Chaos is Expensive

It’s planning time for most of us.  This is the time of year when we all either plan our business or rationalize that we don’t need a plan.  One of the smartest business planners that I’ve encountered on the internet is Tim Berry.  His 9/28/10 post on his site: Bplan.comdealt with the issue of focusing on the business planning process versus the business plan. 

While I agree with Berry that planning is the one of the most critical things you can do for your business (or department within a business), I’m here to say that without an agreed-upon business or marketing plan, the result is chaos.

Everyone reading this treatise has probably experienced the planning process that starts in July and finishes at the end of December.  There are countless meetings, drafts so numerous that the admin assistant starts to put not only version numbers but initials next to each one, and lots and lots of unproductive time is spent preparing the “final” plan.  In one Marketing Department that I worked for, we had separate waste baskets for wet trash and dry trash, so that we could retrieve previous drafts or notes from the planning process after our light-night pizza and coffee dinners in the office.

In that same company, the entire organization failed to finish the plan by the end of December, continuing on through the entire first quarter.  Needless to say, we didn’t hit our retroactive Q1 goals because we couldn’t implement any programs without approved business and marketing plans. 

This obsession with the finished product is what puts a bad taste in our collective mouths for business plans.  Yet, without them, we have no shared understanding throughout our organizations on how we’ll proceed to reach our goals. 

The other weak point of a business plan is that the day it becomes final–it’s history.  The marketplace changes, headwinds arise from unexpected quarters, inputs and ingredients become scarce, opportunistic programs present themselves.  This is why the planning part of the process needs to continue on beyond the plan document and throughout the fiscal year. 

Yet, without an agreed upon plan, management, other departments, even your own staff may believe that your business and marketing are headed a different direction than what you believe.  When good employees sense a vacuum, they try and fill it.  How will they know the guardrails and the ultimate destination if all parties haven’t agreed on those terms with a plan? 

So what’s to be done? 

1)   Know your plan’s target audience   If you’re a start-up looking  for investment, your audience will be very different than a division of a large CPG company or a self-funded natural-products company.  Figure out what your decision-makers want and need, then go build a successful plan based on the required criteria.

2)    Simplify  An article in the April, 2008 issues of Harvard Business Review asked if you could state your strategy in 35 words or less.  If you can’t, how can you expect your staff or anyone else to understand your business?  The same holds true for a business plan.  You may have reams of  drafts and notes, but consolidate the main information into a concise, precise document. 

3)   Customize  If you’re following a planning template, don’t use every suggestion for writing a plan.  Decide which areas are important to your business and do a great job on the parts that are critical to your success.  No one likes reading filler, so save time and effort by leaving extraneous material out of your document.

4)   Delegate  An organic, natural foods company I worked for had never done departmental planning until we merged with several other CPG companies.  Our final Marketing Plan went from zero to 60 pages.  I assigned sections to my staff to learn-by-doing, and to teach them how to move through the marketing planning process.  Delegation not only gets the work done faster, but provides inclusion in the decisions.

5)   Write it Down and Sign Off  Another axiom of achieving goals is to write them down.  One reason is that you have to go through a thought process to hone in on a goal.  A second reason is that writing something down reminds us what it is we wanted to accomplish.  Getting sign-off signals that everyone is in agreement–or at least has compromised with the plan details.  The last thing you want to be doing after planning is having “this wasn’t what I remembered” conversations as you’re trying to implement programs.

6)   Share  Many companies and departments feel that the business plan is classified information–only those with a need to know, are allowed copies.   I believe that it’s vitally important to share the plan information with everyone from investors, top management, entry-level staff, key vendors–anyone who can have an impact on the success of the plan.  Certainly there will be proprietary information in a business plan that shouldn’t be shared, but if your entire organization doesn’t have a working knowledge of where your company or your marketing is headed, how can they possibly help you succeed?

Business planning and a business plan will help you achieve your goals by eliminating some of the chaos of everyday business decisions.  As you already know, chaos can be very expensive in terms of time, money, dysfunction and missed opportunities.

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