Having helped hundreds of businesses create business plans at our workshops over the past few years, I’ve gotten a pretty good idea of how to make an effective plan – and the common mistakes people make. Here’s a brief round-up of what NOT to do when creating your business plan…
The biggest issue is that businesses don’t think they need a business plan. To me that means you are just going to accept life happening to you and your business without taking the opportunity to get on the front foot and be really proactive to make that awesome potential future that you have actually happen… If you just focus on the day-to-day and fight fires and change your focus constantly depending on what is shouting the loudest, you will never, ever be as successful as you could have been. If that was me, I’d have major regrets later in life that I never gave my business the opportunity to be a lot greater by being limited with a short-term focus. Please, find the time as your planning and strategic thinking time is worth a huge amount of money, happiness and success.
“I’ve got it all up here,” others might say. Well that’s cool too, and so many great business people do have it sorted in their heads. But the problem then becomes trying to get the rest of the team onto the same page. How can you get your team to buy-in when it’s not outlined and communicated clearly? Don’t limit yourself and your potential by doing this.
Many companies who do have a business plan let it gather dust at the bottom of their drawer. Good on your for having done one but ultimately it was 95% a waste of time. You need to have a system that gets you referring to your business plan a lot – weekly or monthly is good. It needs to be front of mind so you can get above the day-to-day busyness that we naturally are attracted to and to check in before each big decision to see if it aligns with your decided strategies and goals. Setting time in your calendar to actually make progress on your business plan as a project is a key success factor too!
Some people create the 53-page business plan (which is the template they Googled on the internet or downloaded from a free government website) that they think the bank wants to see. Not good! You’ll never look at it and if you do, you’ll feel overwhelmed. Having a shorter, succinct plan is highly likely to deliver a lot higher ROI on your business plan.
Humans can only focus on a handful of things at a time so if your 53-page business plan includes 135 action points, where do you start? A key mistake that people make when business planning is failing to prioritise to give a clear plan of attack. 135 tasks is overwhelming but if you clearly identify the top 10 things of those 135, things look so much more achievable and you’ll be more motivated to start.
Many people make the mistake of thinking a business plan = a basic SWOT analysis… Yes, a SWOT is a valuable tool, but it is only one line of thinking. You need to consider a heap of business-thinking questions. This is where most people go wrong and their consideration of things is far too narrow so they end up creating a C-grade business plan. Unfortunately it’s a case of rubbish in, rubbish out if you don’t consider the right questions.
Thinking too short-term. A key objective of a business plan is to make sure you are doing the right things to maximise both your short-term future and that of 5+ years. Covid aside, what is usually more likely to kill or restrict your business are usually things that affect you over a few years so you need a bit of crystal ball gazing and future thinking to have a really effective business plan.
People rush their business plan and do it to just tick a box. You can’t do a decent business plan in 2 or 3 hours. This is one of the most valuable things you can do so put some decent time into it. I’d suggest you need 1 to 2 days to create a decent business plan. It might seem like a lot, but it will save you time, money and energy in the long run.
Updating it irregularly. You need to have at least an annual planning session as things change. Doing it irregularly, like every 3 years, is not enough.
Not sticking to their knitting. While sometimes you have to change your direction when your industry is dramatically changing, most of the time your winning strategy can be sticking to doing the basics well. Many companies feel like they need to constantly come up with new things or change direction in a planning session – be careful here as changing for the sake of it is foolish. So unless your market is changing dramatically, you need to be like Luke Skywalker in Star Wars said when bombing the Death Star – ‘Stay on target, stay on target’. (Assuming you have the right target in the first place…)
They don’t include their team in their business planning process. ‘Team’ is way smarter than ‘just me’. Plus, unless you want to deliver all by yourself, you really need the team in on the plan too. Which brings us to…
They don’t share their business plan with their greater team. Your team want to know where your company is going and how you are going to get there. Share it and get them excited and to come along for the ride. When you do share with your team your plan, make sure you take the time to help each team consider what the business plan means for them and what their part to play is.
People have no idea what it means to be strategic and their business plan ends up being a long list of disparate action points ie. an irrelevant to-do list that probably features far more fire-fighting than anything that will meaningfully progress your business.
So, do any of those “don’t’s” relate to you? Want to create a business plan that will actually work and give you the best shot of making your business the most successful it could be? Join one of our upcoming business planning & strategy workshops HERE!