Tag Archives: strategy

Who’s the Best?

There are lots of things in life where you can clearly state what is “best”: in class, whoever scored highest on the test is the best student. In soccer, whoever won the World Cup is the best team. There are enough of them, in fact, that we frequently forget how many things in life cannot be clearly defined to be “best”.

Most pertinently, “best” can almost never be determined in business. When I was in college, “best” to me meant cheapest. When I graduated and got a “real job”, I was able to afford more expense, and “best” included durability and quality and price per unit (Now that my graduate student loans are coming due, “best” may go back to meaning cheapest.) If you’re handling neurotoxins, “best” means “safest”. There are lots of ways to define best, which means there are lots of ways to be the best.

If you can’t be the cheapest, can you be the fastest? If you can’t be the most insightful writer, can you be the funniest? Use what you do best.

Step 7: Choosing Metrics

This step is new to the annual planning process: we added it in this year when we realized that “number of objectives achieved” was a crude and inaccurate measure of our accomplishments: some projects weren’t expected to be completed (they were clearly multi-year projects from the start); some objectives were started in February and could be expected to be completed; some were such micro-projects that completing them was no big achievement. We wanted to be able to more accurately measure what we had done.

Enter Metrics

I wrote earlier about the benefits of metrics in your business (just not competitive metrics!), why not use metrics for the rest of your life as well? Especially since our goals this year were process oriented, providing direction but not distance, we needed a way to measure how far we’d come, so we could compare our accomplishments year to year.

I wasn’t really paying attention to the process while we did this; I was focusing on making metrics. So I’m kind of reconstructing it; please bear with me.

Decide what’s important to you

Look down your list of goals, and decide which of them want metrics. (For some goals, the best measure of success might be “Did I achieve it?” In those cases, you don’t need separate metrics — you’ll already be able to measure accomplishment next year.) For others, where achieving it is unlikely to happen within a year, or where “did I achieve it” is a question without a clear answer, you’ll want to make metrics.

Decide how to measure them

Some examples:

As I mentioned previously, my partner and I decided that maintaining and improving our relationship was our #1 priority. This isn’t really a project… we’re not making to-do lists and checking off tasks to accomplish it… but we do want to have some way to measure what we’re doing.

One such measure is simply subjective assessment: do we think we’re doing better or worse. We’ll grade ourselves each day, and try to keep our “better” days as high a percentage as possible.

Another way to measure it is average duration of a fight: the time elapsed from when the fight begins, to when it’s resolved (both of us understand and accept the other’s position, and we have arrived at a decision that neither resents, and made up). We want to “fight” productively, respecting each other’s opinions, communicating effectively, and making decisions that work for both partners and for the relationship. So keeping that as low as possible will help us measure our success there.

Another objective is to be healthy… but what does that mean?

To me it means eating right, so I’m going to rate my diet each day on a scale of 1 – 10, and try for as high a score as possible by the end of the year.

It also means being able to do things without wearing down so fast or running out of breath, so I Googled a test for aerobic capacity, that measures how quickly I can cover a mile and how much it raises my pulse to do so. I will measure this monthly, and want to maintain or improve my score on this test over the year.

And finally, I want to be able to lift more, and to not injure myself doing everyday chores like gardening. So I want to measure how strong I am, and aim to maintain or improve my lifting capacity over the year.

Decide what the best way is to measure the things that matter to you.

Decide when to measure them

Different metrics make sense at different intervals: I need to eat healthy almost every day, but measuring my aerobic capacity on a daily basis would be a waste of time and drive me crazy. So decide how to measure your progress, and how often you want to do so.

Set up a system to remind you to measure your metrics on the appropriate schedule; use mine if you’d like — it has a tab for daily goals and a tab for monthly measurements, and they’re both printable.

And… you’re ready!

That was quite a process. You analyzed where you’re at and what’s going on, put together long-term goals and short-term goals, and assembled projects and metrics to help you get there. You deserve a reward. My partner and I usually go out to dinner and see a play at the local theatre, but pick something that works for you (guys). And enjoy the year!

Resources for Further Reading
Annual Planning
Using Metrics

Step 1: Review Last Year

This post is an addendum to the Annual Planning series written earlier this year. That series was written after I’d done my first annual planning retreat, but before I’d done my second, and it was clear that someadditions to the process needed to be made. First off, you probably want to review how last year went before you charge headlong into planning next year the same way.

Step 1: How did it go?

Look over your planning notes from last year. What did you hope to accomplish? Write those down in the left column below. Did you accomplish them? If you only accomplished partway, put down a fraction: ½ accomplished, ¾ accomplished, or whatever. Also jot down whatever notes you think might be helpful – project changes and so on.

Objective Completeness Notes

Now with your partner (if you have a partner) or in a notebook (if you’re doing this alone), talk about the year overall, and your objectives in particular. Do any patterns emerge that you should take into account when planning this year? For example, the first time I did this, I determined that I tried to tackle WAY too many projects in my first year. For my second year, I decided to limit myself to five projects at a time.

Highlight, circle, or in some other way indicate which unfinished projects you would like to roll over into consideration for next year’s plan. Then you’re ready for step 2 (which used to be step 1): External Analysis

Annual Planning Addendum: Notes from year two

Last week I had my second annual planning retreat — it marked the first time I’d done my annual planning process when I’d already done it the year before. So I can now speak to the benefits of the process from actual experience, and I thought it would be worthwhile to do so.

