Once a company’s top executives approve the annual plan, the implementation process begins. Proper implementation requires that all members of the organization know what is expected of them. If the plan is constructed correctly, each department will be supplied with the human and financial resources it needs to meet the plan's objectives. Implementation of the plan starts from the top of the organization and filters down to each employee.
Implementation Means Change
A company’s plan is a statement of change. It describes changes to organization structure, business strategy, personnel levels, budgetary expenditures--even in some cases changes in the products the company offers or the markets the company serves. Change can be unsettling to people within an organization. Successful plan implementation involves explaining these changes in a logical manner so the reasons for the changes are understood.
The company’s plan will include goals for each department or functional area. Some goals will be financial, such as sales quotas for the marketing department. Others will be more qualitative, such as lowering customer complaints by 25 percent. Communicating the goals to each department head--and eliciting their full cooperation--gets the plan implementation off to a strong start. Each manager must see how achieving the individual goals fits into the overall success of the company.
Prioritizing and Setting Due Dates
Managers must decide which departmental tasks must be accomplished, prioritize these tasks and schedule due dates for each task to be completed. Successful implementation assumes the architects of the plan know what each department is capable of achieving during a given time period. Unrealistic due dates cause frustration and may eventually lower productivity.
Implementation of the plan requires that each person--not just management-level personnel--in the organization knows what his duties are under the new plan. Supervisory personnel are given the goals and responsibilities first, then break them down into responsibilities for each individual who reports to them.
A company is like a machine with lots of moving parts. They must all work in sync in order for the machine to work at top efficiency. Each department within a company requires input, information and effort from other departments. Part of successful plan implementation is making sure lines of communication are open between departments so they can coordinate their responsibilities and due dates, and a spirit of teamwork is fostered.
Reporting Mechanisms and Feedback Loop
As the year goes on, actual financial results are measured against those in the plan. Negative variances in the plan require immediate attention before problems get worse. Analyzing why these variances are occurring enables top management to adjust business strategies, including expenditures, in order to get the company back on course to achieving the forecast revenues and profits.