One of the problems with business plans is that they have gotten to rigid and formatted.
Some of this is self-perpetuating. People look at other people's plans that have gotten funding and we see a common pattern emerge.
Some of this is due to the business plan software that is out there (here comes the onslaught of e-mails and comments from that industry!!). People buy the software and then simply fill in the blanks.
MyVenturePad has a link to a post by Seth Godin at his blog that makes a good point about business plans:
I tell my students to use your plan to tell a story that answers a few key questions:
Tell me a logical story that holds together. (See my earlier posts on business modeling on how to make this happen).
Make it a realistic story. Make it a believable story. Make it a story that is not an act of fiction. And for goodness sake, make it your story.
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Some of this is self-perpetuating. People look at other people's plans that have gotten funding and we see a common pattern emerge.
Some of this is due to the business plan software that is out there (here comes the onslaught of e-mails and comments from that industry!!). People buy the software and then simply fill in the blanks.
MyVenturePad has a link to a post by Seth Godin at his blog that makes a good point about business plans:
It's not clear to me why business plans are the way they are, but they're often misused to obfuscate, bore and show an ability to comply with expectations. If I want the real truth about a business and where it's going, I'd rather see something else. I'd divide the modern business plan into five sections:His post is worth reading before you write your next business plan.
- Truth
- Assertions
- Alternatives
- People
- Money
I tell my students to use your plan to tell a story that answers a few key questions:
- What are you hoping to do?
- Why is this an opportunity? What is happening in the marketplace to make this work?
- Specifically who is feeling "the pain" that creates their need for this product or service? What will you need to do to get their business?
- Who will you have to fight to get these customers to buy from you?
- Specifically what will you offer and for how much? How will you let them know about you? How will you deliver what you offer to them?
- What resources and people will you need to make this work?
- What does this story look like in numbers?
Tell me a logical story that holds together. (See my earlier posts on business modeling on how to make this happen).
Make it a realistic story. Make it a believable story. Make it a story that is not an act of fiction. And for goodness sake, make it your story.
Interesting, indeed. I got an idea that these 7 key questions could be used as a plan outline at our online business plan software
Wouldn't a format makes it easier to read by others? I'm thinking along the line of resumes that schools have taught us to standardize it for easy reference.
Up to a point you are correct.
But plans have gotten too rigid in their formats. Too many sub-sub-sections that often only muddle the story.
Following a basic logical flow is what makes it readable. Use a few sections headings to lead the reader through your story, but avoid "death by bullet points".
I read the comment about a standard format similar to a resume and it felt like I had been struck by lightning. As an executive talent agent, I am always looking for fresh ideas to apply to the world of executive job search.
It is fairly well accepted that jobsearch is a marketing project. But recently, I have thought that this needs to be expanded to include the principles of a strong,effective business plan. The seven elements listed in this post can easily be adapted into a presentation describing a prospective candidate's unique qualifications and relevant background. I am going to start working on this concept and will share it soon. Thanks for the inspiration/confirmation.
The key questions you posted are spot on. I have a question though
Does not having a time based criterion not increase the likelihood of the plan not working out ? #2 talks about opportunity, by definition it indicates that the opportunity is there now and won't be there forever as either someone else will provide the solution or the opportunity will change itself.
This is implicitly addressed in #2 but a direct question might be good.
failing to plan is planning to fail! Sometimes the plan doesnt work out but your tips on how to plan it would be the basis of a sucessfull one.
I quite agree, He who fail to plan, is planning for failure. Every successful ventures start with good planning.
First of all, no doubt that planning is more than important, necessary in business world today. I like the structure mentioned here. I've built something similar in front of my desk.
Certainly following a form to complete business plans makes for an easier task. But telling the who, what, when, where and how of the project makes more sense for the humans who must evaluate and maybe approve of the story.
I could not agree more. Too few people take the time up-front properly plan. A little extra time in planning will save time later and produce a much better product.
I agree. Business plans have become simply a tool to be used to get funding, etc., instead of a tool to help guide and direct the business. As current done they require little actually planning and are pretty much worthless.
Proper planning is the most important and also the most ignored aspect of starting and operating a business.
Blindly following a form or software to create a business plan is a waste of time. A business plan should be a well thought out plan for the business, regardless of format.
Planning is probably the most important thing a business owner can do. Going blindly into a business without a good solid business plan is a recipe for disaster. Why don't people realize this?
I've got the most brilliant idea on ways to plan for my business. Great post. The 7 key questions are most helpful!
It's amazing to me how many people enter into a business venture without any business plan at all. I suppose that's probably why so many new businesses are failures.
Thanks for sharing these business plan tips.
I have to say, as a small business owner, these tips are really good and to the point. Thanks for sharing them with us. :)
Here's another thing... Make a business plan a bunch of wild story telling and get it approved and then you really have trouble. Best to make a plan that is real with all the bases covered and then you can really go execute and get somewhere.
No doubt business plans can help you and focus you on the right path. Nicely written post, thank you.