There are many aspects of running a business, including managing your workforce, planning new projects, and securing new clients. With so much to do, it’s easy to lose track of the bigger picture. However, doing this could prove detrimental to your company’s future.
If you want to grow your company, then conducting a year-end business review is essential. Not only can it help you identify areas of weakness, but it can also open up new potential areas of growth.
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Why Is An End Of Year Business Review Important?
According to Investopedia, 66% of businesses fail in their first ten years of operation, but an end-of-year review can highlight potential issues. There are many reasons a company might fail, including:
Unclear business plans - Without a comprehensive business plan, it’s difficult to define your goals and check whether you’re meeting them. If you don’t plan for the future, you won’t be able to measure what’s working.
Lack of financial planning - Some people start a business with a small investment and make it work. However, you should always ensure you have money for unforeseen circumstances such as investing in new products and increasing your workforce.
Inadequate market research - Understanding your market is crucial for long-term success. Many people blame a lack of finances for their business failing. Still, if you don’t identify what your target audience is missing, you won’t be able to compete with other businesses.
Conducting an end-of-year business review enables you to highlight the areas you need to improve on.
Reviewing Your Year-End Business
Now you know why a year-end business review is essential, let’s examine five smart ways to conduct yours.
Identify Your Successes and Failures
Whether you provide online services, run a manufacturing business, or operate in a corporate environment, you still need to identify your successes and failures. The best way to do this is to look at how much work you’ve produced this year.
You should count every successful deal, product sale, or conversion as work. Once you know how much work your company has produced this year, you can analyze what worked and areas you might need to improve on.
What Did You Do Right?
Businesses can be time-consuming, and you might not have time to look at the areas your company is succeeding. Which products are selling well? How many of your leads become conversions? By identifying what went well, you can look at what you did to achieve that result.
For example, if you sold a range of products, then think about what influenced that result. Did you change the marketing strategy? Are the products you’re selling filling a niche area? Knowing what you’re doing right means you can use the information to increase your performance next year.
What Went Wrong?
Unless you have a perfect business, there will be things that you could have done better. Looking at the things that went wrong requires reflection and constructive criticism. Don’t be downhearted by your companies performance; use the information as a learning experience.
Everyone wants their business to succeed but running before you walk leads to unrealistic goals and disappointment.
Evaluate how your budget matches your goals and make adjustments. Don’t be afraid to let go of some of your initial goals and look forward to the future.
Redefine Your Vision, Mission, and Values
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Defining a vision for your company is critical if you want to connect with consumers. Goals help you meet targets, but a vision embodies your morals, dreams, hopes, and is the voice of your business. If you don’t have a clear vision, it will be difficult to set realistic goals and targets.
Forbes magazine published an article featuring the best companies for corporate culture, and it shows us how having a strong vision can create a more productive workforce. There are three critical aspects to developing an influential company culture; vision, mission, and values.
In three steps, you can redefine your company culture and gain a focal-point for planning the future of your business. Here’s how:
1. Write a vision statement. Your vision is the reason you started a business. Think of it as your motivation and passion. Here’s how to write a strong vision for your company.
2. Define your mission. Where would you like your company to be in five years? What growth would you like to see? Your mission statement is about how you plan to drive your business forward.
3. Consider your values. Our values define the type of people we are and incorporate ethics, empathy, and understanding. Think about how you want to portray yourself to customers and the way you’ll treat employees.
Companies often create their vision statement, then don’t follow through on their mission and values. If you’re not happy with the way your business is performing, or you have reduced staff retention levels, then it’s time to redefine your company culture.
Check The Numbers
The term metrics makes some people cower away in fear, but they can make or break your business. If you’re the type of business owner that only tracks their finances, then it’s time to get real and use the abundance of data that’s available.
Metrics track all areas of your business and look at the overall performance. For example, a metric measures how much website traffic you generate, but KPI’s look at specific areas of performance. The metrics you should measure include:
How many people visit your website.
How many customers subscribe to your email list.
How many leads you convert.
