Tag Archive for 'Strategic planning'

A business plan and business planning

A business plan is the result of thinking, researching, strategizing, and reaching conclusions about how to pursue opportunities. It may exist only in the head of the planner, but it’s better when written down.

Whether elaborate or simple, a written business plan is an assembly of facts, ideas, assumptions and projections about the future. Here are three ways to use a written plan:

  1. Document the due diligence on a new business or the future of an existing one.
  2. Evaluate opportunities and challenges, and compare them with your strengths and weaknesses.
  3. Assist when getting a bank loan and essential when courting investors.

So how does a static, written plan work when a business is always in motion? It works when you turn your plan into planning. A plan is like a parked car; planning is taking that car on a trip.

Planning is measuring your business motion against the baseline of assumptions and projections you made in your plan. Planning allows you to see how smart you were when the plan was written, or where your research and assumption skills need work. It also highlights external forces you face.

Written business plans often become collateral damage during challenging economic times. But you can’t allow planning to meet the same fate. Indeed, when things slow down there is even greater need to check your position than when things are rocking and rolling.

Here is a critical two-step planning activity that is the heart of a business plan and the essence of planning. Beginning with these will help you operate more successfully anytime, but especially when things are slow.

  • Build a 12-month cash flow spreadsheet in a program like Excel, so you can project and track the monthly relationship between cash collections and cash disbursements from all sources. This planning tool will provide a rolling picture of cash flow in any given month.
  • Look at the “Ending cash” number at the bottom of each month’s column. A negative number in any month means you’ll need to add cash from sales, reduce expenses, add cash from another source, like a bank loan, or some combination.

A banker once told me that if I could bring him only one financial document with a loan request it should be a 12-month cash flow projection that included both how the borrowed cash would be used and the debt service. I always listen to my banker and you should too.

I talked more about business plans and planning on my radio program, The Small Business Advocate Show. I’ve also talked with Tim Berry, the guru of business planning, founder of Palo Alto Software and author of The Plan As You Go Business Plan, about the difference in business planning and a business plan. Take a few minutes to click on the links below and listen, plus leave your ideas on how planning helps your small business.

Write your business plan, but practice business planning with Jim Blasingame

The difference between business planning and a business plan with Tim Berry

A small business strategic plan for leading change

Most of us allow our minds to swing back and forth between dealing with the reality we see in front of us and nostalgia for the way things were. In the marketplace, spending too much time with the latter half of this pendulum swing is an indulgence at best, and dangerously delusional at worst. With change happening more rapidly than ever before, this increased velocity is challenging even when we like the new stuff, but it can be paralyzing when we don’t.

It’s a fool’s errand to just take the direct hits from the rapid-fire changes the world aims at our small businesses. Sustained success in our light-speed world requires developing a plan that identifies and establishes practices that help us anticipate change, manage it and actually lead with it.

Recently on my radio program, The Small Business Advocate Show, I talked with change expert, Rich Horwath, about developing a strategic plan that will set your business up to function effectively regardless what the world and the marketplace throws at you. Rich is a new member of my Brain Trust, founder and president of the Strategic Thinking Institute and author of four books including his latest, Deep Dive.

Take a few minutes to listen to our conversation, and let us know about your plan for leading change. Listen Live! Download, Too!




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