So point one, what makes a good business plan, is that it fits the business need. At this point it’s hard to avoid going into branches.
I’m going to resist the temptation to write about what people look for in investment-related plans, and then the plan for lenders, or the operational plan. Factors like readability and ease of navigation and covering all the main points depend a lot on whether those qualities affect achieving the plan’s business objective. The second measure of good or bad in a business plan is realism.
This is the first of four answers to interesting questions.
Yesterday I got an email from an MBA student asking me four questions. I balked at first, because I think I’ve answered these questions before, on this blog, or on my other blogs, or at or
Plans in drawers, or locked on a single computer, only work when it’s a one-person organization and nobody else has to know the plan. It gets people committed Here too it’s about the process surrounding the plan, more than the plan itself.
The plan has to have the specifics in point 3 and responsibilities as in point 4, but the management has to take them to the team and get the team committed.Then I realized that answering these questions is blogworthy.So here is the first of four: What makes a good business plan?We’re judging the plan by the business improvements it causes; in some sense, by the implementation it causes.So people in charge have to know and understand the plan.A business plan refers to a written document that comprehensively outlines what your business is, where it is going, and how it will get there.The business plan outlines in specific terms the financial objectives of your business, and how it will position itself to achieve those goals in the context of the current market environment.As a genuine ex-hippy baby boomer entrepreneur, I like touchy-feely do-gooder measurement systems. Like just about everything else in business, the value is money. With that in mind, here are some of the qualities of a good business plan, in order of importance: 1.It fits the business need We simply can’t look at business plans as generic. Those are specialty uses, that apply to some business situations, while almost all businesses ought to develop management-oriented business plans that exist to help run the company, not to be presented to outsiders. The business plan used internally to manage the company doesn’t have to polish and present the company to outsiders, so it probably lives on a network, not on paper.You have to start with whether or not the plan achieved its business purpose. But the plan as part of high-end startup looking for VC or angel investment does in fact have to present the business to outsiders. Some of them have sales objectives, selling an idea, and a team, and a market, to investors.Some have a support objective, reassuring a lender about risk, usually with assets.