When Business Planning Goes Wrong!

Business plans can be useless. When I tell my clients this, I am usually met with bewilderment and confusion. I mean – isn’t planning the core of business coaching? Isn’t that what we do at GrowthCLUB?

The process of creating the plan – and not just the plan itself – is of real importance for business owners trying to achieve growth. That is just one of the subtle shifts of thinking that business owners need to continually work on to take their businesses to the next level.

Coaching business owners across a range of sectors, I identified three areas where business planning can go wrong. Which, when corrected, can improve a business owner’s effectiveness dramatically.

1: A business plan is not just for Christmas

One of the biggest misconceptions organisations have about their business plan is that it is there just to tell the decision makers that the company is headed in a good direction and that the business owners have everything under control.

People think a plan can be written at the start of the year and, once it has been seen by everyone who needs to see it, it can be forgotten until the next stakeholder asks for an update.

This is not actually where the power of the business plan lies. Sure, it is part of their remit, but, as the name suggests, business plans are there to help you plan your future. They offer a key opportunity to explore your business’s objectives, strategies and forecasts in detail so that you can achieve and stoke growth.

A business plan is not about the finished product – it is about the journey of creating it, as this is what enables you to measure and assess your business. In fact, a business plan is never really finished: it should be constantly updated.

2: Not writing it down

While it may feel that way when you’re working late nights, no successful business owner is an island. Keeping your business plan in your head and not seeing the need to write it down is typical of the kind of business owner who has no stakeholders (or up until recently hasn’t had stakeholders).

However, even if you don’t have stakeholders, most businesses eventually get to a point where they need to have a team. Without a written business plan, your team members cannot have any kind of input on the plan. While it might seem to save yourself time and boost your own efficiency, keeping a business plan in your head is detrimental to the growth and revenue of the overall business.

According to a survey by the Kauffman Centre of Entrepreneurial Leadership, companies with written business plans achieve 50 percent more sales growth and 12 percent higher gross profit margins than companies without them. The reason? Because the written plan gives you, and your team, clarity on where you are headed – which automatically aligns everyone in that direction.

3: It’s not your fault

When business owners realise that they have not achieved their growth goals, they often blame themselves. They think that the reason growth has slowed is that their approach is wrong, or that they haven’t been putting in the hours and rolling back the sleeves. They aren’t doing the hard work required to keep the growth up.

The answer then seems to be, to push themselves harder and run faster on that treadmill. They put in more hours than they promised their family they would and they start researching mindset principles.

In the vast majority of cases, though, the reality is that business owners of businesses that have reached a successful level of stagnation have done so through blood, sweat and tears. There isn’t more to put into it. What has actually happened is that they have not created an efficient business plan, or the business plan does not involve the implementation of new systems and techniques to facilitate growth.

Instead of thinking you are the cause of the business’s stagnation, you need to return to your business plan (or write one!) and ensure that you have a focus on creating the systems that will not only keep your business running but will also facilitate growth.

Of course, there is a lot more “head-trash” around business plans than the three I’ve mentioned. That’s where getting the guidance of a business coach is really helpful – we’ve seen time and again what kind of business plans help take businesses to consistent and sustainable growth, and which ones just end up sitting on the shelf all year. And I think you’d prefer the former!

To find out more about our planning workshops, book a free discovery call with me.