Before a month, I see an interview with Mark Zuckerback the founder and CEO of Facebook on BusinessInsider.com . In this interview Mark Zuckerberg tells that they don’t need, and also don’t have a time to write formal business plans. The same I’ve experienced in practice. Whilst each book about entrepreneurship that I’ve been read tell me about full formalization of the business plan, I’ve made a mistake several years ago as I was starting a business. Such theory which I call “Plan your business plan” is completely wrong and in some cases diametrically contradicted to the practice.
My Bad Experience
When I start a business I had a business idea and sat down to write a business plan. And I write it very well. It looked very good with different color charts, analysis, tables… I was really proud of myself for my success in making a business plan. But, when I re-read the plan I wanted to improve and make modifications. Well, it looks great. I must mention that the business plan wasn’t required to find funds from a financial organization or a business plan competition, but it was needed only as a roadmap or guideline about growing my new business in the next 3 years. I forgot that I should stop dreaming and start with real actions. I spent several months in which I always have something to improve in the business plan and business normally didn’t start. After several months, I’ve been realized that my very well written business plan with colorized graphics, charts and tables don’t have practical value. That business plan ended up in the garbage.
After that I sat down and made a new business plan. The new business plan doesn’t look so good as a previous that finished in garbage with color graphics, titles and contents, abstracts… But with this new one I started the business, things have moved on ahead. And after one month of the new business plan the business began to bring revenue in my pocket. That business plan was simply composed of:
- Actions that I need to fulfill in that period of time – dashed style.
- What is missing in the market – also dashed style.
- How much money I have and how much I will spend on the startup level of my business.
- What I will apply as marketing weapons in the first and second year as a strategy – also under the dashes.
This was enough and now that business operates well and brings income.
Dangers That Come With Plan Your Business Plan
I will abstract three important dangers:
- Plan your business plan if you want never to start your business. The very first sentence says something inefficient and ineffective. Why we must make something twice? Plan to plan!! It’s nonsense. Planning as a verb is an activity for the preparation of future action steps. And if you intend to plan, and you plan to plan and again plan to plan … That’s a dangerous circle that never ended.
- Too much thinking takes too much time. Planning requires thinking of what tomorrow will bring. If we stuck with this thinking of tomorrow, then tomorrow will come, and we will need to re-think the future tomorrows.
- Too much planning, less time for implementation. If we lose too much time in planning we’ll reduce the time for implementation. Someone will tell if we have a better plan the implementation steps, we can spend less time in respect of the implementation. However, this isn’t a simple math. That’s theory of probability that deals with random events. One thing is sure enough, we can never be 100% sure about what the future would look like. If the business idea is really worth running,we don’t have a time because as we have an idea now, also someone else has a similar idea.
Recommendations Instead Conclusion …
- The business plan is needed because it’s the only instrument that can transform business potential energy stored in the business idea into business kinetic energy. However, the type of the business plan will depend upon the purpose of that business plan.
- Avoid templates. I have a lot templates that I found on the internet. However, my bad experience tells me that nobody can make a better plan than the entrepreneur alone.
- Be specific as you can in the business plan. With this we can easily compare real results with the planned.
- Make it simple and understandable primarily for you and your employees. However, you’re the only ones who will deal with implementation.
- Formalize only when you compete for finances at the financial organization, or if you participate in a business plan competition. In such a case when it came time for realization adjust it to your needs. However, you as an entrepreneur is the central figure in your business.
- Let your business plan serve as a roadmap for you and movement of your business.
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