Maria Waida
Maria is a freelance content writer who specializes in blogging and other marketing materials for enterprise software businesses.
The first step to achieving goals is to come up with an annual plan. A strategic annual plan makes it easier for managers, team leaders, and company owners to execute their vision for growth. Not only does creating an annual plan give you time to reflect on past accomplishments, but it’s also a great way to make ideas actionable. Keep reading to learn more about what annual planning is and how you can create one that has a significant impact on your organization. What is an annual plan? An annual business plan is a set of goals and milestones that guide a company's operations for the year ahead. It helps guide employees and investors in the right direction. For many people, this year's new year begins with a review of their previous year. They then set goals and make plans for the coming year. Annual planning is a combination of two other important elements: a business plan and an annual plan. A business plan is a document that a company or organization uses to set goals and improve performance. It's similar to a belt-tightening exercise. An annual plan is a strategy that a company uses to set goals and expectations for the coming year. It helps employees visualize where they are headed and how they can get there. The annual plan also sets out a company's long-term goals and helps guide how it will reach these targets. An annual business plan helps workers set goals and holds them accountable for achieving those goals for the upcoming 12 months. Then, there’s strategic planning. A strategic planning process helps an organization identify its mission, vision, and strategic goals. The strategic plan combined with the annual business plan are two key components of a successful strategy. The former provides a framework for the company's goals and intentions, while the latter provides the necessary tools and processes to execute those goals. Overview of a strategic annual plan Here is what is typically included in a strategic annual plan: Analysis of past performance. Reviewing your goals can help you identify areas where you can improve and become more productive. Budget estimations. Financial projections are often included in budget planning. They help you plan for the coming year and identify the right course of action for your projects. A clear vision statement. Expectations must be clearly stated, as well as responsibilities and clear OKRs. Having these elements in place can help keep teams on track and motivated. SMART goals. Set specific, measurable goals and deadlines for your company. This will help you measure how far you've come in terms of meeting the key results. Buffer room. A well-written annual plan should include space for emergencies as well. Having a contingency plan can help avoid unexpected expenses. In a nutshell: the annual plan is a strategy used to plan and execute the organization's goals and objectives. It is usually composed of three phases which are strategy, projects, and timing. The importance of an annual plan Annual planning helps define what's important to achieving goals and driving performance. An annual plan also helps keep the workforce united and can be used to motivate and retain employees. A well-written annual plan can help you set the direction for your company while providing the team with a sense of direction. Examples of annual strategic planning Here are some ideas to get you started with your own strategic annual plan: 1. Coca Cola HBC 2020 Integrated Annual Plan Coca-Cola's 246-page report details all aspects of their business. They start by celebrating their wins with statistics. They also include photos of actual customers and partners. Their CEO writes a letter to their stakeholders sharing their biggest accomplishments over the past year. Then they go through their vision. Throughout the strategy, you can see that they are using the pillar method for goal planning. Key areas of focus include leveraging existing business, continuing to win the beverage marketplace, making competitive investments, focusing on employee growth, and expanding their licensing. The overall report is designed well and is reminiscent of a well-crafted white paper. Because the CEO's letter was addressed specifically to stakeholders, we know that this is a tool for increasing investment as well as project planning. Because of this, a lot of the content within it answers the question, “why should I invest in you?” Throughout the rest of the annual plan, each pillar gets its own section. At the top of each section, there is a list of accomplishments from the past year and priorities for the coming year. They also summarize risks, stakeholders, and KPIs. This makes the packet easy to skim but also easy to remember. 2. pep+ (PepsiCo Positive) PepsiCo recently announced that their new 2022 initiative will revolve around “the planet and people.” While this is a long-term process for the brand, the launch will mark the core of their strategic annual plan for the foreseeable future. Their keywords include positivity (hence the “+”), sustainability, and “a fundamental transformation of what we do and how we do it.” On their dedicated landing page, readers can dig deeper into their annual plan. Also well designed, this presentation shows what the future looks like for PepsiCo through refreshed branding and imagery. Symbols such as smiling farmers and healthy, green fields drive the message home. To achieve these new goals, the company will focus on supply chains, inspiring consumers, and driving sustainable change among all its product lines. They link several documents throughout the report, including a comprehensive list of goals which is a great example for your own annual plan template inspiration. This three-page chart names pillars on the left-hand side and targets or actions with due dates on the right. If their goals have numerical metrics, they include data from past years, along with key benchmarks they hope to reach by the end of the year or in the future. Otherwise, their goals are measured in actions. For example, as part of their sustainability pillar, they plan to “develop and deploy disruptive sustainable packaging materials and new models for convenient foods and beverages.” This task is specific and clear, despite the fact that it’s not as quantifiable as some of their other goals. 