Planning for Success

By Steve

Scheff

How

often have you thought about establishing a plan for your business, complete

with standards of measurement and clear statements of the goals you want to

achieve? If you’re like most smaller businesses, the answer is often. And, if

you’re like most smaller businesses, the question of what you have actually

written and communicated to address those goals and strategies is one you’d

rather not be asked.

The

most frequent answer we hear goes something like, “I’m too busy running my

business to take the time to write down a bunch of goals that I’m already aware

of.” The truth is, in almost every case, the lack of a good plan is an

important part of what keeps us too busy.

What

keeps you busy? Is it the effort to obtain new business, which may or may not

be worth the expenditure required or may even jeopardize current sales? Is it

the effort to undo an employee’s mistakes (made because he/she

was not

thoroughly apprised of your values)? Are you spending your time on activities

that don’t grow the business? Can these activities be outsourced to an

accounting firm, legal advisor, or other professional so that your time can be

devoted to what’s really important?

Whatever

happened to that business plan you once had to write in order to get a bank

loan? The bank wanted to see a written plan before it agreed to let you borrow

money. Well, you have a lot more invested in your business than the bank, both

in dollars and in sweat equity. After all, your family’s livelihood depends on

the success of your business. So, doesn’t it make sense to clearly chart the

course you plan to take? This will allow you to work out many problems on paper

and ahead of time, not in the marketplace.

There

are four basic rules, which all good plans reflect:

1. Be

specific. Instead of just saying “increase sales,” provide yardsticks and

strategies. For example, you might say, “Increase sales by 11 percent to

$700,000 through greater penetration of the market, while maintaining a 14

percent profit margin.”

2. Be

thorough. Examine your goals and plans critically. Is a 14 percent profit

margin achievable in an industry where the average is only 8 percent? Have you

anticipated a logical build-up of growth, as opposed to a sudden leap from

December of the old year to January of the New Year? Have you figured out how

your growth will be funded?

3.

Communicate. Discuss your goals with the people who count: investors, lenders,

employees, advisors, key suppliers, and — yes — key customers. They can make or

break your plan, so help them participate, albeit selectively, in the planning

and goal-setting process.

4.

Review. Periodically throughout the year, get out the plan and evaluate the

progress of the business. Are you where you wanted to be? If not, what must you

do to manage the business in accordance with its stated goals? Your job is to

not let the business run you — it’s the other way around!

Above

all, stick to it! You went through a meaningful process to establish and

communicate your plans and goals. It isn’t rational to veer off course without

going through the same thoughtful disciplines.

Steve

Scheff is an adjunct professor at Florida Gulf Coast University and a volunteer

certified business analyst with the Small Business Development Center. The SBDC

assists small business owners with one-on-one confidential free counseling with

any business issue, offers educational seminars, trade shows, and networking

events. Also, the SBDC helps small business owners with loan packaging and

other alternative sources of financing. March 8, 15, 22 and 29, the Small

Business Development Center is offering a Business Plan Series for Start-ups

and Emerging Businesses at the Palmetto Pines Country Club in Cape Coral.

Sponsored by Cape Coral National Bank, this series is once a week from 6 to

8:30 p.m. at a cost of $99. Call the SBDC at 948-4040.