Annual Planning is one of the most valuable parts of the EOS Process®.
It gives the leadership team two full days to step away from the day-to-day demands of the business, reflect honestly on the year just completed & create clarity about the year ahead.
But a strong Annual Planning session does not begin when everyone walks into the room.
It begins with good preparation.
When my clients book their Annual Planning session, I start talking to them about it early. That is intentional. There are a few things that make a significant difference to the quality of the session, & they are much easier to organise before calendars fill up, financial information is rushed & the best venues disappear.
The aim is not to complete the Annual Planning work in advance.
It is to arrive ready to do it properly.
What Happens During an EOS® Annual Planning Session?
An Annual Planning session follows a clear agenda:
- Check-in
- Review the prior year & prior quarter
- Team health
- Organizational Checkup®
- SWOT Analysis & Issues List
- V/TO®
- Three-Year Picture
- One-Year Plan
- Rocks
- IDS®
- Next Steps
- Conclude
Across the two days, the leadership team reflects on the previous year, celebrates progress, strengthens team health, reviews the company’s vision & agrees on the most important priorities for the coming year.
The session also gives the team time to solve significant issues that may be preventing the business from moving forward.
The better prepared everyone is, the more time can be spent having meaningful conversations & making decisions, rather than searching for missing information or debating facts that should already be understood.
Have Your Financial Information Ready
The financial results from the previous year & the final quarter should be complete, accurate & understood by everyone on the leadership team.
This is important because Annual Planning is not a budgeting session.
The budget for the year ahead should already have been prepared & agreed before the team arrives. Annual Planning is where you determine how the business will achieve those financial goals.
If the leadership team spends a large part of the session debating the budget, confirming last year’s results or discovering that people have different financial assumptions, there is less time available for planning, issue solving & execution.
Everyone should arrive understanding how the business performed, where it exceeded expectations & where it fell short.
Do not simply bring a stack of reports & assume the finance person will explain everything in the room.
The leadership team should already be across the numbers.
Reflect on the Previous Year
Before the session, I ask each person to think about the year just completed.
- What were the biggest wins?
- What were the most significant challenges?
- What did the business learn?
- Which goals were achieved, & which were missed?
Where did the leadership team perform well, & where did it make life more difficult than it needed to be?
Annual Planning should include celebration as well as honest reflection. Leadership teams are often very good at moving immediately to the next target without pausing to acknowledge how far they have come.
Recognising the wins creates energy. Understanding the challenges creates learning.
Both are necessary if you want to build a better plan for the year ahead.
Think About Team Health
Day 1 of Annual Planning goes deeply into team health.
That means the leadership team should arrive prepared to be open, honest & willing to hear different perspectives.
Before the session, consider what is working well within the team & what could improve.
- Are people raising issues openly?
- Do you trust one another?
- Are difficult conversations happening early, or only after frustration has built?
- Does everyone support decisions once they have been made?
- Are people holding one another accountable?
- Is there unresolved tension sitting quietly beneath the surface?
You do not need to solve these questions before the session. That is part of the work we will do together.
You do need to arrive prepared to talk about them honestly.
A brilliant plan will not achieve much if the leadership team responsible for delivering it is not healthy enough to work together.
The Organizational Checkup®
The Organizational Checkup® helps the leadership team assess the strength of the business across the Six Key Components® of the EOS Model®.
Each leadership team member should complete it honestly, based on how the business operates today rather than how they hope it operates.
The individual answers can reveal important differences in how people see the business.
One leader may believe the vision is completely clear, while another may feel the team is moving in several different directions. One person may believe accountability is strong, while somebody else sees commitments being missed regularly.
Those differences are useful.
They give the leadership team a clearer picture of where alignment is strong & where further discussion is needed.
Consider the Strengths, Weaknesses, Opportunities & Threats of Your Business
The SWOT Analysis gives the leadership team an opportunity to look at the business from a broader perspective.
Before Annual Planning, spend some time considering what belongs in each area.
- What does the business do particularly well?
- Where is it vulnerable?
- What opportunities are emerging?
- What could disrupt the plan?