3. Nestlé Global’s Annual Report Their annual plan is not public but they have shared an annual report on past wins from 2020. In addition to a financial review, Nestlé also shares a new strategy. Starting with important facts and figures the company highlights statistics from organic sales growth and more. They also visualize data about which types of products are selling most and where in the world the company has grown over the past year. As Coca-Cola did, Nestlé also includes a letter to shareholders. They discuss ways in which they plan to grow in the coming year. This includes what product areas they will invest more in and where they will pause or halt efforts. They also emphasize a new product area which will be the focus moving forward in the short term. In this section, Nestlé touches on long-term strategies and how these short-term goals will affect them. In general, their annual report focuses on the word innovation. It mostly has to do with developing new products and revamping old ones. Like PepsiCo, they are using sustainability as a pillar as well as e-commerce. The report goes on to elaborate on each strategy individually. Nestlé lists action steps and provides clear evidence as to why each is important. They also highlight statistics for growth in key areas and name even bigger numbers for where they hope to be in a year. Throughout the report, they include images from ad campaigns that demonstrate the change they wish to continue implementing as part of their marketing plan. Again, branding imagery makes a big difference when creating your own strategic annual plan. It sets the tone for what's written on the page and can help visual learners better understand what you're going for at a glance. Although Nestle's strategic annual plan is designed more like a white paper than a chart, this layout is the most magazine-like by far. It serves as a great example of how you can organize ideas on the page in a way that is interesting and attention-grabbing. One of the most notable aspects of their annual plan is the Materiality Matrix. They use this chart to visualize key areas of interest and prioritize them according to stakeholder values. Within each box, they’ve listed bullet points of business areas this value will impact. It’s a great method for summarizing goals that cover a wide variety of departments and business engagements. Understanding strategic planning best practices Everyone has their own way of thinking about annual plans. Regardless of what you’re trying to achieve, the following strategic planning best practices will help you get there: 1. Use SMART goals A variety of SMART goals are commonly used to help guide and motivate people. They help set realistic benchmarks and are designed to help teams achieve success. It will also help you plan for the ups and downs of your business. To reach your goals, divide them up into smaller goals and set specific deadlines. These goals will help you measure how successful you are at reaching them. 2. Include contingencies For example, having an emergency financial reservoir is a good idea to prevent a potential financial disaster. It can help your company navigate slower seasons while still sticking to your annual plan. 3. Build in flexibility Even minor shifts in external factors can significantly impact on how effective you are at creating and implementing your strategic plan. Never forget that, while we are creating our annual plans in a vacuum, the world will undoubtedly go through more changes this coming year. Even though we can’t predict the future, we can make our plans foolproof by being flexible now. What is an annual plan template? An annual plan template is a document or tool that can be utilized repeatedly to outline the various stages involved in creating an annual plan. Its purpose is to provide a clear understanding of the annual planning process by specifying the actions to be taken and the timeline to follow in order to develop an effective business plan. By utilizing the annual planning template, individuals or organizations can ensure that they have a systematic approach to reaching specific goals, and can enhance the quality of their business plans. Using Wrike to assist with an annual plan template Wrike’s project management software can help you keep track of all your company-related information in one place. It can also streamline your work and help you stay on track. It can also help you keep track of your annual plans and develop a strong strategy. Start by using last year as a reference. By understanding the issues that affected the previous year, a company can improve its performance in the following year. Draw reports of time spent per project and see where your team went over or underestimated. Then look at which tasks tend to drain resources the most. Determine whether or not the ROI is worth it moving forward. Next, set realistic goals. Reflect on last year's statistics from Wrike Reports and put together a plan with a realistic metric for improvement. After, break down big plans into individual steps. Start by focusing on the business goals of the company then outline your key objectives that align with those. Make sure that everyone knows who is responsible for executing and approving each task. Draft a Gantt chart that includes each step broken down into relevant tasks. Remember to add deadlines to every action to keep teammates accountable and keep to realistic deadlines. Then, delegate tasks according to strengths and weaknesses. Use project reporting and individual job performance to assess team members. You may find that those with specialized talent are being tasked with unskilled work when they could help solve major problems elsewhere. Don’t forget to involve the whole team. Start early, plan ahead, and keep everyone involved in the process. Doing so will make it easier to overcome obstacles once the projects are underway. Additionally, ask them for direct feedback on your ideas for the next year. You will learn from the front line what obstacles they may be facing that will affect the timeline. Another bonus of getting your team involved is that it creates more transparency in the workplace. Using Wrike as a part of the process is not only helpful, but the team also keeps learning how to use the system more efficiently as they go. Having a work management platform that enables you to plan and execute annual plans is a good idea. Plus, it's also a good idea to use tools that allow you to collaborate and manage complex processes. Create an effective annual plan today with Wrike’s free trial.
