Whilst there’s no doubt that business plans can sometimes fail, the reasons for this are usually linked to the development or execution of the plan, rather than the notion of business planning itself.
By the same token, we also see business owners “scared” into writing a business plan, pushed along by the old adage that “businesses don’t plan to fail, they fail to plan.”
So the question then becomes, why do some business plans reap great outcomes for the company, and others fall in a heap?
Reload Consulting’s IMF approach to business planning looks at three core elements in determining whether a business plan will be successful or not.
Arguably the most critical element to any business plan is innovation. If the business plan you’re writing doesn’t change anything, if it doesn’t propose something that sets you apart from your competitors, then why did you bother writing it in the first place?
Innovation also doesn’t need to involve massive R&D expenditures, or involve a complete company-wide shift in market alignment, but can simply be something that is different. This can mean something different to what you’re doing now, or something different to what your competitors are doing.
The second part to making a business plan successful is momentum. Even whilst you’re still writing the plan, there needs to be “quick wins” that occur along the way to create momentum.
If you sit around waiting to completely finish the plan before starting to implement anything, then it’s more than likely it will never be fully implemented.
You’d be surprised by the number of times I’ve heard business owners say the words “but that’s not what it says to do in the business plan” or “the business plan says we don’t need to do that until later this year.”
A business plan is normally written at a given point in time, using the best available information to lay out the game plan of the business moving forward. However, sometimes things need to change, either because an opportunity comes along that’s too good to pass up or a new threat emerges that must be dealt with quickly.
Either way, the successful business plans are those that are flexible enough to be modified if the game changes.