Business Plan Resources - The Small Business Plan - Seven Critical Components
by Peter McLean
The effective and successful small business owner works to a well thought through small business plan. This plan outlines and documents the key business objectives, benchmarks and performance measures that must be met.
A good small business plan is the result of having first conducted a thorough Strategy Formulation exercise. The ability to think strategically is one of the qualities of good leadership that all successful business owners and entrepreneurs should possess as part of their repertoire.
Strategy Formulation is a fundamental process that identifies the critical areas to be addressed and sets the priorities for the business across an agreed strategy period.
By focusing on the key areas that are identified as part of this process, the effective manager and business owner ensures laser-like focus in achieving results.
The small business plan integrates and aligns all the business activities around these critical areas and ensures that all effort is targeted, contained and understood by everyone in the business.
Having a plan is critical. It ensures that the right things get done, within the time frames allotted, and allows for the emergence of new initiatives when the plan is reviewed.
This review period should be in keeping with the rates of change that the business encounters around the factors experienced in both its internal and external environments.
Given that this is clearly understood, and that any gaps in capability have been identified, the small business plan is written with seven critical components in mind.
1. Determine Where You Are Now
This is simply a list that identifies and spells out where the business currently finds itself in relation to a particular critical issue. An example might be sales and marketing, for instance. The list, in bullet point form, spells out what is being done, at present, in relation to these activities. All critical issues facing the business should be analyzed, in turn.
2. Project Where You Want to Be Across the Time Frame
This is a second list that identifies where the business should be, in relation to the critical issue being addressed. Using the same example of sales and marketing as above, this list spells out what the "end picture" should look like in relation to these activities, across the business plan time frame.
By analyzing the gaps between the two lists we have created, we are able to identify the main objectives that must be achieved to fulfill our vision across the agreed time frame. These gaps must be managed well as part of the business performance management process and the business development and risk management profile.
Objectives must be broken down into a series of tasks and jobs that need to be completed to ensure that the given objective is met. These tasks must be specific, agreed, realistic, targeted and have accountabilities and responsibilities clearly assigned to them.
Tasks should be made into "bite-sized" pieces. Once this is done and each task is completed, it will unerringly lead to the objective being achieved, and everyone can see how their particular task and its completion fit into the bigger strategic picture.
All of the tasks assigned must have strict deadlines that are agreed and adhered to by all people involved. Keeping each other accountable is an important dimension in pushing for high performance in the effective and successful small business. Interrelated tasks must be identified, and critical paths for their completion established.
6. Accountabilities and Responsibilities
All the tasks must be assigned to people who take responsibility for getting them completed within the agreed time frames. The successful small business has developed a culture where the taking of personal responsibility for an assigned task is simply a given.
All of the objectives and tasks spelled out in a business plan will quite likely have glitches arise as part of the implementation of the plan. Part of a successful business plan roll-out includes keeping a regular, updating reporting mechanism in place, so that potential problems can be addressed and emerging opportunities can be exploited. Therefore, follow-up and reporting must be conducted on a regular basis to ensure the success of the plan.
Small business plans are nothing more than ordered common sense. A plan makes sure that the right things get done, in the right way and in the right sequence. Effective small business owners have a business plan, and everyone in their business knows exactly the part they play in ensuring its success.
Peter McLean is a highly experienced Coach, Senior Manager, Consultant, Business Owner and Company Director. He successfully coaches top Executives in some of Australia’s leading multi-national companies. One such Senior Executive recently won an International Award for Excellence within his particular field. In addition, Peter works extensively in the Public, Private, Commercial and Not-for-Profit sectors, delivering outstanding results for his clients. To learn more of how you can benefit from Peter’s experience, visit the Essential Business Coach web site!