So there’s a critical but subtle mistakes I see founder make all the time when times get more challenging. And they made it a lot the past year or so:
They don’t just reset the plan. They lower the bar.
What’s the difference? In practice, it can be a bit subtle, but let me give a recent real-world example.
A startup at $10m ARR hitting tough headwinds might want to reset the plan to say 30% annual growth from 100% in a really tough year. Hopefully, a reset like that only happens once in your journey, but it’s happened to many the past 12-18 months.
OK so you reset the plan, and now instead of going from $10m to $20m in a year, you plan to hit $13m. That’s adding $250k a month instead of $800k.
But for how long do you reset to a lower bar, not just a lower plan? Forever? If it’s forever … the team sort of settles into that lower goal.
And in fact, here’s the thing: it doesn’t really help. Morale still suffers. Folks are still grouchy. They aren’t any happier ultimately struggling to hit a newly reset plan.
What’s critical sometimes is a reset of the current plan, and a reset to a New Normal. But you do have to get back to growth.
If you keep the plan so low for too long, it all becomes a muddled mess of “best efforts”.
And I’ve never seen a “best efforts” sales team hit any number. I’ve tried it myself. It doesn’t work.
So when you reset the plan, get everyone to buy into a new, realistic, but still tough plan. And leave nothing on the field to hit it. If you let too much pressure out of the system, it may take stress out for a month or two. But not getting anywhere after that … just introduces new types of stress.
Here’s the thing: after a reset, if nothing else, you have to do better the quarter and months after the reset.
Reset the plan to +$300k a month instead of +$800k? So be it. But it can’t stay $300k forever. You have to keep growing. If you leave it there … at best efforts … you probably won’t even hit the +$300k plan.
(lower the bar image from here)