Some years, things go really well.
And some years, they do not.
If you’ve experienced a lot of difficulties in your business, you may be tempted to see it as a massive failure:
“What a crummy year! It was so terrible. I can hardly wait for it to be over.”
“The new year can’t come soon enough.”
Even you were not able to meet your strategic business objectives this year, I encourage you to consider the positives that happened, rather than speeding past it.
You can develop risk intelligence by understanding how much value you created, the positive outcomes from your work, and the growth you’ve experienced despite the setbacks.
Check out this video, where I explain how to leverage “failures” and make improvements for next year. Or keep reading for a transcript (with bonus content!)
I serve independent business owners who want to:
- achieve high profit margins,
- serve patients more effectively,
- create efficient processes, and
- establish multiple revenue streams.
My services can help evaluate profit margins, make the most of their time, and design a comfortable work-life balance.
A tool I highly recommend to anyone who wants to see significant growth is called the “Year In Review.”
What Is a “Year In Review”?
History often repeats itself.
Unless we choose to examine why things happened in the first place, we tend to repeat the same mistakes… and get the same results year after year.
By evaluating what happened in your business, you’ll be able to see cause-and-effect patterns. The more time you spend understanding the root causes of those mistakes, you can increase your level risk intelligence and avoid making those errors in the future.
I have found that the most effective way to do this is by stepping into the pain of what happened using a Post-Mortem Evaluation, also known as a “Lessons Learned Review.” It involves asking four questions:
- What happened
- What went well
- What didn’t go well, and
- How I can adjust for the future
To go a step further, use a Risk Matrix to determine which step to take next.
You will see significant improvements in your organization’s outcomes if you simply
- look back at what happened in the past year,
- categorize it, and
- decide where to make adjustments.
When You Have a Year That Stinks
Some years, things do not go as planned.
As the founder of a consulting firm, a wife, mother to 3 children, and the “solo parent” (my husband travels extensively for work), I’m often pulled in a lot of directions.
Like a lot of business owners, the struggle of reaching work goals and fulfilling family obligations can often be a difficult balance.
(Read more: Yin and Yang Approaches to Management)
Some years, both succeed splendidly.
Other years, the business does very well but it comes at a high cost to my family.
…And in years like this past one, family obligations make it necessary to step back from my business goals.
What is a “Bad Year”?
Let’s reflect on the idea of a “bad year.”
Even when things don’t go as planned, or you’ve had a lot of disappointments where you feel like the year has been a complete failure… putting a label on the entire year is very limiting. It doesn’t allow you to reflect on all the things that DID go well:
- How did you grow and mature?
- What did you learn?
- How did you benefit other people?
- Where did your business improve?
- What did you do to improve others’ lives?
- Which new tasks, tools, or skills did you gain?
If you think of the whole year as a dismal failure, these questions will seem pointless. When we see the world in limiting terms, this causes blind spots that do not allow us to recognize possible threats.
The more limited a business owner’s perspective, the higher the possibility they will miss the signs of problems in the 5 areas of risk: Governance, Operational, Competitive, Financial, and Reputational. The best way to avoid these “blind spots” is to
- admit you don’t have all the answers (Risk Roles),
- listen to the input of others (Pull Back the Curtain), and
- analyze the possible ways you could be making critical mistakes without even knowing it (Strategic Risk Analysis).
Maybe for you, the past year was full of problems. You did not meet any sales targets. You took unexpected time off. Projects didn’t go as planned.
And you can’t wait to move on.
Maybe you’re feeling like this:
In 2018, my business took some unexpected detours. Family obligations made it necessary for me to reduce my business availability. When I look back at the entire year at once, I realize “Wow, I didn’t meet my business goals.”
When we don’t meet goals, it can feel like the whole year was a waste.
But was it?
Maybe you had some setbacks that have slowed down your pace: things like
- dealing with an illness,
- caring for family members,
- moving to a new location,
- experiencing life changes
All of these can cause even the best-laid plans to take a radical detour.
Instead of trying to brush the year aside, consider what happened. Review the data logically, as if you were an objective observer. Take the emotion out, and focus on “just the facts.”
Try to see the events as a series of decisions. What choices did you make? Why did you make them? How did they turn out?
This process can provide deep insights if you enter it with curiosity and not judgment.
Once you have the facts, look for patterns to emerge. Were there any repeated loops that make you miss the target? Are you serving Non-Ideal Customers? Did key staff members quit? Did you cut corners or avoid difficult conversations?
Here’s a better way to approach the end of a difficult year:
The 4-Step Disappointment Reset
Once you’re ready to face your fears and recognize where your business experienced setbacks of this past year, I recommend doing a “Disappointment Reset.”
Here are the 4 steps to do this:
1. Look objectively at the facts.
Where did you succeed?
Where did you miss the mark or fail to reach your target?
Even if this feels emotionally difficult or painful, it’s important to accept that you did (or did not) meet those goals.
The facts are not a reflection of you being an inferior business owner, or having any problems; it’s just a statement that the outcomes occurred.
2. Acknowledge value.
Once you can see the past year objectively, you can look further for areas where you had any growth, even if you weren’t able to achieve your goals.
Maybe you improved your knowledge, expertise, or skills this year.
Perhaps you made a difference in people’s lives, even if your sales didn’t reflect it. What kind words did you hear from grateful customers? How many people were helped by your services or products?
Identify the areas where you did succeed, even if they’re qualitative (emotional impact and improving the way people feel). (Read more about the difference between quantitative and qualitative data here).
Decide to be grateful for what you DID accomplish.
And be gracious with yourself. Even in the worst year, good things still happen.
3. Decide how you’ll adjust.
Accepting failure is not enough. In order to build your risk awareness, you need to decide whether your current goals are still good, or whether to change them for next year.
Some goals aren’t good goals.
The only way to make positive change is to understand what happened already, and either Control, Mitigate, Accept, or Share the risk as you continue to move forward. Without taking the time to understand the past, you will likely continue to make the same mistakes.
Is it time to change your expectations?
Maybe last year’s goals aren’t worth pursuing. They could be a bad fit for your business. Your “Year In Review” might reveal some valuable insights about how your customer needs have changed, or where you’re seeing high profit margins (which could be in services or products you weren’t expecting).
(Read more: Analyzing Profit Margins FAQs Part 1: Perceptions)
There’s nothing wrong with creating new goals that reflect a different reality. Adjust your goals accordingly, and decide how you will pursue those goals in the new year.
4. Make a plan.
Once you know what happened, and you acknowledge where you experienced growth, it’s time to decide how you’ll do things differently in the next year.
Make sure your new goals are SMART:
When creating a new plan, it is helpful to
- decide what resources you’ll need,
- on what timetable,
- with which tools
…and then set reminders to review your results each month to see how much progress you’ve made.
One role that is super useful when doing a Year In Review is the “Devil’s Advocate.” This is a person who can see situations from an objective point of view in order to identify potential vulnerabilities and flaws. If someone like this is on your team or in your circle of influence, be sure to include them in your Year In Review process.
Finally, keep in mind that change is inevitable. You may continue to experience similar barriers; but when you design a plan that reflects your awareness of these risks, you will be able to improve to your processes (with Health Feedback Loops), manage your time efficiently (with Intelligent Decision Making), and make progress toward your goals (with a Move the Needle visual to show measurable progress).
For suggestions on how to evaluate your year, check out:
Interested in getting professional advice on how to evaluate your business risks? Schedule a free 30-minute consult with me today.