One of the busiest times of the year for small business owners is the fourth quarter. Not only from the perspective of holiday gifts, greetings and events for clients, staff and other supporters and closing out past due accounts. Most importantly, the fourth quarter is where business plans and budgets for the new year are set.
It's the last one that usually strikes fear and consternation in the hearts of business owners. One problem maybe that often the plan is created, printed and stored away not to be seen again unless there is a need to seek funding. PROBLEM: a business plan should be a “living” document that grows and changes with the business and environment around it. SOLUTION: The 3Rs
What's a Plan
One thing to remember is that a plan is simply who does what by when. It doesn't matter if the more traditional plan or the simpler plan is used. The point is to have one.. The plan should not be set in stone nor stored in a drawer hidden from view. Success is in the ability to measure and act on those measurements. This is where the 3Rs come into play.
The 3Rs – Review, Revise and Repeat
Review - Dust off the plan, pull it out of the drawer it has been hiding in, locate it on your hard drive and read it. Read the assumptions made, the costs speculated on and the milestones that were set.
Revise - Be HONEST, seems obvious but writing it down makes it too real for some. Look at writing down the plan as outlining a successful reality. During this process:
- Check the numbers
- Costs: What costs did you include? How have they changed? Are there any new costs planned for the future?
- Projections: What were your projections? How do they compare to your actuals? What caused the differences? Were the factors internal or external?
- Check the dates
- Were they realistic? Have you met them? What new ones should be added?
- Check the thinking
- Assumptions: Were they correct? How have they changed?
- Strengths: Were they correct? How have they changed? Any new certifications? Any unexpected strengths?
- Weaknesses: Were they correct? How have they changed?
- Opportunities: Were they correct? How have they changed? Any unexpected opportunities, environmental or otherwise? Any overlooked opportunities?
- Threats: Were they correct? Any new competitors? Any new regulations, environmental changes or other factors that may cause a threat? How will the threats (actual and potential) be addressed?
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Goals: Were they correct? Were they reached? What should the new goals be? Are the goals in the comfort zone or are stretch goals?
- Strategy: Was the strategy sound? Are there environmental factors that may cause a temporary or permanent shift?
Repeat - This is not a one-time process! Reminders should be set in the tool choice: calendar, PDA or software, wherever it will not be missed. If no major business or environment changes, at minimum plan a yearly review of “the plan”.
No Plan
Better late than never to create a plan. Many of the newest businesses, especially the online businesses were started without a plan, so how to know when the company breaks even or is a success? Forgive the cliché - it's no time like the present to create the plan.
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