If You Don't Plan, You Plan to Fail

“A goal without a plan is just a wish.”

I have talked about planning here before, but I continue to run into small business owners who seemingly just don’t get it. They don’t plan because they don’t see the value in it. So I continue to hammer away at it in hopes that the lights will come on and they will finally “get it.”

Think of a driving vacation. You can get in the car and start driving, hoping you end up someplace you’ll enjoy. Or, you can plan your trip, deciding where you want to be at the end of each day, what you want to see and do, and what your ultimate destination will be. If your goal is to have a fun vacation, which method is more likely get that result? Jump in the car and hope for the best, or plan it out?

Does a plan guarantee you’ll hit your goal? Of course not. But it does guarantee you’ll come a lot closer to your goal than you will if you try to just wing it.

We used to talk about 3-year and 5-year plans, but business conditions are changing so fast that it’s questionable how useful those longer term plans are. However, you should have some over-arching goal (i.e., we’re a $5 million company and we want to become a $20 million company). Then each annual plan should move you down that growth path at a pace that gets you there within an acceptable time frame.

Many companies refer to their annual plan as a budget. I suggest you lose that term in your corporate culture and substitute “profit plan.” “Budget” sounds confining, restrictive, and it’s there to restrain our spending. “Profit plan” is more positive, and it’s more descriptive of what we’re doing. It’s saying, “Here is the profit we expect to make this year, and here is how we intend to do it.”

If you’re not already doing it, start building annual profit plans that move you toward your long-term goal(s). If you embrace each year’s plan and really work it as a management tool, your company will move more sure-footedly and more profitably down the road you have chosen for it. Guaranteed.

For more small business blogs, visit my website at www.rocksolidbizdevelopment.com.

Planning Isn't Optional

“The nicest thing about not planning is that failure always comes as a complete surprise and is not preceded by a period of worry and desperation.”

Many small business owners do not engage in any real, substantive planning activities, even though planning will do more to move the business forward than anything else they can do. This is often because:

a) they are so busy putting out the fires of today that they don’t have time to worry about tomorrow, or
b) they believe it is a waste of time to produce a plan document that will sit on a shelf collecting dust and never play a meaningful role in the management of the business.

The most successful business people find time for planning despite the daily fires that need to be put out, and these leaders insist that the results of the planning regimen become an essential tool for making decisions and managing the business. It’s not an either/or proposition. It’s both. We’re going to put out today’s fires and execute a plan for tomorrow.

The planning process need not, should not, be a complex, onerous task. It’s a simple activity that defines where we want to go as a company, where we are now, the steps needed to get us where we want to go, and a timeline for accomplishing those steps. That’s it.

If your company does not do any serious planning, start now. If you need help with your planning process, go get it. Your business will travel down a path of some kind. The only question is, will your business travel down a path toward the destination you have chosen for it? Or will it go down a path random circumstances have imposed upon it and lead to . . . where? The answer should be obvious.

For more small business blogs, visit my website at www.rocksolidbizdevelopment.com.