How many clients or customers you have.
There are many ways you can keep track of your metrics, but Google Analytics is the most popular for businesses of all sizes. Once you know how to use it properly, it can highlight problem areas such as where you’re losing money or when people leave your website.
Remember, you should also use social media analytics and analyze how effective your emails are. Doing this allows you to change marketing strategy or review how you connect with your audience.
Employee Performance
Your company depends on the competence of the people you hire to make operations run smoothly. If your employees aren’t performing well, then it can result in financial losses for the business.
Common ways of measuring employee performance are:
Setting goals and KPI’s
Using checklists
Reflective thinking
360-degree feedback
Rating scales
If individual employees aren’t performing well, then it’s time to think about whether they have a future at the company. However, if all your employees are under-performing, you should look at what you’re doing wrong.
You can learn more about how to measure your employee’s performance levels here.
Include Others
So, you’ve had a bad year, and you know change needs to happen. Don’t hide away in shame, let people know that you understand your mistakes, and you’re willing to make changes!
You should include your employees in the evaluation and listen to what they have to say. Remember, while you’re in the office, your team is on the front line dealing with customers. Maybe they’ve noticed an aspect of the business your customers don’t respond to, or some products don’t sell. Ask your employees to write evaluations and incorporate them into your planning.
Company reviews are a fantastic way of seeing how people respond to your business model. List your business on Trustpilot and be open to the feedback you’ll receive. If it’s all positive, then keep it up next year. Negative feedback means you need to make changes and focus on turning your corporate image around.
Plan For The Future
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We’ve explained how important metrics and data are but don’t forget about the bigger picture. If your focus is making money, your business will suffer. A robust year-end review incorporates financial growth and your company goals.
The best advice we can give is to think small and grow your business step-by-step. Achievable goals are easier to accomplish and can give you a strong foundation to meet long-term targets.
When it comes to planning for the future, you should write an actionable strategy that covers the areas your business is failing.
Set Your Metrics
Look at your current data and decide which metric you’ll incorporate into next year’s strategy. For example, if you know you’ll focus on social media, make a plan to measure the likes and shares your posts achieve.
You can measure how your audience engages with your content and the conversions you achieve in sales or subscribers. If you begin next year knowing what you want to review, you’ll be able to keep track of your data and save yourself some time at the following year-end business review.
Choose Three Deliverables
Setting multiple goals may seem proactive, but it will only lead to disappointment. Instead, choose three deliverable targets that you know you can meet and focus on achieving them.
Describe what you need to do to meet those goals and stick to the plan. What resources do you already have, and what do you need? If you need new software, do your research to ensure you get the best deal and break your goals into small steps.
You should also keep track throughout the year of how you’re meeting each goal and highlight any areas that are proving difficult. By keeping track of your achievements, you can look back on the information and perhaps find ways to make processes simpler.
Plan How to Connect With Others
Every business, no matter how big or small it is, should have a publicity strategy. If your customers don’t trust you, they won’t purchase your product or service. Maybe you need to improve your content strategy and define yourself as an authority in your industry. Do you have time to manage your company blog, or should you hire someone to do it for you?
A great way to increase your visibility is featuring in a local newspaper or magazine. Remember to consider the financial implications and put together a publicity plan that will help improve your profitability.
Identify potential opportunities to gain exposure and plan for them in advance. You might need to pitch your business to magazines, and a strong vision statement can help secure you a feature. Be aware of exhibitions you could attend, and attempt to connect with your audience on social media.
The Takeaway
There are many aspects of conducting a year-end business review, but doing it can be beneficial for your company. In an increasingly competitive world, businesses must do everything they can to set themselves apart from the competition.
Once you conduct your first review, you’ll find that the process more straightforward, and it can be advantageous. Make sure you keep track of your activities and put together an actionable plan based on the information you gather.
Now you know how to review your year-end business, it’s time to get to work. Here are some great strategies to help you stay focused on the task.
Do you have any tips for conducting a year-end business review? We’d love to hear them!