What are the 3 types of business plans every business owner should have?
As a business coach, I am constantly asking my clients “what if” and “tell me more” questions. I know it’s my obligation to test and measure everything they are planning to do in their businesses before they set events in motion that can prove not just costly but downright catastrophic. One of those things, something that I continuously pound on with my clients is to have a current (that means this year) business plan that they review at least monthly.
But did you know that there are actually three different types of plans for a business that all are critical?
1. The most fundamental plan is your annual business plan.
We offer an annual planning process called GrowthCLUB where we take our clients out five years and then back their planning down to three years, one year and then one quarter, so they not only have longer-term vision, but also current goals, strategies and tactics that they can immediately set in motion.
As the old Asian proverb states, “If you don’t know where you are, then you can’t tell where you are going…”
So if you’re a business without a business plan you are subject to the whims of the marketplace rather than in control of your own destiny.
2. Special Situation Planning:
These plans contemplate the truly catastrophic “what ifs” that can affect your business.
- If you are suddenly taken ill do you have a process for notifying clients?
- Do you carry business disruption insurance?
- Are your files and data backed up?
- Does your business partner, or your spouse, have access to all your financial data, keys, usernames and passwords so that they can access financial records without getting a court order?
- If you die suddenly, have you selected a friend or family member to run your business, or are you just going to let it collapse in a pile of debts?
Any one of these “what ifs” can not only stop your business in its tracks, it can prove fatal to your business and financially detrimental to your family. You should routinely plan for special situations and even run scenarios at least on an annual basis.
3. Succession and Transition Planning:
- Are you prepared for the day when you want to retire, or at least reduce your workload?
- Do you have a successor lined up?
- Are you contemplating a transition or sales strategy?
You should be thinking at least 10 years out on these types of issues because it can take that long to put the right mechanisms and people in place to support your goals. So if you are older than 40, start thinking now about what you want to do with your business when you are ready to move on, or reduce your involvement. Because we all know that times moves faster than we want it to.
If you are interested in discussing any of these plans, contact ActionCOACH Business Coaching at 203-210-7003 and set up a Complimentary Coaching Session.
Don’t wait to start planning. Don’t plan in your head. Get your plans on paper as soon as possible.
