Depending on the type of person you are, approaching the task of writing a business plan can either be exciting, or an unbearable chore.
Regardless of which side of the fence you fall, with the amount of time it takes to write a really good plan I think it's only natural to ask yourself "Do I really need a plan?"
Consider This
According to a new study, the Small Business Administration found that writing a plan early in the business planning stage could increase your chance of success with your new venture.
However, the reasons for this may be a bit different than what you may think, quite simply it appears that:
Those who plan, do!
As the author of the report states:
"...challenging prospective entrepreneurs to accomplish a formal business plan early in the venture creation process will likely enable them to engage in additional start-up behaviors that could further the press of venture creation"
Business Plans Speed Development
Not surprisingly those new ventures with a plan developed early in the start-up phase of their businesses more quickly completed other phases of the startup process.
It stands to reason that if they have taken the time and effort to create a formal plan, they are the type of individual who would want to act quickly on the plan they developed.
Activities vital to a businesses success early on, such organizing finances, getting your team together, or developing a marketing plan are more quickly acted upon by individuals who have a plan for them. This speed to complete important tasks cannot be underestimated in the early success of the business.
Improve Your Odds
By writing your business plan early in your start-up process you will improve your odds for success according to the study. Early in the process is the most important factor they found in increasing your chances for success.
Not only will you be setting a solid plan by which to follow, the simple act of writing a plan will help put you into action mode.
Also, by having a well thought out plan early on you may be showing potential investors and other supporters that your business is feasible and gain their assistance as your move ahead.
Your First Step
While the conclusions of the study can be debated, and there will be some who think a business plan isn't necessary, for those of you who have been wanting to start a business but haven't acted yet this study should give you reason to get going!
Regardless of if you think a busineness plan is essential, there is now evidence that the mere act of writing the plan will spur you into doing. Congratulations, you've just found your first step to get you moving in the right direction.
Start today and give your business the jump start it needs, and keep in mind that planners – do!
What do you think...are business plans necessary?
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{ 4 comments… read them below or add one }
I do agree with the fact that being active early in the process is a good indication of what’s ahead, of the “wherewithal” of the individual.
Planning your start-up is must,
but…
writing a formal business plan isn’t!
Writing a business plan is, too often, a science fiction novel. There is a lot to do before writing a business plan…
@Alain Theriault
Agreed with the part that there is a lot to do before even writing a plan, but as a tool to get you moving and doing something I think there is value.
At least it creates action, which can be a big barrier for some who feel like they don’t know where to start.
Matt
“for those of you who have been wanting to start a business but haven’t acted yet this study should give you reason to get going! ” Period.
Great resource. Good post.
For me, I think planning is crucial. Like you have mentioned in your blog post, a startup requires an entrepreneur to deal with a lot of things at the same time and most of these things have different priorities.
However, instead of a formal business plan, I do mind mapping and to-do list to plan what’s next for me. If you asked me, a formal business plan is just something to show others (potential investors, lenders, judges in a biz plan competition). If it is just to organize your tasks and to make you more productive, one could adopt the crappy plan that only they themselves understand.
Wayne Liew
http://www.wayneliew.com