Having different generations in the workplace is common these days. In most cases, team members of varying ages work together on the same project or task. Others may even manage multiple generations of workers at the same time. This article aims to help people who work with and manage different generations in the workplace by developing a fair strategy that takes their unique qualities into account. We’ll also explain how to avoid making mistakes and dealing with multi-generational issues that may be new to you so that your entire team can feel comfortable at work. How generational diversity looks in the workplace The generational gap occurs when people are born at different times. It can affect how people behave and think at work. For example, members of the silent generation are typically portrayed as being very conservative, while baby boomers are likely to have more liberal fiscal tendencies. Although everyone is an individual with a unique personality type regardless of age, you may see common traits associated with each generation play out right in front of you. There is a lot of common ground between different generations in the workplace. Most of us like to feel valued at work. We also enjoy feeling as if we're making a difference and doing something meaningful for ourselves and others. And yet, teams with generation gaps can face challenges that relate to their ages while collaborating. Why? Having different generations in the workplace means that company culture and communication is not one size fits all across the board. Don’t force people to fit in the same work environment. Instead, set up guidelines that will allow everyone to feel comfortable. Another solution is to consider what values and habits each generation has to offer in a team setting. That’s not to be confused with stereotyping. Putting each generation into a box often encourages counterproductive assumptions. While it's true that working with different age groups can be challenging, it can also teach employees about differences in their abilities and attitudes. Here are the generations you may see in the workplace today and what defines them: Generation Z Gen Z is focused on core values of being smart, funny, and witty. They may also consider diversity to be an important consideration for hiring, especially at the management level. Gen Zers want to work with like-minded individuals who share similar goals and values. This generation's managers should help them develop and grow by providing them with the right support and resources. Millennials Performance is very important to millennials. They are more concerned with the quality of their work than the number of hours they put in. To ensure that they are being treated fairly, managers should communicate honestly with their employees. The idea of an “always-on” work culture is not acceptable to most. Generation X Gen Xers are known to be individualistic, having been former latchkey kids. They may also prefer to manage their work and physical and psychological space in a more flexible manner. As a result, they often prefer to work with less supervision and are more comfortable communicating with others through various forms of media such as email and Facebook. Flexibility and a solid work/life balance are non-negotiable for this generation. Baby boomers Baby boomers are known for their work ethic and goal-oriented processes. They value face-to-face interaction and traditional recruitment methods. Structure, reliability, and flexible work policies are all ideal for this group. Acknowledgment for their skills and hard work will go a long way with this generation, although most employees would likely be grateful for that too. While we’ve mentioned some tips for each already, it's important to listen to the different work styles of multi-generational employees and communicate with them through various channels regardless of their age. Even the smallest details can make a significant impact on their work experience. Take onboarding for example. While some generations may prefer to receive information via email, others may ask to see printed copies of pamphlets and manuals. How do you manage a generation gap in the workplace? There are many differences between generations. While many people can agree that working together is beneficial, others believe it can be problematic. Managers must ask themselves: with the rise of multi-generational work environments, how do we work together seamlessly? Regardless of our age or experience, everyone wants respect. In order to succeed, older generations need to respect their younger colleagues and vice versa. While it may seem like a challenge at first, managing different generations in the workplace has its benefits. Generational diversity can help people develop new ideas and improve their work. It can also make managing other types of diversity and inclusion an action step rather than an idea. As you begin to develop your strategy, it’s wise to work with the group on issues that affect everyone. For example, creating stress-relieving fundamentals can help businesses retain employees and attract new ones companywide regardless of age. What are the challenges of working with different generations? Intergenerational conflict has been a growing issue over recent years. Concerns over climate change and political unrest have, in some cases, made conversations between different age groups a bit standoffish at best and downright hostile at worst. When there are many different generations in the workplace, there is a real risk of conflict and misunderstanding. Make sure you have a clear communication plan with everyone’s preferences laid out ahead of time. You’ll also need a documented and fair system for how you’ll address missteps between team members. Another one of the challenges of working with different generations is compensation. Different phases of an employee's life may affect