Business plans take research, analysis, and, quite frankly, a great deal of work. When you finish one, it seems as solid as a sculpture carved of stone. You can see the business being assembled: the market accepting, buyers buying, factories cranking up production, job candidates applying, supervisors training, and revenue flowing. The solidity of the plan is what bankers and backers bank on.
As soon as the laptop’s proverbial ink is dry on the business plan, however, things begin to change. Gas prices go up, US drivers drop their gas consumption, whole grain consumption gains, the carb-free diet is saluted by a big star, housing prices drop, funding for new sports facilities surges, war injuries increase, a new prosthetic hand is invented, China’s growing middle class demands higher wages, Europe’s recession deepens, and so forth. Meanwhile, a half a million new startups are started. Some or all of these things may directly or indirectly affect your business plan. Suddenly the plan is more rocky than rock-like.
Entrepreneurs are nothing if they aren’t resilient. By nature, they cause change by creating something that wasn’t there before. Seeing the connections between seemingly disparate events can help entrepreneurs to understand the likely impact of change on their plans.
Here’s an example of business plan evolution. In late 2010, I created a qualitative research business. My step daughter joined me and we spent half our time on business development and the other half on interviewing entrepreneurs to create the content for the 100 Entrepreneurs Project, a course designed to help wounded veterans see the breadth of opportunities available after their recovery.
Only after the business was launched and we had thrown ourselves into business development for market research, did I recognize the impact of two dramatic trends. First, the recession had tightened every company’s marketing budget, from startups to multi-national companies, and the belt tightening continued even through 2011. Meanwhile, technology and social media alternatives had created new ways of conducting and distributing surveys, such as popups, which transformed the definition of market research. Companies that would have conducted qualitative research in earlier years, were turning to the internet to conduct quick surveys. It’s a bargain!
Our interviews with entrepreneurs had become more time intensive. More than 100 have been interviewed so far. In addition, we created case studies, analyzed the data collected, prepared class presentations, and recruited class speakers and mentors for the wounded veterans. The company transitioned from a market research company to a research and education company. Later this year, these interviews will be the source material for a book, so our plan now includes research, education and publishing books. This changes the business plan dramatically!
But that’s not all. One of the very bright veterans in the class last year told me that the vets had short attention spans. He said their training was to prepare for the next thing, and the next and the next. I thought about this and realized the same could be said of entrepreneurs in general. We prepare for the next thing, and the next and the next. Time is a precious commodity. We don’t like to waste it, and we like to do more than one thing at a time. This led me to believe that the lessons learned from the more than 100 entrepreneurs we interviewed could be categorized and distilled into short stories and articles and provided via an App. While waiting in line, on a train or in the airport, going to the next thing, entrepreneurs could tune in to the lessons learned from their mobile device and quickly garner opportunities and pitfalls that may apply to their businesses. Yes, that’s right, now my company, QA Company LLC, is an App developer, and beginning to create Apps for other companies and organizations.
The newest version of my business plan involves research, education, books, and Apps.
Perhaps this is why 17% of the entrepreneurs we interviewed have not had a business plan. A business plan is essential if you plan to get funding from someone else, however, they commonly morph and change, requiring time and significant effort to keep them current!
Here’s to all you entrepreneurs. Please invent, create, establish, recruit and grow!