What is the best way to balance short-term and long-term financial objectives?

1 Define your financial objectives

The first step to balance short-term and long-term financial objectives is to define them clearly and realistically. You need to identify the key financial indicators that measure your program's success, such as revenue, profit, cash flow, return on investment, or customer satisfaction. You also need to set specific, measurable, achievable, relevant, and time-bound (SMART) targets for each indicator, based on your program's scope, budget, schedule, and quality standards. You should also consider the external factors that may affect your financial performance, such as market conditions, competitors, regulations, or risks.

2 Prioritize your financial objectives

The next step to balance short-term and long-term financial objectives is to prioritize them according to their importance and urgency. You need to assess the impact and feasibility of each objective, and rank them from high to low priority. You should also align your priorities with the strategic vision and mission of your organization, and the needs and preferences of your customers. You should communicate your priorities to your program team, sponsors, and stakeholders, and get their buy-in and support.

3 Plan your financial objectives

The third step to balance short-term and long-term financial objectives is to plan how to achieve them. You need to develop a detailed financial plan that outlines the actions, resources, costs, and benefits of each objective. You should also define the milestones, deliverables, and dependencies of each objective, and assign roles and responsibilities to your program team. You should also create a contingency plan that anticipates potential changes, issues, or risks that may affect your financial performance, and how to mitigate or resolve them.

4 Execute your financial objectives

The fourth step to balance short-term and long-term financial objectives is to execute them according to your plan. You need to monitor and control your program's financial performance, and track the progress and results of each objective. You should also manage the changes, issues, or risks that may arise during the execution, and adjust your plan accordingly. You should also communicate your financial performance to your program team, sponsors, and stakeholders, and provide regular feedback and recognition.

5 Evaluate your financial objectives

The fifth step to balance short-term and long-term financial objectives is to evaluate them at the end of your program. You need to measure and compare your actual financial performance against your planned financial performance, and analyze the variances and gaps. You should also identify the strengths, weaknesses, opportunities, and threats of your financial performance, and the lessons learned and best practices. You should also report your financial performance to your program team, sponsors, and stakeholders, and celebrate your achievements and improvements.

6 Improve your financial objectives

The sixth step to balance short-term and long-term financial objectives is to improve them for your future programs. You need to use the feedback, data, and insights from your evaluation to identify the areas of improvement and the opportunities for growth. You should also implement the changes, actions, or recommendations that will enhance your financial performance, and align them with your organization's strategy and culture. You should also update your financial plan, objectives, and indicators, and set new SMART targets for your next program.

7 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?