Business plans always seem to be in the same format these days with the primary purpose being to confirm what we already know. They are for the most part boring documents.
I came across a guy recently who got me thinking about business plans by looking at them in a different format. He split his plan into five sections and I would like to share his views:-
Truth, Assertions, Alternatives, People and Money.
This is a summary of how things are today. What the market is like, the pressures that rivals are under, the needs that exist and an appraisal of your competitors. In short, its the world as it is and the modern business plan can take the form of spreadsheets or management models etc as long as you can articulate it.
This is the section where you really can tell your story on how you are going to change things. We will do this and the result will be that and then we will do this next and the market respond by doing this. It will take this much money and this much time and the results will be when. There is no point producing a business plan unless you are going to effect a change in your business. This is the what we are going to change, the how and the results underpinned by key assumptions.
Now, it may shock you to know that not all plans go to plan ! Things happen or often don’t quite happen. You’ll miss budgets, deadlines and sales etc So this section needs to detail what do we do if our plan doesn’t work. Is it all over? Can we adjust our plans? Do we have flexibility in our business?
Covers the people that you need, but not just their qualifications or C.V. It needs to cover their skills,attitude, demeanour and determination to succeed. Who’s on your team and what addition may you need to succeed.
How much do you need, when, how are you going to spend it? Cash flow, P&L and Balance Sheets – What we would expect but focus too much on.
I can guarantee that if you take a look at a business plan in this format then you team will at least think through the hard issues in a clearer way.