This past year has been one for the books! We’ve been through some uncharted waters and many are still weathering the storm. Today we are going to put the chaos of this year to the side for a few moments as we discuss how to execute some year-end planning and strategy with a virtual CFO. Right now is the perfect time of year to start planning so you can get a leg up on your business to-do list because the new year will be here before you know it.


What we cover in this episode:

              • 03:42 – Start with an agenda
              • 04:23 – Year-end planning and reflection
              • 13:42 – Revisit your why, core values, and vision
              • 16:07 – Complete SWOT analysis
              • 18:04 – Creating a financial model
              • 22:50 – Create a key issues list
              • 24:44 – Identify quarterly “Rocks”
              • 28:54 – Review budgets, forecasting and cash flow projection
              • 29:51 – Create a marketing plan

At PJS & Co. CPAs, we are fresh off the heels of our own strategic planning meeting so we are excited to get you prepared to conduct your very own year-end planning! Right now is a good time to get something on the books where you and your leadership team can reflect on last year to see what worked well and what needs improvement, and then get a plan in place to turn a new leaf in a few short weeks. It’s beneficial for your business, and it’s fun, to look into the future to think about where you want to go, and how you’re going to get there. 

We have referred to the book Traction by Gino Wickman in our podcasts before but will be using some of the terminology from this book. Traction provides excellent tools to help you as you prepare for this end of year, strategic planning meeting. If you haven’t done a formal strategic plan in the past, this really is the time to put that in place. 


Start with an agenda

When you sit down to think about a strategic plan, start with preparing an agenda, even if attendees are limited to you and your virtual CFO or advisor. This way, you have a plan for how the meeting should run. It’s good practice to share this agenda with other meeting participants in advance so they, too, can have expectations heading into the meeting. If needed, they can run reports, digest the information, formulate questions, and prepare discussion points. This can also be updated as you run the meeting, which can be helpful for task management and follow up.

Keep in mind, as you move through your agenda, there may be some back and forth taking place. The agenda may not always just flow in one direction. You’ll see this a bit when we talk about establishing goals for next year. While establishing goals for next year you may need to know what the key issues are first, but our agenda shows that establishing the goals comes first. So, just remember to be flexible and know this may not be a simple fluid process.

Year-end planning and reflection

Looking over last year, there are quite a few pieces of information you need to make sure to review. We want to give you an overview regarding the important topics you need to cover as a small business owner. Depending on your industry and business, the details of these areas will vary.


The first thing on your agenda, which might actually take the longest amount of time, is to review the financials. During this time you should discuss in detail where things went well, what worked, what didn’t work, and why it didn’t work. Overall, review your performance and have conversations surrounding how the prior year went to date. Some may recommend doing this at the beginning of the following year, but we want you to be a bit ahead of the curve as you head into the new year. If this review takes place in the fall, you should be far enough into the year to get a good idea of whether or not you are on track with what you are trying to finalize by the end of the year.

Make sure your financial statements are solid and in good order. Someone on your team should be tasked with ensuring their accuracy in order to be utilized to their full potential. If you don’t have good financial policies in place to produce accurate reports, your financial statements won’t help you much from a strategic perspective. 

year end planning

Budgets vs. Actuals

You want to take a look at your budget and compare it with actuals. This should be done on a regular basis so you are able to determine if your initial budget needs to be adjusted. For example, we had an initial budget for 2020 and after things went crazy, we decided to put our initial 2020 budget to the side and moved forward with a revamped budget. In this case for our strategic meeting, we looked at both budgets as well as the actual is to see how things lined up.

During this year-end strategic planning meeting, you will want to take a step back and look at the big picture when you are comparing your budget with actuals to identify how the business performed overall. Take time to review each budget line item to identify what went the way you predicted and what didn’t. This will allow you to budget better going forward because you’ll have more insight as you make adjustments for the next year

Key Performance Indicators

You also want to look at the key performance indicators (KPI) you established for your business to see how they line up and how well your people performed. In case you missed it, we covered KPIs in depth in episode #08: Strategic Planning – Digging Deeper – KPIs. Ask yourself and your team, how are the percentages coming out? You may realize some tweaks are needed moving forward, or maybe even identify process changes that need to be implemented to achieve the original KPIs if they haven’t been reached yet. 

Prior Year Plan vs. What Happened

Next, it’s time to take a look at the 2020 plan. We recommend separating the 2020 budget from the 2020 plan, or whatever year it is that you are reviewing. This is to differentiate the financial side from other plans you had in mind for the year like expanding your team or changing software systems. Use that information to find out what you accomplished and what you didn’t. What stopped you from accomplishing anything that didn’t happen? In 2020, it’s likely that you may have changed direction in some areas.

