How to prepare and maintain a business plan

Managing my business

01 July 2014

Top tips for preparing and maintaining your business plan

Experts maintain that a robust business plan and strong leadership can not only position a business towards success, but can also help identify risks and define the resources required for a business to achieve its goals. Yet, while many businesses invest significant time and resources in pursuing business plans, experience tells us that few mid-size companies develop, execute and realise the key elements of their original strategies. Over time, the observation of mid-size Australian companies has revealed certain trends in business planning. Here are the top four tips for business leaders looking to prepare their business plan.

1. If you don’t have a plan, get one – soon

The smaller the business, the less likely it is to have a developed business plan. In fact, recent findings from a Bankwest Future of Business Series report revealed more than half of businesses categorised in the ‘growth phase’ said they did not have, were not sure about or still intended to develop a formal strategic plan.

Planning is an investment, and like any investment, great care and attention must be made to ensure positive outcomes are achieved. To this end, great business leaders do not always make great planners. It is crucial for all business leaders to critically evaluate their planning skills and either adapt their planning style or surround themselves with ‘detail experts’ to ensure the success of the business is maintained and grown.

2. Make the plan succinct

Too many businesses see planning as a one-off activity, facilitated by a consultant, which leads to the production of a phonebook-sized document gathering dust on the shelf.

Similarly, business leaders are told they should spend hours developing vision and mission statements for their companies. However, while there is value in developing a well-defined vision for your business, it is essential that it aligns with the ‘lived values’ of your staff in their work life.

Business leaders must be able to synthesise their business plan to a maximum of five pages – Where are we now? Where do we want to get to? How do we get there? These are the fundamental questions of strategy that will play out at an operational level through budgets, organisational charts and other tactical implications.

3. Review, challenge and edit the plan on a regular basis

The majority of respondents in the Bankwest Future of Business Series report believe their business is flexible enough to deal with challenges that could disrupt its overall direction, with 45.9 per cent saying their business is flexible and 12.9 per cent saying it is very flexible. Planning is a dynamic process; it is a ‘living’ part of the organisation and should be regularly reviewed, assessed and changed to match the evolving requirements of modern business.

4. Align the plan with the culture and performance of the company

Lastly, in assessing the questions above, leaders and executives in mid-size businesses need to ‘own’ their plan. The Bankwest Future of Business Series report found more than seven out of 10 respondents said planning is very important to effective leadership. Further, three in five said leading as a role model to foster ownership of common values and goals is the most effective strategy.

Once a business ‘road map’ has been developed, a company has direction and distance totheir goals. Perhaps just as importantly, it can identify ‘speed bumps’ or risks to the plan, and the resources needed to achieve its goals. It has often been said, “That people don’t plan to fail, they fail to plan.” Strategy and planning can help to identify and mitigate a range of risks that would otherwise damage or destroy a company’s perceived and real value. Furthermore, they can ensure your business is well positioned to take advantage of any opportunities.

Mark McConnell is a serial entrepreneur and mid-market expert.

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Mark McConnell

Mark McConnell
Serial Entrepreneur and Mid-market Expert

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