowth of these assets.”Blueprint your implementation. Once goals are established,the managers must hash out, then prioritize, the steps toward implementation.Ideally, figuring this pathway should involve input from every leveland even every individual. It is a sifting process where the entireteam must feel they are on a sensible track and be aware why eachstep has been so ordered.Employing plans piecemeal invariably fragments potential success intobewilderment and frustration. Many firms conduct grand marketing surveys,identifying a specifically defined solution to a consumer need, whichis sent off to production before executives realize they can’t capitalizeon it. Or perhaps the sales force cannot sell what the ads are promising.Such glitches can be avoided through a combined team effort whilethe plan is still on paper.Decision factors. With this path to profit neatly documented,one must come down to reality and face the obstacles and ramifications.Most companies, for example, figure where the competition lies beforegoing into another line, but often some of the subtler factors gounnoticed. How will this new move shift the company’s tax status?Will it affect the pension system? If this expansion requires an acquisition,no matter how small, what is the business culture of the acquiredcompany?Flexibility. A business plan should always be writtenon paper, but it should never be written in stone. Interestingly,some of the least flexible plans exist in the mind of the company’sowner, who has never shared his vision with anyone. “Simply put,”says Mount, “a plan should never be a rule. It is a pathway tosuccess that can be overridden as conditions change.””We had one client,” adds Ritter, “who had it fixed inher mind that she was going to retail home decor items right here,in this location. When encouraged to be more flexible, she ended uprefocusing on her clients needs with a line of personal accessories.”This slight shift proved most profitable. How much flex should youadd to your business recipe? The Mount Ritter team agrees that thefurther in the future you move — from a one to a five to a 20-yearplan, for example — the more flexible you must become.On the downside. Alas, not every business plan can begenerated from wish lists alone. There comes a time to pull in ourhorns and downsize a bit. Here again, a planned, orderly retreat preventsa disorganized disaster. When sales droop, letting inventory run lowmay prove a short term solution. “Personnel belt tightening,”Ritter notes, “can frequently be achieved with a little creativity.Instead of outright firing, workers can shift down to a 35-hour week,or overtime can be eliminated.”Probably no business tool is more obvious, yet more generally ignored,than pragmatic planning. When it arises from a democratic groundswell,it becomes the greatest morale and productivity booster a companycan adopt.— Bart JacksonNext StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
