The Step-by-Step Annual Planning Guide for Overachievers – CharlesNgo.com

No ratings yet. Please rate this article at the end 🙂

I use to be a horrible annual planner. Then I read everything I could find on planning, spent thousands on workshops, and iterated my process over ten years. Now, I’m badass at this.

I’m going to teach you everything I know about annual planning. This won’t be easy. This is designed for overachievers. I’ve held nothing back.

So, why go through this process? It’s a major time commitment. I’m investing four days into mine.

First, it lets me zoom out and see the bigger picture.  It’s hard for you to see the bigger picture when you’re stuck in an endless loop of emails and zoom meetings.

I reached a crossroads last year. I was no longer excited about running affiliate marketing campaigns or creating courses. The feeling was lingering for years. So last year, I spent a significant amount of time confronting this feeling.

And then I realized I needed to move on from this industry. I wanted to move on to projects that I could be obsessed about.

Second, it helps you connect the dots. There was a lot of pain this year. None of our years went according to plan. What lessons can you learn so you don’t repeat the same mistakes again?

Finally, you’re infinitely more likely to achieve your desired outcomes. I believe that a successful life comes from doing hard things.

Talking about teamwork is easy. Firing your employee because you realize they’re not a great culture fit anymore is hard.

Declaring your goals on Facebook is easy. It’s hard to think, analyze, and reverse engineer how you’re going to achieve your goals.

That’s my mantra for 2021 – “Do hard things.” Everyone wants to take the path of least resistance. You won’t have much competition when you choose the harder path.

Many people won’t bother with annual planning because life’s too unpredictable. Look at how 2020 went for everyone. I get it.

But here’s the thing: the discipline of planning means you’ll react better. 

“You know the business plan won’t survive its first encounters with reality,” he says. “But the discipline of writing the plan forces you to think through some of the issues and to get sort of mentally comfortable in the space. Then you start to understand, if you push on this knob, this will move over here and so on. So, that’s the first step.” – Jeff Bezos

Life is like jazz. There’s a score you could follow exactly, but you have permission to riff and make the music bolder.

I don’t know what 2021 has in store for us. But I promise you that your year will be better if you invest the time into annual planning.

You bring the energy – I’ll give you my exact blueprint.

Some Notes Before You Start

There are a few things you should do before you get started.

0.1 Be in the Right Environment

Don’t do this in your home office. You’re too close to the trenches. You need an environment that inspires you.

Look at how Muhammad Ali trained for his fights. His original training camps were in Miami. He had to leave Miami. Too distracting. He built a new training facility in Deer Lake, Pennsylvania. It was called “Fighter’s Heaven.”

It gave him complete focus to train for his big fights.
You need to find your “Fighter’s Heaven.”

Here’s my formula:

  • Rent an Airbnb that’s within driving distance. Around one or two hours away is good. Don’t deal with the stress of airports.
  • Be close to nature.  I want you to be able to open your door and see a forest, a mountain, or a lake. This makes a difference.
  • Don’t be too far from civilization. I like to still be 30 minutes from a town. Going out for dinner each night is my reward.
  • No outside work. You’re here for the annual planning. No meetings. No checking email. Be disciplined.

 An example of the vibes I want. Just make sure it has WIFI. Photo credit: Pixabay.

Here’s my schedule this year.

Sunday: Leave at 4pm. Settle into town.
Monday: Day 1 Reflections. Go into town for dinner.
Tuesday: Day 2 Planning. Go into town for dinner.
Wednesday: Drive home at 11am.

I know it’s tempting to try and shorten your trip to save money. But you don’t want the check-in, and check-out processes to interrupt you.

0.2. Adapting This to a Team

This guideline is for individuals doing their personal planning, but you can easily adapt this to a team.

If you have a team, then I recommend doing two separate annual plans.

For the company version,  I recommend doing this in person with your employees. It also doubles as facetime if you’re remote.

