Annual planning has a reputation problem.
Some teams treat it like a painful ritual they must survive once a year. Others avoid it altogether because “the market is unstable” or “things change too fast anyway.” And many go through the motions, produce a polished deck, and never look at it again.
The issue isn’t annual planning itself. It’s when we start, who runs it, who takes accountability, and whether we treat it as a living system or a static document.
When Is the Right Time for Annual Planning?
Short answer: earlier than most companies are comfortable with.
Longer answer: annual planning should start before urgency forces bad decisions and this could be different depending on the company.
Planning kicks off in Q4, timelines are tight, people are half-checked out, and suddenly you’re rushing toward execution without proper alignment or even final board sign-off.
What happens next is predictable:
- Assumptions don’t get challenged
- Dependencies aren’t mapped properly
- Decisions get postponed instead of made
And the “plan” turns into a vague intention.
Good annual planning needs time to align leadership and space to say “this doesn’t make sense” before money and headcount are locked in.
If planning feels rushed, it usually is.
Why Annual Planning So Often Feels Rushed
Planning rarely feels rushed because people are unprepared. It feels rushed because of structural reasons. In my experience, here are the most common ones.
1. Planning Competes With Execution
When planning starts in the and of the year, it overlaps with year-end targets, sales push, delivery deadlines. And even when people show up to planning meetings physically, mentally they’re still firefighting.
How to avoid it:
- Separate strategic planning from end-of-year execution mode
- Protect planning time the same way you protect delivery time
2. Data Isn’t Ready When Decisions Are Needed
Another classic issue: meetings happen before inputs are ready. So instead of making decisions, teams debate numbers they don’t trust.
How to avoid it:
- Define upfront what data must be ready before planning starts
- Assign ownership for preparing inputs, not slides
- Delay the meeting if inputs aren’t solid - rushing won’t fix missing data
A planning session without reliable data becomes a discussion of opinions. I'm sure you've been there and all we know what the results are.
3. Decisions Are Deferred “Until We Know More”
Uncertainty makes leadership hesitant to commit. Market conditions are unclear. Budgets feel risky. Strategy feels fragile.
So decisions get postponed.
Ironically, that hesitation compresses timelines even more. When decisions finally must be made, there’s no room left for debate or iteration.
How to avoid it:
- Accept that planning is about making assumptions explicit, not eliminating risk
- Use scenarios instead of single forecasts
- Commit to decisions knowing they will be revisited
Avoiding decisions doesn’t reduce uncertainty. It just delays clarity.
4. What “Enough Space” in Planning Actually Means
When I say annual planning needs space, I don’t mean more meetings. I mean the right kind of time.
Alignment doesn’t happen in a single meeting.
It happens through:
- Iteration
- Disagreement
- Refinement
If leadership alignment is rushed, misalignment shows up later - during execution, when it’s far more expensive to fix.
Early planning gives permission to pause and say:
- This target doesn’t match capacity
- This plan doesn’t support the revenue goal
- This strategy looks good on paper but breaks operationally
Once budgets are locked and headcount is approved, these conversations become political instead of practical.
A Simple Rule of Thumb
If your annual planning feels rushed, it probably started too late.
If decisions feel forced instead of considered, timelines are working against you.
And if the plan feels more like a compromise than a strategy, you didn’t have enough space.
Annual planning works best when it’s treated as a process, not a deadline-driven event. That’s what turns it from a yearly obligation into a tool you can actually execute against.
The Most Common Pitfalls (And Why They Keep Repeating)
1. Planning in Silos
FP&A plans one thing.
HR plans another.
GTM leadership plans a third.
On paper, everything looks reasonable. In reality, the plans quietly contradict each other.
Revenue targets don’t match hiring capacity.
Hiring plans ignore pipeline reality.
Budgets assume growth that the GTM model can’t support.
This usually isn’t a competence issue. It’s an alignment failure. Without cross-functional workshops and a single operational owner, planning becomes a collection of disconnected spreadsheets instead of a coherent business strategy.
2. Top-Down Targets With No Bottom-Up Reality
Many companies still set targets from the top and work backward, hoping the math will magically resolve itself. But Operations don’t work that way.
When leadership sets aggressive goals without bottom-up input, teams end up committing to numbers they don’t believe in. The plan looks bold, but execution quietly resists it from day one.
Ambition is fine. Detachment from reality isn’t.
3. Excel Optimism and the Human Blind Spot
In many annual plans, the math works only because the model assumes things that almost never happen in real life.
For example:
- A new sales hire is treated as “fully productive” from month one
- Every salesperson is assumed to hit 100% of quota
- No one leaves during the year
- Performance variance doesn’t exist
On paper, revenue targets look achievable.
