As the year is coming to a close for most of us, it can be about survival or overwhelm in the final run up to Christmas. All those networking functions, parties, and general social catch ups people have avoided all year but feel they must attend before December 25.
There is possibly a thought about next year. Although it’s usually just that, a thought…
Business planning seems the furthest thing from business owners’ minds.
The definition of a business plan is: a written document describing the nature of the business, the sales and marketing strategy, the financial background, and containing a projected profit and loss statement.
A business plan is also a road map that provides direction so a business can plan its future and help it to avoid bumps in the road. The time you spend making your business plan thorough and accurate, and keeping it up-to-date, is an investment that pays big dividends in the long term.
As a business coach, SME clients come to me because they are not achieving the results they want in their business. Usually, it is a combination of sales, (and therefore marketing) financial or operational challenges.
My first question is always to look at the business plan and there are generally two responses;
- “Sure, I will get it for you,” a.k.a I will write one between now and next time we meet. Or I will ask around, find a template, and copy someone else’s.
- They will present a beautifully bound business plan many pages long filled with graphs, and numbers but covered in dust.
When asked how often they check in to measure this and where they are at, words like ‘probably’, ‘should be’, ‘will be’, feature in the vocabulary. A.k.a I don’t know because I am not measuring – too busy working.
So if we know that having a business plan supposedly brings you focus and clarity together across all areas of your business, with the goal to shift your business performance, then why don’t more SME’s do it and use the plan consistently as a tool?
When you are a smaller business, it is easy to get lost in the ‘busyness’ of the day. You may have some understanding of what’s working but it’s in your head. Or you really just don’t understand some areas in your business – usually the financial and operational components so it’s easier to avoid or distract from these issues.
Sometimes it is transitioning from an employee mindset to employer or self employed mindset. There is a mindset adjustment that needs to be made moving from tactical to strategic and can be sometimes challenging.
You take comfort that a plan needs to be done, or if you have done it, don’t measure against it. You might as well not have one if there is no measurement. I also think that sometimes coaches and banks overcomplicate the business plan process. Which brings me to the purpose of this post.
I believe every business should have a plan. A plan that is simple, dynamic, and measureable. It needs to focus on the areas that should be shifted in the business for that year and there must be some way of understanding the benchmarks you are measuring against.
If you don’t measure then how can you shift the performance?
Here’s my take on what your business plan should do for you:
- Be in an interpretable format that you find easy to edit and understand.
- Have well defined measurements.
- Define the business, ‘Why’. Why this business? Why Me ? Why right now?
- Understand what you want to focus on for the year, have a clear plan of how you will achieve it, and who else is involved.
- Have a pipeline. A simple template that allows you to track business prospects. It doesn’t need to be complicated.
- Really understand your business financials. Get some expertise around this area if you don’t.
- Mindset. Where do you need to adjust your mindset in your business in the next year to meet your outcomes?
- Time. Write the plan and then take some time to reflect and edit – don’t be in a hurry. It take more more time to keep them simple. Simple is most effective.
They are worth the paper as long as the type of paper suits your style. Make it work for you.
If you want to finish the year feeling great, not be stressed and want to have some certainty around your business performance next year, we are running a business planning workshop that will give you a simple, structured plan with useful tools to help define what’s important to you to focus on next year.
Find out more information here.