their compensation and benefits package. Younger employees may also be focused on training opportunities or flexible work days since their entry-level wages are assumed to be low. On the flip side, older generations may expect and take pride in handling more complex or senior-level tasks. This is because their compensation packages tend to be higher and would match the workload. Understanding how compensation levels also affect how different generations think and feel about each other in the workplace will help managers better understand their teams. How should you handle generational issues in the workplace? If you’re of a younger generation and you are placed in a management position, there’s a chance that you’ll be overseeing older, more experienced (and sometimes more qualified) colleagues. To navigate this, you’ll need to establish trust in yourself and in others. This is especially true for anyone working under you who already has experience in leadership. If you’re of an older generation and you are placed in a management position, understand that there may be younger employees who have a different way of problem-solving or communicating than you do. Speaking of communication, how team members communicate is different for different generations. For instance, younger team members tend to use more slang and abbreviations in their messages. Older team members are more likely to use emojis in their communications. These seem innocent at first but can create rifts between members if not acknowledged upfront. For example, an older team member sending a thumbs-up emoji may seem like a friendly confirmation that they’ve received a message. But to a younger team member, it may come off as condescending or even angry. Getting everyone on the same page about communication style will go a long way towards resolving and even preventing issues like this. The same applies to your communication with the rest of the team. Sticking rigidly to your own preferred means and style of communication can alienate others, even as a team leader. Try to modify your message to suit the needs of whichever generation you’re speaking to in that moment. But no matter how much you prepare, you may find that you make a mistake here and there. When that happens, simply remember to be understanding and graceful with how you handle the situation. How to create a strategy for motivating different generations in the workplace 1. Do your research Understanding what makes other generations tick can help avoid division and conflict. There are many different ways to work and each generation has its own needs and wants. For example, many Generation Xers are known for being devoted to helping older adults and their children. So incentives revolving around health insurance benefits or anything else that directly supports the goals they have for their loved ones is a major plus. On the other hand, members of Generation Y enjoy being sociable outside of work and believe it is important for their careers. Opportunities for networking are more often than not a success with this group. 2. Consider the viewpoints of each team member Despite best intentions, there are many ways that ageism and cognitive bias toward different generations can show up in the workplace, such as stereotyping co-workers based on how they dress or their social media usage. If you notice or hear about intergenerational stereotyping among your colleagues, don’t be afraid to start a dialogue about it. Emphasize the idea that, instead of assuming that everyone is the same, employees should try accepting others based on their merits and contribution to shared projects. 3. Strategically place different generations on projects together so that their work complements one another For example, baby boomers can pass on their knowledge and experiences to Generation Y with digital tools and systems that Generation Z sets up for them. Remember that successful multi-generational teams are built on the strength of their individual performers. One way you can manage this step is by using a project management tool such as Wrike. In Wrike, users can signify which employees possess what skills and assign them to projects accordingly. This can also be used to view individual employee workloads across all active projects. 4. Never assume that an employee will have certain skills or abilities just because of their age This assumption most often shows up when technology is involved. Give everyone the opportunity to demonstrate what they are capable of and go from there. 5. Go out of your way to help employees bond with teammates of different generations Monthly mentoring sessions are a great example of this. This will encourage employees to share knowledge and be more open to learning from one another. By the way, mentoring doesn’t necessarily have to be one older person coaching a younger person. You can throw out conventions and offer mentorships led by the younger generations in the office too. If mentoring doesn’t apply to your field, try building up a social calendar. Plan team-building activities and happy hours so people can get to know each other. Team members will get the opportunity to appreciate each other more outside of email and Slack. Finally, find the similarities and preferences the different generations do share and use them to form the basis of your managerial choices. For example, if both your millennial and your Generation X employees prefer one-on-one performance feedback, adding that to your strategy will help. In conclusion At the end of the day, the key to understanding and respecting other generations is to accept that they are different from you. It’s always important to acknowledge individual strengths, weaknesses, and skills, regardless of how old a team member is. With the right strategy, you can reap the benefits of a multi-generational workforce and build a stronger foundation for long-term success.
