How did you put your business plan together? Did you use a software package to guide or help you? or did you ask somebody to help you?
Recently a business owner, who asked me to meet with him because his business wasn’t growing the way he’d hoped for. He proudly showed me his business plan, a 20+ page document that looked great, and had excellent detail. However upon further review, the pro forma numbers were unrealistic, and many of the action plans had either not been done, or were done very poorly. It seemed that his attitude was “If I have a great plan, my business will work.”
May of us have heard staggering statistics that 80 percent of new businesses will fail within the first five years. I struggle with that figure and my interpretation of the word failure in this sense is that they struggle to survive. Many of these so called failures could be improved by having comprehensive business plans aimed at guiding the business. Yet how many of these same businesses do have excellent plans, and still fail? I’m sure the numbers are still staggering.
Why is this the case? In many cases, the business owner goes out and gets a generic business planning software program, fills in the blanks, and once it allows them to get their business loans or credits, the business paln goes into a desk drawer to gather dust or is used to prop up the computer screen. The software does not have the intuitive ability to ask the tough questions of the owner, push them to think through where their business is heading, and then stay with them to make sure the plan is executed with discipline and precision.
The magic of the business plan is not the “plan” itself, but the process that the business goes through in putting it together, and then using it as a living document to guide and direct the direction of the business. It needs reviewing regularly, and action plans developed from it for the next short period. When was the last time you looked at your plan, or wrote an Action Plan. Maybe the time should be now…