In a recent session, I was coaching an executive who leads a large division of a global manufacturing firm whose products are very much a commodity. They have a very rigorous process for cost containment and the reasoning behind it makes some sense.

What makes it so very challenging is when the company is enjoying record profits while the board is absolutely determined to reduce expenses in the year ahead. There are many of you who find yourselves in situations like these and are very challenged to keep innovating new products (not to mention keeping morale high and your culture healthy) while having to cut costs, especially if your current numbers are solid.

So here is what I was reminded of by my client.

In commodities type businesses, the only thing we can control are our expenses. Outside factors such as regulations, interest rates, consumer confidence, huge increases or decreases in supply can all cause the spigots to our businesses to open wide or shut down to a trickle without any notice. Those who have such commitment to constant cost containment know they will miss some of the upside in the better times by following this strategy.

But they also know that they will not suffer through the troughs that are naturally part of the business cycle. So in the end, these organizations do not have to hurt their teams by rapid hiring and the eminent layoffs that follow. This then enables them to retain greater percentages of their talent and ultimately to control more of their destiny.

Here is what I know: if you lead in a commodities-based industry where cost containment is the annual mandate, wise leaders, investors and boards will always break the mandate if they are presented with a winning strategy. So it is up to us leading in the trenches (as my colleague Jerry Baker says) to continue to innovate in alignment with our vision and strategy. It is then up to us to build our plans and our cases in ways that cause our investors and boards to want to jump in and get behind what we see.

Don’t ever buy the lie that you cannot drive the future success of the business. Don’t sit around and wait for the board or shareholders to show you the way. The best leaders have the vision and believe in it, build the plans and then influence the right people to lead the organization ahead.

Leading to your vision, building the plans from your vision, building healthy teams, innovating, improving, communicating, keeping costs in line and managing it all takes the courage of a tight rope walker!

To the balancing act,

The power of this Business Plan is that it is very specific and personal.  It is not meant to replace a larger corporate plan.  It answers the following three critical questions for you on a single piece of paper:

1. What are my measurable goals for the year? 
2. What do I need to do each day to reach those goals? 
3. What improvements do I need to make in the year ahead? 

Part One:  Outcomes

What goals are you aiming for in the year ahead that are specific and measurable?  These are your desired outcomes.  You should be able to assign a specific number to each outcome.  Your desired outcome could be the number of people served, units built, or units sold.  It could be a target for revenue, net income, market share, ROI, or customer satisfaction ratings.  The clearer you are on your numbers, the easier it is to identify the behaviors and projects that will be required to achieve those outcomes.

Part Two:  The Disciplines of a Champion

What non-negotiable disciplines or behaviors will you repeat over and over in order to have the highest probability of reaching your desired outcomes?  Identify three to six disciplines that you will repeat daily or weekly, regardless of how you feel.  Examples might include sending five handwritten notes each day, conducting weekly financial reviews, making ten sales calls per day, holding weekly coaching sessions with your direct reports, walking the floor daily, or spending eight hours per week behind the customer counter.  The Disciplines of a Champion are very specific.  They should be so clear that you can schedule them as appointments in your calendar.

Part Three:  Improvements

What three to five specific, one-time projects will you work on in the year ahead that will help you to do your job with more success?  These are your improvements, and they differ from disciplines in that they have a finite point of completion.  List them out in order of priority and assign a target completion date for each of them.  Examples of improvements could be updating your database by March 1, rolling out your new customer service plan by May 15, or hiring two new sales representatives by August 1^st.  Once you have clarity on each of these projects and how they fit into the overall plan, you can schedule the needed ON Time (or project time) in order for you to complete your improvements.

So there you have it:  a simple and personal Business Plan that has the power to cause your behaviors and results to improve.  If you review it frequently, you will remain focused in the year ahead.

You are welcome to contact our coaching company, Building Champions, to receive this tool from us as a year-end gift. 

May you find clarity about your plans for 2010,