If you’re ever planning to manage a production process, you absolutely need a collaborative work management software. Check out our overview of the importance of production management, including examples of how leading brands use collaborative work management software to successfully complete projects.
Employee wellbeing is a critical component of a healthy working environment and organization. Companies that promote wellbeing make it easier for employees to manage stress levels while also maintaining a positive and productive environment. Wellbeing can refer to mental and physical health, as well as more complex things such as satisfaction and engagement levels. In this article, we’ll explain what employee wellbeing is, why it matters, and how to create the best employee wellbeing program in a workplace using a project management solution. What is employee wellbeing? Employee wellbeing is defined as the overall mental, physical, emotional, and economic health of your employees. It’s influenced by various factors such as their relationships with co-workers, the decisions they make, and the tools and resources they have access to. Hours, pay, and workplace safety also have a significant impact on employee wellbeing. While it will vary from person to person, employee wellbeing should average out to a level that allows for a productive and healthy workplace. Outside factors contribute to employee wellbeing too. Stress around issues such as housing, health, and family all play a role in performance at work. However, employers can acknowledge they have no control over what takes place after hours while still taking responsibility for what they can do for their employees. According to a recent employee wellbeing study by Alight, less than half of U.S. employees have a positive perception of their overall wellbeing. Overall, there has been a major decline in employee wellbeing from early 2020 to mid-2021, even as employees return to work at the office again. Why does wellbeing at work matter? It is the employers' duty to provide their workers with the necessary support and care for their physical and mental health. Despite this, many organizations still don't have a dedicated wellbeing strategy. A wellbeing strategy can help employees feel valued and supported at work. It can also improve employee engagement and motivate teams companywide to reach their goals. One recent historical example of why it’s important to improve employee wellbeing comes from the United States film and entertainment industry. The International Alliance of Theatrical Stage Employees (IATSE), which represents a wide range of technicians responsible for film and television production behind the scenes, recently considered a strike to improve employee wellbeing. Issues such as inhumane hours, inadequate rest, and inadequate pay are affecting all areas of employee health. In fact, many are now coming forward to explain how a lack of care and action towards improved employee wellbeing is affecting them on a personal level. Clearly, employee wellbeing is a fundamental building block of all organizations. Even if your company is smaller or in a different field, you may still find that there are plenty of meaningful ways to improve the quality of life for everyone involved. Being proactive about employee wellbeing now can improve or even save lives in the future. The advantages of good employee health and wellbeing When employees feel well, they tend to perform better. This increases productivity and helps employees develop better habits. Studies show that workers are 13% more productive when happy. Habits such as healthy and consistent work/life balance policies from management are a good example of how employers can help increase joy. These habits also ensure business continuity, even during busy seasons. Good employee health and wellbeing also leads to higher employee morale. When employees have their needs met, they feel valued and competent as a result. As one corporate wellness program points out, “it’s also about preventing lost time due to absenteeism, stress, and illness. These issues cost many companies far more money than traditional healthcare costs”. Although great employee morale is, in itself, the biggest benefit for companies, preventing foreseeable problems like these is also important. If you’re recruiting or plan to recruit in the next year, creating a plan to improve employee wellbeing can help you attract and retain skilled individuals. For example, 38% of Gen Z job seekers consider a healthy working environment to be their number one factor in choosing a company to work for. Benefits such as increased sick days and mental health services