November becomes the target

For years I ran November to beat the number. I had the wrong opponent.

The number is the annual target, or what is left of it, and a peak that clears it feels like a finish line. The revenue lands, the screenshot goes round, and for a week it is the best month in the building.

Then the budget cycle starts, and this is what I did not see for too long: the month I had just beaten was about to become the month I owed.

Next year's target is built from this year's actuals, and almost never from this year's actuals with the discount taken out. The thirty percent that made the month possible does not travel into the planning model; the revenue does. So the model reads a November that was bought at a cut and asks for the same November plus growth, at a margin the cut never allowed, and everyone nods, because last year's actual is a fact.

That is how a discount becomes permanent without anyone deciding it should. The customer at least remembers the price. The target remembers only the top line.

I used to argue about the growth rate, and the argument was in the wrong place. The base was set in the week the screenshot went round, by people who took it as a result rather than a price.

What I do differently now is dull. I hand finance two Novembers: the one that happened, and the one restated at the price the brand wants to hold next year. The second is smaller, and it is the only one fit to be a base. It is also the harder conversation, because it means saying, in the week everyone is congratulating you, that some of the month was not yours.

A peak does not close the year. It opens next year's argument, and it opens it with the discount already removed from the evidence and still inside the number.