Good business planning process: ready, set, revise

Doug May
Doug May

Most of my columns this year have focused on developing business plans to help entrepreneurs achieve their visions of success.

As with the individuals with whom we help to prepare personal financial plans, a printed “plan” sitting on a shelf is worthless. It’s the process of planning that’s most helpful.

The final step is to prepare the executive summary — the bottom line of this passion you call a business.

The executive summary is the alpha and omega of the planning process. While the summary is the first thing readers see, it’s the last thing entrepreneurs write. The summary is an elongated elevator pitch written to communicate, reiterate and engage the community in your idea — it both sets the stage and closes the sale.

Matt Mayer, co-founder of Footbeat, a local medical device maker, uses his plan to cement his pitch. “We started Footbeat to save a million lives,” Matt said.  That objective has been clear since Day 1.  “When we first meet people, they are intrigued by the goal. They want to know how we’re going to meet that big, hairy, audacious goal.  After they’ve read the plan, that goal inspires people to want to work with us.”

The executive summary lays out the core mission and general strategy. With a successful business, the summary probably won’t change a lot. Individual strategies come and go as leaders learn how to be more successful. The overall business plan needs constant updating, but the executive summary is so fundamental it should remain consistent.

In the past, I’ve actually used my business plan as a tool to brainstorm ideas that change strategy. Realizing that resources are limited and success is often a function of focus, I limited the number of marketing ideas incorporated into my plan. I identified 10 marketing strategies used to move my business forward. In retrospect, I probably should have cut that back to five. The point is this: If you spread yourself too thin, you won’t have time to do a good job on any of them.

A couple times a year, I discard marketing ideas that aren’t being implemented well or don’t seem to be working. Then I reach down into my grab bag of potential marketing ideas and incorporate a new strategy.  In other words, the business plan constitutes a working document.  The important thing is to see the plan as written in pencil and give yourself and key staff members permission to suggest revisions as appropriate. Healthy organizations are learning organisms. What good is experience if you can’t integrate new ideas into how the business is run?

The planning process is something like this: ready, set, revise. The plan is not a completed, authoritative encyclopedia of how the future will unfold. That would take a crystal ball. You can’t write the perfect plan, put it up on a shelf and expect it to result in business success.  The plan will help a business succeed only because it’s regularly used to get people moving in the same direction while at the same time being constantly updated to account for dynamic markets, organizational experience and technological improvements.

It’s the same with our individual clients. We start with a vision of success and create a set of strategies likely to give us our intended result. Then, as markets change, careers ebb and flow and health challenges arise, we update the plan based on what we’ve learned.

As with the business planning process we’ve been discussing, we need to understand each client’s finances to completely understand the key economic drivers in each situation and stress test the plan based on known risk factors.

Finally, but rarely done, the plan should be shared with key advisors. Your attorney and accountant should be able to use it to understand your big picture so they can tailor their advice to your unique plans and objectives.  Success often requires your family and perhaps friends to play their part, too.  If so, it wouldn’t hurt to bring them in on the picture early.

It’s important to plan to prosper. Just as there are many businesses that succeed without a formal business plan, there are individuals whose cavalier attitudes toward planning hasn’t prevented them from living the good life.  In the grand scheme of things, however, planning will help increase the probability you’ll achieve your goals, whether business or personal. To borrow a phrase from Nike, just do it.