go a long way toward enticing top talent from this generation to apply. Even if you’re not hiring now, an employee wellbeing program can also help you avoid losing talented candidates now. Many companies have learned firsthand that treating employees well is the key to creating a great customer experience. Simply having a happy and satisfied staff has been shown to improve the way clients feel too. As HR Zone points out, this is especially important in the wake of the pandemic, as many customer-facing employees have dealt with extreme emotions and demands from people experiencing prolonged stress from the pandemic. That, combined with safety measures making it difficult to engage in activities most people use to destress, makes it even more important for employers to take responsibility in this area. The challenges of wellness initiatives in the workplace One of the biggest challenges of wellness initiatives in the workplace is setting and measuring goals. Getting a clear idea of what your current employee wellbeing looks like can be tricky. Not only is it subjective, but some employees may not feel comfortable responding truthfully in case their complaints come back to haunt them. For that reason, even anonymous surveys may not give the whole picture. Many traditional incentive programs rely on metrics such as blood pressure and body mass index, but these are often inaccurate too. As a result, many companies are now asking their workers to provide their health information in exchange for insurance plans that are higher-cost. This practice could put older workers and part-time employees at financial risk if they are unable to make up the difference in the cost at their current wage. Another issue is execution. Some companies may not be able to provide the programs that they promised to offer. Or if they do take action, the resources and policies they endorse may not be widely used. Having a constant eye on employee reactions to the program and obtaining feedback can help solve this problem. How to create an effective employee wellbeing program with Wrike Truthfully, there is no one-size-fits-all approach to designing an employee wellbeing strategy. That’s because it should be based on the unique needs and characteristics of your organization. However, if you create a more robust framework to promote mental health, you’ll not only improve the culture surrounding employee wellbeing, but you’ll also improve the lives of everyone involved. That’s where an employee wellbeing program comes in. An effective employee wellbeing program begins with strong communication. To have strong communication, you’ll need to introduce formal project management software for implementing your program. Doing so will show senior leaders and employees that everyone understands the seriousness of workplace health and wellbeing. It’s also a great way to test out, measure, and get feedback on initiatives. Next, you’ll need a project management solution to bring employee wellbeing from theoretical to practical. Even the best intentions fall short when action steps aren’t assigned and carried out. Use Wrike to create a project timeline or to separate employee wellbeing initiatives into quarterly goals. Then, add project phases for program implementation. After, you can begin adding specific tasks such as announcing the program, creating documents explaining the benefits, and facilitating feedback from current employees. Include individual deadlines for each task and assign them to specific managers to ensure that someone is accountable. Wrike can also help you manage and organize goal-related data. Ask for employee feedback and reports from managers directly on the platform. Use @mentions to grab the attention of individuals who need to turn in related paperwork and let them know what’s missing. Once those are collected, you can also securely store documents and manage permission settings within the platform. If your employee wellbeing program is already underway, Wrike can help you manage common health issues employees face at one point or another. For example, if you're noticing signs of employee burnout, Wrike's Workload Charts will help management see and evaluate individual tasks across all projects on one screen to avoid the detrimental effects of assignment overload. Ready to improve employee health and wellbeing? Sign up for a free trial and get started today.
Collaborative work management software is changing the way we acquire and keep clients. We’ll cover the importance of client management, including six of the most common questions, a brief look into its history, plenty of examples, and nine predictions for the future of client management.
