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Tips for 2022 Business Planning and Goal Creation

Business Planning | Business Advisory | Fahrenheit Advisors

One year ago, as organizations were starting to plan for 2021, pretty much everyone threw up their hands and said, “There are too many unknowns with COVID-19 to even try to plan!” Now, driving toward 2022, we feel like we can see a little more clearly… starting to visualize life after COVID-19, though admittedly through a bit of a haze.

That haze continues to make planning tough. Is Delta winding down… what about MU or other variants? Is business travel coming back? What about returning to the office? Sooner… later… never? Suddenly, it starts to feel like late 2020 again.

But we have to plan! We owe it to our employees, customers, capital providers, and to ourselves.

Planning provides an opportunity to reexamine our business strategy, performance drivers and the internal and external forces impacting our business. Planning is never perfect, but it enables us to be better prepared for the inevitable challenges over the coming year.

Here are several recommendations for 2022 planning:


Financial Planning

Whether you call it budgeting, planning or forecasting, putting together a picture of what you expect the next year to look like usually comes down to numbers… orders, sales, margins, expenses, profits, etc. As you look at 2022, keep the following in mind:

  • Scenario Planning: It has long been a best practice to consider a variety of alternatives when looking forward. Many terms are used, but the most common practice is to consider the MOST LIKELY case, an OPTIMISTIC case, and a PESSIMISTIC case. In the past, it was not uncommon to consider a range of outcomes +/- 10-20% different from the MOST LIKELY case. If COVID-19 taught us anything, it taught us that the potential range of outcomes is much broader than that. As a result, for 2022 we recommend considering a wider range of possibilities than normal.
  • Government Assistance: Based on the large amount of funding already provided and the increasing concern about government debt, we recommend assuming NO additional government support in 2022, even if things slow down again.

“we recommend assuming NO additional government support in 2022”


  • It’s not just the P&L: Many organizations prepare just a P&L budget, but this ignores consideration of cash flow and balance sheet impacts. We have seen cases where significant projected P&L growth would require cash or credit facilities well in excess of what current capital providers can provide. Run the P&L projection through the balance sheet and cash flow analysis to anticipate additional funding needs. Don’t forget capital purchases!
  • Focus on people costs: We generally see 70-90% of operating expenses being comprised of people costs. In spite of that fact, when it comes time to make hard decisions as part of a planning process, we see the focus often shift to other costs. “Oh, we can save money on office supplies,” or “We can cut back on unnecessary travel expenses.” If you find that you will need to make significant cost reductions to prosper or even survive, you will have to follow the money and look carefully at people costs. Don’t plan on another round of PPP. Alternatively, if you’re forecasting significant revenue growth, don’t forget to account for associated increases in number of people and costs. Key areas to consider include:
    • Sales commissions
    • Sales support staff
    • Warehousing, shipping, and receiving staffing costs
    • Back-office operations staffing costs


Non-Financial Planning

In addition to budgeting, many organizations use the 4th quarter to set goals and objectives for the next year. Here are 4 hints for completing that process:

1. Keep consistent with the budget

As you plan new initiatives, make sure that their financial impacts are captured in the financial plan. Evaluate and prioritize now. Aligning what you will commit to do with the dollars in the budget is an iterative process. Make sure you evaluate priorities over the course of the year so you maintain flexibility and can adjust if market conditions or planning assumptions change.

2. Focus on people costs

Some organizations will not be looking to cut people costs, but instead will be looking to staff open or new positions. Finding and keeping good people is very challenging right now. A few ideas to help in this area:

  • Don’t lose your A players. Pay them what they are worth and give them more challenging assignments. Build this into your budget.


  • Eliminate tasks that don’t add value. What are you doing that you don’t need to do? When I took over as fractional CFO for a company that previously had a full time CFO, I took a critical look at the voluminous reporting package that took days to complete each month. After surveying the recipients of the report, I determined that only one spreadsheet, that could be completed in a matter of minutes, was being used. We stopped doing the rest.

3. Give yourself a full 12 months

It is an annual plan, not a first quarter plan! We see many goals and objectives heavily front loaded to the beginning of the year. Invariably, all of those things do not get accomplished that quickly. Prioritize and be realistic about when various initiatives can be accomplished throughout the year.

4. Incorporate technology

Take a look at your goals and objectives for the year. If they do not include a healthy dose of technology initiatives, go back and revisit. Companies that are not focusing on technology either to improve customer experience, to better support decision making, or to reduce costs run the risk of being left behind in the marketplace.


Need an objective look at your 2022 business plan and goals? Fahrenheit’s experienced advisors work with companies of all sizes across different industries to help them map the straightest path forward. Reach out to us now at


About the Author

Doug Jones provides fractional CFO and senior financial management services to small and midsize organizations. In addition to improving his clients’ accounting and finance operations, Doug frequently serves as the link between company owners and outside advisors including attorneys, CPAs, investment bankers, appraisers, and personal financial advisors. He is skilled in identifying and integrating the full range of financial and non-financial business issues in contract negotiations and resolution of business decisions. He is a member of Fahrenheit’s Leadership Team.