(Note: This article is meant to be evergreen. If you’re reading this in the middle of the pandemic, you can do this via Zoom)

Do your personal annual planning the weekend after. Don’t do it back to back.

I tried it once. It sucked. I had no energy after the company one.

0.3. Sweep Your Digital Dust

It’s important for Chinese people to clear their houses for the New Year. It symbolizes a wish to put the past behind, say goodbye to the past year, and welcome in the New Year.

We’re going to do a digital version of this. I want you to inbox zero everything.

  • Answer all outstanding emails.
  • Go through your Task Manager and clear out tasks.
  • Clear your laptop. I love doing a reformat of my laptop!

0.4. Do Your Homework

Annual planning can be mentally and emotionally draining. Take some time to go through this article.

Is there anything that you’re missing? You might not have a list of core values yet, or a life’s mission statement written. That’s OK. You can work on it now.

Create a checklist. Gather all your financials and documents in one place. Make everything frictionless for yourself.

You want most of your energy during the retreat to be spent on thinking.

This framework will be intimidating if it’s your first time doing it. Give it your best shot. Don’t skip any sections. It’ll get easier with practice.

And don’t feel the pressure to do all this in a few days. It’s fine if you’re still working on this after January. Focus on progress, not perfection.

Day 1: Looking Back

Ray Dalio is the most successful hedge fund manager in the world. His favorite principle is “Pain + Reflection = Progress.

He believes that every pain we go through in life contains a “gem.” But we have to spend time reflecting to uncover those gems.

We’re going to spend the entire day reflecting. I’ll give you some frameworks and questions to guide you.

1.1 What Happened This Year?

It’s been a long year. Take a walk down memory lane. Go through this year month by month.

Write down all the major events that happened each month. It can be hard to remember. Go through your calendar, emails, and task managers to help refresh your memory.

January:
February:
March:

This is easy if you have a system of doing a monthly review.

1.2 Deep Dive into the Different Departments

Life and work can be organized into departments. This helps us see in detail how we’re performing in different areas.

Your company is generating record profits. If you look at your company as a whole, you’d think that nothing’s wrong. But analyze each department. You might notice that the customer service department is lacking.

It’s taking five days on average for customers to get a response. They’re starting to leave bad reviews everywhere. Influencers are starting to trash your products. These are leading indicators. If you don’t improve this department, then it’ll affect the future of your whole company.

This applies to life, too. I’ve seen many people go “all in” on their businesses for years. Their wealth and career might be a 10/10. But what happens if their health or relationships go down to a 3?

I don’t believe someone’s life can truly be “balanced.” We’re looking out for “danger zones.” We’re making sure no areas of our lives are weak enough to hold us back.

Let’s look into the departments.

I categorize my personal life into these buckets:

  1. Work
  2. Financials
  3. Fun/Enjoyment
  4. Skills/Learning
  5. Health
  6. Relationships

You can get more granular with each area.

Health -> Mental Health, Exercise, Diet

Relationships -> Family, Significant Other, Friends, Children

Financials -> Budget, Retirement, Investing, Taxes, Robustness

Adjust accordingly for your life.

A few things that I’m looking for:

  1. Am I balanced in the way that I want? I spent too much time playing video games this year. I spent too little time studying Spanish. Seeing this lets me think about how I can adjust my systems and environment next year.
  2. Are there any areas of my life that are underperforming? I’m not doing as well in the friendship subcategory this year. Quarantine made it tough, but I could’ve called more people. I’m going to make an effort to improve next year.
  3. Did I achieve what I wanted in these areas this year? Why or why not? Identify the obstacles in your way.
  4. Give yourself a score in each area. Rank yourself out of 10. If you’re scoring high in an area, that’s a signal to keep doing whatever you’re doing. Scored low? That’s a signal you need to make some changes.
  5. What systems can I build? I didn’t understand the importance of mental health in my 20’s. So my solution is to create different systems to maintain this area. Some of these include daily meditation, journaling, seeking therapy whenever I needed it.

