Step 1

Have a Plan and Track Your Progress

Take the first step in faith. You don't have to see the whole staircase, just take the first step.

Dr. Martin Luther King Jr.

One of my good friends, Erik Weihenmayer, often tells me, "Great plans allow you to accomplish difficult tasks with measured risk." He should know, because he's constantly off somewhere in the world on some amazing adventure — and without a plan, he probably would have crashed and burned a long time ago.

Erik has climbed all seven of the highest summits in the world, including Everest, Denali, and Kilimanjaro. He's climbed the rock wall of El Capitan in Yosemite National Park, one of the toughest in the world. He paraglides. Last fall he finished a 277-mile kayak voyage down the Grand Canyon, including all its dangerous rapids. He also climbs ice waterfalls while hanging hundreds of feet in the air.

And did I mention that Erik is blind?

Erik is now in his mid-forties and every year adds to his long list of adventures. That he's still alive is a testament to his superb planning.

Erik and I first met at a Pepsi CEO event in Venice, where I heard him speak along with a lot of other top-shelf communicators including Tony Blair, Deepak Chopra, and Newt Gingrich. Erik topped them all, by far. By the time he finished his talk, you could have heard a pin drop.

Erik had synced his speech with a video playing behind him. I'll never forget the scene shot in his own backyard in Golden, Colorado. He set up a ladder a foot above the ground and then practiced walking across it. He fell down a lot, got back up, and continued to practice. Suddenly the video switched to some dramatic footage of his climb over the Khumbu icefall on Mt. Everest. He had to walk on rickety ladders across deep crevasses plunging thousands of feet. I watched, almost breathless, as Erik slowly made his way across those shaking ladders, loaded down with his massive backpack. And I kept thinking, he's blind!

A short while later, at my invitation, he and his ski guide came up to Beaver Creek and we skied together for a day, in the process becoming fast friends. Ever since, he and his family ski with us a few times a year.

Erik has been a huge inspiration to me. Not only does he humiliate me into embracing a no-barriers mindset — last summer we climbed three 14,000-foot peaks together in one day — but whether he's skiing, kayaking, or presenting, I've never seen a guy work harder on developing a sound, well-researched plan. And yes, that includes surrounding himself with great teammates and guides, such as Eric Alexander, who led him up Everest, and Jeff Ulrich, who guides him when skiing. Erik does this because he knows that if his plans fail, he may not make it. And so he always has a rigorous plan.

The same is true in business. If you want to make it, you must have a solid plan.

The Importance of a One-Page Plan

It's critical that you develop a very simple, one-page plan to help you reach whatever business destination you have in mind. This is the all-important Step One of my five-step process.

When I worked at Continental, we used to tell our pilots, "We are going east today. East is 090 on the compass. You could go 070 to 110 (directionally east) and I'd be okay with that. But if you decide to go 270, you'll have to turn your butt around."

Stephen Covey emphasized a similar principle in his book The7 Habits of Highly Effective People. He insisted on the importance of "beginning with the end in mind." The main point of developing a one- page plan is that it helps you to begin with the end in mind. It permits you to say with utter clarity, "This is where we want to be three years from now with our company." In a powerfully succinct way, it lays out how you intend to get "there."

Where to begin? First you need to identify the three to five critical levers that drive your business. (I'll talk more about this important concept in a bit.) If you require more than one page to lay out the key parts of your plan, then you'll have almost no chance of actually executing it. You must pinpoint the key activities that, once accomplished, will take you most of the way to becoming a great company. Many call this the 80/20 rule, where 20 percent of the identified actions yield 80 percent of the results. In most businesses, I think it's probably more like 90/10.

Every year, I sit down with CEOs of the new businesses we buy and ask them to bring me their strategic plans. Most of the time, they bring one of two things: either a huge, thick document with enormous detail that requires a forklift to move (which you know hasn't come off the shelf since it was written), or four to six pages of tiny script filled with long lists of to-do items. Neither is a strategic plan. Nobody in a company can communicate, action, or track that many items.

Studies show that our brains are pretty good at remembering three or four major categories and then recalling three to five elements categorized beneath each of those categories. If we try to remember fifteen to twenty strategic goals without any categories, or without subdividing them, we almost always fail. Your one-page plan should be so clear, so condensed, and so potent that everyone in your company can remember these key items and take appropriate action on them.

Let others help you develop your plan. Invite your board and management team to comment on it, discuss it, and change it. In the end, they need to own the plan too. Their input will make it better. I'd even encourage you to ask some of the younger, high-potential men and women in your company to give you feedback. You will be surprised by the fresh perspective that they bring. If you're not the CEO, no worries. A one-page plan can be applied to a division, department, or function to achieve similar results.

Once you finish, assign each item on the one-page plan to an executive or a team, who creates even more detailed plans about how to achieve that particular objective. They should also develop a target and a "stretch" goal so you can measure progress. I ask them to develop a plan for the first one hundred days to make sure they get off to a fast start. As Peter Drucker said, "what gets measured gets managed." Measurement is critical.

You'll see a good example of a one-page plan later in this chapter for a company called Generac (and another in the appendix for Continental).

The Necessity of Identifying Value Drivers

The key to being able to get your plan on one page is to thoroughly understand the value drivers of your business. What is a value driver? You already know of about a million tasks you could pursue to improve your business. These are actually pretty easy to identify. It's difficult, however, to boil down that long list to the three or five actions that really matter, that really drive profitability. When I talk about value drivers, I'm talking about that short list.

Do you have businesses, for example, that are losing money? Stop doing that. The fastest way to make money is to stop doing things that lose it. Do you have businesses you should acquire, businesses that fit perfectly with yours? By all means, pursue them. Are you providing your customers with the type of service they want and will pay for? If not,...