How to come up with the best business plan

You can deal with them as the plan develops. The first five points here are about the plan. ItвЂ™s communicated to the people who have to run itДЄt this point we leave the discussion of the plan itself, as if it were a stand-alone entity, and get into how the plan is managed. You identify assumptions and keep them visible during the following planning process.Д¦. So business plans must clearly show assumptions up front because changed assumptions ought to lead to revised plans. TheyвЂ™re done by humans, who are guessing the future, and humans guess wrong. This is very important because business plans are always wrong. You can go through a business plan and look to see whether or not you can recognize a specific person responsible for implementation at every point. A task that doesnвЂ™t have an owner isnвЂ™t likely to be implemented. You have to be able to identify a single person will be responsible for every significant task and function. It clearly defines responsibilities for implementation While blue-sky strategy is great (or might be, maybe), good planning depends more on what, when, who, and how much.Д¤. ItвЂ™s measurable.ДЄsk yourself, as you evaluate a business plan: how will we know later if we followed the plan? How will we track actual results and compare them against the plan? How will we know if we are on plan or not? You can track results against plan.Д®very business plan ought to include tasks, deadlines, dates, forecasts, budgets, and metrics. A plan that ignores a fatal flaw is not a good plan.ДЈ. The plan that requires millions of dollars of investment but doesnвЂ™t have a management team that can get that investment is not a good plan. For example, a brilliantly written, beautifully formatted, and excellently researched business plan for a product that canвЂ™t be built is not a good business plan. You donвЂ™t get points for ideas that canвЂ™t be implemented. The second measure of good or bad in a business plan is realism. So itвЂ™s entirely possible to have an excellent business plan thatвЂ™s never been printed, that isnвЂ™t edited, that contains only cryptic bullet points that only the internal management team understands.ДЄnd itвЂ™s also possible to have a well written, thoroughly researched, and beautifully presented business plan thatвЂ™s useless.Дў. Factors like readability and ease of navigation and covering all the main points depend a lot on whether those qualities affect achieving the planвЂ™s business objective. There are a lot of branches on that tree. IвЂ™m going to resist the temptation to write about what people look for in investment-related plans, and then the plan for lenders, or the operational plan. Does it achieve the business objective?ДЄt this point itвЂ™s hard to avoid going into branches. So point one, what makes a good business plan, is that it fits the business need. A plan that might be great at selling the company might be bad at supporting a loan application, or for managing a company.

My favorite business plans are about managing: starting and growing a company.

Some have a support objective, reassuring a lender about risk, usually with assets. Some of them have sales objectives, selling an idea, and a team, and a market, to investors. But the plan as part of high-end startup looking for VC or angel investment does in fact have to present the business to outsiders. The business plan used internally to manage the company doesnвЂ™t have to polish and present the company to outsiders, so it probably lives on a network, not on paper. Those are specialty uses, that apply to some business situations, while almost all businesses ought to develop management-oriented business plans that exist to help run the company, not to be presented to outsiders. Some are supposed to support loan applications. You have to start with whether or not the plan achieved its business purpose. We simply canвЂ™t look at business plans as generic. With that in mind, here are some of the qualities of a good business plan, in order of importance: But there it is, a cold hard (although hypothetical) number. You take the money in the bank with the business plan and subtract money in the bank without the business plan, and thatвЂ™s the value. The actual calculation is pretty hypothetical. Like just about everything else in business, the value is money. As a genuine ex-hippy baby boomer entrepreneur, I like touchy-feely do-gooder measurement systems. ThatвЂ™s hard for me at least, maybe not for you, but for me. HereвЂ™s the hard part, right at the beginning: the value of a business plan is measured in money. Then I realized that answering these questions is blogworthy. I balked at first, because I think IвЂ™ve answered these questions before, on this blog, or on my other blogs, or at or. YesterdayВ I got an email from an MBA student asking me four questions. This is the first of four answers to interesting questions.

How to come up with the best business plan