Tips to use when reflecting on last year! 

  • It’s important to step back, look at the big picture. Acknowledge where you were trying to go and where you are right now. 
  • Take an honest, realistic view of all that happened over the year regardless of whether it was good or bad. 
  • Encourage your team to be transparent about what worked and what didn’t. 
  • Create a culture where your team will openly communicate with you. You can’t solve problems and address areas of concern if no one is honest and brings those items to the table. 
  • Talk about the things that didn’t work, but we also want to look at the things that did work and the things that were accomplished. You have the ability to set the precedent with honesty and transparency, and when you do this it is going to drive conversation, ideas, and resolution of problems. 

One way to implement these tips is to have each person attending the strategic meeting list out three accomplishments the company achieved throughout the year. We learned about this practice from Wickman, implemented it in our company, and recommended others do so too.

Even in a tough year like 2020, there are still good things that happened in the business and things that you accomplished. You may have pivoted, changed product lines, changed delivery systems, you worked virtually, etc. Whatever the accomplishment, it needs to be acknowledged. If nothing else, to bring up everyone’s energy and motivation. As humans, we tend to focus on the negative. Your honest review may reveal how tough the year was, but identifying the positive parts of the year provides you an opportunity to give yourselves credit where it is due. 

Revisit your why, core values, and vision

Once you’ve completed your reflection of the year, it’s time to move on. You want to always make sure you know what your path is, that you are remaining on the path and that you still like the path. To do this, you have to discuss your core values, your vision, and your company “why.” These topics are easy to skip over unless it is purposefully added to the agenda.

For more about finding and discussing your why, listen to episode #12: What’s Your Why? Your why, core values, and vision should be revisited at least annually because you want to make sure that if something has changed, you’re reflecting that in your internal vision and external mission that is shared with your customers and clients.

Your core values and vision are good gauges to use when making decisions for your business. If you are drifting away from those, find out why. Sometimes you are drifting away from your core values and vision because you simply aren’t holding true to them and you aren’t using them to help you make decisions. Or, it’s possible things have changed a bit and you actually need to change your core values, vision, and “why.” We talk about establishing a vision and actually utilizing it in decision-making throughout your organization in episode #47: A Vision Shouldn’t Be a Mirage


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Complete SWOT analysis

After revisiting your why, core values, and vision, you should brainstorm all of the strengths, weaknesses, opportunities, and threats of your business. With this SWOT analysis and brainstorming session, you can discover concerns that were overlooked previously. These revelations could be very important things you need to work into next year’s plan. For more information, check out episode #15: SWOT Analysis, where we cover this process in detail. 


Creating a financial model

A financial model is a tool that can help you look at your business model, big picture, and play with the numbers to see where your business will be as you grow and ensure stability as you move forward. We cover financial models in-depth in episode #85: What is Financial Modeling? It’s helpful to include someone with a financial background, like a CPA, business advisor, or vCFO who can provide the financial model of your business. It’s beneficial to have the current year financial model available as you establish goals because you can use it to project for the upcoming year. With the guidance of your financial expert, you can create a financial model using programs like QuickBooks, Spotlight, or even Excel, if you don’t have one. 

When planning for the future, things to consider include revenue, staffing, new locations, and software upgrades. With an efficient financial model, you can start with identifying and setting your new revenue growth goal. Revenue drives how many customers/clients you need, your marketing plan, how many people you need to have on staff or on your team, and much more.

To determine staffing goals, identify the number of team members needed to accomplish a particular task. For example, if you know you need 60 clients to reach your new revenue goal, approximately how many people do you need to service 60 clients? How many support staff do you need? You want to make sure you have enough staff on your payroll at the right time to ensure you are delivering the quality of service to your clientele.

As you review last year’s plan, or even a key issues list, you may identify your software isn’t working well, a process is clunky and needs redesign, there is a hole in your reporting, or you just need information on a more regular basis. If so, you can plan for upcoming software upgrades. This is one area that is non-financial in nature that can improve your business.


Create a key issues list

Key issues are key priorities, they are things that are problems or things that need to be accomplished in order to achieve your goals. All of these challenges, roadblocks, and issues need to go onto one list. The items included on this list can come from many different places like the SWOT analysis or the review of the current year’s plan.

