Many owners see business plans as merely a way of acquiring funding. They do not recognise the power of the business plan in steering your business forward many months or even years down the line.
What’s the point of a business plan?
A business plan serves a critical purpose in any organisation. It focuses your efforts,
enabling you to spot potential pitfalls. It also allows you to set realistic targets and to trace your growth.
Good business plans enable you to structure and monitor your business, as well as recruit the right level and calibre of staff.
However, even when written, most business plans tend to end up in someone’s drawer. This completely defeats the original purpose and will not serve any benefit to your
Entrepreneurs need to communicate their business plans to their organisation and to their staff so that everyone is singing from the same hymn sheet. The document should
not be reserved for the eyes of management only – all employees should understand the opportunities and the threat to the business.
Businesses which are well-established tend to use a business plan every month to
realistically analyse whether or not they are on track. A business plan allows you to consider detailed market research in relation to your competitors so you can fully understand where your business is going.
The benefit of having it written in black and white is it focuses your mind. It’s also
extremely motivational to write. More importantly in a recessionary period it allows you to say no to certain opportunities which come your way.
If an offer is not exactly in line with your business plan you should say no as you can become sidetracked.
That said, no business plan is good if it’s too static or inflexible.
A business plan is a good way of making people in your business accountable. Business plans can be as simple as a single sheet of paper to focus your mind or as comprehensive as a 70-page report dealing with all strategic issues in a business.