We’ve all been there. Sales and revenues are off-forecast for the quarter and the founder and team are getting ready for that big meeting (live or online).
The questions will be tough. The faces in the room may not be very friendly.
After all...you promised X and delivered less than X.
“The COVID-19 pandemic” is wearing thin as a reason why sales are down. By now, you should have factored that into your forecasts and created a “pivot plan” for making up some of that lost revenue.
We all wish that every quarterly meeting was filled with great news. But that’s simply not the case. And, sometimes, when your projections are off, your board members and investors begin to distrust you and your numbers and ask for even more meetings and reports.
And that simply means more stress on your organization.
Here are 7 tips for ensuring you maintain credibility with the people who rely on you to deliver -- and report good (but honest) news.
Don’t throw your entire organization into a tizzy in the weeks before the meeting. Although you may need certain critical leaders like your CFO, Sales VP, COO and HR director to help you gather facts and projections, the trickle-down impact of that preparation exercise can be huge.
You don’t want to pull critical people off the phone or e-mail to run spreadsheets and prepare detailed reports. Automate as much as possible (See Tip #6 ) and consolidate your prep and forecasting work with the smallest number of team members possible.
Rehearse your presentations by role-playing and ask your “faux board” to ask tough questions so that you can be ready no matter what gets thrown your way during the real meeting.
Smart people usually know when the “pig is being perfumed.” If your projections are off, own it. Don’t sugar-coat bad news. But have a plan for turning the ship (or the pig) around.
Get ahead of some of the questions that might be asked and be prepared with thorough answers.
If you have great relationships with certain board members, investors, or advisors, talk to them privately prior to the meeting.
Avoid the natural human instinct to get defensive. Again, own the results and have a tight plan for improving them.
This may be painful to hear, but not every founder is a great CEO. If you ultimately believe that your company would be better managed by a different type of leader, step down or aside before you’re forced to do it.
We get it. It’s your baby. You gave birth to it. But a different type of leader may be better equipped to scale it, allowing you to focus on the things you love to do and at which you excel. But when you want to hang in and fix the issues...
We’ve all seen line managers take the fall when results are bad. But a great leader will continuously be working with his senior team on issues and areas for improvement.
If, for example, your Sales and Marketing leaders are pointing fingers and placing blame on each other, take them out for an honest and direct team building discussion. Bring in outside advisors if necessary. Work the problem. Don’t bring out the axe.
Some organizations will replace their entire senior team when forecasts aren’t hit. That may seem like a great short-term solution, as it will buy you more time to fix problems. But you only get to do that once. If your forecasts are off AFTER you’ve made management changes, you need to start looking at your own role in hiring and managing the people who run your day-to-day operations.
New founders often face thorny issues for the first time ever. Seek out mentors and other founders who may have faced similar challenges and ask them how they resolved them.
Do not be overly cocky. Listen to the advice you receive and take it to heart (and head and balance sheet.)
Professionals will swallow bad news much more easily if they see that you have done the work to improve performance.
Keep your action plan simple and realistic. Do the work to understand exactly why your business didn’t hit its goals or overspent its budget. Detail how you plan to fix the issues in time for the next meeting and keep the board members and investors involved of progress as the plan unfolds.
Of course I’m biased. But I created BurnRate because I saw that start-ups and scale-ups were making some common critical errors in capacity planning and growth forecasting. And I’m a founder myself, so I feel your pain.
Most companies only use Excel spreadsheets, which don’t take into account the human elements of capacity planning and sales forecasting.
When you switch to a cloud-based forecasting tool, you’re eliminating many human errors, saving time, and giving your Board and Investors an easy-to-digest and fact-based snapshot of how you’ll be spending their precious dollars.
If you’re crushing your forecasts and the meeting is upbeat and positive, you’ll all be celebrating over adult beverages and snacks (with the entire company). Thanking the whole team builds morale and aids with retention.
On the other hand, if you walk out of the meeting feeling defeated and depressed, suck it up and focus on the plan for improving results before the next one. Thank the team for their hard work and hold the equivalent of a “pep rally” to get everyone energized heading into the next quarter.
Starting and scaling a business is never easy. You’ll have good years and terrible years. By having the right forecasting tools, you can minimize the impact of the latter.
Schedule a demo with us today to explore how BurnRate can help your organization.
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