Here’s Why Good Business Planning Takes Hours, not Months 2

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One of the biggest barriers to better business planning is the horribly mistaken and disappointedly common myth that develop a business plan takes months. That’s just wrong. And harmful, too, because it pushes away people who could use planning, but don’t because it takes too much effort. They think.

In the real world, where good managers include planning process in management, and use it to steer their companies, good business planning takes hours, not months. Here’s why:

  1. Planning is about results, not documents.
  2. The plan is what’s going to happen, and when, by whom, and how much; not a document. Form follows function.
  3. A good annual SWOT meeting (strengths, weaknesses, opportunities, and threats) takes an hour or so.
  4. Thinking about strategy is always and often. Writing it down in bullet points takes a few minutes a month.
  5. Maintaining milestones, responsibilities, assignments, deadlines, metrics, and who does what is part of every manager’s job, is management, not plan development. It’s not separate work. It takes a serious commitment of not just time but also effort, honesty, communication … but putting it into the plan takes regular minutes, committed often, in hours (at most), not months.
  6. Keeping your financial projections up to date with actual results, and adjusting them regularly, isn’t a matter of months, just hours.

Think of it like physical fitness, which is a good analogy, because good planning process is management fitness: physical fitness takes minutes, regularly, over a long time. Hours, not months.

About the Author Tim Berry is the founder of Palo Alto Software and Bplans.com. Follow him on Twitter @Timberry. Follow Tim on Google+ Read more »

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  • http://www.morton-morton.com Drmorton

    Sorry Mr. Berry,

    I totally disagree with you and so does the conventional thinking in the business community. Just start with the Small Business Administration. The SBA says that on “average” a good business plan will take around 400 hours to complete. Well, let”s see, most people work around 8 hours a day and that comes to around 160 hours a month and, yes it looks like over 2 months.

    You see Mr. Berry, templates are not business plans. A good business plan requires business experience, education, and detailed compilation with strong research. Investors discount templates everyday because it is a cheap substitute for “value”. If no value is put into a business plan then there cannot be any value taken out of it.

    Have a great day!

    • http://timberry.bplans.com Tim Berry

      Thank you Dr. Morton…

      1. I completely agree with you regarding templates as business plans. Your wording seems to imply that I’m in favor, but I’m not, never have been, and would never suggest investors like them. I hope reading the post above doesn’t make you think I’m advocating templates. Please click those links in the post here for more depth on that subject. I don’t think there’s anything there in favor of templates, and I’ve written a lot, here and elsewhere, about the need for planning, not just a plan; and the reasons not to think business plans are found, or bought, instead of developed by the users — business owners and managers — themselves.
      2. I’m happy to question what you call “conventional thinking” regarding business plans. There are a lot of overused myths on the subject. Conventional thinking is often obsolete. Certainly, the idea of a ponderous formal business plan document, rather than a flexible, just big enough, practical business planning process, is obsolete. And the idea of spending 400 hours, in one big grueling push, is obsolete. Business planning itself is needed now more than ever, because when it’s done right it helps to manage change and steer an organization; but that’s not the idea of the plan document, so often left in a drawer and forgotten.
      3. Business plans are not documents. Documents are outputs of the plan, not the plan. The plan is what’s going to happen, why, when, who’s responsible for what, how much will it cost, how much will it bring in, etc. That document is just output exactly as the pitch, the summary, and so on are just output. There’s a link in the post about that.
      4. Business planning isn’t measured in hours spent, any more than management, leadership, or success. A business plan is measured by results, not hours. And while it is true that at a few hours a month you might end up spending hundreds of hours on business planning if you’re in a long-term successful, growing company, anybody who spends 400 hours just developing a business plan, in one big push, instead of developing a business, is crazy.
      5. As for the SBA having said that, there are tons of diverse opinions on the SBA site, including mine (I’m a blogger there, and present as well in my business planning tutorials series), so I could cite you hundreds and maybe thousands of counter opinions on that site.
      6. As for what makes a good business plan, I agree with you about experience, but not necessarily education and strong research. Here is what I say makes a good business plan, my post on 8 factors that make a good business plan. I thought everybody understands that you don’t measure business quality, much less thinking quality, in hours of input. No? And research is proportional to need. A majority of entrepreneurs have been dealing with their markets for years before they start their business, and don’t need rigorous research because they already know their market. Research is never bad, but can be overkill, expensive, and inefficient.

      I appreciate your comment. Your assumption of what I think bothers me a bit, because it’s certainly not what I’d expect you’d take as my opinion on business planning, but I’m glad for the comment that gives me a chance to address that potential confusion.

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