Business Magazine

Wed Aug 19

Business planning - bull$#!+ = better small business

Written by Warren Harmer

I like to keep an eye on articles about business planning, with two this week increasing my frustration with the conversation on this topic. One article was bagging the process all together, whilst the other espoused their own version of the process, saying forget the ‘business plan’ but do a ‘strategy plan’ instead (with the content pretty much the same). These are circular conversations, driven mostly by gurus who are really looking for more exposure for themselves. Whilst this chatter goes on at consultant level, those businesses that could really do with business planning - small businesses - continue to do no planning. It’s time to move this conversation down a gear, stop trying to out-expert each other and start talking to those who need attention..

From what I have seen, pretty much all business planning articles fall into 3 categories:

* Good - business plans are great, hurry up and go do it now
* Bad - business plans are a waste of time, don’t bother
* All about me - business plans are worthwhile, but only if you follow my method - everyone else is doing it wrong.

To say business planning is a waste is ridiculous. I have worked with hundreds of businesses who went through the planning process and in doing so learnt more about themselves, their businesses, saved a lot of money and many avoidable errors. Does anyone really believe that starting a business without researching start-up costs is a good idea? Or not defining target markets? No projections? Even marketing channels and costs? Successful businesses that started without business plans are put on a pedestal and used as case studies that justify doing nothing, to apply this as a rule is reckless.

Where this whole discussion is distorted is in the concept of the “business plan”, which is the biggest thing getting in the way of small businesses doing any active planning. They think of a formal, detailed document that seems too onerous for little perceived benefit. In fact the format doesn't matter (when planning for yourself) and just needs to be usable for your business: one-page, spreadsheets, mind maps, documents, milestones or whatever works for you. In this context, the purpose of planning is not to create a perfect document, it's the research, review, discussion and analysis the adds value. It's the setting of goals, targets and milestones, of knowing what a new business owner is getting themselves in for. Reframing the discussion around business planning as an activity changes the focus to an active, ongoing process rather than a single activity.

In other types of planning, such as fitness plans or financial plans, different advisors will offer different approaches, all working towards a positive outcome and arguable equally effective. For most small business, being active is better than doing nothing; once proficiency is gained and better practices in place, different methods and advisors will help to optimise results for that business.

There’s no great revolution in the content of business plans, which have very similar content, regardless of the format. More value is added when great consultants, advisors and coaches make business owners live the process, implement their plans and learn to be better at business. But the greatest value is in the average business owner taking on planning as an essential activity.

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