Startup: Get the Business Plan Right

Most aspiring entrepreneurs fail to recognize the importance of the business plan. If you want to be successful in business and in life, you need to be able to define your goals and targets and measure your progress as you aim to achieve them. For entrepreneurs, this is where the business plan comes in. Getting this important first step right will help to give you the focus you need as you grow your business and it makes it easier for potential customers to understand who you are and what needs you're fulfilling.

The business plan articulates your business idea and your reason for being. It includes an analysis of who's in your target market, who your competitors and potential competitors are, what sorts of laws and regulations you must consider, and of course how you plan on financing your operations (and why you think your venture is worthwhile in the first place!)

Yet, why do most small businesses fail to accomplish this important first step? Is it that they're put off by this "extra" work? The point is, articulating what your business is and how it will remain profitable and sustainable shouldn't be considered an extra workload, but rather a necessary part of your business strategy. Furthermore, you should periodically re-assess your plans to determine if the internal (resources, capacity, targets) and external (competitive, governmental) factors have changed since your last assessment.

If you want to give your business more focus and learn how to create your own business plan, you'll probably find some examples helpful to get you started. There are some free business plan samples available at BPlans.com, a resource which also features tips on how to improve and refine your business plans and grow your business in the way you intended. If you're still at a loss for creating a business plan that suits your particular business, post your comments below, or e-mail me at web (at) dilawri.com and I'll be happy to help.

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Bridging the Strategy and Operations Gap

A challenge for business leaders is the ability to connect their company's strategy with the operational side of their business. The shortfall, in most cases, is the inability of leaders to break down the organizational strategy far enough to be able to understand the details needed for the higher level plans to work.

In an interview conducted last year with Strategy+Business, Jack Stahl, former CEO of Coca-Cola suggested that situational leadership is the key leadership component that can help bridge the gap between strategy and the operational details.

Situational leadership is, as the name would suggest, a form of leadership which states that different circumstances call for different types of leadership. This type of leadership, proposed by Paul Hersey and Ken Blanchard, suggests that there are four different types of leadership styles, each best suited to its own set of circumstances:

1. "Telling" - these leaders outline the roles and responsibilities of their subordinates and manage them closely. This is perhaps the most common of the four leadership styles.
   
   
2. "Selling" - these leaders engage their subordinates more than the telling-types, and while the decision ultimately rests with the leader, the leader is also receptive to input from the staff.
   
   
3. "Participating" - these leaders delegate all of the decision-making responsibilities to their subordinates, and only act as a participator or facilitator of the discussions.
   
   
4. "Delegating" - as with the participating types, these leaders delegate the decision-making responsibilities to their subordinates; unlike the participating types however, these leaders do not participate in or guide the direction of the the discussions.

Surely, the telling-types are the most common examples of leadership, and the selling-types perhaps the most inspirational, but can a case be made for either of the last two leadership styles, the more hands-off participating and delegating styles?

Stahl seems to think so. CEOs must have a thorough and detailed level of knowledge of their business, and their company leaders must have a more thorough picture of the operational aspects of the business. To bridge the gap between the organization's high-level strategy and its detailed-level operations, leaders must be able to recognize which of the four styles of leadership will work for any given situation. Having leaders who have the ability to connect the strategy to the details is paramount, and having them be able to adapt to any circumstance and employ the appropriate style of leadership is equally as important.

Read the full interview.
Learn more about Situational leadership.

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Tying strategy implementation with strategy creation

Abhay Padgaonkar has written an insightful article on strategic planning and how meaningless it is without careful consideration of how to actually do the strategic implementation. He writes of the problems that come with formulating strategic plans that are unnecessarily long and too abstract, thus making them all the more difficult to implement.

Some of the more common excuses most company's make include: the preference toward status quo, lack of effective leadership at the higher levels, and an unwillingness to look at old problems in new ways.

The article goes on to explain how these companies can put together a strategic action plan that is as attainable as it is succinct and straightforward.

Read the full article here.

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