Business Plans – The Good, the Bad and the Ugly

overworkedMany business consultants, mentors or coaches seem to think that getting their clients a business plan (normally based on the same old boring business plan template waffling on about this and that) is the best thing since sliced bread (assuming you agree that sliced bread is better than a fresh, crusty loaf or baguette which smells divine!).

Now I’m keen on business plans in principle but the problems I see in practice go something like this:

  • They are often written by someone other than the business owner who doesn’t really understand the business and who is just filling in the blanks on a template. These type of plans are of very limited value, are often produced for the bank manager and just collect dust for the next 5 years.
  • The business owner has no clear goals in their business and this lack of goals is reflected in the business plan which doesn’t provide any real help or guidance on how to improve or get on in business. In addition, there is a complete lack of action plans, no timelines, no guidelines as to how progress is going to be measured and no way of telling included as to whether the non-existent objectives have been reached or not.
  • Whilst the business owner is probably a great technician or professional they lack sufficient knowledge of business, finance or marketing and are not going to pick this knowledge up from a cold, impersonal business plan so guess what, it goes to the bottom of the draw!

As I see it, if we really want to help our clients rather than just boost our fee income, we who offer business advice need to do quite a bit of research and work before going anywhere near a business plan:

  • Find out their business goals and objectives first. If they haven’t got any it could mean one of several things. It could be they’ve never had the time to think about this type of thing, or they’ve never had their eyes opened to the possibilities, or it could be that they can’t see further than the end of their noses and never will do. I’ll leave it to you to decide who needs a business plan AND when!
  • Are they business drivers or “lifestylers”? The in-terminology these days, these types of business owners are totally different and each needs completely different goals and advice.
  • Are they “professional” serious business people or just someone who went into business because they couldn’t get a job? The latter is all too common and if this the case, you well as well just face facts and go next door – save them some money and yourself some stress!
  • Do they have skill gaps but recognise this and are prepared to pay an outsider to carry out the tasks they can’t do or do they try and do everything themselves with No. 8 wire, not realising or understanding that they’re getting themselves in a mess. If the latter they need a lot of educating first……
  • Are they totally disorganised with no systems, no filing system or software? If so, put the business plan on the back burner and get their systems right first (if you can!).
  • Are they unable or unwilling to learn or do anything different? Then you may as well beat your head against a brick wall since it will save you pain and stress in the longer term!

Looking back at what I’ve just written, it looks like I’ve written this to offer tips to business advisers but that wasn’t my intention at all. I started off with the objective of pointing out the dangers involved in banging out a business plan without thinking about the business owner and what they really need (or don’t need!) but it looks like I’ve ended up with a critique of business advisers’ ethics. Isn’t that interesting?

If you need help with your business (and maybe even a business plan!) for the new financial year contact Nick on 0800 ASK NICK or email [email protected]