First, what I love about business plans. I contains four elements very close to my heart: Writing, talking to people, innovation, and entrepreneurship. That is not to say that writing business plans is a fun activity that should be taken lightly. The crux of writing a business plan is that it needs to be executed upon. And that is where the complication arises.

One of my last freelance projects was amazing fun and in two ways very rewarding. Financially, because the investment that followed it, far exceeded the more than generous fee I was paid. Creatively, because my involvement lead to a lot of focus product- and strategy-wise, and we developed what I thought was a clear timeline as to the execution of the plan in different phases of product and market development.

But, as mentioned, writing a plan does not mean that it reflects the reality. I was reminded of this again, listening to a venture hacks podcast on “pitching hacks” (you can watch and listen to the presentation here). Business plans are worth squat, because a. there’s a lot of them, and b. the proportion that is executed upon is fairly small.

In theory, business-plans serve as a way to make the strategy of a young company explicit. Kind of like Gerber’s “Franchise manual” for startups in the E-Myth Revisited, it allows you to solidify what you do while you’re doing it. But, I don’t think it automatically leads to a (better or actual) business…

…

Those three dots is where I stopped writing some three weeks ago, and I have in the mean time developed my thoughts further on this. I think that the gist of good business planning is taking ownership of the project. And the single most important key-component of the business plan is the timeline section. And the single most important action as an entrepreneur is to already have at least 10-30% completed of that timeline.

In other words:

• if you’re an entrepreneur you should write your own business plan: you cannot outsource this!
• The most well-developed section of your plan should be your timeline: as conservative and realistic as possible!
• The best way to illustrate the value of your plan (and timeline) is to already be following it: actions scream much louder than written words!

If those three components are in place, I think that the world of business planning and entrepreneurship would be a much better place.

End braindump…

Vincent

Addentum: The problem of multiple agendas! I should also add that another complication is that plans are written with a singular vision in mind, perhaps alternative scenarios are included, but it still very often reflects a singular approach to “doing things.” But… many companies are composed of multiple people, who may or may not have multiple agendas. I still think it can belong to taking ownership of the idea, in the sense that the plan is worked on together and perfected until everyone agrees with it. But more often than not, the business function is delegated to certain individuals, meaning that this isn’t the case.

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