Build margin into the plan
A plan with every hour and every dollar spoken for looks efficient until one thing goes wrong.
The best-run companies I’ve seen share a quality customers and employees rarely notice: things just work. Problems get handled before they reach the customer. Busy seasons feel manageable. Nobody is scrambling. That comes from preparation the team never sees.
The planning mistake I see most often is a plan with no margin. Every hour booked, every dollar assigned, every key person at full capacity. It looks efficient on paper. Then a key employee gets sick, a shipment runs late or a big client pays slowly, and everything else falls with it.
I relearned this planning a family trip to Bryce Canyon: food prepped the night before, extra time for tired legs, and a plan B for when half the group needed a break. To my boys the day looked effortless. That was the point.
Margin in a business looks like this:
- Time: no key person scheduled above 80 to 85 percent.
- Cash: a reserve measured in weeks of operating expenses.
- People: at least one cross-trained backup for every critical role.
- Process: the important things written down where others can find them.
One of the most useful questions a peer can ask is a simple one: what happens if your key person is out for two weeks? Owners who have lived through that answer it very differently from owners who haven’t, and the room usually has both.
Where has your plan run out of margin, and what would happen if one key person were out for two weeks?