Last week I wrote an article (can be seen here) about the losing fight being waged by entrepreneurs of both start-ups and established business alike against the basic rule of business - having a plan. I was taken aback by the chord it struck with readers around the world (over 11,000 views) and honored it was selected as a LinkedIn Editor's Pick.
One common question I have fielded since that article was published is:
"Why?... Why don't they have a plan?!"
I’ve been consulting with business owners for over 15 years. Clients typically call because sales are slumping or things are seemingly out of control. They feel lost about where things are going and are just along for the ride. When trying to diagnose what might be wrong I will always first ask to see the plan for their business. The common response, “What plan?” or they will point to their head and say, “It’s in here”.
What has always intrigued me is when I ask these same people if Coca Cola has a 3-year plan. Or Boeing. Or Starbuck. They, without hesitation, will say, “Of course they do!” Yet when it comes to their own businesses - no plan.
Remarkably, 90% of private business owners operate without a plan.
Here are the 8 most common reasons I have heard for this short-sighted practice.
1. "I'd rather DO rather than plan."
Clients have said they would rather do anything than plan. Fix a machine, support a sales call, talk to a supplier, or review a new website. In doing these things they get immediate gratification of accomplishing something, of solving an immediate problem. They rationalize this is the role of the President and owner, to solve problems, to be an expert on all matters and keep the business humming along.
2. "It’s just not possible to do any long-term planning for MY business, it’s just too dynamic and unpredictable right now."
“Mike, you don’t understand. My business is different.”, is a commonly heard phrase. Then they will site all the day-to-day chaos they manage as evidence. Employee performance issues, a customer cutting their order in half, an upcoming conference to prepare for, a new competitor emerging, and the list goes on. “In such an environment, how do you expect me to do any long-term planning?"
3. "Time spent on this is just not worth the effort."
Citing reasons (1) and (2) they will rationalize that it just doesn’t make sense to spend precious time on this long-term thinking right now. Some will further justify this position by recalling an instance where a plan was produced only to sit on a shelf - never to be referred to again.
4. "I don’t know how."
I have had owners tell me they intended to do this for years. Some even locked themselves away and stopped taking calls for the sole purpose of crafting a strategic plan. They admitted only getting as far as typing ... “Strategic Plan” ...at the top of a blank Word document. They add that despite the fact there are numerous resources on the web for how to do this very important and cerebral activity, “it is hard to have any confidence I am doing this right”. That’s not surprising. Building a quality, viable strategic plan takes experience just like any other discipline required to run a good company.
5. "What if it’s not the right plan?"
Here is the logic behind this excuse. A plan puts our company on a certain path. If the plan is the wrong path that could spell disaster. “No plan means I have the maximum flexibility to adjust in real-time based on the real-time dynamics of the business.” I’d like to see a CEO of any public company give this rationale to their Board of Directors or a startup to their principal investors.
6. "I don’t want to be hand-cuffed on how I run my company."
A written plan means accountability. “Publicizing our plan means committing myself (the owner) to accomplishing things in certain timeframes, right?” Yes it does. "Failing to meet written milestones may reveal I am not a good leader." I wrote an article about how paralyzing this can be, "The Spotlight Effect" .
7. "I’ve operated this long without a plan and it seems to be working for me."
Why change? This is one of my personal favorites because I invariably find abysmal marketing initiatives, costly bad hires, and expensive, ultimately aborted excursions into new markets that would not have otherwise been pursued had they been operating to a plan.
8. "I don’t have time."
“I know I should but things are just too busy right now for me to do any planning. Maybe later when things slow down.” Hint: Things never slows down.
Do you recognize these excuses? Have you used them yourself? As we approach the 4th quarter you have an opportunity to reflect on your business and your leadership thus far.
There is no doubt you possess a wealth of quantitative and quantitative data - inside your head. But that jangled mess of important information benefits no one there. The planning process draws this out and turns data into an actionable script for your company.
What has always intrigued me is when I ask these same people if Coca Cola has a 3-year plan. Or Boeing. Or Starbuck. They, without hesitation, will say, “Of course they do!”
Yet when it comes to their own businesses - no plan.