It’s time to speak of some sort of business plan. As a professional investor in early stage companies, I have long discounted long, detailed business plans in favor of a concise “executive summary” followed by a believable spreadsheet-based financial forecast projecting three to five years into the future.
Yes, everything does change between drafting that plan and its successful execution. But flying without a map of some kind seems just plain too risky.
I once joined the board of a company that was growing slowly, running beyond break-even, but had not approved a plan for the current year, let alone attempted to develop one for the next. So, the CEO had one of his own that he did not share, while the CFO had one for internal use that was never shown to the CEO or to the Board. No wonder the Board members wanted to dig in and find who was communicating with whom, and who was in charge of the map to the goal. By the way, there was no goal understood by all or agreed to by anyone. How do you compensate executives and all levels for successful accomplishments if there are no established steps toward the goal? And how do you measure a person’s contribution to an unnamed goal?
[Email readers, continue here…] So, if you have not, create a concise map for your enterprise. Start with a reasonable goal, usually expressed as a revenue number some number of years into the near future. Assess your current resources and attempt to calculate the resources needed to accomplish the goal. Do you need to raise money, focus spending upon only core projects that advance the company toward the goal, or bring in new management talent to make it happen? Write these steps down in any form for now. We’ll explore a more organized approach in the next insights.