When someone mentions business planning we have been conditioned to think about writing a business plan to. There are hundreds of books and articles, tons of software, an army of consultants, and help a variety of state programs, write a business plan. There is virtually no resources to help you set up, which calls for the current business environment really is - a continuous, ongoing planning system.
A widely accepted theory is that for a> Company to survive and thrive, they need to be flexible and nimble. It must relate to one cent, as do the conditions to guarantee. Having a written five-year plan is not part of the picture. In fact, trying to follow a long term plan during rampant change is not logical. It is applying linear thinking to a non-linear situation. It does not work.
After a formal written business plan will be recognized as critical to the success of which there are not many studies or surveysTest this premise. If business plans were such a wonderful thing, there was a significant difference between consistent and companies that they have and those who do not. Interviews of 100 founders of companies on 1989s "INC 500" list of fastest growing private companies in the U.S. found only 28 percent had "blown" business plans. The 1993 AT & T Small Business Study found that 59 percent of small companies in the past two years grown useda formal business plan. A survey in 1994 found the fastest growing companies in the country, 23 percent lacked a business plan. "The Relationship between Written Business Plans and the failure of small businesses in the U.S.," by Dr. Stephen Perry, surveyed 152 failed and 152 non-failed small businesses in 1997. He found that 64 percent of non-failed firms had no written business plan. He also found that companies had about more than detailed written plansfailed firms, 23 percent compared to 9 percent.
As you can see the results of studies and surveys to be proved on the whole line and nothing. Clearly, a significant part of the successful companies have not written business plans. None of these studies show the nature of the process that created the plan. Was it an annual process with occasional updates or an ongoing, continuous process outcome? As Professor Albert Shapero said: "Companiesthis plan even better than companies that do not, but they never in their plan. "
The focus is not on the process on the plan. When a continuous, ongoing planning is usually a written business plan is not just important. Writing a business plan without a planning system is in place, a massive effort that is done very rarely. Many businesses write three to five year plans and update annually. The plans will be reviewed periodically during each yearanalyze, is the plan-vs. deviations. Little, if any, is given as a strategy of annual updates. Strategy should be the focus every day. Allows the establishment of a planning system, and sometimes forces you to concentrate on the strategy.
A planning system has two functions. One is a setting of objectives and procedures to achieve, and the other is observed trend or environmental scan. The establishment of a planning system is carried out in several steps. The first and most important task is to eliminate ortime for planning on a regular, ongoing basis. It must become a part of your everyday life, not an occasional event that will be easily moved. In the evaluation phase, the owner or management team and the company analyzed. Be identified from the analysis, keys and other critical areas of the company. These areas are filtered down to the most concentrated. Performance measures are identified and established systems for collecting and processing the necessary data when needed. A basiscurrent performance is used to set goals.
Now is the regular starting running order. Strategies formulated, tested, implemented, monitored and reviewed to achieve the objectives. Watch Any planning session between the work on strategies and trends split. As goals are reached, begins the aim and the strategy formulation process again.
If we put the focus back where it belongs on continuous, ongoing planning activities which, instead of writing business plans. As Karl Albrechtwrote in his book Corporate Radar, "The majority is not always right, the conventional wisdom is not always wise, and the recognized doctrine could be faulty. The more fashionable an idea, the more it is likely to be excluded from critical evaluation. Breakthrough thinking sometimes calls contrary to the widespread assumptions and beliefs. "
Copyright 2005 David Coffman
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