Data

Last year I set 25 objectives. I intended to achieve them by working on 7 projects (things you can work on with a definite endpoint, like “Make a website”), and 9 policies (things you do all the time, like “Run 3 times/week”).

Of those, I achieved 9 objectives, or 36%; I completed 4.75 projects, or 67%, and I stuck to 4 policies, or 44%.

Interpretations and Inferences

The first thing we did after our review was to celebrate. Despite the low percentages – a clear failing grade in any educational institution, which is another way that life differs from middle school – we were both proud of what we had accomplished, and we both agreed that it had been one of our most productive years ever. Goal-setting is useful even when you don’t accomplish your goals, because it give you focus.

The low percentages indicate that we still need to “dial in” how much can be accomplished in a year. I actually suspect that my 2014 self would be able to accomplish everything I’d set out to do, but my 2009 self wasn’t that disciplined or organized yet. This caused something of a depression as we compared our “most productive year” to the things we’d hoped to do in a year, and how big that discrepancy was. And yet I don’t want to scale my goals down, because I think I can learn to do that much.

What we did instead was to set goals that are more process-oriented. My boyfriend proposed to me while we were up there – we both agreed that our top priority was to keep our relationship strong and to improve it further. We both want to have more peace in our lives and to become the best possible version of ourselves — that was the second priority. I want to help people learn how to monetize themselves; he has his own vocation. What all of these goals have in common is that they set a clear direction, without specifying how far in that direction we must travel. If I don’t make it as far as I thought I could, that’s OK. If I make it much farther than I thought I could, that’s OK, too. I don’t have to make arbitrary guesses about how far I can go

I could do that this year, because I’d had a year to shake out which goals were vocations, and which were just projects. Last year’s objective list was a jumble of

  • vague goals,
  • of projects that would be nice to complete someday,
  • of projects that would clearly take multiple years (maybe a lifetime),
  • and of projects that were vocation-worthy, but aren’t my vocation.

This year I have it pared down to several overarching lifetime-projects, and have selected less-than-one-year projects to support those objectives.

But I don’t think I could have done that last year, because I didn’t have the data I needed. My first year of annual planning was kind of a data dump, that gave me a chance to list every daydream and career-like notion and impractical fancy that I’d ever had. I wrote it all down, and tried it all out. And over the course of the year, I was able to learn what really mattered to me. It was obvious in the list of projects that I’d worked on (because they’d excited me enough to receive sustained energy) and the ones that had died out from lack of interest. When compared to other, new items on the list this year, it became obvious that several of last year’s objectives were really sub-projects of another lifetime-project – a connection I couldn’t see until I’d spent a year experimenting. I think this kind of focused, pared-down planning can only be done in the second year of this process.

Recommendations for Future Work

The original Annual Planning post was written during my first year of planning, and was written for people who have never set out to do this kind of thing before. And I think that’s a fair assumption in most cases – I’d never done that kind of thing before, and people look at me funny when I explain it. But obviously some things need to change for the second time around: we added in a review of the previous year, and modified the goal-setting process to accommodate 2nd-year planners. I’ll discuss those changes in the next few posts.

Play it Safe — and Experiment

In Learning From Your Competition, I discussed what things you can learn from your competitors, including what price, which promotions, and which combinations of products are most likely to be effective for your business. But if your business just copies what other businesses do, why should any customer go to you? This is especially true on the internet, where “Just like Facebook, only different” has repeatedly proven a recipe for failure.

What your competition does is safe

Nonetheless, copying the competition is a good place to start your entrepreneurial ventures, because you know there’s a market for what they’re selling. If you offer a product that’s basically the same as your competitors’ most popular product, at a price that’s the average of all their prices, using the same promotional methods as they do, you’re pretty much guaranteed to sell some of it.

It’s a low-risk choice, but it’s also a low-reward choice: since your offering is essentially identical to everyone else’s, you’re relying on the vagaries of fate to randomly steer some of the customers in your direction.

Once you’re safe, then experiment

With your solid base of safe, low-risk products, you have a relatively stable platform from which to explore. Now start experimenting.

Experiment with new products, or product combinations. Would your customers like these new items? Would they like the deluxe edition? Instead of buying products individually, would they like a subscription?

Experiment with prices (the people who select the MSRP are just guessing, too). If you put this on sale for 10%, does it increase the number of sales by more than 10%? If you increase prices on this one by 5%, how many people still buy it? What does it go for on eBay? Does it make sense to have different prices at different times of the day? Different times of the year? In different locations?

Experiment with delivery. Does it make sense to open another location? To offer home delivery? To create e-products that can be sold everywhere? Will customers pay extra for quicker delivery or more efficient locations?

Experiment with promotions. Is advertising the best method? What about networking meetings, or a booth at local events, or seminars at your local library? Are your customers on Facebook? Would they like to receive information via text message or email?

Keep what works, get rid of the rest

Eventually you’ll have a fantastic marketing mix — product, price, distribution, and promotion — that is great for your customers, and gives them a reason to bring their money to you.

Resources for Further Reading
Seth Godin on Competition
Risk Analysis