Why Annual Strategic Financial Planning Makes Sense for Your Business

Do you remember that time you decided to lose 20 pounds and immediately accomplished your goal with no planning or forethought? No? That’s probably because you know that worthwhile accomplishments and successes only come from strategy, planning, and hard work. For businesses in Carmel and the surrounding area, an annual strategic financial planning session with Edgewater CPA Group can position you for success for the year ahead.

Save Time and Set a Clear Path

Some people think strategic planning is time-intensive and cumbersome. Not only does this not have to be the case, but it can actually save time. In fact, a good strategic plan:

• Narrows your scope so you can become laser-focused on your goals and objectives
• Reduces cost and effort put toward ineffective initiatives
• Limits your risk by planning for contingencies and worst-case scenarios

Strategic planning allows everyone to work together toward a shared goal. Strategic financial planning determines when, where, and how to use your money, time, and talent to achieve those goals.  

Think Big Picture

Strategic financial planning allows you to think with the end in mind. For many businesses, the exit strategy is the end. In other words, is your exit strategy to an IPO? Is it to sell the company? Is it to enter into a new vertical? Develop a lifestyle company based on recurring revenue? The answers to these questions provide a starting point for your goals and objectives.

Develop Your Goals and Objectives

What specific goals and objectives move you toward your exit strategy? Perhaps it’s increasing market share, or maybe it’s launching a new product. Maybe you pivot due to unfavorable market forces ahead or invest in re-branding. Maybe you invest in commercial real estate and bring manufacturing in-house. Whatever you identify, it should align with your company’s mission, exit strategy, financial forecast, and budget. 

Define Your Success Criteria

What measurable results will communicate how you performed compared to your goals? Do you currently track these key performance indicators, or will you need to develop a tracking mechanism? Do you have sufficient cash flow to carry you through to your goals? Are you currently tracking things unnecessarily?

Delegate Ownership

Goals are more likely achieved when they’re written down and owned by someone. If no one is ultimately responsible for an initiative or metric, the odds are that you won’t achieve the goal. The strategic planning session allows businesses to set goals, define how to measure success, and assign ownership to company leaders. 

Keep Up the Rhythm

Clearly communicate the strategic financial plan during its unveiling. Then, include it regularly in monthly or quarterly meetings. When your strategic plan is a living document that trickles down through your business, achieves buy-in from your team, and is reviewed regularly to assess the progress, you can confidently forge ahead. 

At Edgewater CPA, we often participate in the strategic financial planning process of the clients we serve. It’s just one way we come alongside our clients as they grow, with wraparound services such as tax preparation, payroll services, and bookkeeping. If you want a firm that can support multiple areas of your business as you grow, call us today at (888) 317-4835 or schedule a consultation online.