Let’s look at the departments in a business.

  1. Product
  2. Marketing
  3. Finance
  4. Operations

If you’re a bigger company, then you can add in departments like customer service, project management, etc.

I recommend keeping it simple. Too many departments mean you’ll start losing focus on what matters.

If you’re doing an annual review with a team, then every department head should prepare a report. Let them own it.

Here’s an example for Finance:

  • Show the numbers. Income statement, balance sheets, cash flow forecasting. Make charts and graphs where necessary.
  • Explain the numbers. Not everyone understands finances. Their job is to make it easy for the rest of us.
  • What happened this year? “I don’t think Charles spending $3,000 at Spearmint Rhino in Las Vegas was the best use of our funds.”
  • Recommendations for next year. “Our monthly software and subscriptions expenses are at $6,000 a month on average. Here’s how we can bring it down to $4,000 a month.”

Analyzing a department is simple if you’re already using a framework such as Objective and Key Results.

Compare this year’s results to what was planned. How did the Key Performance Indicators line up?

1.3 Reflect on the Year

Now you have a clearer picture of what 2020 was like. Now it’s time to make sense of what happened.

Here are a series of questions to help you reflect.

  • What Were My Big Wins This Year?
  • What Were My Losses This Year?
  • What Happened This Year That Surprised Me?
  • What Were the Biggest Lessons I Learned?
  • If I had a time machine and could go back to one year ago, what would I have done differently?

DO NOT BREEZE THROUGH THIS QUESTIONS.

I go into thinking time mode in this section. You’ll see that the first few answers you have will come easily. Then you’ll be “stuck” for a few minutes. The next answers? That’s where the gold is.

You have to be honest with yourself. Let’s say you set a goal to lose 15lbs this year, and you gained 15lbs instead.

It’s easy to blame quarantine. The gyms were closed, and it was easy to stress eat. It’s bullshit and we both know it.

If someone had a gun to your head, you would’ve found a way to exercise. You could’ve run outside. But you didn’t. This is where you have to go deeper to understand what happened.

You can’t make improvements if you’re not aware. If you have trouble with self-awareness, then it can be helpful to ask for constructive feedback from others.

1.4 Evaluate Your Mission and Core Values

We need purpose in our lives to feel fulfilled. We need a reason to wake up in the morning besides collecting a paycheck.

This is the part where I ask myself, am I living up to my mission? Am I living according to my values?

One of my core values is to “push my comfort zone.” Everything that I want in life comes from pushing it. It’s what encouraged me to move to Asia, start speaking publicly, and even start this blog.

I didn’t do a great job this year of pushing my comfort zone. Some of my original plans weren’t possible due to quarantine.

I hold myself accountable, though. I could’ve made adjustments on a quarterly or a monthly basis. There are plenty of ways to live up this value even if I’m stuck at home.

That’s it for Day 1. It’s time to recover. I’ll go for a jog in the area. Go into town to grab some dinner. And then I’ll watch something on Netflix.

Go to bed early. Make sure to get plenty of rest for the next day.

Day 2: Planning Next Year

We did a thorough analysis of 2020. You understand what happened this year.

Now it’s time to look forward.

2.1 Review Your Long Term Goals

Before I start planning the year, I want to do a quick refresher on the bigger picture of my life. You need to know where you’re going before you start planning your trip.

Steps:

  • Review Your Life Mission
  • Review Your Core Values
  • Review Any 3- or 10-year Goals You’ve Set

You also need to evaluate if these long term goals are still relevant to you.

At one point, I wanted to write a book. Now? I have zero interest in it. The desire is still there to teach and help people. But maybe a book’s not the best method for me.

Starting a podcast sounds more fun and interesting to me than writing a book.

Don’t be afraid to change your goals if they’re no longer relevant to you. My destination is the same, I’m just taking a different road to get there.

2.2 Write Out Your One Year Vision

Most people start listing out their goals. There’s a valuable step before that called the Vision Story.

