Why Most Companies Plan to Fail
Remember when you started your business? You had a product or service that would serve the market better, faster or cheaper than the competition. You were in control of your destiny and the world was your oyster. As time passed the energy and enthusiasm began to dissipate. Things weren’t going as planned. You thought it would be much better by now. This is not the outcome you planned, or did you?
Most manufacturing, trades & technology businesses that struggle don’t have a business plan, so in reality they did plan; they just planned to fail.
Studies have shown that well written and detailed business plans can double the chance of a business succeeding.
Starting or building a business without a business plan is the same as trying to build a house or commercial structure without a blueprint. Imagine sketching some drawings of a house on a napkin, buying lumber and nails and starting to build. There would be many mistakes, ripping down walls and starting over. We would be no further ahead months or even years later.
A business plan is a blueprint for success. It details Strategic Focus, Goals, Market Analysis, Organizational and Personnel Needs, Financial Considerations such as Forecasts and Budgets and a Detailed Action Plan with predetermined Milestones.
Strategic Focus & Goals
This is where you “sketch” your business. It is imperative that you and your staff fully understand why you are in business, your values and where you want your business to be in 5 years.
A Marketing Plan should not be confused with a Marketing Strategy. A Marketing Plan provides a “big picture” view of the overall direction on the markets served whereas a Marketing Strategy provides detailed action plans on how a company will promote and create opportunities for its product.
In this step we identify and describe the market and clients we intend to serve. Some research needs to be done to determine size of the market, the need or desire for your product and how your company will be positioned against your competition.
This section deals primarily with the “back end“ or operational side of your business. If this were a blueprint of a home you would be detailing the floor plan, size of rooms and general theme for decorating. In a business it should detail the departments, management structure and other support mechanisms that are needed to achieve your goals.
This step requires a lot of research, forecasting and in some cases making an educated guess. It’s number crunching time. Assign numbers to the descriptions and planning provided in the first three steps of your Business Plan.
This section should include sales forecasts, expense budgets, cash flow analysis and of course a prediction of your profits if the plan is successful. Provide spreadsheets, charts and graphs with explanations to back up your numbers.
You’ve written a great plan, have all your numbers complied and accounted for. Now what? The key to a successful plan of any type is implementation and execution.
Developing an action plan is a relatively simple process but requires attention to detail. Here are some simple steps to follow:
- Review your plan very carefully and do a “take off” (itemize) of all the actions that will be required to execute each part of the plan.
- List the items in order of need and time sensitively to be accomplished. Be sure to include each step if an item requires more than one step.
- Assign realistic deadlines for each.
- Use a Timeline, Gantt Chart or Calendar as a tool to track and maintain progress.
It’s a challenge but be disciplined and stay on track. Keep evaluating, adjusting and “keep your eye on the ball” at all times.
To get my comprehensive report, “5 Steps To A Powerful Business Plan” just email me at firstname.lastname@example.org or call 604.374.5934.
Tony Malyk, Vancouver Business Performance Coach