Necessity or passé?

A room full of entrepreneurs who had written a business plan were asked if they had actually looked at it since launching their business. There was a resounding ‘no’. Then they were asked if the business they now owned and ran looked anything like the one they had written about in the business plan. Another ‘no.’ They all admitted that they had written the plan simply because they thought that is what you’re supposed to do. They had exerted great effort on a document that they would not look at again. How does this make sense? And this is from entrepreneurs who made their idea work – these were the successful ones…

Gary Vaynerchuk – video blogger and accomplished business owner says: “A Five Year Plan is impossible in a world where what five years represents is so different than it used to…think about what five years ago looked like.”

The truth is that you can’t predict how things will look in just five months’ time, let alone five years. Right now, businesses have to be agile, prepared to rethink and reinvent what they do and how they do it.

So, NO business plan? Well, we doubt that Mark Zuckerberg laboured for weeks trying to decide what Facebook would look like in 5 years—and then put it down on a spread-sheet. But we do believe he had a goal. And goals are powerful. The world is full of thriving businesses that began without a big, explain everything, business plan – but they had a goal, a vision, a desire and passion.

“Really, a business plan is another way of saying ‘guess’, a strategy is another way of saying ‘hunch’. The awful truth is that we don’t know what will work”, David Hieatt, co-founder of Howies Clothing Company.

So does your business really need a plan?

David Heinemeier Hanson of 37 Signals was asked what role instinct has played in the company’s success: “We rely heavily on instinct. An instinct that has been developed and formed from a decade in business. Sometimes careful analysis is helpful, but often times you’re just trying to justify what your instinct is already telling you. Why not follow that straight from the get go?”

Is your business plan merely a thumb-suck because we don’t know what will happen in 5 months’ time – let alone 5 years from now?