You write out what you want your life to be like a year from now.

I’ll write an imaginary example:

“I will quit my job. My affiliate marketing side hustle will grow to a profit of over six figures a year. This freedom will allow me to travel the world. I’ll explore living in Asia, Eastern Europe, and South America.

I will take my fitness more seriously. I’ll drop down to 185lbs and 10% body fat. I’ll do this through a combination of CrossFit and dieting. In order to perform at my best, I will be completely sober. I won’t drink any alcohol, smoke any weed, or do any drugs.

I am single now and am fine being single next year. However, I’ll definitely date a bit when I’m in different countries.

I don’t have a great social circle where I’m at right now. I want to network with more affiliates and entrepreneurs next year. I’ll go to several conferences.”

Do you see how much easier it is to plan your future if you just write it in story format? If reading your story doesn’t excite you, then you need to think bigger.

I suggest writing out an entire page’s worth. The more detail you give, the better. The details and emotion you put in the story is what gets you excited.

2.3 Prioritizing Your Outcomes

The story was a brainstorming tool.

Chances are that you have plenty of things you want to achieve for this year. Unfortunately, your time, energy, and attention are limited.

I only set three outcomes for the entire year. 3 is easy enough to remember and keeps you focused.

Your average person is too ambitious and sets a ton of outcomes. Here’s what happens after a year.

  • Earn six figures in profit from affiliate marketing  – NOT ACHIEVED
  • Spend at least a month in three different continents – NOT ACHIEVED
  • Reach 185lbs and 10% body fat – NOT ACHIEVED
  • Read 20 books ACHIEVED
  • Journal every day – NOT ACHIEVED
  • Get scuba diving license ACHIEVED

Note: Notice how specific and measurable each outcome is. It holds you accountable.

Your resources are too spread out. Our brain tends to focus on doing what’s easiest. You’ve achieved two of your outcomes but they are the least impactful ones.

You read 20 books this year and got a scuba diving license. How much of a difference does that make to your life? Not much.

Instead, constrain yourself to the most impactful outcomes.

  • Earn six figures in profit from affiliate marketing – ACHIEVED
  • Spend at least a month in three different continents – NOT ACHIEVED
  • Reach 185lbs and 10% body fat – ACHIEVED

Now imagine how much different your life would be when you achieve these.

You know who else sets their outcomes in 3’s? Lululemon. Here is Lululemon’s strategic growth plan.

The Company’s three priorities to drive revenue growth over the next five years are:

  • Product innovation– The Company expects to more than double the size of its men’s revenues by 2023. In addition, its plans call for continued expansion in the women’s and accessories businesses. Both existing and new product categories are planned to grow, with lines supporting yoga, running and training. The Company also plans to continue its product collaborations, expand its popular Office/Travel/Commute category, and pursue new opportunities, such as self-care.
  • Omni guest experiences – The Company expects to more than double its digital revenues by 2023. The Company will focus on offering an integrated guest experience across channels which are intended to inspire, provoke and celebrate guests who live a healthy and mindful lifestyle across multiple experiences – such as events, dynamic new store formats, and its innovative membership program that fosters connections among guests.
  • Market expansion– The Company plans to quadruple its international revenues by 2023. The Company’s recent success in its international markets demonstrates that the sweat life translates across cultures and geographies and presents considerable growth potential for the brand. Expanding across China, as well as the APAC and EMEA regions, will be continued areas of focus for the Company. The Company also believes that considerable growth potential remains in both the U.S. and Canada and it plans to leverage its agile store formats, digital experience, and community connection.

What about the other goals?

Forget about them. You want to stay laser-focused. But I know not everyone thinks this way, so I’ll give you a solution.

Break them out into projects.

One of my goals was to learn how to salsa dance while living in New York City. I wanted it, but it wasn’t important enough to be one of my three main outcomes.

So I turned salsa dancing into a quarterly project. You can turn some of your goals into quarterly, monthly, or weekend projects.