These do not need to be beautifully written or fully agreed in advance. Bring your observations, concerns & ideas into the room so the leadership team can discuss them together.
The goal is not to produce the world’s longest SWOT Analysis.
It is to identify the information that matters when reviewing the vision & planning the year ahead.
Start Identifying the Important Issues
Every member of the leadership team should arrive with the issues they believe the business needs to address.
That may include a people concern, capacity constraint, structural problem, profitability challenge, unresolved leadership tension or an important decision that has been repeatedly delayed.
Do not filter the list because an issue feels too difficult, too sensitive or too large.
The session creates space to bring those issues into the open, prioritise them & use IDS® to solve the most important ones.
You are not expected to arrive with the answers.
You are expected to arrive willing to name the real issues.
There is little value in creating a polished One-Year Plan while politely ignoring the problem most likely to derail it.
Review the Current V/TO®
Each leadership team member should review the current V/TO® before the session.
Think about what remains true, what may have changed & what needs further discussion.
The purpose is not to rewrite the company’s entire vision every year. Constantly changing direction creates confusion.
Instead, consider whether the leadership team is still aligned around where the business is going, how it plans to get there & what success looks like.
Annual Planning gives the team time to refresh the Three-Year Picture, create the new One-Year Plan & agree on the Rocks that will move the business forward during the next quarter.
Coming into the session familiar with the current V/TO® makes those conversations much more focused.
Begin Thinking About the Year Ahead
It is useful for each leader to think about the few outcomes that would make the coming year successful.
This is not an invitation to arrive with a personal wish list of 27 projects.
It is an opportunity to think about what the business truly needs.
- What must be achieved?
- What needs to change?
- What important capability should be built?
- What problem can no longer be carried into another year?
- What would make the greatest difference to the business?
The final One-Year Plan & Rocks will be agreed by the leadership team during the session. However, arriving with thoughtful ideas makes it easier to have a strong discussion & get laser-focused on what matters most.
Choose the Environment Early
I also encourage clients to think carefully about where the session will be held.
You are not looking for somewhere unnecessarily fancy. You are looking for somewhere that allows the leadership team to step away from its usual environment & think differently.
Natural light, an open view, comfortable informal spaces, room to move & walls or glass that can be used for large sticky notes all help.
Airbnbs, private homes, golf clubs & relaxed off-site venues often work very well.
The important thing is to avoid the usual interruptions. Annual Planning is much harder when team members are disappearing to deal with staff questions, answering emails during breaks or being pulled into operational problems happening down the corridor.
Protect the two days properly.
Plan the Overnight Experience
Where possible, I encourage leadership teams to stay overnight at the venue or nearby.
By the second Annual Planning session, I generally make this non-negotiable.
Day 1 can stretch people. It often includes honest conversations about team health, business performance & issues the leadership team may have been avoiding.
Doing something together after the formal session helps people reset, reconnect & enjoy the experience.
My only real rule is that it should not simply be the team’s usual dinner & drinks.
Choose something playful, competitive or different from what the team normally does. It does not need to be expensive or elaborate.
The purpose is to spend time together outside the usual working roles & strengthen the relationships that support the plan.
Annual Planning is not only about the document you create.
It is also about the team responsible for bringing it to life.
Clear Your Calendar
Everyone needs to be fully present for the two days.
Do not schedule calls during breaks.
Do not plan to arrive late, leave early or keep one eye on your inbox.
Make the necessary arrangements so the business can operate without the leadership team constantly stepping out of the room.
If the company cannot function for two days without the owner or leadership team answering every question, that may be one of the first issues worth adding to the Issues List.
Bring Openness, Not Perfect Answers
The most important preparation is not a spreadsheet, report or completed form.
It is the willingness to be open.
Annual Planning works best when the leadership team arrives ready to tell the truth, listen to one another, challenge assumptions & make decisions for the greater good of the business.
You do not need perfect answers before you arrive.
You do not need everyone to agree in advance.
You need accurate information, considered opinions & a willingness to have the conversations that matter.
The session will guide the leadership team through the process of creating the plan.
Your preparation makes it possible to use those two days well.
Because the more preparation & openness you bring, the more value you will gain from your EOS® Annual Planning session.