Steven Bartlett (of Dragons' Den fame) says he's never had a business plan. A number of other business commentators say the same; that business plans are unnecessary.

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Well it's true to some extent. You don't always need a business plan but...

 

There are times when you do

 

Here's when:

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• Going into business with a partner: So you're clear about who is responsible for what. A business plan can force you to formalise what you’ll need, what effort will be required, how much money to invest and how much of your time will be absorbed. Plus other critical factors to get you organised. In many ways, it can act as the basis of a shareholders' agreement.

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• Raising funding from external investors: Quite simply because they'll use your business plan to help decide if your company's worth investing in. And to know what you'd do with the money they give you. This is why every investor (and some lenders) ask for one.

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• To help keep you focused: If you struggle to keep your strategy and goals in mind while you're running your company day to day, a business plan may help. It can serve as a guide, reminding you of your ultimate goal and the path you plan to take to get there.

 

If you're not in any of these positions, you may want to save the time and instead invest your efforts elsewhere.

 

But — for those times when you don't have a business plan, this is what you need...

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• A clear, logical and executable strategy

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• An effective, operational business planning processto convert your high-level strategy into near-term action points

 

And it doesn't need to involve a lot of effort.

 

Your strategy can be as simple as a few bullet points. But what it should include is:

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1. The opportunity in your market

2. The needs and desires of the target customer niche that you aim to serve

3. The nature and strength of the competition you face

4. The distinctive skills or capabilities your business has relative to your competitors; and

5. How you can turn these skills and attributes into a distinctive product or service that delivers compelling benefits to your target customer which (importantly) they value

 

You may want to include additional information depending on what's significant for your unique business circumstances. For example, how you manufacture, market and distribute your product or service or the particular skills your staff need.

 

Once you have your strategy, you can then work on your operational business planning process. As mentioned, this should translate your high-level strategy into shorter-term action points.

 

In other words, it should set out what you're going to do in the next month or quarter to put your strategy into action.

 

Here's what it might include:

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1. Your business development initiatives, e.g. new products or services, new marketing campaigns, other ways you'll capture new sales, etc.

2. Staff hiring and retention plans

3. Cost cutting initiatives

4. Efficiency measures

5. Cash flow planning

 

In simple terms, it should be your list of the key corporate action items that will move you forward towards your goals.

 

And never forget:

 

Strategy and planning are dynamic and never static

 

They evolve constantly because your market is always changing. So if you want to stay ahead of your competition and realise your ambitions, keeping your strategy and business planning up to date is vital. Always being prepared and ready to adapt can only be to your advantage.

 

If you need help getting started, feel free to get in touch.

 

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Image credit: Freepik