(As published in the Sunday Star Times and on Stuff.co.nz on Sunday, September 10.)
I work with hundreds of businesses of all shapes and sizes every year. Working through a business plan and doing the related strategic thinking is the first thing we start with in our focus on how to grow the profitability of a company and ensure long term success.
I’ve kept a record, and less than 10 per cent of these businesses had a business plan to start with. Isn’t that scary
It is the same as you driving to a new destination that you’ve vaguely heard of without really knowing where it is, and not planning out the route to get there. It might take you 30 minutes to get there, 2 hours, 6 hours, or you may never get to your destination depending on what comes up on your journey and how good you are at heading in the right general direction.
This is literally how the normal business operates. No wonder most businesses never reach their full potential and take forever to get there. Sound familiar?
A business plan can take any format that works for you to keep you heading in the right direction, and it’ll add accountability. But it’s best you have a succinct version – beware of the ’58 page business plan’ as you are unlikely to look at it much. A business plan is really worth its weight in gold if you look at it regularly.
People ask how much time should go into creating a business plan. I’ve found good planning and strategy takes about 2 days of intense focus (big companies might take longer). The business plan created should set you up well for a successful medium to long-term future. I suspect you will look back in a few years time and think that creating your business plan was the best thing you ever did.
It’s best to go off-site to create your business plan. I run three versions of two-day business planning workshops, one with many different companies attending at once with senior staff to create their business plan, another just for a company’s management team and/or board, and another with several divisions from inside a large company attending to work through their business plan at the same time.
Imagine the power of sharing with your entire company aspects of the business plan, so they know where the business is going and how to get there. It will be one of the key factors in getting everybody more engaged and loving your business, which ultimately customers will notice.
Many businesses are poor at implementing their business plan. Stuff comes up day to day and you are too busy fighting fires. Implementation of your plan is key, including a strong review process to ensure people are being accountable to deliver upon the plan. That said, I get asked, what is more important, the creating of the strategy or the implementation of the plan? There is no point being great at implementing the wrong plan and strategy for your business. Time needs to go into creating the right plan in the first place.
A business plan and the related thinking can be your best friend in business. It’ll help you consider what you could be, the different ways to get there and what might come up along the way. Key people in your business want to be involved in this thinking. A business plan is the ultimate KPI for you and your team to be accountable against.
I wonder if I could see a show of hands of everybody reading this, whether more than 10 per cent would already have a live business plan and of those, what percentage are truly accountable against this plan?
Zac de Silva is an award-winning profit maximisation advisor, facilitator and speaker and founder of www.businesschanging.com – his next 2 day business planning workshop is in Auckland on October 5 and 10. Zac also co-founded www.nurturechange.com – the 5 day business retreat with 12 speakers in Fiji in November 2017 including Sir Graham Henry, Frances Valintine, Kathryn Wilson, Sir John Kirwan and others.