There’s a tendency to think business plans are only necessary for starting a business, satisfying a board requirement or applying for loans, but they are vital for running your business, growing your business and exiting your business. Perhaps Benjamin Franklin put it best, “If you fail to plan, you are planning to fail.” Writing a business plan allows you to think realistically and objectively about your business and consider its place in the market. It also more clearly communicate your objectives, strategies, and competitive advantages to others.
Here are the essential questions you should ask of everyone in your company:
1. What business are we in?
A friend of mine is fond of reminding her clients that they are in the lawn business not the grass seed business. You do what you do so your customer can have a great lawn, grass seed is merely the means to get there.
2. What is the vision and mission of the company?
This builds on the previous question, and should be a concise statement that everyone in your business knows by heart.
3. Who is our customer?
Who makes the decision to buy your product or service? Who needs your product or service? Who have been your customers in the past and who will they be in the future?
4. What does our customer value?
Is it the lush green attractive lawn, or the prestige of having the best looking lawn on the street, or a durable play area for the dogs and kids? Talk to the customer and research what the customer values.
5. What is our target market?
This requires more analysis, evaluating and tabulating to discover who needs to hear your message. Who are you reaching today, who should be on your target list and who shouldn’t.
6. What products and services do we provide?
Are you offering the products or services your customer needs or wants? Are there gaps in what you’re offering? Are you offering products or services nobody wants, or perhaps nobody will want tomorrow? This is really a question about innovation.
7. What is our sales and marketing strategy?
Customers need to know what you offer; your number one job is creating customers. How do you drive them to you site or storefront? They will fork over the dollars if you fill their need or want.
8. Who is our competition?
While you are studying the marketplace, take stock of who is selling lawns and who is selling grass seed. Who is chasing the same target market, what are they doing and how successful are they? What distinguishes you from the competition?
9. Who do we have? Who do we need? How do we find more of the right people?
All organizations are built around people—having the “right people in the right seats” is critical, not just to current productivity, but to the future viability of the organization whether you plan to expand or exit. Consider all levels: leadership and management, product and project management, accounts and sales, production and key support departments.
10. How will we on-board, train and develop new people?
Development requires management time and dollars and is critical to leverage your investment in new people and retaining current people. This is your people maintenance budget, and cutting it has the same effect on your bottom line as cutting out oil changes and new tires for your car.
11. Do we have the physical plant and equipment we will need?
Requirements for people, profits and production will likely require more or different resources than you have today.
12. Do we have the capital we need? Will we generate the profits we need?
Solid financial data and projections are still important!
13. How will we measure our success?
Organizations must track data about quality, customer needs, delivery times and other non-financial information that often is predictive of financial results.
14. What is our exit strategy?
Every company needs to ask this question, but it is especially important for small and closely held companies.
15. What are our short and long-term goals?
Organizations often start with this question—but you cannot produce an effective plan without considering the preceding questions. Your goals need be action-oriented, and time-bound with specific targets or measures so that you can tell when you have arrived!
STM has an experienced staff that can work with you one-on-one or help facilitate planning sessions with your team. We will help you draft a planning document and will work with you in the critical communication phase of the planning process. We can also assist with project management to implement your plan.
Get on with it!
Need Help with Your Business Plan?
Ready to start writing your business plan? Need help answering the questions in this post? Strategic Talent Management has you covered!