- Drives tactical planning and provides a management tool for your business, often done on an annual basis
- You can use in your search for external financing
- Shows the capacity of your team to control and manage all the aspects of the company
- Enables you to identify new ideas to refine your business or take it in a new direction
There are many important elements to consider when developing a business plan for your company, but the first step is to fully understand the main uses of a business-plan. A well-crafted Business Plan is a written document that:
The owner (in a small company) or the management team should be the main author of a business-plan, because the Business Plan is, so to speak, your own “baby”. It should be a reflection of your personality and the tool that your investors will discover with whom they are collaborating.
But your business may be too important and you may want to call in a consultant for help and consultation. Even so, you should stay in control of its development!
1. To be credible, a business-plan must be coherent and each parameter in the plan must be based on facts.
2. Define what your Mission is. Your mission is what you’ll seek to achieve within 12 to 18 months. You can’t change the world in that time frame, but you can accomplish a lot. The better you define where you are going, the better your chances of getting there will be.
3. Once you have your mission defined, identify the most critical things that need to happen to get you there. We call these Critical Goal Categories.
4. For each Critical Goal Category, identify the specific Goals that need to be accomplished during the plan period. This process will be the heart of your plan and will logically lead to the Action Plan, a listing of concrete steps that will be executed in order to ensure the success of the plan. You’ll need to identify both who will be responsible for each action step as well as when it will be done.
5. Make sure that all your Goals are SMART. That is an acronym for Specific, Measurable, Attainable, Realistic and Time bound. Each one should have all 5 elements so that you can ensure that they’ll get done.
6. Next is the Budget which is the result of the all of the other work embodied in the plan. The calculation of the costs of the planned actions and the resulting revenue in your Business Plan are essential and make overall financial projections possible.
7. The last point and certainly not the least significant: Business Planning should not be “once and done”. A regular follow-up and comparison between the Business Plan and the reality of its execution are essential. This should happen at least once a quarter. You can then modify your Business Plan and adapt it to improve performance and achieve your goals.
In conclusion, careful and thoughtful planning should result in a plan that is achievable and useful in managing your business. By following the roadmap established through the planning process, you will enable a business to reach new levels of success.
About Our Author:
Paul Clough is a business leader with 25+ years of experience spanning several functional areas including Business Development, Strategic Planning, Leadership Development, B2C and B2B Marketing and Operations. He helps business owners develop a marketing strategy and a strategic business plan for midsize companies . He is a trusted advisor for senior executives of entrepreneurial companies, enabling them to more effectively manage and expand their businesses. A central theme of Mr. Clough’s career has been developing new businesses, brands and product lines. He earned an MBA from Harvard University and a BS in Accounting from Bucknell University.