5 Steps for Value Creation in the Annual Planning Process

Whether in the midst of your annual planning season, mid-year, or anywhere in between, the below process aligns the leadership team toward value creation amid dynamic market conditions.

SBI research and Growth Forum discussions indicate that CEOs and their leadership teams tend to hedge their bets during uncertain times. But we have seen from high-performing companies that they take a focused approach to value creation. To do this effectively, assessing the conditions in a systematic way and knowing where to focus efforts is critical. Whether in the midst of your annual planning season, mid-year, or anywhere in between, the below process aligns the leadership team on the direction of creating value. 


Step 1 - Establish a Fact Base

Before diving into the planning process, Revenue Operations needs to lead the charge in collecting data to establish one fact base that the entire organization agrees is the source of truth. Where does your organization sit right now? Evaluate your firm’s performance to understand how you are executing against KPIs. Leading and lagging indicators will help identify potential areas for value creation.


Step 2 - Inventory Bets

Once the fact base is established, executive leaders can work with their teams to evaluate how and where they can contribute to growth. The base includes the look-back facts about company performance, forward-looking beliefs, and Revenue Growth Maturity level.  All go-to-market teams identify growth levers and develop business cases supporting where they believe they should place bets.


Step 3 - Place Bets

Led by the CEO and CFO, the Executive team collaborates to select 3-5 initiatives that are large impactachievable, and aligned toward a shared commercial goal.  Bets are evaluated based on time to realization, level of effort, and impact to revenue. Quantifying the time, effort, and ROI of bets allows executives to make objective, informed tradeoff decisions versus subjective or reactive decisions on where to make strategic investments.


Step 4 - Build the Annual Revenue Plan

The revenue plan identifies how the 3-5 selected bets will impact financial targets across five levers of revenue growth.  Using bottoms-up capacity modeling as the foundation helps GTM teams understand what to adjust to execute on the selected bets and achieve growth targets. It also shows how bets will impact the different levers of revenue growth and where dollars and resources should be allocated.


Step 5 - Execute and Rollout the Annual Plan

After establishing the revenue plan, use a detailed execution cadence to align the GTM teams to drive desired results. Map out the details of each strategic objective ranging from a long-term to short-term view, and create a 3- to 5-year vision that can be allocated by function and by year, quarter, and week. This enables you to be agile so you can reassess and pivot every week/quarter on the actions that help achieve each objective.


In the upcoming weeks, we will take a deeper dive into each step as a resource for executive leaders to consult and action accordingly in pursuit of value creation. For a preview of what’s to follow, especially if your team is in the middle of revenue planning for 2023, click here to access the complete Annual Planning Process playbook.