Paul Tiffany - Business Plans For Dummies

A new start-up: If your business is just out of the blocks or about to launch, then there’s no question that the key founder(s) has to do the work. That means you. But don’t fret: Who better to create a view of the future and set business goals and objectives than the person responsible for reaching the goals and making the future happen?

Small businesses: If your business is only yourself and a couple of other colleagues, making a plan for the company is your responsibility. You might have one or more trusted insiders or external mentors who can offer wisdom, but in reality, something as critical as a business plan can’t be outsourced. Own it.

Medium-size companies: If your company is a bit bigger, the process of creating your written plan requires more organization — and more people. Putting together a plan is a big job, and involving all your key people has a certain advantage: Everyone involved in the plan has a stake in making sure that your company succeeds. And they will appreciate the inclusion.

Large corporations: If you’re part of a big company, you may need to bring in people who work on business planning full-time, if they’re not already there. Make certain, however, that you don’t create an independent planning staff: You don’t want your plan to take on a life of its own and get completely divorced from what’s happening with your business and those who make the day-to-day decisions. You have to make sure that your planners don’t create the plan all by themselves. Your planning staff should always work alongside the managers and owners who actually have to execute the business plan. (See Chapters 16and 17for details on implementation.)

Putting together a business plan resembles any project that involves teamwork, from building a house to running a relay race. The clearer the ground rules, the smoother the process — and the happier your team. Make sure that your ground rules do three things:

Identify key steps. Typically, the process of writing a business plan includes five distinct steps: research, first draft, review, revised draft, and final review. You can specify as many or as few of these steps as you think you need. Just make sure that you spell them out up front.

Clearly assign duties. Everyone involved needs to know exactly what you expect from them. You can use the key steps you identify to create separate sets of tasks, and then you assign each task to members of your team (see the next section).

Establish a schedule. Although writing up a business plan is a big job, the process doesn’t need to be a long and drawn-out affair. A business plan has to be timely, responding to the current business environment — not the way it looked six months ago. After you complete the preliminary research, the rest of the steps are fairly straightforward. To keep your project on track, set specific due dates for each component of the plan and each step in the process. Assign the members of your team as much time as they reasonably need, but no more, and be fair but forceful in having them meet deadlines.

If your company is large enough to boast a management team, you should divvy up the work involved in putting together your written business plan. We’re not suggesting that you delegate responsibility just to make your job easier (although it certainly does). Different people bring different insights to your plan. With a team in place, you have a wider array of people and perspectives ready to read and review drafts, offer suggestions, and fine-tune the document to make it as good as you possibly can.

We can’t give you a simple formula for putting together your team. Every business is different. We can’t even tell you the ideal number of people to choose — that depends on the size of your company and the complexity of your plan. But here are a few tips that can help you create an efficient and effective team:

Keep your team lean and mean. Too many planners are like too many chefs in the kitchen — they get in each other’s way. A bloated team can mean endless meetings and too many points of view. Involve only the number of people you think you really need to get the job done.

Appoint people who want the job. Sure, you may have trouble finding volunteers who jump up and down at the chance to work on a business plan. But you need to make sure that whoever you choose is at least willing and able to complete the task. To spark your people’s enthusiasm, take time to explain why creating a written business plan is so important. See Chapter 2if you need help convincing your team of the importance of a plan.

Organize your team around the plan. By accomplishing this, you make sure that your people know the purpose of their task and how their work fits into the larger picture. Some of the assignments are straightforward. Your financial person takes charge of the financial review. Your marketing head puts together the customer segmentation section. However, if certain pieces of the plan are more complex than others or require tight coordination among units, think about assigning a small group to work on them.

Put one person in charge. Keeping track of the whole process can be a job in itself, especially if you have a large team or a complicated plan. Name one person as the project director to manage the team and ensure that employees complete tasks on schedule. Make sure every person on the team understands that the person you choose has the ultimate authority.

Appoint a wordsmith. A business plan is a written document. If you’re lucky, you have someone on your team who enjoys writing — or at least has the talent to put words down on paper with clarity. Pick a lucky person to be in charge of writing key sections of your plan, such as the executive summary. They can also serve as senior plan editor, checking grammar and spelling and making sure that the writing style is clear and consistent throughout the plan.

When you first set out to create a business plan, the task seems overwhelming. Right off the bat, you need to answer fundamental and sometimes difficult questions about your company and what you see for the future. You have to decide what targets to aim for as you look ahead and set specific business goals and objectives. To succeed, you have to take the time to know your

Industry

Customers

Competitors

Company resources

Company’s unique qualities

Company’s advantages

Basic financial condition

Financial forecast and a budget

You also have to prepare for changes you will make to this list down the road. That means thinking through other options and alternatives and being on the lookout for new ways to make your company prosper. Few business plans ever pan out according to the first cut, so the more you can build flexibility into it, the better.

You don’t want to scare people — yourself included — with a giant written plan. The longer your plan is, in fact, the less likely people are to read it. Ideally, your written plan should be 15 or 20 pages maximum. You might even consider putting the whole thing into a PowerPoint format, knowing you can support the main bullet points with all the exhibits, appendixes, and references that you think it needs, along with a brief written summary if desired. If you want to glance at a sample business plan, check out the Appendix.