Every month it seems like there are new marketing tools being introduced and new trends to stay on top of. But in the constant mad hunt for what's cool and trending (the legacy of all social media), marketers sometimes forget to revisit relevant lessons from classic marketing books. Below, we've put together a roundup of the last few marketing book reviews on the Wrike blog:
For some companies, bootstrapping is the first choice when it comes to expanding or innovating. Using funds from the firm's internal operations allows owners to retain their firm's equity while reinvesting profits into more profitable ventures. But you may be wondering, what is bootstrapping? In this article, we’ll help you better understand what the term bootstrapping means, as well as its benefits and challenges. Keep reading to discover tips and must-take steps that will lead your business to bootstrap success at any stage. What is bootstrapping? Bootstrapping is a word that originated in the early 19th century. It became a lasting symbol of success. The concept of being able to pick yourself up by your bootstraps is a metaphor for overcoming the limitations of life. In business, it means overcoming the limitations of traditional financing. Bootstrapped companies are traditionally defined as those that get off the ground without external funding. Google and Facebook are two of the biggest examples of this. The word bootstrapping in business also refers to the process of developing complex software programs in various stages. But for this article, we define bootstrapping as building a startup company with little or no outside support. Instead of starting with a blank check, a bootstrapper uses their own personal savings or loans for initial funding. Bootstrapping is a strategy that involves taking on significant financial risk, which is one of the many threats to startup success. It can be very challenging to get started. The entrepreneur is more likely to have total control over all aspects of the business, which includes but is not limited to sales, marketing, and operations. The biggest appeal to bootstrapping is its ability to establish a safety net for future investments. Entrepreneurs can experiment with their brands and products without the pressure of investors or venture capital. On the other hand, there is a lack of credibility to bootstrapping despite its known success stories. This can prevent a business from obtaining the support of respected investors later on. When it comes to funding a startup, the entrepreneur’s mindset must be different than that of a venture-funded company. For instance, while the former expect to be around for a while, the latter believe they will have high business growth and therefore need outside funding to fund their exit strategy. Entrepreneurs who choose to bootstrap must have a wide variety of skills and experience to succeed. Creating and maintaining a culture of excellence should also be part of their core values. What are the benefits of bootstrapping? For some people, it's a decision about how much they should retain to maximize their gains. Others believe that they should keep all of their capital to maximize their returns. And, there are also some other people who are simply looking for a way to get started without taking on external financing. By paying back these debts, you can start to grow your business and avoid incurring any costly late fees or interest. And after you reach this stage, you can start looking towards future expansion (theoretically) sooner than if you had gone with a bank loan. There’s also the ownership aspect. Some bootstrappers have a desire to retain all of the company's equity and receive all of its profits. Plus, bootstrapping has a much lower barrier to entry compared to the alternative. So it’s an attractive option for new entrepreneurs or people who want to get their idea off the ground as soon as possible. Another advantage is that bootstrapping is not just for startups. It’s a strategy that can be executed later on in the life of your business too. This is true even if you've already held an equity financing round. While some major shareholders might object to the use of company profits for new ventures (unless they receive a dividend payout), bootstrapping can still provide the same benefits as long as everyone is on board. Companies that benefit the most from bootstrapping include: Early-stage companies that do not require large amounts of capital Serial entrepreneur companies, which are typically started by former employees turned entrepreneurs What are the challenges of bootstrapping? Bootstrapping your company requires that you have a strong belief that your business can gain significant value quickly. It also means having an unwillingness as a business owner to give up decision-making powers to outside investors, no matter how tempting it may be down the road. For these reasons, having the right mentality is one of the biggest challenges of bootstrapping. In fact, being a bootstrapper puts you at greater risk than you might think. If your venture doesn't go well, potentially losing the friends and family members who invested can be devastating. When your company needs an extra boost to expand or meet a one-off cost, it might be time to consider alternatives to bootstrapping. There are many types of finance available for businesses, and it's not just one type of loan. Knowing all of this might make keeping your nerve even more challenging, but it’s important to fully understand what you’re getting into before moving forward. How to bootstrap your startup There are quite a few bootstrapping methods to come up with your own business funding. However, here are some foundational steps every business should take. Step 1: Know what stage you’re in You're either a beginner who is doing it on your own while also working another job, or you’re at the stage where crowdfunding and a personal connection with your audience provide most of your financial backing. If you're neither of those, then you're likely at the growth stage, and you can focus on credit or expanding your offerings. Step 2: Create a roadmap It is best to break a big idea into several parts and then execute it piece by piece. Doing this will allow the startup to execute