In previous articles we have discussed tips and elements that need to be considered before ending a business year and starting a new one respectively. In this article, we will be examining how to go about writing an annual business review. An annual business review details the progress, achievements, challenges and pitfalls of the closing year in precise, measurable and quantifiable terms.
As you prepare for your annual business review, I recommend Simon Sinek (https://simonsinek.com/), an author, motivational speaker and organizational consultant and his book Start with Why (2009). He counsels, business owners from corporate to SMEs should stay focused on the why you do what you do. The goal he says “is not to win every battle but to outlast every competition”. Constantly asking yourself the question ‘why’ ensures the business is value-led and you make value-based decisions. In his view, the order of priority for any business should be First Employee. Second Customers. Third Shareholders.
Always remember your business culture and values, irrespective of the size of your business, every business should have core values and practices that it rests upon. It does not matter if you are running the business as a sole proprietor or with a team. As such, it is important that business owners to view the achievements and challenges of the business year through the lens of business values and culture. Ask yourself the important questions. For example, “How did you encourage the practice of your business values this year?” or “In what ways did your company values affect productivity in the past year?”
With that in mind, here are some guides that can help you properly prepare one as an entrepreneur.
Outline Year’s Goals
We already touched on this in a previous article (click here to read), however, it is important to state the importance of being totally objective and dispassionate during this process. Put aside all emotional and sentimental attachments to your business so you can have a wholesome view of your activities during the year.
Ask The Tough Questions
As an extension of the above mentioned points, make a list of questions that will give you a straightforward approach to the review process. These questions include but are not limited to:
- What did we achieve this year?
- What were the strategies we put in place to attain these achievements?
- What lessons did we learn this year?
- What were our biggest challenges/setbacks?
- How did we handle these challenges/setbacks?
- Why did we experience these challenges/setbacks?
- What steps can we take to avoid the negative experiences we had this year?
- What steps can we take to encourage the positive experiences we had this year?
Set-Up An Effective & Flexible Schedule
It is not compulsory to work on your annual review in one day or one sitting. It is a process that should not be rushed, if you do, you are likely to miss important details. You must factor in the size of your organisation and the scale of your operations. With this information, create a practical and flexible schedule that works for you and your team. For some companies, a day or two might be enough while for some others, you might need a month.
Establish Clear Parameters For Evaluation
To be able to properly review your business activities in precise, measureable and quantifiable terms, you need to setup clear (mostly numerical) metrics of evaluation. Your financial statements are a clear example but there are other aspects of your business that need proper assessment. These include mailing lists, analytics for your company website, subscribers (if any) and customer growth to name a few. These aspects of your business should be reviewed carefully to determine the factors that contributed to company growth (increase in revenue generation and job creation). They will also inform the steps that need to be taken for future growth.
Elements of An Annual Business Review
Implementing the above written guidelines, listed below are some of the key elements of an annual business review:
- The different sections that make your business
- The key roles and responsibilities of each section
- The growth cycle and statistics of the people that work for you
- The core metrics of performance for each section
- The overall profit and loss margins of each section
- The business numbers and analytics
- The overall results and conclusions of the closing year
It is my hope that as a business owner, you will apply this knowledge and the insights shared in the previous article as you draw the curtain on this business year. To read the two articles posted before this one, see the links below.
5 Key Elements That Must Factor Into Your New Year Business Plan
5 Key Things That Must Be On Your End-Of-Year Business Checklist
