Many businesses will benefit from having a Business Plan, but, depending on the Life Cycle Stage of your business, this may or may not be a good idea.
They can be complex but it is possible to structure a fairly straight forward plan that suits your business.
When is a Business Plan Advisable
Business Plans are certainly advisable at some of the stages of a business' Life Cycle.
- Startup or Pre-Startup: It would be wise to undertake a reasonably comprehensive Business Plan. This will ensure that you have a very clear general direction in mind.
- Fast Growing: Requires a Business Plan that looks ahead for several years so the Growth trajectory will be maintained.
- Troubled State: A Business Plan will help to resolve whether the business can be saved. This process will highlight the problems that led to a troubled state. If the business can be saved, the Business Plan will help avoid the same problems reoccurring unpredictably.
- Mature, Steady State: may not benefit as much from a Business Plan since its operations are usually very well understood by its owners.
Elements of a Business Plan For Any Life Cycle Stage
1. Set of Goals or Vision for your business (Goal Setting Recipe).
2. Set of Business Metrics (Metrics Recipe).
Metrics are a set of numbers that allow you to track how your business is progressing against your Goals.
Most of them are likely to be numbers relating to Profit and Loss, Inventory size, Growth rate, and a host of other topics designed to reflect whatever Goals you have in mind.
Building Your Business Plan
There is a great deal written about the construction of Business Plans.
Profit Savvy has come across an excellent book by Dave Lavinsky entitled Start at the End: How companies Can Grow Bigger and Faster by Reversing Their Business Plan.
Dave has produced a book that is easily understood and comes with a separate, free, downloadable set of workbooks.
Watch The Video Now
A great way to formalise a company’s Purposes, Goals, and Values is to have formal Mission, Vision, and Value statements.
This is an easy to understand tutorial on Mission, Vision and Value statements.
Watch this 6 minute video
on the link below
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