When talking to small business owners, I find myself often trying to explain or rather clarify the difference between a fully kitted “Business Plan” and an implementable “Action Plan”, as many seem to use these terms interchangeably.
In my experience, breaking these concepts down to their bare basics helps people gain perspective and start thinking about these two very important ideas that provide two very different outcomes. The first point to make, is that I believe both are of equal importance and by taking a holistic view, they attempt to answer two of the big questions: “What is the business actually about” and “How will it achieve or fulfill its vision and purpose”.
When I first meet potential clients and (on the rare occasion) discover that they have actually done some form of business plan, I get super excited! But even with the understanding that business plans are typically reviewed periodically, my enthusiasm quickly dwindles when they tell me things like: “Ah my accountant has it” or “Yeah….spent weeks on it, great exercise, but been so busy and things have changed so much, I can’t remember most of it”. All that great study and energy spent on the company vision, mission and values to working on a complete market and strategic analysis followed by the financial forecasts – now just collecting dust somewhere. What a waste don’t you think?
Digging below the surface, implementation or lack thereof soon became the buzz word in these conversations, which is then often accompanied by a myriad of excuses (bundled up as two words: “No Time”). By actively listening, the other observation made was the widely held view that business plans often have the stigma of being inflexible and given the nature of such a rapidly changing environment, are now being scrutinised even further. Despite all this, we all know that a well thought out business plan is a must, however if we are not regularly referring to it, tweaking it or living it – then where does its value lie?
On the other hand, a simple but powerful action plan seems to relate more to small business owners as it can focus on both business and personal aspirations and also has the opportunity to add that secret ingredient of accountability if done correctly or supported by a professional. Implementing strategies within the plan can also result in quick results and these small wins continue to build momentum, which in turn gives back the time and energy to redefine or engage more with the overall business plan.
There is no better time than the now to take stock of where you are at and perhaps think about starting the planning process in the direction that resonates most. However, a useful tip I share with many, is to rather view these two different plans as interdependent rather than two competing processes.