Your Evolving Business Plan

When you want to start a business based upon your great idea for a product or service, you know you need a plan. Having a good business plan helps you to get the needed startup funding (the banks insist on a business plan these days).

A business plan also helps you to get organized, realize how much work your business will be, and how to systematize your business.

But now – after your business is rolling along – is that business plan gathering dust?

There is no getting around it if you are running your own business full time – YOU ARE BUSY!

You don’t have time to write business plans, and besides who reads them?

Anyone with a degree in business knows that the school business plans are very detailed, thick, elaborate, and boring. That’s because in school, you are not doing a business plan for a profitable business. You are doing a business plan to get a grade and your marketing class will probably give you several weeks to finish the class business plan.

In the real world, business plans need not be that detailed and should follow a “keep it simple” plan. Remember, creating a business plan is an activity that is “non-profit.” In other words, the hours you expend on the plan is costing you money in terms of opportunity costs and lost business. Therefore, get to the business of making your business plan, get to the point.

You business plan should be your roadmap to the future. It will help your business grow at a sustainable level. It will help you to generate new sources of investment (be it through bank loans or investment). And it will keep you on track.

Your business plan should start with the executive summary that states what your business will be doing—simple as that. It should include a few straight forward goals of your business. You can always then decide on anything that comes up by asking yourself, “will it contribute to your stated goal of your business?”

The next section should describe the “who” and the “how” you are going to do your business. It should describe the resources (in terms of people) that will get the job done and the strategy of how they will do it. This is a great section that helps you plan to have the right people in the right place at the right time.

In the “how” section you must document what the business does, and how it gets it done. This part of your business plan is critical if something ever happens to you. Often this area is expanded into a full business manual, customized for your company. That way, at any time, a new person can step in and know exactly what to do by following your plan. Strategies must be also be listed to include the plan for when things don’t go right.

The most important section is how the business intends to make its money. The budget in your business plan should be updated regularly to make sure you are on track. This last part is the bottom line but you can rest assured it is the most important priority to the investor, your banker and YOU.

When the business plan document is finished, make sure it isn’t too lengthy. Have it in a binder close by your desk, with each section tabbed for easy reference. That way it will be your most important document your business owns.