11 Dec How to Bring a Plan to Life
Bringing a Plan to Life
“It’s not the plan, it’s the planning.” This simple statement says so much about where we get real value from the endeavor of planning in business. All of us know of plans that stayed harmless and ineffective because they stayed on the shelf. All of us know of plans that were so silly, so devoid of substance because they were dreamed-up at the top with no grounding in the realities of execution, that people never paid attention to them. And most of us can remember a whole handful of people vacating their conference room chairs with a warm feeling under their nametags – and thinking that somebody else was going to do something about what they just discussed.
When a plan become a wellspring of strength, a touchstone of direction that empowers people to take action and exercise initiative, a measuring stick against which awareness is built and performance is evaluated – and rewards are prompted – that’s because somebody realized that the plan itself is just the outward and visible sign of concerted human thought and regular communication. In effect, the plan itself is the boobie prize, unless people use it as a map, and a yardstick, and a compass.
As the year draws to a close, and most businesses are trying to avoid in the coming year the first mistake of planning – not doing one – let’s share some reflections on business planning from our experience and contacts.
Most business heads are experts at something. That specific talent or grasp of a subject is what put them in business in the first place, especially in today’s economy of knowledge-based businesses. However, few indeed come into business with actual business skills. Passion and ability created the business, but the skills to run it effectively and profitably are as different from the subject of the enterprise as mining is different from construction. There’s different stuff to know. For the entrepreneur, it is often a slow awakening to discover that business is more than common sense, addition, and subtraction.
This knowledge gap, between the core business and the know-how to run it, is so widespread that it got a name, the E-myth, in a book that’s now a quarter-century old. “E” stands for entrepreneur, and the myth is that the brilliance that put him or her in business can make running that business an easy, incidental thing. Not true, as it turns out.
Mistakes and How to Avoid Them
In our experience at REI Commercial Capital, we see examples of losses sustained and opportunities missed just before our arrival, because there’s more to business finance than the mastery of generally-accepted accounting principles. In other words, with all respect to the CPA colleagues on whom businesses depend, there’s more to being smart about your business than accounting. Even proper accounting doesn’t always add up the awareness that business owners need to lead effectively.
Thinking success will come overnight heads the list of common planning mistakes. Overnight might be an overstatement, and too easy to dismiss as dumb on its face, and yet one of the mistakes we see most often in business plans is overestimating income, and underestimating the time it takes to build a customer base and achieve it. Our perspective from running construction and development firms, and from manning financial posts at Fortune 500 companies, has brought with it a perspective on earnings and timing that comes from a broad base. Clients find it to be a game-changer when this perspective tempers their own projections. The passion that put you in business is vital, but it can often lead to wrong conclusions about earnings and timing. Here’s a crucial point where REI can shed the light of awareness.
Focus is one of the real benefits of a plan, and one of the first advantages that goes out the window if the plan stays between the covers of a book. A well-built plan serves as a sieve for filtering the flood of distractions that business activity attracts. A plan that’s brought to life can give everyone who uses it a clearer tool for seeing what’s important, how important, and for seeing that all-important difference between the urgent and the important. Here, it’s tempting to recall the statement by WWII Supreme Commander, Allied Forces Europe, Dwight Eisenhower: “I have two kinds of problems, the urgent and the important. If it’s urgent it’s not important. If it’s important, it’s never urgent.” Pretty harsh and radical, but you have to admit, it worked well.
An effective plan is the Rosetta stone for you and your team that enables you to focus, to see the difference between the urgent and the important among all the demands and decisions that come with a business. REI can help you form a plan that serves this purpose well.
Breathing Life into the Plan
Not sharing the plan, and failing to check back, are two of the other key hazards to avoid when it comes to planning. The plan needs air to come to life, just like a fire. Otherwise all you’ve got is fuel and heat. The air comes best before the plan is concluded, by involving key people and according them specific responsibilities for aspects of the plan. When the team takes part in planning, it’s hard for them to avoid ownership when ongoing measurements bring corrections to their door. There are many formats for conducting a guided planning discussion. SWOT – Strengths, Weaknesses, Opportunities, and Threats – is a well-known agenda that still serves well for putting team-members’ observations into usable stacks.
Making it measurable is a planning skill that pays off in awareness. There’s no shortage of data in this digital age, but the data means nothing without a point of comparison. Where are we versus the plan? Are we progressing toward our goal? We never know, if the plan doesn’t include measurement. Pointing back to those goals, and the measurements against them, is perhaps the most important way to bring the plan to life and put it firmly on your side. Responsibility and reward can be hinged on these measurements, and there’s no better way to ensure that the plan is working even when you are not.
Now, here’s the graduate-level thing. Knowing when and where to make the plan flexible is a key factor for success. These are not Moses’ laws, and Charlton Heston didn’t come down the mountain with five under each arm. Yet changing plans willy-nilly is just as good at neutralizing their effectiveness as leaving them on the shelf. Knowing when to modify is one of the best reasons for following our final tip.
Absence of perspective torpedoes plans. A point of view from outside the bubble can be as valuable as the plan itself. That’s where a mentor or guide or coach comes in, and it’s a feature of every successful business career. Ask anybody whose success you admire, and chances are they’ll admit they had a guru. That could be the final card for deciding to get acquainted with REI Commercial Capital. Clients have depended on us for our perspective – from our portfolio of skills and resources – so broadly that we call our consulting practice “the 21st Floor,” a nickname from our Fortune 500 executive suite days. Call us and see how to put that big-company power in your plan for 2020 and beyond.