Planning in the Past, Present and Future
After teaching a recent business planning workshop, I noticed something different about the business plan drafts written by these entrepreneurs—other than the fact that most of them were already in business. One group of people wrote plans that were almost entirely about doing business in the future. While the minority of the group, this future oriented group of planners were mainly involved in startup businesses. A second group within the workshop wrote extensively about their business, activities, recent history, and plans for the present, with little to no planning into the future. This group consisted mostly of existing business owner’s plans. It’s rare as an author and instructor that I see such extremes in time orientation in one workshop. Why do some people stick so close to the present while others want to skip the present and go right to the future? Some business planners live in the future. They think of business planning as a vision of what is yet to come. These folks try to predict what their business will look like in 5 years, and describe it in vivid detail. The dreamers are comfortable here. What a comfortable place it is, to ignore that past and the present and simply create the business life that you want in the future. But the problems with planning in the future alone are obvious, right? Imagine trying to read a map knowing where you want to end up, but not understanding where you are. If you are as geographically challenged as I am, then you have literally experienced not knowing where you are while traveling away from home. I have literally missed planes while traveling because I took a wrong turn and lost track of where I was. Even more fun is thinking you are on the west side of a major city looking at a hotel map when you are actually on the east side. That makes for some interesting conversations with yourself. I can’t imagine ignoring where I am or my present situation in business while writing a business plan. You have to make a living today. You have finite resources committed to your business. You only have a specific amount of capital that you are able or willing to risk. You only have so many hours per week that you can commit to the new business initiatives described in your business plan. Accounting for specific resources such as money, your time, and other people’s time helps us to get our head out of the clouds, think more realistically, and place our feet on the ground. How much of a business plan should be written geared toward present versus future business activities? Finding the right balance between planning for the present situation, and for the future that you want to create, is essential for successful business planning. If it helps, think of business plan time frames in three stages: the present, the short term, and the long term time horizons. Short term planning is generally defined as plans within one year of today. Long term planning is generally defined as plans more than one year away. To get from where you are now to where you want to be in the future, you must include present, short term, and long term time horizons. One tool that helps us manage the present with the future is tying action plans with business milestones as describe in the book The One-Hour Business Plan. A business milestone is a significant business event at least 90 days in the future. For example, imagine the milestone that states, “Our company will increase revenue by $100,000 by the end of the first quarter of next year.” Technically this is a quality milestone. It is a significant business event associated with growing sales with a measurable time period. Anecdotally, it would help if the person(s) responsible were included. Now let’s take the same milestone and add an action plan to it. An action plan is a sequence of steps designed to achieve a broader business goal.
- Email 100 business owners, Due 1/6/20xx, Marketing Assistant
- Telephone follow up from initial list, Due 1/15/20xx, me
- Divide the list between interested prospects; separate the people that are interested 1/30/20xx, me & Administrative Assistant
- Visit prospects to provide demonstration, due 2/28/20xx, me & Technical Support Person Jeff
You get the idea. The actions items keep detailing the steps that will be taken to achieve the broader business milestone. These action steps force us to work in the present and incrementally step into the future to achieve our goals. They’re how we move from the present to the future we’re creating. What milestones and action plans can you think of to achieve your business goals next year?
Copyright © John McAdam 2014. All Rights Reserved.