4 - Document the plan
The extent to which a business plan is documented is a personal and business choice. To avoid the risk of misinterpretation, however, it is best to write down your plan.
The very action of writing down goals and objectives and the overall plan gives the process more rigour, enables a deeper level of thinking and clarity and can impose greater discipline.
Further, research has clearly shown a person’s wellbeing index (happiness) can be significantly improved when they achieve their goals. When these are easily identified because they are in writing, personal happiness is generally better. This is a key reason for the formal planning process and, in particular, writing it down.
While the business owner(s) may have the final say, input from staff, suppliers and advisers can be incorporated if the plans are written and easily shared. This helps everyone involved in the business to acquire a sense of achievement.
Accountability, including tracking progress towards the goals and objectives, is easier when they have been recorded.
Goals and objectives need to address short-term (this year), medium-term (3-5 years) and long-term (next 10 years) and this is difficult to clarify without a written plan.
Determining and balancing priorities, including between conflicting objectives, is easier when they are documented. In part, this will involve determining the core values of the business and determining the priorities on that basis.
Writing a plan down makes the process more formal, which is helpful if objectives need to be set and decisions made in an area where you do not have extensive experience.
Documenting a plan is also useful when you are seeking financing or external investors. Finally, it always makes for good reading to go back over your plans and see how you have grown and succeeded.
Tool 1.12 provides a structure or format for a written business plan. While you do not have to follow this to the letter, it gives a good indication of the information you will need to document during the planning process.