Lessons Learned #42: Your Business Plan – From Dream To Reality

Two years ago in an issue titled “What Makes Your Business Different?” I asked several questions designed to get you thinking about managing your business from a “big picture” perspective (see Issue #28).

Where is your business today, and how does it differ from your competitors? More importantly, what is your goal for your business and what is your plan to get there?

In my consulting work over the past 26 years, I’ve had the opportunity to interact with businesses of all sizes. I have observed many different styles of management and noted a variety of organizational structures that were employed to achieve similar end results; namely, the construction of new facilities, or maintenance of existing properties.
There are two general observations that emerge from my experiences:

  1. There was usually a notable difference between the perception, or image that I had of a company (based on my external exposure to them), versus the impression that I obtained once I interacted with the company from within (based on direct management exposure).
  2. The overwhelming majority of the companies did not have an actual defined business plan that they could articulate (never mind a written one) which could be used to guide them on a path to achieve their goals. The closest thing some companies had was a mission statement which could have been written for nearly any business.

This confirms one of the fundamental management problems of small businesses – the lack of a defined business plan that is designed to achieve the goals of the owner(s). Most construction companies I deal with seem to be operating on the “one size fits all” business plan. They do what everybody else seems to be doing, regardless of the results (or lack thereof) in the marketplace. Year after year, project after project, they go about doing things the way that each new manager thinks is best. As a result, it’s not uncommon to find a variety of management styles and systems in place within a single business.

This ad-hoc approach to management is confusing and error-prone. In addition, since it is not a unified approach, it won’t advance the goals of the company and creates internal conflicts that, over time, will set the company back.

Let’s face it, even though your business may be providing the same basic functions as your peers, it’s NOT THE SAME as all others. For starters, you and your key employees possess different strengths and weaknesses than your counterparts in other companies. Off the top of my head I can list a few reasons why you would want to have your own specific plan for the success of your business. This is due to the differences that exist in the following factors:

  1. Owner(s) objectives for business (including risk tolerance).
  2. Working capital, lines of credit and bonding limits.
  3. Managerial staff depth, experience and comfort with certain types of work.
  4. Quality and experience of key field managers and superintendents.
  5. Management structure.
  6. Geographic interest.
  7. Management staff’s strength and breadth of contacts.

I could continue listing factors, but my point is that due to the differences between businesses, when it comes to planning, one size doesn’t fit all.

Creating an effective plan for a business is an exercise that should be taken seriously. There is no simple short cut, magic solution, just as there aren’t two companies that are exactly the same. Coming up with your plan is a process that will vary in much the same way as personalities and personal goals vary. Some companies find it useful to seek outside help to guide them through the process and to provide a framework for development. One approach is to begin with a special meeting of key personnel to create the backbone of your plan. Then, turn it over to a few executives to complete the details.

Good business plans take into consideration the philosophy of the business owner(s) and their vision of the future for their company. The plan will need to consider the strengths and weaknesses of its key staff, the company’s financial condition and many other factors which, in the eyes of the executives, will interact to achieve the desired results that will determine the future success of the business.

In order to construct a realistic plan, you need to begin with an honest assessment of where your company stands today in all areas of the business. In creating a plan, it’s useful to think in terms of short-term objectives that will advance you toward the long-term goals you want to achieve. Constructing a business plan does not have to be difficult. Done properly, it can produce results you’ve only been able to dream about.

So, I ask you once again – do you have a plan to reach your goals? If not, why not get started today!

I wish you great success in turning your dreams into a real plan for your business. With my best regards, Paco Farach.

“There are some people who live in a dream world, and there are some who face reality; and then there are those who turn one into the other.” – Douglas H. Everett

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