Writing a business plan is a project that very few do well. In fact, almost every business plan that was ever written finished up on top of a filing cabinet gathering dust, instead of becoming a valuable business development tool. Despite the importance of having a plan, the reality is, most business plans just don’t work to improve business performance.
How do you write a business plan that works? It takes more than downloading a business planning template from the internet and filling in the blanks. That’s a recipe for mediocrity.
Most business plans are merely forward projections of past results. There is usually no attempt to challenge assumptions or to question the status quo. Or the total reverse happens and lofty goals are established without confronting reality. Often these pie-in-the-sky objectives are stated but no real strategies are developed to achieve them.
Planning is a Process not an Event
Effective business planning is not so much an event, but an ongoing process. It is ultimately about navigating your business through several business growth levels until it is capable of achieving the goals you have set in relation to the opportunities that exist in the market. To achieve this growth, you need to establish specific strategies and an action plan that prioritizes the changes and has activities delegated to appropriate people for implementation.
To be effective, business planning needs to be an ongoing process.
- You start with analysis and learning,
- Then you move to strategizing and scheduling.
- The resulting action plan leads to implementation.
- Implementation needs to be followed up by evaluation,
- which leads into a new phase of analysis and learning.
Before you begin any forward planning, you must start with a clear understanding of where your business stands now. What are the strengths and weaknesses in your management and internal operational capabilities? If you want your business to grow and capitalize on new opportunities, you must ensure you build internal capabilities. Building internal capability must go hand in hand with developing winning strategy. What is the point of generating a flood of new sales inquiries, only to discover that you can’t keep up with the new level of demand?
Planning Must Lead to Progress and Results
You need to analyze your business with the skill and knowledge to understand the requirements of creating the appropriate objectives, strategies and structure at each level. Unless you understand which type of structure is needed you will end up just creating more pressure within the existing structure. Your growth will be limited by the weaknesses inherent in your current structure and no real progress will be made. Simply following a template and set of planning instructions will only help you create a plan that leaves you stranded or stalled and frustrated on your business growth journey, trying to get to where you think you want to go, but having no realistic means of getting there.
A staged planning approach is needed in your business development. Once your plan is written and you have begun implementing the new strategies, you need to establish an evaluation process, to identify whether the changes are working and how effective they are. This evaluation process has two benefits; it helps you improve your planning processes and it helps you identify where your strategies need to be improved. Both lead to increasing the speed of performance improvement.
Once you start planning effectively, you soon come to realize that the planning is more important than the plan. What happens is that you make effective changes that improve what you are doing and achieve better results. This improvement typically leads to better and more interesting opportunities that you could not see from where you were before you started the planning. It won’t be long before you outgrow your plan and will want to do another one to take you to the next stage of your development.
The Most Valuable Tool
It is critical that your planning addresses the strategies you will need to create an attractive business that works for all stakeholders. Instead of becoming a document that collects dust, your business plan, particularly the action plan, will become the most valuable tool you use in your business to guide your day to day activities and to monitor your progress towards success.
This is a slightly amended version of an article written by business strategist and ‘Run Your Business on Autopilot’ author Greg Roworth and his business partner Troy Eadi. It has been shortened to make it suitable for web publishing.