2.4 Do a Strategic Gap Analysis

Anyone can set goals. The hardest part is to turn them into reality. Now is the time to think. How do you bridge the gap between now and your desire?

The easiest way to do this is to do a Gap Analysis.

Here’s my version of it.

  1. Be clear on the end result.
  2. Understand where you’re at now.
  3. Figure out the obstacles in your way.
  4. Brainstorm solutions to the problem.
  5. See if you know anyone who has achieved what you’re trying to do.
  6. Design the machine and systems.
  7. Take action.
  8. Measure results.
  9. Reflect and revise.

I wrote a detailed article on how to do this.

Read: How to do a Gap Analysis

Here are some other tools that I use:

Thinking Time:

Getting the right answers to your problems requires the right questions.

COVID-19 is affecting everything right now. As of me writing this article, a vaccine has been approved and everyone’s excited. What if there is a COVID-20 and it’s worse than COVID-19? What can I do now to prepare my business for that possibility?

How about a sales question?

My customers aren’t buying my product because of perceived risk or uncertainty. What are those risks and how can I mitigate them?

You can’t come up with good answers in a few minutes. But having the discipline to answer these questions means you’ll know your business better.

Here’s an article I wrote on Thinking Time. If you want a ton of thinking time questions, read The Road Less Stupid.

SWOT analysis: This stands for strength, weaknesses, opportunities, and threats. This gives a high level overview of your business.

I.C.E. analysis: You’ve brainstormed several project ideas by now. You can use the I.C.E. framework to see which ones are the best opportunities.

You score each project according to Impact, Confidence, and Ease.

Impact: How much of an impact can this project have on your business?
Confidence: How confident are you that you can pull it off?
Ease: How easy is it to implement?

Charles writes a book:

Impact: 6
Confidence: 4
Ease: 3

Average = 4.33

Charles starts a podcast:

Impact: 9
Confidence: 9
Ease: 8

Average = 8.67

This scoring system lets me know that starting a podcast would be a better project for me, than writing a book. It’s a great way to figure out WHAT to prioritize.

2.5 Critical Drivers and KPIs

Finished with your analysis? Now it’s time to understand what activities lead to the desired outcomes. These are called critical drivers.

Desired Outcome: Lose 15lbs

Everyone tracks weight. The problem? It’s a lagging indicator.

We want to track the activities that lead to losing weight. Samantha wants to focus on exercising and dieting.

Critical Driver #1: Go to OrangeTheory class three times a week.
Critical Driver #2: Eat 1500 calories a day.

She can create a simple spreadsheet to track. Is she performing the activities consistently? And if she is, are they making her lose weight? If not, then she needs to adjust.

Look at your three outcomes for the year.

What are the critical drivers, and how are you planning to track them? 

2.6 Map Out Your Year

Next, we’re going to map out your year in a spreadsheet. I did a quick example.

You’re not going to fill it out completely. You’re going to fill things out the best you can. You’re going to revisit this sheet on a quarterly, and a monthly basis.

Let’s look at my December 2021. One year from now.

I don’t know what my work projects or personal projects will be. I do know some of the anchor events.

It’ll be my birthday and Christmas, we’re planning a trip to Peru, and I’ll need to block out a few days to do my 2022 annual plan.

This map helps you reverse engineer your projects. Let’s say you’re manufacturing a physical product. You want it to be ready for Black Friday.

Draw out a quick project timeline.

Quarter 1: Conduct customer research. Make a decision.
Quarter 2: Work with the manufacturers to finalize the design.
Quarter 3: Buffer period. A million things can go wrong.
Quarter 4: Prepare marketing.

People tend to underestimate how much effort a major project takes. Think about how many people are late to an event. They can’t even get that right!

Creating a project map for the year can make your predictions more accurate.

Keeping the Momentum Going

We’re not putting in all this work to feel good about ourselves. We’re here to achieve outcomes. We need to implement and create different systems.

