Subscribe

Stay tuned to the latest posts by having them delivered to you for free via RSS or Email. Simply Enter your email address or click on the "Subscribe to RSS" button.



OR

Subscribe via RSS

You have a business plan – what now?

You have a business plan – what now?

climbing small

 

You have spent time putting together a great business plan, don’t waste it

 

It takes time thought and money to put together a credible business plan. You may have needed one to get finance, or to get suppliers to support you, or because you believe that planning your business is the right way to go, which is the best reason. Now the plan is complete, it has goals, targets and projections, mission and vision, marketing promotions, organograms, staff recruitment and training plans, financial projections and all the other characteristics of a great business plan – so what now?

Sadly in even the best intentioned businesses the day to day activities of running the business, and as all that great work fades from memory the plan document remains in a file, never to be looked at aside from out of nostalgia. If this is done deliberately it can be a good strategy, especially if you follow Eisenhower’s motto that “Plans are nothing, planning is everything.” In this strategy the business recognises that merely developing a plan drives the business to more focused and effective actions, but the entrepreneur wants freedom to react to situations on the ground, rather than stringently following the plan. If this is so in your business I have no problem at all.

However if your business is like the majority, the great ideas and lofty goals set down in the plan will slowly be submerged in the sea of day to day tactical management, and very few of the goals of the plan will be met. If this is you, or if you are in a planning cycle and fear this very widespread problem then read on…

Is the plan achievable?

Even before you start to implement the plan go back and take a realistic look and what the plan proposes you do. Many plans are not balanced between the available resources and the planned activities, in the enthusiasm of planning it is easy to list marketing or sales goals when there is not enough capacity or money to do them. This is a sure recipe for building a culture of ignoring the plan, which is pretty easy to do anyway; day to day necessary work will always take precedence over planned actions, no matter how hard you try to change this. If the plan requires more effort than can reasonable be applied then simplify the plan or reduce the goals.

Implementation actions

You also need a clear understanding of what needs to be done to implement the plan. Many business plans have no action plan and this makes non implementation a near certainty. Go though it in detail, making notes of exactly what needs to be done to put the plan in place, prioritise the things that will make the most difference then allocate the responsibility for tasks and the start and finish dates to individuals. Even if a group undertakes the task there must be a responsible owner. If there are large or ongoing task set milestones or better still set it up as a project. Be clear on what completion means, otherwise most tasks will perpetually be more or less complete. Tasks undone are bad, tasks partly done are worse – they give the illusion that something is happening, but in reality very little has changed. Mange by outcomes, not by work input.

Success factors

Your plan should have key success factors, those things which must happen for the plan to succeed. These are usually specific conditions which must be created like buy-in from all staff, sales growth, customer satisfaction levels or penetration into new markets. Occasionally KDFs may be assumptions in the plan like interest rates or competitive activity.

If you do not have KSFs in the plan then you determine them by identifying the factors which will destroy any hope of the plan’s targets being met, if they do not happen as the plan suggests they should. They must be measurable. You should pick five or six, and then regularly measure and monitor if they are happening as planned. If there is a deviation from any one of them you will probably need to revise your planned goals.

Reporting systems

Your plan should have included measurable goals, objectives and KSFs. If it does not then you should junk your plan and start again, translating the fine words of the plan to hard targets. Devise reports which will tell you whether you are tracking your plan or not and take these seriously. If there is a wide divergence between the plan and the actual results then it may be time to re-plan, but now with the advantage of experience. Never simply write off big variation and excuse the differences by one of the usual excuses; the market conditions are bad; it’s all the fault of the government etc. Analyses the real reasons and either fix them, work around them or set you sights lower. Continuous operation far below planned returns will demoralise you and your organisation and lead to a culture of blame rather than responsibility.

Review and adapt

The best business plans I have worked with are the ones with comments and changes written in them and well-thumbed pages because they are working documents. The worst ones are those gathering dust in a file, used once to get finance and then ignored. Review and adapt – no plan will have been a perfect forecast of what will actually happen, but do not ignore it because of this factor.

©copyright Ed Hatton. All rights reserved. You may republish this article or extracts from it provided you state I am the author, acknowledge my copyright and provide a link to my blog or my e-mail address.

Leave a Reply

Your email address will not be published. Required fields are marked *