Business Planning is ‘old school’ … Entrepreneurship is about getting out into the big wide world and doing stuff! Not simply researching and writing a Business Plans!
Reality or Rubbish?
A respected Lecturer writing in the Harvard Business Review proposes that all aspiring entrepreneurs need to do is to focus on knowing their customers. And then testing their hypotheses to ensure business success. Building a product or service, and undertaking market research to test their theories about business challenges. He suggests that entrepreneurs will learn from their failures. Thus grasp the true meaning of pivoting or changing to meet the needs of the market.
The conclusion being that ‘Hands-on Entrepreneurial Action is all that is required to create a Business!’
In the experience of Pro-actions however, most business owners are not at the leading edge of entrepreneurship. They may well have leading edge ideas, products or services. But they do not posses the ‘stardust’ associated with the rare few that hold that ‘leading edge’ position. Few of us ‘mere mortals’ do! And even one of the UK’s best loved and undisputedly successful entrepreneurs – Richard Branson – holds the belief that:
” … the way forward is not entirely uncharted … you must formulate an innovative business plan. Find funding, hire the right people etc …”
A Business Plan is an essential roadmap for business success. It should be a living document that generally projects 3-5 years ahead. It outlines the route a company intends to take to grow revenues.
What it is not, is ‘fairy dust’!
Many times, an SME business does not have a Business Plan at all. Sometimes the only thought is a ‘goal’ to retire in 10 years time …’
Or, perhaps worse still. There is a reasonably accurate business plan, created by a ‘business adviser’ at the request of the business owner – with the sole objective of obtaining finance, perhaps for business growth. It achieves its objective. BUT, because it has been ‘prepared’ by the business adviser, purely to obtain funding approval, it is:
- not owned by the business owners / directors,
- not adopted by the business owners / directors, and invariably
- not understood by the business owners / directors
… it is no more than ‘fairy dust’. A plan that is despatched to the bottom draw of the filing cabinet!
What it should be is a ‘living document’
For a business to be successful on a sustainable basis. The Business Plan must be the ‘living document’ within the business.
It is imperative that the business owners / directors of the business fully understand, own and apply all aspects of the Business Plan:
- Company goals
- Market and Competitor analysis / differentiation
- Organisational and Management structure
- Service or Product line – Unique Perceived Benefits (UPB)
- Marketing and Sales strategy
- Financial Projections
The Business Plan should drive the behaviour of all in the business.
If the whole Team share…
- the vision,
- the goals,
- the planned route
and also follow…
- the system,
- the process,
- the monitoring tools,
then achieving the aspirations of the business will be virtually assured …
The Business Plan may be the boring side of Entrepreneurship. But it is the sure-fire route to success for us ‘lesser mortals’!