I notice many entrepreneurs have challenges with this topic called “business plan”.
3 out of 10 business owners do not have a documented business plan for many reasons. Firstly, it’s in their heads! I am told they have a business plan, but it’s not written down anywhere. Sometimes, that’s the reason why they are working the hardest. Secondly, some business owners do not feel there is a need for a plan, because its business as usual. We are not implementing any new strategies, we seem to be going with the flow, hence a 12-month plan may not be needed. As a Business Advisor, this is a big no-no. Regardless of what industry you are in, having a plan of execution is non-negotiable.
So, how do you know when you have a good and actionable business plan?
I have listed down the specifics, and if you need someone to look at your plan with you, do give us a holler, and we’d be happy to do that with you.
- A Plan is on a 1-pager
This is hard to do. Entrepreneurs are too used to writing complex business plans. Perhaps we were trained in school, and we think more details are better. I do agree that you should have backup information and data, that supports your plan. However, your action plan should sit on a 1-page view, with High-level Milestones, Timelines, and Persons-in-charge. That way, it is easy to review, keep track, and monitor progress. If your business plan is 30 pages, there will be difficult keeping track of your results and action items.
- Clear Strategy & Tactics
A business plan should have clarity on what needs to be implemented and differentiates the strategy and tactic. A strategy is a broad idea of what you want to achieve in the year. For example, 3 strategies for an F&B business this year is to reduce food cost, increase customer happiness, and train the team. This is purely strategy, not tactic. Let’s follow up with tactics now. Tactics for reducing food cost would be, (1) measuring food wastage daily, and (2) reviewing new suppliers. Tactics are a specific action, while strategies are the broad stroke of the effect you want to have on your business. A lot of business plans are not actionable because they contain strategies, without clear tactics.
- Orientate your Business Plan toward a Timeline
Gearing your plans toward a timeline makes the plan more realistic. Some entrepreneurs set plans, that merely fail from the stage of conceptualization because the plan can’t be implemented. When a plan has a timeline, it also makes the tasks more intentional because it needs to be specific, so that it’s not an airy-fairy fluffy hope-to-do, without strategizing exactly what needs to be done.
- Having PICs for every Strategy & Task
A PIC is a Person-In-Charge. This creates ownership on the task, and this person is like the Project Manager, and his/her job is to drive the milestones forward and keep following up with results. Does this person do the job themselves? NO – their job is to project manage, and keep ensuring the project has follow-up actions, and it generates results for the organization. They have to rally their team to make their projects happen.
- Quarterly Reviews by the Team
Solid and executable business plans engage the team. Poor business plans belong to just the business owner. An actionable plan undergoes quarterly checkpoints where everybody goes “STOP”, BREATHE and they get together and review what happened over the quarter that passed. After that, they start deciding what goes on in the next quarter.
- Plans are Flexible & Adjustable
Flexibility is more powerful than being rigid in the name of the business. Almost never, and never does anything ALWAYS go according to plan, in the journey of entrepreneurship. I believe that strategies and plans can be flexible, but we do our best as leaders to maintain the goal post. For example, you can change marketing strategies in getting more customers, but do your best to maintain your sales target for the year.
This is one of many principles, but I talk much in detail on how to overcome the hurdles of an average business, in this article. Check out my article “Are You Tired of Running a Mediocre Business: Seven Success Principles that Differentiate GREAT Businesses from Mediocre Ones”
I cover these in detail accompanied with real examples and how to execute your business plan well. Click here to find out more.