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Success from Strategic Objectives

When you don’t have clearly defined strategic objectives, you can really wander along year after year quite aimlessly feeling like you’re trying really hard, but not necessarily getting a great sense of progress towards your strategic outcomes. So thinking about your strategic objectives, there are a few things that are really quite important. Firstly, what is the profit margin that you should be achieving year on year?

 1 – Profit Margins

You may not be achieving it right now, but certainly understanding what it should be and aiming to achieve that over time starts to set a mindset where you’ll make better decisions so that you can drive profitability. The next one, of course, is your top line annual sales revenue.

 2 – Annual Turnover

What your annual turnover is, typically, it has to grow in 99% of cases in order for you to become more profitable. We often need more growth, more revenue in our profit formula. So having a sales target is also a critical idea to understand really where you want to be in the future and focusing on that every single day, breaking it down to a daily target, so much more value in that than focusing on a breakeven target, which can eventually lead you to going backwards. The third one, of course, is your cash buffer and understanding your cash burn rate.

 3 – Cash Buffer/Burn Rate

What does it cost you daily to actually keep the doors open? If you can get serious about your cash buffer, then building up a cash reserve over time really pushes you further away from the cash flow cliff edge. That’s a critical thing to understand. We all trade way too close to the cash flow cliff edge in the early stages when we start a business. So understanding how to get away from that and setting a target is really important in the longer term.

The fourth one, of course, is succession planning and it’s understanding the talent that you need to get into your business, so that 80% of what you do can really be done by somebody else 100% of the time.

 4 – Succession Planning

When we don’t focus onattracting talent that can succeed us from the start, we don’t necessarily build a highly talented team that can really run the day-to-day business for you. The fifth one, of course, is your work/life balance objectives.

 5 – Work/Life Balance

Work/Life balance objectives are so important to make sure you don’t burn out and that you don’t end up having a business that you’re working for because the objective is to have a business that works for you rather than you working for it. By the way, please click on the “Like” button at the bottom of this video if you’ve appreciated today’s session. Thanks again. I look forward to sharing with you soon.

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