Writing a strategic business plan - Part 1

Business owners should know that a business plan is not written in stone and does not lock you into a set way of doing things.  A business plan is simple a guideline.  A business process or procedure on the other hand is way to do something specific and should be followed, this is often associated with more complex business process development exercises that deal with specific tasks.  A strategic business plan revolves around high level goals and focus of the company or business.  The primary purpose of a business plan is to outline and evaluate of all areas of your business and goals.  Having a well written plan for your business venture will help determine the viability and profitability of your project.

A strategic business plan can be written in many different ways, from very specific to very broad.  They can be 1/2 a page long or a book.  It all depends on the type of business, business style and management style you want to portray.  There is no perfect way to write a plan, it's your plan, write it how you want. 

Writing down a plan is something every person going into business for themselves should do. It doesn't matter if you are thinking about opening a small part time business, small business franchise or if you are considering opening something as complex as a manufacturing plant.  A solid business plan will help you maintain consistency in the business development as a guide to a common goal.  This is especially useful for a first time owner.

One of the biggest misconceptions is that a business plan is unchangeable. If you are the business owner or in a partnership, the only thing that remains constant is change.  Everything in business in a constant flux and continues to change. As part of that change, your plans must change along with it.  When you go into business for yourself there are lots of things that will go better or worse than you expect. You should periodically review and make changes to the plan as market conditions change. A regular review will help keep you on track regardless of varying market conditions.

Do not be afraid to put it all down on paper, many people are afraid that writing it down will lock them into a plan and it doesn't. Many business owners try to avoid this and don't have a valid reason. I do not know of a valid reason not to have some sort of plan in place for any business.  The important of a strategic business plan far outweighs the laziness of not writing one down.

The most common excuse is that people do not want to be held responsible their actions.  Again, this is lazy.  Writing down projections, numbers, expectations gives businesses something to fail against.  Many people don't want to see something fail against a projection, this is the wrong way to think.  You must use the plan as a road map and understand that it is a journey and not a final destination of the business.  A well written business plan will take into account the changes that can and will occur.  Use the strategy of a road map from one city to another.  There are always alternate paths to get to the same location, some are harder then others and some are more profitable then others.  This plan should be able to take that all into consideration and show you the way to success.  There are advantages and disadvantages to any path taken, but knowing what they might be ahead of time and how certain paths can lead to different outcomes will help you guide your new small business in the right direction.

A strategic business plan is a great way of showcasing your small business ideas to investors and finance officers. Venture capitalists, lending institutions and banks normally require some sort of written plan before they will even see you through the door.  When you are meeting with potential investors you can present a well thought out plan of action.  You can demonstrate how the business can develop and how it will get there.  This is a great sales tool and will help you sell your idea to any investor or lender.  Without a plan, you won't have anything to show them and will also look unprofessional.

A business plan is a tool you can use yourself as well. It will help keep you focused on the end game.  By clarifying and defining your goals, methods, strategies and marketing ideas, you will be able to stay on a set course.  Throughout the course of your business plan development you will learn new ways and be able to adjust them as you see fit along the way. 

Not all business plans and ideas are developed by a single person either, you can use your business plans to get ideas and suggestions from friends, relatives and others. Using the your contacts, or other people contacts, such as a business consultant, you can share your ideas with them and by providing a draft or starting point will make it a lot easier to convey your plans with them.  You do not always have to take other peoples advice, but the simple idea that one person may have can shed new light on an existing idea and from there you can use that to go in new directions and streamline your process.  Listen to all ideas from everyone, use them or not, it is up to you.  Listen with an open mind and do not to get emotionally attached to an idea just because it happens to be your idea. Some of the biggest failure in small business start-ups is from people who refuse to accept or even consider the advice of others.  They get caught up in the way they want to do things without seeing a bigger picture.  You might miss a great idea that can double you profits.  You need to be aware of great ideas and suggestions and find a way to incorporate them into your own plan.

In part 2 of writing a strategic business plan, I will go into a little more detail on how you can speed up the process and save a little time and money creating one.