A business plan is defined as a formal statement of a set of business goals, reasons why they are believed to be attainable and how you plan on reaching those goals. It can also contain background information about the organization or team attempting to reach those goals.
What are the uses of a business plan?
A business plan is often prepared when you are starting a new organization, business venture or product, or if you are expanding, acquiring or improving any of the aforementioned. It is also used to plan your goals on an annual basis in order to track your progress and make course adjustments.
What are the benefits of business planning?
There are a number of benefits of doing business planning, including the following:
· To identify any problems before implementing plans.
· To get the participation and commitment of those who will help you implement the plans.
· To establish a roadmap to compare results as the venture moves forward into reality.
· To achieve greater profitability.
· To obtain financing from investors.
· To minimize the risk of failure.
· To update your plans and operations as the world changes.
· To clarify your goals and strategies.
However, business planning doesn't end with the business plan. When you start a new venture, you've spent a lot of time on the planning process and are now ready to put them into action. The early period always carries surprises so you better be prepared to find out that what's on your business plan may not go exactly to the point.
What could affect change in your business plans?
· Your market research could be wrong. It doesn't matter how diligent and thorough you were with your research, without thorough knowledge of the actual business you may have interpreted facts or data incorrectly.
· Changes in the economy. The economy is in constant change and customer ability, interest and ability to purchase can change dramatically overnight.
· The product or service may not be what you've projected in your plans. In a new business with multiple products or services, it's important to listen to customers, both those who buy and those who don't, and revise the mix if necessary. The first six months of a business are important in the business planning process. Be flexible in the product line and be open to changing to meet market interest.
· Let customers shape the product and message. The best way to get the right message out to your target customers is to ask them what's important about the product or service you are offering. Focus on this feedback to help improve your business while not sacrificing your integrity.
· Figuring out the right marketing strategies. Part of the business planning process is how you plan on marketing your organization's product or service to attract customers. Drawing from the above points, word of mouth can be more effective than all other marketing activities. People who know you and your organization, as well as satisfied customers and those in your various networks can help you get your foot in through their networks than all of the marketing materials you can make. Focus efforts on these people and let your product speak for itself.
© 2012 Incedo Group, LLC
Linda Finkle, CEO of INCEDO GROUP, works with innovative leaders around the world who understand that business needs a new organizational growth style. These innovative leaders know that powerful cross-functional communication is the highest priority and the strongest strategy for building organizational effectiveness. To find out more, visit: http://www.IncedoGroup.com
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