This is a guest post by Alex Jordan, entrepreneur, business consultant and Sage Business Expert.
Creating a business plan is an essential step in turning business ideas into viable enterprises. Business Plans are excellent tools because they allow you to explore the feasibility of your idea and determine the resources required to launch your business. But getting started with a plan can be daunting, especially as it may be the first time you are scrutinising your business.
I’m a big advocate of business plans as they are a great tool for vetting ideas and can assist in the development of the strongest ideas. Over the past few years I’ve had a lot of ‘great’ ideas, only to find that the majority weren’t worth pursuing after putting business plans together. For those I did pursue, the plans helped me develop strategies.
I’m not going to explain in detail how to create a business plan but you can read a post on the Sage UK blog on how to write a killer business plan. I will offer some of my own thoughts and insight that I’ve picked up over the past few years:
It’s very easy to see a business plan as a rule book that must be followed to the letter. But developing a business plan that incorporates everything right from the start is impossible, and at the very least would require an awful lot of time, research and planning. As with most things, simplicity can go a long way.
By exploring only the key issues, you break through the clutter and ensure you are not wasting time on the wrong tasks. You can always develop ideas later on and expand your research, but by starting simple you have a strong foundation to build on.
Business plans are not fixed. Market forces are constantly changing, with new opportunities and threats arising. Skills and knowledge will change over time and financial circumstances will inevitably change too.
Being able to adapt your business plan to meet these changes is essential. For example, what would happen if a competitor beat you to market? Or you discovered a need for a new feature on your product? If you stuck to your original plan then it’s likely you’d fail pretty quickly. So rather than seeing a plan as a fixed process, think of it as flexible and use and adapt it to guide you in your decision making.
It’s easy to ignore the difficult questions or problems that may be highlighted from creating a business plan. Whilst it is always recommended to have other people look over it, you should also get into a mind-set that ensures you ask yourself difficult questions and face home truths.
For example, if you are launching a new product and your research suggests that the market is extremely competitive, you may choose to ignore the significance of this because you are in a mind-set that has committed you to launching your product.
By using the business plan as a tool, it can help you see the reality of the situation, allowing you to devise a strategy to tackle the market and help you identify what resources are required. You should be open to the possibility that your idea is not viable.
Business plans can’t make you successful alone, but using them as a tool to help you develop your business ideas and form a strategy will certainly help you think about the right things to make the right business decisions.
About the author: Alex Jordan
Alex is a digital entrepreneur and business consultant specialising in start-ups and digital media. He is the CEO of Hyperlink Media, a digital agency based in London, and having previously worked at Durham University’s Centre for Entrepreneurial Learning Alex also spends much of his time mentoring students, helping them develop their ideas and grow their start-ups.