I work with new business owners who struggle with developing their business plan. The last thing they want to hear once it is finished, is that they will need to complete a plan every year to assist in the ongoing success of their organization. Most panic. They don’t want to have to go through that again; and fortunately, they don’t have to – exactly. But there are very sound reasons for developing an annual plan that serves to monitor and manage the ongoing operation of the business.
1. Developing an annual plan forces you to take an objective, critical, and unemotional look at the facts of your business – what is working and what isn’t.
2. It requires you to consider the gaps in your business based on a realistic assessment of your exisiting resources as well as your personal skill set and then plan to bridge the gap
3. An annual plan will be a powerful communication tool that encompasses your goals, objectives, and strategies to achieve success.
4. A plan serves as an operating blueprint for the year.
5. An annual plan can provide the appropriate linkages internally and externally to make sure goals are met.
Not all categories required for a business plan that is intended to attract capital need to be included in an annual plan that is designed to manage the business. Remember who the intended audience is and from that you can determine the best type of plan to write.
I always start my annual plan in October because I like to have ideas percolate for a while before committing to them for the following year. My thoughts are currently on paper and final decisions will be made within the next few weeks. As a business owner, I find the most challenging part of this exercise is objectively examining the numbers and choosing which activities stay in the mix for another year, and which have to be dropped. Sometimes I can be ruthless and other times I keep things on the menu of services just in case the timing will be better in the next year. As with so many aspects of running a business; annual plans are part science and part art – part prediction and part taking actions based on calculated risk.