It is a simple statement: all business plans are wrong, but nonetheless vital.Tweet
It is paradoxical, perhaps, but still very true.
We’re human. We can’t help it. We’re predicting the future, and we’re going to guess wrong.
But they are also vital to running a business because they help us track changes in assumptions and unexpected results in the context of the long-term goals of the company, long-term strategy, accountability, and, well, just about everything lean planning represents.
First You Do Your Business Plan
All of which is why the best way to manage your business is with lean business planning. That’s a simple plan to start with, just bullet point lists and tables, setting down strategy, tactics, essential numbers, and execution specifics.
Then You Review and Revise Regularly
A good planning process is to business what a GPS plus real-time traffic and weather is to a driving trip. The plan is like the destination (strategy and tactics) and the route (tactics, execution specifics, and essential numbers). The business plan is wrong only temporarily. Like steering, you keep making corrections.
So the business plan itself is an important first step. To optimize for you business, though, you can’t stop there. You need to have regular monthly business plan review. Look over plan vs. actual results. Turn the planning into a dashboard.
Measure the value of a business plan by the execution it causes.Tweet
It’s about getting what you want from your business. Forget the big formal business plan document of decades ago. Forget the fact that the plan will be wrong. Keep it simple. Do only what you need. Write it down and keep track of it so you can look back in a few weeks to check what you thought would happen and compare that to what actually happened. Your business plan is wrong, but it’s vital to good business management.
Use the planning process like a GPS for your business — the plan as destination and route, and monthly plan review for constant course corrections.Tweet
Do a lean business plan — keep it lean and simple — then track results and review and revise regularly.Tweet