Before we begin, I'm not selling fancy leather bound planners, trendy books on the topic or heirloom quality prayer rugs. I'm not here to convert you. I could stand on my head and do double summersaults while I ranted on and on about the virtues of planning. But all would be for naught. Either you believe in planning or you don't. It's just that simple.

Instead, I've designed this article for the believers and latter day converts - for those who have consciously decided, “If we're going to plan, we might as well get our money's worth.” With a little luck, some people will recognize themselves as psychoplanners. These are the folks with deep-seated illusions of planning. Instead of believing they're Napoleon, they conjure themselves as planners. Allow me to illustrate with a story from my early career.

We'll go back to the world of polyester and leisure suits: the year 1981, the place the orange Naugahyde coiffured office of a distributor client. As yearend approached, the conversation turned to planning. Here in dead earnest, my distributor shared his plan for 1982: “Work hard, get as many sales as possible and have a nice vacation sometime during the summer.” You know deep down in his heart of hearts, he believed he had a real plan. Most likely (and I avoided the subject) at the end of that year, he devised another similarly amazing plan. But we had a bit of a problem. His company was missing out on some of the rapid technology and cultural shifts of those times. Ultimately, I had to come up with a plan for finding a new channel partner.

Here's the issue with his “plan.” How do you measure, define and refine “work hard and get as many sales as possible” in real terms? At least his plan for a nice vacation in the summer was measurable and had a bit of a time frame.

This little story from my checkered past drives home an important point. Many people believe in planning. But when those plans are exposed to the unflattering light of scrutiny, they appear as phony as Naugahyde trying to pass for leather. They're psychoplanners.

Armed with these remembrances, let's head out on a quest for planning best practices for the HVACR distributor. After observing the planning process at hundreds of distributors, I have come to recognize some inarguable trends, the stuff that works and the pitfalls to making planning a profitable venture. Here are common variables amongst all plans:

  • Every step of the plan has a due date - When we say we will get something done in the future, the future rarely happens in our lifetimes. When we say we will get this accomplished by 3rd quarter and set milestones for January, March, May and August, results take place.

  • Every step of the plan has a single person responsible for its completion - Committees rarely get anything done unless the chairperson takes on the responsibility. The same holds true with departments, groups and other work teams; somebody needs to be responsible for shepherding the results. This doesn't mean they do all the work, but they must hold others to the course.

  • Plans must be documented and archived - When you don't write plans down and document them, they get lost in the shuffle. Employees forget their responsibilities. Later on, disputes arise as to the actual results expected and commitments made.

  • Review the plans - Any plan without periodic review is a waste of time. Review is easy with documented plans and when you hold individuals accountable for their implementation. Further, in companies ramping up their planning skills, it takes a couple of reviews before employees believe that planning is serious and real.

  • Not every plan works - Some plans just plain don't work. Good managers and their companies take the time to understand what changed, what mistakes people made and which assumptions proved to be incorrect. This improves future planning.

  • Don't confuse lack of execution with a poor plan - Many times, plans don't work because somebody failed to follow through on their commitments, mishandled an important step or didn't have the personal horsepower to drive things forward. Without execution, even the best plans fall short of the mark.

  • There must be consequences for lack of performance - Some people respond to plans better than others. In every company we helped, we have discovered a few individuals who did not take the planning process seriously. Sometimes these poor performers produce a respectable result. In their own mind, their results prove planning is a wasted effort. We believe differently. Periodic review and individual responsibility soon flushes out poor planners. Be prepared to deal with these individuals.

  • There is no generic best plan - Beware of those who tell you their plan is the best. The right plan is based on your company, the skill sets of employees, long-term culture and business climate. You must tailor the plan to your situation. This doesn't mean you can't model it around a successful plan of another company. Instead, it means you need to tailor for your circumstances.

  • Expect (demand) planning improvement - One of the most rewarding experiences comes years after an active planning process comes to fruition. As the team develops planning skills, activities that once took years, you can now accomplish in months. This accelerates the growth of your business.

  • Bring in outside help - This may sound just a wee bit self-serving but ask yourself these questions: Does any of this sound like rocket science? Why aren't we better in our planning? An outside resource helps you anticipate the bumps, bruises and roadblocks along the way.

  • Anticipate pushback - As you begin adding discipline to your planning process, expect pushback. The most common phrases heard in the trenches of wholesale distribution sound remarkably close to these. “I'm too busy to plan right now.” “I already have a plan; it's just not designed in a formal way.” And the omnipresent favorite, “Listen, do you want me out selling or sitting in the office planning?”

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This isn't about strategic planning

Let's not get this confused with some kind of elaborate strategic planning session. This type of activity could best be considered tactical planning. Applying planning to some of the critical aspects of our business to accelerate the flow of results is paramount to success in our world today. Planning helps prioritize important tasks in a world full of distractions.

Here are a few topics to get your planning juices flowing:

  • Joint planning with key supply partners - Not all vendors are created equally. Some have the power to cause our business to accelerate; others don't. We have proof that companies who plan with their supply partners grow faster than their competition. Lots of companies go through the motions of planning with their partners. If you would like to hear of our proof, give me a call.

  • Major marketing activities - These can be marketing activities, plans for customer presentations, open houses, trade shows and other such events. Often we observe distributors rushing into events they have known about for a very long time - just because they lacked planning.

  • Major technology initiatives - What major initiatives can fundamentally change the way you do business? Here we are referring to things like CRM System implementation, implementing pricing tools, rolling out a new software system or warehouse bar-coding projects.

  • Product launches - Far too many times, distributors in our industry launch new products and nothing happens. Based on observations and reports from the field, very little planning is applied to the process. Before you launch a new product, ask yourself a few questions about the plan. Do we have the stock on hand to support the initiative? Is literature in place? How many times have you allowed a supply partner to do the training only to realize the support materials were lacking?

  • Targets: accounts, products and line expansions - Research indicates companies who establish formal targeting processes are 47 percent more effective in reaching their sales and financial goals than organizations who leave targeting to their sales team (without a process). Do your targets have timelines, individual responsibilities, opportunities for review and measures of success?

  • Inventory management - Seasonal shifts in demand, changes in technologies and obsolescence of existing products sometimes requires more than just a single person's input. Without a plan in place, less than ideal consequences arise. A process for measuring and monitoring the ever-changing conditions around the HVACR industry is a practice you must incorporate into the inventory management to achieve maximum results.

Now a final word for our psychoplanner friends

You have read through this article. Little voices are going off in the back of your mind. One voice says, “I'm a planner. This is a bunch of hot air. Plans don't need all of these things to work.” But you feel a little discomfort because you remember times when things didn't work out like you imagined they could. The other voice is saying, “If I would have had reviews, I could have avoided a costly mistake.” Or they're saying, “The inside sales group just didn't execute on the plan. Maybe I should have assigned Deborah to make sure things got done.”

No plan is a perfect plan. But following the best practices of other HVACR distributors tips the scale in favor of accomplishing top-notch results. What would happen if you started looking back to the best practice list on a regular basis? My guess is you would soon find yourself enjoying at least one of my old distributor friend's plans. And you too could plan for a nice summer vacation.

If you are planning to improve your own planning process, shoot me an email. I have a list of other areas where planning can impact your business.


Frank Hurtte provides Strategic Insight for New Times. He speaks and consults on the new reality facing distribution in a post-recession world. Contact Hurtte at River Heights Consulting via email at frank@riverheightsconsulting.com or via phone at 563/514-1104.