smoothly. This should include gathering your essential tools, your investor pitch deck, and your team if you're choosing not to go it alone. You then need to outline both the practical steps that will get you from point A to point B and your philosophies or mindset behind your approach. The latter will help differentiate you from the dozens of other pitches your potential investors are considering. Establishing a successful long-term strategy is a key element to building a successful startup. Step 3: Consider proactive solutions Bootstrapping assumes a high level of risk, which is why you need to plan ahead and create contingency plans now before something goes wrong. Ask yourselves what problems do you know of that other bootstrap companies have experienced? What about other bootstrap companies in your industry? What will your team do if these come up at any point during your own bootstrap phase? Step 4: Consider building a team Even adding one member can help your bootstrapped business grow faster and more efficiently. For example, having a great co-founder can help you get more funding, spread the work out, and avoid tunnel vision. If you don’t have anyone in mind, try using a startup networking site to meet new people. Remember that our first employees are the ones who will help make your business successful. Make sure that your team is motivated and committed to your goals so you can maintain a high level of standards and business continuity. Step 5: Use a lean model Before you start working on a product, you need to make sure that it is a viable product that can be used by early customers. This is also the time to learn about your product and its customers. This model works seamlessly with the nature of a bootstrapped startup because it requires minimal financing and is typically faster than a traditional startup approach. Step 6: Get real about finances If you're bootstrapping a startup especially, then you’ll need to discuss your financial situation with your co-founders. Don't go overboard with expenses—there are plenty of ways to cut costs that startups have done successfully. For example, if you're not afraid to try new things, then you might want to consider taking on a side job or even buying used office equipment instead of brand new gear. You could also start a home-based business by avoiding renting an office. This is also easier today due to the rise of online communication. Consider applying for grants sooner than later. And keep up the practice before, during, and after launch. Tips for getting bootstrap funding Work with an angel investor. Angel investors are individuals who are able to provide advice on how to start a business or get your products on the market. If you're a new startup entrepreneur, having the expertise and experience of other startup professionals could be very beneficial. Remember, it’s not about you. It's about doing the right thing for your business and your shareholders. That should be the number one motivator you share with partners. Always think big picture. If you can keep up with your cash flow and clear any debts that you owe, you will be able to keep your company running smoothly for the long term. Getting this vision in writing will go a long way towards impressing potential investors. Start small. Even if your business requires a lot of capital, even some small form of investment can help you get started. Follow your expertise. Getting started with a new venture can be challenging if you have little or no experience in the industry or have no idea how to market it effectively. This is why it is important to create a company that’s already established in a certain industry or a specific area. Prioritize creativity. If your product or service is easy to replicate, a larger company with more resources can steal it and scale it much faster. Potential investors will be able to see that from miles away. Do market research. Before you start investing in your small business idea, it is important to validate that your target market will pay for it. Bootstrap and startup tools you can't go without The top must-have tools for bootstrap and startup companies are project management software, website creation platforms, and SEO tools. Project management software Project management software like Wrike is essential for showing potential investors an actionable roadmap they can feel confident about. Wrike is a collaboration tool that works seamlessly across all types of businesses. It has bootstrap-friendly features such as visual project map tools that make it easy for collaborators to see exactly what you have planned and how you intend to execute on it. This allows you to manage the wide variety of bootstrap-related projects you’ll have going on all at the same time. As an added bonus, your team can easily sync and collaborate across all your devices in real-time, so everyone stays on the same page even when working with third parties such as freelancers. Plus, it’s secure and will keep your data safe. Website creation platforms Even running an offline, local business can be challenging without a strong web presence. However, you don’t need to spend thousands of dollars on an expensive web design agency. It’s possible to build a website from scratch using an intuitive website builder such as WordPress or Wix. But either way, having your own domain and website is a must for proving the legitimacy of your business. SEO tools When you can’t afford paid search ads and collaborations, you have to rely on organic efforts to reach the right audience. That’s where SEO comes in. Although it takes an investment of time, a solid SEO strategy and the right combination of tools can land you above your competitors for high-earning search terms on Google. Every bootstrapped entrepreneur should use: A keyword suggestions tool for finding competitive targets A domain analysis tool to see where your strengths and weaknesses lie A website crawler for uncovering technical SEO ideas Getting started with cash flow is an important step in any business. Bootstrapping can help you avoid running out of money and control your debts at any point during your company’s lifetime. Use the right tips and tools like Wrike to get your bootstrap strategy started today. Begin your free trial.
