Lately I’m concerned with how often I read people who should know
better suggesting to would-be startups that they shouldn’t do a
business plan. The best of them mean well, they are trying to say
“don’t do a thorough, complete, formalized business plan” but doing a
very poor job of explaining. I don’t think they really mean “don’t
plan,” as in don’t know what you’re doing. If you ask, they’d answer
that of course you need to focus and prioritize and set your steps and
track results and, most important in small business, manage your cash.
The worst of them are just parroting something that sounds cool and contrarian.
Because of this concern, I want to point out to people
that planning is good, and if you’re looking to start a new business or
grow an existing business then you should be planning. It’s dumb not
to. Why deprive you and your business of the benefits of focus, setting
goals and tracking progress, planning cash flow, prioritizing, and
managing a plan.
To that end, I’m doing a series of posts on how to take
simple first steps. Get yourself and your business going on planning
and you’ll see the benefits and keep going with planning. This is the
Think of strategy as focus. You don’t need an MBA degree
or complicated framework. Just focus on something that you and your
business can do in your world better than anybody else. Your world can
be your town, your block maybe, your neighborhood, your industry, your
segment, or some other very well defined subset of the world. How are
you different? What can you tell the world about that? How can you
explain it? What medium will you use?
All of this is about focus. Focus on specific areas of your
market, specific market segments, specific product subsets, specific
Example: don’t just be a good restaurant, be the best
restaurant in your market at something; anything. Have the best
breakfasts, or best desserts, or best soups. If you must be the
cheapest, good luck with that, it’s one of the hardest ways to make a
go at a small business. Being the best and having pricing to match is
generally a better way to go.
Ideally you can help with this by asking yourself some critical questions:
What is my core competence? What do I do better than anybody
else? Don’t kid yourself, you can’t be the best, the lowest price, and
the fastest delivery at the same time. That’s just not credible.
What are my strengths and weaknesses? What opportunities and
threats do I perceive in the external market? That combination of
strengths, weaknesses, opportunities, and threats by the way is called
SWOT, and it’s a great way to bring a group or team together and start
thinking about strategies. Put it into a brainstorming session, use
Resources: The Dip, by Seth Godin has a very strong treatment of focusing and being the best in your particular slice of the world.
My book Hurdle: the Book on Business Planning has a chapter called “Strategy is Focus.” The link here is to the free online version.