It's Not About the Business Plan; It's About the Business Planning Process

Before you make the crazy attempt to start a business or change your current business model without a business plan, stop and think about it for a minute. Do you do anything in your life without a plan? If you do, you're probably a spur-of-the-moment-do-what-you-feel-when-you-feel-like-it-fly-by-the-seat-of-your-pants-eccentric-yet-carefree-soul-and-slightly-lucky-person and you can stop reading this right now and live life the way it works best for you.

However if you are like me and most others, you plan your family vacations in advance; before you make the leap, you've come up with an estimated budget, picked your outings, where you will stay, how long you will stay, who will house sit the dog and mow the lawn while you're away, etc. If you are like most people, you planned your wedding, your kids' birthdays, your family reunion, etc.

So at the risk of sounding cliche, tell me, why would you even attempt to start a business without a plan? If you have done this or are thinking about doing it, Stop, take a deep breath and answer me this: "What is wrong with you??!!" Do you not care about your legacy, your economic independence, the future for your family, your freedom to achieve your purpose in life? Do you not care about your business?

The format for a business plan may change. The method for producing one may change. The fact that you need to plan for business will never change as long as entrepreneurship exists. And the actual business plan is just the product of your brainstorming.

So although some people may use business plans simply to get some funding or to say they have a plan, here's why I've been able to operate a business that survives on producing business plans: I believe in the process itself.

It is annoying to see how most people skip the process and concentrate on only the end product. The business plan is then seen as a product and the planning process (the service itself) is ignored. Well, my company operates on the belief that the business planning process is key. Of course, when we produce a great business plan end product, our process becomes solidified.

A good business plan and process will reveal seven truths:

1. It will put your business idea to the test. If you think you have thought things through without going through a planning process, you're in for a rude awakening. A business plan forces you to think about things you've never considered. I call it the "mean aunt." You know that mean aunt in your family who always said what everyone else was thinking but was afraid to say? That aunt becomes your business plan.
2. It will morph a good idea into a "SWEET" business structure. Ever wonder why so many people have businesses that still look like hobbies after 5 or 10 years? That's because they lack a structure. A business plan helps you build a model that works and it gives your business a steady foundation.
3. It will "Show you the Money." How much do you really need? Where will you get it from? If you can't raise the money you need, what can you cut back to survive or can you even start without your needed funding? What will you need in order to open your doors to the public? It gets so annoying when people throw out these thoughtless figures, like...fifty thousand!....why do you need fifty thousand?...well...twenty to cover this...ten to cover that...Blah Blah. After you've seen so many plans, you can tell when someone's pulling your leg. And people wonder why their banker or investor won't give them money. The process, not the plan! Anyone can get a plan from the internet. Go through the process!
4. It will "Keep it real" with you. Like I always tell my client, "the numbers just don't lie." What are you really going against here? Your planning process will help you uncover the naked truth. Scope out the competition, analyze your market, know what you are getting into before you take the leap. And the great part is that if the truth is too much to handle, you can clothe your truth by customizing the process to fit your scope, your reality. Example? A client once worked with me to start three locations in three different states. After going through the process, his budget and obligations revealed his "truth:" to start with one location in his locale.
5. It will help you find money. I know, this point is overrated but true. No banker wants to hear you talk without seeing some proof of your hard work and great idea. No investor will take you seriously if you don't look serious on paper. You have to be able to convey your thoughts and this means you need a well-thought-out plan. Period.
6. It will help you measure progress. Did you achieve a goal? If not, why? Were your costs too high? Prices too low? Sales quantity not up to par? Great revenues but still no profits? Did you try so hard and still can't seem to breakeven? Your planning process will prompt you to go back to the drawing board and measure your success.
7. It will help you to brace yourself for the unexpected. You know that annoying noise your GPS makes when you somehow manage to go off route? It keeps saying, "reroute...reroute..." over and over? Well... your business plan is your business GPS in this case. Paying attention to it will help you find a new route when things are not working. Wondering if you will run out of money? Pay attention to your plan, it will tell you. Don't be discouraged though, because that same plan can help you figure out what it will take to avoid that.

I'm not saying that planning is perfect and will get you out of every hole. However, we all know that having A plan is better than No plan at all.

Stay tuned for our new business plan website that focuses on the planning process and business structuring methods. I'll be posting details soon...

About the Author: Cheryl Isaac is the writer of this blog and a Startup Business Consultant & Owner of Isaac Business Services, an agency that offers startup concierge & business planning services for small businesses