MONITORING OTHER OBJECTIVES 337
Finally, make sure that you do more than just go through the motions. Make sure that
you always ask, what does this tell me about my business plan? Are the strategy and plan
working, or should they be revised? Or if they are working, should the financial projec-
tions or any other objectives be revised to bring them back into line with reality? A plan is
only a plan. The outturn is much more important.
Monitoring other objectives
The monthly budget report is a regular mechanism for tracking performance against
financial objectives. You can set up similar procedures for non-financial objectives. Most
companies have regular reporting of sales, complaints, production output, staff turnover,
a whole host of interesting information. These should include progress against objectives.
The more solidly that they are quantified, the easier they are to track. Production is 3%
above plan is more useful than we are very busy in the production department.
You will recall from Chapter 6 that my preference is for exception reporting. Tell me
when it’s going wrong, not when it’s going right. Regular meetings tend to turn into dull
affairs where small problems are glossed over and attention is shifted to the insignificant.
Dominant personalities do this on purpose. Wafflers do it by accident.
If you are at board meetings, watch for the Maxwell style of chairmanship. Any other
business … no … right … I have important things to do. This reduces the meeting to a
pointless rubber-stamping exercise.
Ten reasons why business plans that look good on paper fail in practice
1 Poor specification. Ineffective strategy, plans or objectives.
2 Conflicting objectives. Watch for budgets that restrict action.
3 Stifling heat. Poorly set or an excessive number of objectives deplete energy
and enthusiasm, and stifle creativity and innovation.
4 Weak employee management. Make sure that employee objectives-setting,
appraisal and counselling are effective; encourage good leadership.
5 Not invented here. Resistance to change arises when employees are not sufficiently
involved with a plan and do not buy into it – we’ve always done it this way.
6 Poor integration. Marketing does not understand why production cannot
deliver enough products; sales promises things that R&D cannot deliver.
7 Authoritarian regime. Domineering management usually prevents employees
from pursuing their objectives.
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