Summer break is ending, and I can feel it.
With three weeks remaining before the beginning of a new school year, there is a need to get it all in! There were big expectations for summer: night time bike rides and star gazing, s’mores, family reading, and pool time. Because we live in the heart of the Willamette Valley in Oregon, trips to the coast and to the mountains are a requirement.
At the same time, we had some limitations: two full-time working parents as well as scheduled family commitments. And of course balancing the 8-year-old’s wants with the family’s needs is always fun! With summer slipping away, I’m thinking about those last most important things to do together as a family to take advantage of the precious time remaining, and I’m putting together an adjusted plan.
Why does establishing a summertime plan feel like such a natural thing to do?
Anything we care about needs nurturing, which means care, feeding, and growth. For growth, there must be a plan. The nuances of a plan are the expectations, needs, wants, limitations, and requirements of the key stakeholders. So too it is in business.
The goal of every business owner is healthy, sustained growth
Therefore, a business must have a solid plan from which to develop a roadmap. And it must incorporate the expectations, needs, wants, limitations, and requirements of the key stakeholders.
The main components of a business plan are well understood, but the way each item directly impacts day to day business management may be less understood. The plan drives the forecast, the forecast creates the roadmap and the roadmap dictates day to day management decisions. When this direct connection is exposed, the importance of the business plan takes on a whole new meaning.
Here are some examples of business plan components:
The problem worth solving and business solution are the initial window into what drives the business owner. You’ll never understand their expectations, needs and wants without fully understanding this piece. And it also sets the stage for what the business will sell, which defines the revenue types.
The target market section exposes the business’s potential, which helps in laying out a revenue growth plan, as well as known limitations.
The sales and marketing plan is where you really begin to understand the economics of the business’s sales model. What will it sell, and how will it sell it? Items like resources and partners are discovered here as well, which become a key part of the business model.
Resources like intellectual property are assets. Key team members and strategic partners affect potential revenue and necessary expenses, and establish requirements.
Never forget milestones! They may seem mundane, but they are key to successful execution of the plan, and in some cases they may be contractual obligations, which affect expenses.
These business plan components, and the business model they generate, are the bedrock of the business. And because they are based on each business owner’s expectations, needs, wants, limitations, and requirements, they are the unique building blocks of the financial forecast. Without a solid financial forecast, there can be no strategic, much less meaningful, advising.
Does this business have unique seasonality based on its location? Does the business have a growth trajectory based on the unique interests (expectations) of the owner, or the owner's limitations within his marketspace? Is there unique competition in the area? Does this business have special resources, like intellectual property or partnerships that could affect its growth or direction, or certain contractual requirements from its investors or partners? All of those things are gleaned during the process of establishing the business plan.
Industry standards and benchmarking data are helpful resources but they cannot be used solely to determine growth potential for a business. It is the individual business owner running their individual business. You must have your radar set on them, to understand what drives them, what makes them unique, and what their individual expectations and needs may be.
I could take my daughter to the local minor league baseball game because most of the people in our area love to do that, but she would be bored out of her mind! That’s not part of her expectation. And the perfect Saturday morning for my husband and myself? Going to high intensity interval training together and then to brunch. My guess is that this wouldn’t show up on the Industry Standard Benchmarking for most middle aged married couples. But it’s part of our needs, wants, requirements, and even expectations, so it’s on our roadmap.
If you want to help your clients grow, get to know them. Understand their unique business drivers. Translate that into a living business plan, using a structured method, and use that plan to model a roadmap for their perfect business.
You cannot get anywhere efficiently without a plan. Help your clients put together their plan and be a part of their growth. It will be an exciting ride!