Your business plan is your formal statement of your business goals, the reasons why you believe they are attainable, and your plan for reaching those goals.
In the book "What They Don't Teach You in the Harvard Business School" (Bantam, 1986), author and business success expert Mark H. McCormack talks about a study conducted on students in the 1979 Harvard MBA program. In that year, the students were asked, "Have you set clear, written goals for your future and made plans to accomplish them?" Only 3% of the graduates had written goals and plans; 13% had goals, but they were not in writing; and a whopping 84% had no specific goals at all.
Ten years later, the members of the class were interviewed again, and the findings, while somewhat predictable, were nonetheless astonishing. The 13% of the class who had goals were earning, on average, twice as much as the 84% who had no goals at all. And, what about the 3% who had clear, written goals? They were earning, on average, 10 times as much as the other 97% put together.
Do you have a business plan? Is it in writing and regularly reviewed? If your answer to one or both of these questions is “no”, what are you waiting for? This 6-step guide will help you develop and get into writing a formal business plan, including your vision, mission, values, beliefs, goals, strategies and your tactics to meet those goals.
Step 1: Develop your vision
This is a crystallization of what you want your practice to become and guides the development of strategy and organization. It describes an inspiring new reality and is achievable within a specific time period. The vision statement is primarily useful internally. It answers the question, “What do you want to become?”
Step 2: Develop your mission
This is a statement explaining why your practice exists. It provides context for all decisions made within your practice and describes an enduring reality. It is capable of infinite fulfillment not subject to a time frame. It can be used with both internal and external audiences. It answers the questions, “What do we do, for whom, and what are the benefits?”
Step 3: Set your goals
Goals are the desired result you envision and commit to achieving. They are your desired end-points in your plan development. You reach goals within a finite time by setting deadlines. Ideally, goals are specific, measurable, attainable, realistic and time-bounded (S.M.A.R.T.). Goal setting serves as an effective tool for making progress by ensuring that participants have a clear awareness of what they must do to achieve or help achieve an objective. The process of setting goals allows people to specify and then work towards their objectives.
Step 4: Develop your strategy
What is your plan to beat present and potential competitors? What are your high-level sets of actions to provide products or services that create more value than their cost? What is the "value proposition" chosen by your team? Strategies have to be flexible as they need to change in response to analysis, customer experience and trial and error. Strategies are for internal use.
Step 5: Develop your tactics
These are the actions you will implement, the setting of specific tasks you employ to accomplish your goals and help achieve your strategic targets. While strategy refers to a direction toward a goal, tactics are the actions taken to support that strategy.
Step 6: Your action plan
Describe the individual steps you will use to execute the tactics, i.e., how will you get there? How will each tactic get implemented and completed? Outline each component that must be completed and the appropriate time frame.
In summary, heed John L. Beckley's quote, “Most people don't plan to fail: they fail to plan." You need a plan, it must be written and it needs to be reviewed weekly or biweekly to keep it alive. The time to start planning is now.
Eric Sheikowitz and Michael Silver are the founders and senior managing partners at Focus Partners, a practice management coaching and consulting firm. David Leo, strategic partner and senior coach at Focus Partners, contributed to this article.