Planning, done right, is management. The best reason to adopt planning in your business – and I mean any business, from the one-person solopreneur on up – is because it will help you manage your business better.
This is from my post How to Actually Use Your Business Plan to Run Your Business, posted over at the NCR Silver blog. The main point there is a critical point about the purpose of business plans for most business owners:
You may or may not have a business plan for sharing with banks or other lenders. If you do have a plan, are you really using it to manage your business better? And if you don’t, are you missing out? Either way, adopt a powerful business planning process that will turn planning into management.
Good planning process doesn’t take a formal business plan document. You can get most of the benefits from a lean plan combined with good planning process, which means regular reviews and revision.
Contrary to the popular myth, real planning doesn’t require a formal business plan document. If you have that, fine. If you don’t, you don’t have to do a full formal plan to get the benefit of planning. You could do a lean plan, which is just bullet point lists and tables for strategy, tactics, metrics, milestones and essential projections.
I’ve posted here the essentials of the lean plan, most recently with the metaphor of lean business planning as dashboard and GPS for running your business. The rationale for that is fairly simple:
Planning isn’t voided by change; planning manages change. The plan is like a route, and the monthly meetings turn that route into something more like a complete navigation system, with GPS positioning and real-time information on weather and traffic.
The secret is plan vs. actual analysis. That’s looking at the difference, in numbers, between what you had planned and the actual results. You don’t have to be an accountant or financial analyst to do it. You just need common sense, knowing your business and tracking what actually happened and comparing that to was expected.