Once you have created your list, it’s time to prioritize. Ideally, you want to have between five to seven key issues. These should be things that, once resolved, will allow you to achieve your goals. Then, your leadership team determines who will be in charge of tackling each key issue. Assigning these tasks does not necessarily mean they’re doing all of the work, they may be delegating it. But, they are responsible for making sure work is done and steps toward resolution are taking place. 


Identify quarterly “Rocks”

Once you have the key issues list, you then filter it down a bit further into what Wickman calls “Rocks.” Stephen Covey popularized the term “Rocks” in The 7 Habits of Highly Effective People. It essentially means prioritizing your issues to emphasize importance on the actions that will solve your largest problems. You need to do this because one key issue may have many actions that need to be addressed.

In order to resolve the items on your key issues list for the year, you need to identify what needs to be done in the first quarter to move in the right direction. Those particular steps are the quarterly Rocks. Each of those Rocks should then be assigned to an individual, but no individual should be assigned more than five to seven Rocks. Each Rock should also be very specific and measurable. A Rock shouldn’t be something general like, “increase sales.” Instead, the Rock should be something more like “increase sales by X amount by doing X, Y, Z.” When you monitor these Rocks monthly and quarterly you need to be able to measure if you are on track so the person in charge of that Rock can be held accountable. 

Rocks should be revisited in leadership meetings and adjusted on a quarterly basis. Then, set new Rocks for the next quarter and keep updating milestones toward the key issues you came up with for the company. If someone is constantly paying attention to each Rock and tracking it, you’re going to do what needs to to meet the goals. For more about Rocks, you may find them in Chapter 8 of Traction.



Review budgets, forecasting, and cash flow projection

In order to accomplish the goals you’ve established, and get those key issues under control, you need to layout your financial plan, budgets, forecasts, and cash flow projections for the next year. Determine what you want the budget to look like so you can run those budgets and actuals to make sure you’re on target. We recommend looking at forecasts in different ways because the budget shows what you want to happen.

What’s shown in the forecast may be a far-reaching budget, but it will take longer to get to that number. You always want to have a good cash flow projection to foresee any potential problems in cash flow. To take this a step further, tax planning and considerations for you retirement plan, properly planning for tax liabilities by looking at taxable income and getting tax advice from a professional can help you manage your financials in a proactive manner. The help of a financial advisor or virtual CFO can be helpful to get the guidance needed. 



Create a marketing plan

The last key component you need to address is creating a marketing plan of attack. What you do on the marketing side is a huge component for all businesses. Once you set your goals for revenues and established your Rocks, you need a clear, defined plan for marketing.

Whoever is handling your marketing needs to be a part of this whole strategic planning process because much of what’s being discussed and established for your strategic plan is going to play into the marketing plan of attack. For the marketing manager to create an effective marketing plan, they need to know details like the revenue goals, sales capacity, who is handling sales, staffing, etc. There are many moving parts to consider as far as capacity and goal setting. Your revenue goals are going to impact the budget and also will affect client acquisition goals. 

It is helpful to run through similar reporting of current year marketing KPIs much like you did for the financial side. This will help project where you’re headed for the next year or two. Look at your client acquisition numbers historically so you know your sales conversion numbers. Those will be helpful in knowing what is needed to hit your new client marks.

The marketing plan is part of the larger strategic plan, but the marketing plan itself is a strategic plan, with a budget, analysis of reporting and projections and then execution. All of these things need to be measurable and specific in order for the marketing plan to be successful. It is helpful to incorporate marketing into year-end planning and strategy so everyone is on the same page and moves forward as a united front, including all owners. Everything takes time, so consider everyone’s capacity when adding to the plan. 



Year-end planning and strategy formation improve your business and mindset. You’re going to feel so much more under control, so much more just on top of things rather than scrambling all the time because you have that foresight of where you’re heading.

We hope you enjoyed this speed round discussion where we shared some high-level information with you on planning for next year with a virtual CFO. Don’t be overwhelmed with all the important information we provided today. Instead, take action and get a meeting on the calendar! Once it’s time for your meeting, you’ll be fully prepared to reflect on the good, bad, and ugly of last year, discuss your company “why”, core values, and vision to ensure they’re aligned with how things went this year and how you want them to go next year.

Then, you can move on and tackle the SWOT analysis. Identifying the issues, strengths, weaknesses, opportunities, and threats of the business helps you to create your key issues list and identify your “Rocks” and plan of attack. This plan of attack should align with the goals you set for the following year. To accomplish these goals, you will want to review the numbers – budget, forecast, and cash flow, projection, and then create your marketing plan. We often encourage you to involve your virtual CFO in important conversations, and this strategic planning meeting is one of those conversations.  


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