When somebody mentions business planning we've been conditioned to think about writing a business plan. There are numerous books and articles, tons of application, an army of consultants, plus a multitude government programs to assist you write a business plan. There are practically no sources to help you setup what today's business atmosphere actually demands - a continuous, ongoing planning system.
A commonly accepted theory is the fact that for a business to survive and prosper it has to be versatile and nimble. It has to be in a position to turn on a dime as situations warrant. Obtaining a written five-year plan is not a part of this image. In truth, looking to follow a long-term plan throughout rampant change is just not logical. It truly is applying linear thinking to a non-linear circumstance. It just doesn't operate.
Obtaining a formal, written business plan is so accepted as becoming essential to success that there have not been a lot of studies or surveys to test this premise. If business plans had been such a fantastic factor, there would be a substantial and conclusive distinction involving organizations that have them and these that don't. Interviews of 100 founders of organizations on 1989s "INC 500" list of fastest expanding private businesses in the U.S. located only 28 percent had "full-blown" business plans. The 1993 AT&T Small Business Study found that 59 % of small businesses that grew over the previous two years used a formal business plan. A 1994 survey of the country's fastest developing providers found 23 percent lacked a business plan. "The Relationship among Written Business Plans and the Failure of Small Firms within the U.S.," by Dr. Stephen Perry, surveyed 152 failed and 152 non-failed small businesses in 1997. He found that 64 percent of the non-failed firms had no written business plan. He also located that non-failed firms had more extensive written plans than failed firms, 23 percent compared to 9 percent, respectively.
why not try here - CBM
As you can see the results of research and surveys are all across the board and do not prove anything. Clearly, a significant percentage of successful companies don't have written business plans. None of these studies reveal the nature of the process that created the plan. Was it the result of an annual process with occasional updates or an ongoing, continual process? As Professor Albert Shapero said, "Companies that plan do better than firms that don't, but they never stick to their plan."
The focus needs to be on the PROCESS not on the plan. If a continual, ongoing planning process is in place, a written business plan is just not important. Writing a business plan without a planning method in place is a massive effort that is done very infrequently. A lot of businesses write three to five year plans and update them annually. The plans are reviewed periodically during each year to analyze the plan vs. actual variances. Little, if any, thought is given to strategy in between the annual updates. Strategy should be the focus everyday. Setting up a planning method allows and sometimes forces you to focus on strategy.
A planning method consists of two functions. One is a goal setting and attaining process, and the other is a trend watching or environment scanning process. Setting up a planning technique takes several steps. The first and foremost task is to set aside or make time for planning on a regular, ongoing basis. It should become part of your routine, not an occasional event that can be easily postponed. Within the evaluation phase, the owner or management team and the company are analyzed. From the analysis, key or critical areas of the business are identified. These areas are filtered down to focus on the most important ones. Performance measures are determined and systems to gather and process the necessary data are set up, if needed. A base of current performance is used to set goals.
No comments:
Post a Comment