It’s no surprise that I am a big believer in the advantages of planning and preparing strategic plans, business plans and budgets.
It’s the process of planning and how it helps you to clarify your thoughts and see problems and weaknesses in advance which is often more important than the plan itself although it can be very valuable to capture your thoughts and assumptions in writing. Your memory can play funny tricks.
But I find that many small business owners are confused about planning and because they are confused, they either don’t do it or their plans don’t help them as much as they can.
And because they don’t plan, actions taken don’t produce the results expected.
There’s a fine balance between thinking and doing.
Too much thinking and not enough doing means that you don’t make the progress you want. I met one lady who had spent five years planning here business without ever trying to take it to market and proving the concept – and she wanted me to help her do more planning. I decided not to play.
Too much doing without thinking means that precious resources (time and money) are squandered. I’ve known plenty of people who leap into a new marketing campaign without taking 30 to 60 minutes thinking about what they want to achieve and why potential customers should take action.
There are five types of planning suitable for small businesses:
- A strategic plan – this answers the big questions about how and where you are going to compete and keeps you focused on the 3 big business risks.
- A business plan – which is written to attract resources from third parties, usually loans from a bank or equity finance from venture capitalists. The purpose of a business plan is to “sell” your business idea and provide sufficient credible proof that people want to become involved.
- A budget or annual operating plan – this is a detailed plan of action for the next year with numbers that you’ll be using to compare your business performance against.
- A project plan – a very detailed action plan to implement one particular project.
- A one-page campaign marketing plan – I really like the idea in Guerrilla marketing that you can quickly create a winning campaign by thinking through and answering a few carefully chosen questions.
Confusion happens when you mix up these five types of plan or think that one plan will serve for all five purposes.
Here are some quotes about planning which help reinforce the advantages of planning:
“Planning is bringing the future into the present so that you can do something about it now” (Alan Lakein)
“Let our advance worrying become advance thinking and planning” (Winston Churchill)
“Good fortune is what happens when opportunity meets with planning.” (Thomas Edison)
“Plans are only good intentions unless they immediately degenerate into hard work.” (Peter Drucker)
“In preparing for battle I have always found that plans are useless, but planning is indispensable.” (Dwight Eisenhower)
Planning is thinking about the future – what could be, should be, may be – and turning it into the actions which will help you to create the future you want.
Planning is the start but not the end.
Successful action must follow the planning stage so your plan needs to have your commitment.
There’s a useful acronym, SMART which helps you to create the right kind of action focused goals:
- Specific – be clear on what it is you will do and achieve
- Measurable – so you can be certain you’ve succeeded
- Achievable – your goals should stretch you but not overwhelm you.
- Relevant – to your bigger objectives
- Time bound – to create some urgency. Even with a great plan, day-to-day problems can mean you delay what it is important for you to do today.