I don’t do this section during my trip. I rather devote more energy to thinking. This next section can be done over the next few weeks when you have more energy.

3.1 Set Reminders

You have to remind yourself of your outcomes every day.

Some ways I’ve done it:

1. Create a desktop or mobile wallpaper. Hire a designer on Fiverr to make it visually appealing.

2. Sticky notes. Write your outcomes down on sticky notes. Put one on the bottom of your monitor, and another on your bathroom mirror.

3. Accountability partner. I had a goal a few years ago to enter a BJJ tournament. Me and my friend made a $1,000 USD wager. If we didn’t compete, then the other person would get $1,000 USD. I would not have competed if I didn’t have that pressure.

This works amazingly for the gym.

“We’re going to the gym Monday, Wednesday, and Friday. Whoever misses a workout owes the other person $20.”

3.2 Quarterly, Monthly, and Weekly Reviews

Your annual review is a blueprint. You need to establish a regular rhythm to make sure you’re on track.

  • Quarterly Review – It’s similar to my annual review, but on a smaller scale. I do the same thing where I take two days off and spend it in nature.
  • Monthly Review – Last Friday of the month. Takes me around four hours.
  • Weekly Review – Every Sunday. It takes around an hour.

Think of it like a waterfall.

Take your annual plan and break it into a 3-month plan.

3.3 Building Systems to Achieve Your Outcomes

It’s hard to keep track of everything. The easiest way for me is to establish habits, routines, and systems in my life.

Let’s look at relationships. Most people just say they want to have better relationships in their lives, and then they leave it to chance.

When I want something, I establish a system for improvement.

Here are some of the systems in my relationship department:

  1. Me and my fiancé go on a date every Friday night.
  2. I make sure to see my mom at least once every two weeks.
  3. On Sundays, I set aside an hour to do a catch-up call with a friend.
  4. Before COVID-19 hit, I hosted a board game night at my home every month for my friends.

I know this can seem too robotic for some people. I get it. But I have way too much shit in my head.

Creating systems eases the cognitive load on my mind.

Sometimes I get too hardcore into work and Brazilian Jiujitsu. Having calendar event to see my mom is my insurance to make sure I do it.

Let’s look at financials:

My fiancé reconciles our finances every Sunday using a program called YNAB.

Every month, I spend an hour updating our financial spreadsheet. I also have a journal where I list what happened and reflect.

We have a one-hour call every month with a personal finance coach. He keeps me accountable and helps me from making dumb decisions.

Everything in your life can be systemized.

The Plan is Useless, but Planning is Essential

I’m pretty sure that my love of planning and strategy came from playing Starcraft as a kid.

I learned the value of prioritization. I couldn’t have a strong military and a booming economy within the first few minutes. I was constrained by my minerals and gas. I had to choose which one was more important. Most people plan goals as if they had unlimited resources. Too many desires mean nothing’s going to get achieve.

I learned how to analyze and reflect on my own games. Most people just play games over and over again. It’s fun. But you’re just turning your bad habits into muscle memory. We don’t have unlimited lives in the game of life. So reflecting lets us get more juice from the lemons.

And finally, thinking ahead made me more prepared. I was a Terran main. I loved investing in my economy early on, so I could attack during the mid-game. But I knew I’d always be vulnerable to be attacked early. So I made sure to scout the enemy well. I’d create a bunker if I knew they were preparing for a “rush.”

So now I think often in terms of what if’s?

  • What if I die? I’ve already prepared a trust and will. My family will be taken care of, and they won’t have to suffer through probate court.
  • What if someone hacks into my computers and servers? I have 2FA on everything. Everything’s automatically backed up.
  • What if another Pandemic happens? We bought a deep freezer in the garage. The freezer’s full, and our pantry’s full. We have extra masks.

All these make me more robust.

I don’t know what’s in store for 2021, but investing this time into planning will make you more robust.

Please rate this article – it helps me know what to write!

Leave a Reply

Your email address will not be published. Required fields are marked *