In a recent New York Times article, Eilene Zimmerman called attention to the diminishing role business plans are playing in today’s fast moving, technology, start-up dominated market. She, along with those she interviews, tell us there are also many good reasons to write a business plan. For instance to obtain a bank loan, financing, letting you make mistakes on paper, setting goals, adapting to changing market conditions, developing priorities, reducing decision time, increasing decision certainty, and becoming the foundation for action.
Probably the most important reason for a business plan is not the plan itself, but the process one goes through to develop the plan. The business planning process forces you to step away and think about the strategic direction of the business, the definition of success and how to achieve those goals. The real benefit is taking the time to think. To ponder what is and what could be. Owners and companies, especially smaller businesses, are too involved in the day to day operations. They don’t take the time to journey through a strategic planning process and thus never realize the full potential of the business or worse, fail to see their impending demise.
In Louis V. Gerstner Jr.’s book Who Says Elephants Can’t Dance? he describes walking along the beach as his process for thinking through critical decisions or contemplating strategy. Two things always struck me about this. First, that an executive of his experience and leadership didn’t make intuitive, quick decisions and second that he took the time to think and consider possible outcomes and effects. Although, when I worked with IBM, they were plan driven. Global Services would create a Spring Plan AND a Fall Plan. Leave it to IBM to over-engineer just about everything.
Michele Flynn, Founder and President of a 25 employee consultancy, Expense Management Solutions would take her management team off site every year to consider the changing industry environment, develop new products and services, and set the direction for the coming year. This was a highly energized exercise that not only planned of the coming year, but because it was a collaborative plan, everyone felt a certain ownership for the outcome.
So good businesses, large or small, understand a business plan is absolutely worth the time. Not because at the end you will have this nice formalized written guide, but because you will have a given yourself the gift of invigoration, direction, and hopefully unleashed your creativity.
Do you have a business plan? When was your plan last updated? Please share your thoughts…
Need a template to get yourself started or to give your thoughts some structure? Send me an e-mail. I will be happy to share.