How to Create a Road Map For Your Business

how-to-create-a-road-map-for-your-business

As a business owner, to achieve growth and success, you need to define where you want to be, preferably in the form of targets and milestones - your future "destination". Here's an exercise that will help you to create a road map for your business:


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Work your way through the exercise below. Don't be concerned if you cannot complete everything in the level of detail suggested. The purpose is to give you a sense of direction - you can fill in the gaps later.

Defining Targets

What are the large ambitions? The "Big, hairy, audacious goals" in management-speak that you have for your business?

What are your overall targets:

  • > For year 1?
  • > For year 5?
  • > For year 10?

Can you set more detailed targets for your business' performance?

Recommended reading: A Framework and 10 Key Questions for Your Business Strategy

Financial

Next year

Next year + 1

Next year + 2

Sales

     

Gross profit

     

Net profit

     

Your own salary

     

Total promoters/management team remuneration

     

 

Customers

Next year

Next year + 1

Next year + 2

Number of customers

     

Average purchase per customer

     

Average purchase per customer - units of product/service

     

 

Products/services

Next year

Next year + 1

Next year + 2

Percentage of total sales accounted for by each of the business' top three products/services:

> Product/service 1

> Product/service 2

> Product/service 3

     

Number of products made/hours of services supplied for each of the business' top three products/services:

> Product/service 1

> Product/service 2

> Product/service 3

     

Average cost of each unit of product made/cost of service provided per hour

for each of the business' top three products/services:

> Product/service 1

> Product/service 2

> Product/service 3

     

 

Assets and liabilities

Next year

Next year + 1

Next year + 2

Fixed assets

     

Cash

     

Stock on hand

     

Money due by customers

     

Money due to suppliers

     

Total Working Capital

     

Less Borrowings

     

Total Net Worth of Business

     
       

Equity contributed by promoters and management team

     

External equity

     

(External equity as a % of total equity)

     

Profits retained

     

Total Shareholders' Funds

     

 

Other measures

Next year

Next year + 1

Next year + 2

Number of staff (including promoters and management team)

     

New products/services introduced

     

Percentage of total sales accounted for by new products in first year

     

New customers won

     

Percentage of total sales accounted for by new customers in first year

     
       
       
       

Recommended reading: How To Get Customer Feedback That You Can Take Action On

New Customers

What new customer types can you reach:

  • With your existing products/services?
  • With new products/services?

What new products/services will you introduce?

When?

What stage are they at now?

What market demand do you expect for each?

What competitive reaction to do expect for each?

Which of the following factors are important to the market? For each factor that is important to the market, what targets will you set for improvement and how will you reach them?

 

Importance to market

Target for improvement

Method of improvement

Product features

(specify what these are)

     

Quality of products

     

Range of products

     

Customer service

     

Marketing

     

Price

     

Location

     

Delivery

     

Image

     

Other

(specify what these are)

     

Final Thoughts

Do you expect important changes in these factors? If "Yes", what are these changes? How can you capitalise on them?

How will you measure the success of your business in the future?

Every year, you should set yourself targets for the next year, keeping in mind your 10-year plan, which sets out the direction of your business.

Using a road map analogy, the 10-year plan is your destination; the one-year plans are the turns (right, left, straight, short cut, scenic route, stop-over, break for coffee, etc.) that you take on the way. And, just as on a journey by road, you need to check your direction on a regular basis to see whether your plans need adjustment.

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Monday, 20 May 2019
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