Overview

Click to go to amazon.co.uk

Nearly 20 years ago I wrote “Business Plans: how to make yours more successful” and that is what all my subsequent books on business plans and all my consultancy in the area have tried to do – I aim to help people to write more effective business plans.

Most business plans are not very good but with a little effort they really can be a lot better – and a lot more effective.

If you are considering buying my latest book, and I think you should, be aware that it is not really a step-by-step, handholding guide. It assumes the reader is prepared to do some of the work! If you are going to present your plan to a bank or investor or business partner you don’t want to find out in the key meeting that you don’t understand it – that there are questions you can’t answer. You must own this plan. It must reflect your passionate beliefs so, even if other people help you a bit, it must be your plan and describe your ideas.

My book sets out what key information should be in the plan, in what order, and describes key issues the reader should think about.

So….some brief points to think about

Your plan is a story…in this case a true one…about where you came from and where you are going to and what the readers must do to help you get there – and what is in it for them – and what the risks are. So tell your story: tell it briefly (don’t bore the reader) and tell it with conviction and with passion.

Discuss ‘the market’ and, particularly, ‘competitors’. It is amazing how many sophisticated people in business seem to believe they live in a world without competitors; they must do, because there is no mention of competitors or what they may do in the business plan. If asked they would be able to explain why the competitors don’t pose a real threat or else they would explain what they will do about the various competitive possibilities. But, the trouble is, if the entire subject is ignored in that written plan then there is no opportunity to explain these things in person, because the precious document finds its way, literally, into the bin.

Risk too is like competitors…absent from many plans. However confident you are, there is a risk that things will not work out. All business plans must include a section on what can go wrong, how likely it is, and what you can do to mitigate that risk. My book on ‘Critical Financial Issues‘ includes the example of Glaxo SmithKline, one of the world’s largest drug companies. Their 2009 director’s report has three pages of explanation of the principle risks facing the company and another three pages on the structures they have in place to deal with business risk. And yet…not a word about the reasons behind a US court case that eventually cost them $750m in fines plus: the costs of closure of a major manufacturing facility, legal costs, damage to their reputation…the best part of a $billion in total. Your business plan must not merely tell the reader that you have a court case outstanding; at the very least you will explain what has been done to avert future problems of that sort.

And data…the business plan veers one way or the other and seldom settles in the middle: there are no figures at all to support the proposal or else you are deluged with figures and can’t puzzle out what on earth they actually mean. So present relevant figures, clearly and explain what they mean. They provide evidence to support the business story. I am a great fan of Andrew Ehrenberg, who taught me at The London Business School, and wrote a book on presenting data, called Data Reduction, which is the source of my thinking on the subject. The only edition still in print seems expensive but it is worth buying it second hand.

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