As an entrepreneur, keeping on top of your company’s performance plays an essential role in ensuring its ongoing success. Proper fiscal planning, paired with mid-year strategic reviews, helps you set your growth benchmarks and come up with a clear, measurable pathway for meeting them. 

As you conduct your mid-year strategic reviews and revisit your fiscal plans, it’s also a great time to explore new financial tools that can support your company’s growth goals. One option worth considering:  Mercury is currently offering a $150 bonus when you deposit $10K within your first 90 days of signing up. This is a simple way to give your financial strategy a boost — and a nice way to jumpstart your contingency or investment funds. . If you’re rethinking where to allocate your capital for the second half of the year, partnering with a financial platform that truly supports startups and growing businesses — with real incentives — can make a meaningful difference.

Whether it’s your first time building, executing, and reviewing your business’s plans or your 30th, learning more about proper planning assists in the fine-tuning of your current strategies so you can elevate your company’s performance. Below, we break down what fiscal planning and mid-year strategic reviews are and then give you a list of tips for conducting both.

What Is Fiscal Planning?

Fiscal planning involves determining a financial plan for an organization so that resources can be allocated effectively and efficiently over a period of time. Most typically, company leaders plan for the entirety of a fiscal year. A fiscal year doesn’t necessarily share the same dates as a calendar year, and your company’s fiscal year may start at any time. For example, it’s not uncommon for fiscal years to begin and end in the summer. This type of planning is heavily involved in mid-year strategic reviews so as to modify budget needs and expectations as needed. 

Tips for Effective Fiscal Planning

1. Review Your Past Financial Performance

Before you dive into fiscal planning, you’ll want to review your company’s past financial performance. So, pull all the relevant data and consult with your accountants. See if you met or exceeded any past financial goals, or if you have some areas for improvement. During this phase, the most valuable insight lies in trends. Can you spot a period of time in which your finances flourished or floundered? If so, consider what may have impacted these downward or upward trends.

2. Set Realistic Financial Goals

Next, you’ll want to take a look at where you want to go in the future. While your goals will almost certainly involve making more money, you should also be as specific as you can be. How much more money do you want to make? Is there something in specific you would like to do with that money? What changes that rely on money would you like to see in the organization by this time next year?

Be realistic. While it might be tempting to dream big at this step, you might accidentally set yourself up for failure if you set too lofty of a goal. Instead, determine what percentage of growth would be acceptable for your company and formulate your plans around that.

3. Prioritize Your Spending

Next, determine which of your company’s initiatives align with your overall growth strategy. Commit to spending the greatest percentage of your company’s income to these initiatives. At this point, you’ll want to engage your department heads in the process. After all, they know exactly what tools and staffing needs will be required to execute your goals, so they can give you a better understanding of how much your vision might actually cost. 

4. Build a Contingencies Fund

No matter how much you plan, you’re bound to encounter some unexpected expenses during the fiscal year. So, as part of your fiscal planning, set aside a percentage of your revenue for emergencies. That way, you’ll be able to weather unplanned situations, such as natural disasters or an unexpected market downturn, with a lot more peace of mind and minimal distractions from your overall goal.

What Are Mid-Year Strategic Reviews?

During mid-year strategic reviews, company leaders study the company’s performance during the halfway point in a fiscal or calendar year. By doing so, they take a look at progress toward goals set at the beginning of the year and make any necessary adjustments to processes. Since about 6 months have passed at this point, they also review any challenges or unexpected events and make decisions that redirect the company onto the right track. 

Tips for Effective Mid-Year Strategic Reviews

1. Set Clear Objectives

Before you start your mid-year strategic reviews, determine what you want to get out of them. For example, some company leaders may want to identify risks, refine their tactics, or even make subtle or drastic changes to goals. Having an objective for your review ensures everyone stays on task and doesn’t get unnecessarily side-swept into new directions.

2. Gather Data and Review KPIs

Next, take a look at your data. As in your fiscal planning procedures, you’ll want to look at the overall picture and at trends. Are you on track for meeting your key performance indicators (KPIs)? If not, what adjustments do you need to make in order to meet your goals?

At this point, you may want to get the input of your employees. Ask them how well they’re able to understand and meet their goals with the resources given to them. Sometimes, failure to meet benchmarks comes down to either unclear communication or a lack of resources. So, ensuring your employees understand what’s expected of them and that they have the tools to meet expectations is essential. In addition, focus on what they’re doing well and encourage them to keep doing it!

3. Reallocate Funds

During a good mid-year strategic review, company leaders determine whether they need to reallocate some funds in order to better meet their goals. This step becomes especially important if there has been a huge and unexpected financial expense during the year.

4. Communicate and Document Your Findings

Finally, you’ll want to share your findings with the whole team and document them in case you need to go back to them. Companies document in various ways, from storing a write-up of their plans to emailing meeting notes and so on.

After you do this, communicate your findings and any changes to your whole company. Invite people to ask questions about what you’ve found or any changes. That way, everyone has a clear picture of where the company is headed and can get excited about playing a part in the overall vision.

While mid-year strategic reviews and fiscal planning may sound scary, they don’t have to be. On the contrary, you can use them as an excellent opportunity to drive your company closer to your ultimate vision and goal. Then, you’ll get to hopefully watch it grow and thrive!