In reality:
- New hires need months before they contribute meaningfully
- Some people outperform, some underperform
- Attrition happens - even in good years
4. Treating Planning as a One-Time Event
Many companies treat annual planning as something you finish. Once the deck is approved, it goes into a shared folder and slowly gathers digital dust.
That’s not planning. That’s documentation.
5. Weak Communication and No Feedback Loops
When assumptions aren’t challenged early, they show up later as missed targets and unclear ownership.
Without clear feedback loops:
- Risks stay hidden
- Accountability gets blurry
- Execution drifts
And by the time leadership notices, it’s already Q3.
Who Should Actually Lead Annual Planning?
This is where things usually get uncomfortable.
Annual planning often fails because no one truly owns the system as a whole.
Good news is that there’s no universal owner that works for every company.
Who leads annual planning should reflect how the business actually makes money.
Agencies
Lead: Operations (or RevOps, if you have it). Agencies are constrained by:
- Delivery capacity
- Utilisation
- Hiring and ramp time
Revenue is meaningless if the work can’t be delivered.
Operations is best positioned to:
- Translate sales targets into real capacity needs
- Flag delivery risks early
- Balance growth, margins, and team health
Finance and sales must be involved, but Ops should own the process.
Enterprise / B2B Product Companies
Lead: RevOps (or FP&A, in less mature setups)
In enterprise and B2B product companies:
- Revenue is driven by pipeline, conversion, and long sales cycles
- Hiring and GTM efficiency matter more than short-term utilization
RevOps works well here because it:
- Connects pipeline generation to revenue targets
- Aligns GTM strategy with capacity and hiring
- Enables continuous planning rather than annual snapshots
If RevOps doesn’t exist yet, FP&A often leads — but only if GTM and HR are tightly involved.
Startups (Early to Mid-Stage)
Lead: Founders, supported by Ops / Finance
At this stage:
- Strategy is still forming
- Data is limited
- Speed matters more than precision
Founders should lead planning to ensure strategic coherence, with Ops and Finance grounding decisions in reality.
The risk here isn’t being wrong — it’s being unclear.
Scaleups
Lead: RevOps or Operations
Scaleups sit in a dangerous middle zone:
- Growth pressure is high
- Complexity increases fast
- Informal planning starts to break
This is where ownership must shift away from founders and toward a system.
RevOps or Ops should lead to:
- Reduce chaos
- Create repeatable planning cycles
- Introduce continuous planning
How to Prepare for Annual Planning (A Practical Checklist)
Good planning doesn’t start in the meeting. It starts before anyone opens a deck.
1. Get the Right Inputs First
Before you book anything, you need:
- Historical revenue and pipeline data
- Conversion rates by funnel stage
- Average ramp time by role
- Attrition trends
- Capacity per role (not theoretical, actual)
If this data isn’t ready, the meeting will be emotional instead of productive.
2. Bring the Right People (Not Everyone)
At minimum:
- FP&A
- HR
- GTM leadership
- RevOps (as the process owner)
Don't forget that: Too few voices create blind spots. Too many create noise.
3. Structure the Meeting Around Decisions, Not Slides
Your agenda should answer:
- What revenue target are we committing to?
- What capacity is required to support it?
- When do we hire, and why?
- What assumptions are we making?
- Where are the biggest risks?
If you leave without clear decisions, the meeting didn’t work.
4. Make Assumptions Explicit
Assumptions aren’t bad. Hidden assumptions are.
Call them out. Write them down. Argue about them early.
How Do You Know If Planning Was Successful?
A successful planning cycle isn’t measured by how polished the deck looks.
Better signals:
- Clear ownership across functions
- Targets that teams actually believe in
- A hiring plan tied directly to pipeline reality
- Defined execution cadences post-approval
- Fewer “surprises” in Q2 and Q3
If execution immediately starts drifting, planning didn’t fail. Alignment did.
Move From Static Planning to Adaptive Execution
The real shift happens when companies stop treating the annual plan as a fixed promise and start using it as a living framework.
That means:
- Continuous planning instead of “set and forget”
- Regular execution reviews
- Best, base, and worst-case scenarios
- Cross-functional workshops throughout the year
- Dynamic hiring and capacity adjustments
This isn’t about being indecisive but about being responsive.
A Final Thought
Some companies avoid annual planning because it forces clarity.
Clarity about economics, about strategy, and about trade-offs.
Avoiding the conversation doesn’t make uncertainty go away. It just makes it implicit.
A good annual plan doesn’t lock you in. It gives you and your team a North Star.
And yes, it should change when reality changes. That’s not a failure of planning. That’s the point.
