How Strictly Should You Follow a Business Plan?

For an aspiring entrepreneur, one of the first tasks is developing a long-term business plan. But be prepared for it to be a guiding light rather than a rigid instruction manual.

How Strictly Should You Follow a Business Plan?

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You’ve been a good employee for other contracting companies, so you decide to take a shot at opening your own shop. You create a business plan to forecast what will happen in the next five to 10 years, and you’re off and running. How closely can you expect to follow your business plan? The answer may surprise you.

“I’ve never seen anyone follow their business plan,” says Dave Kaster, principal at Fidelis LLC, a business advisory practice in Green Bay, Wisconsin.

Kaster has written more than a thousand business plans with his clients. He recognizes the value of putting concepts and projections down on paper, but he also acknowledges the limitations.

“A business plan is like a battle plan. Like all of the generals say, ‘Once you engage in battle, all of the plans go out the window,’” Kaster says.

You may envision the number of employees you’ll manage in five years, the revenue you’ll generate, and the services you’ll provide. But circumstances will change, and you need to be open to those changes. A business plan outlines the objectives to achieve, but an operational blueprint describes your business processes and sets your daily and monthly targets. These targets may include the number of sales calls to make or clients to serve.

“A business plan, by its nature, is five to 10 years out. It can give you direction, but on a daily basis, you need to tackle what’s in front of you or you’re going to get totally overwhelmed,” Kaster says.

For a new business just getting started, he says the focus should be month to month. 

Business plans have their purpose. They help fledgling entrepreneurs define their vision and secure financing for long-term success. Developing an operational blueprint is the next logical step in order to outline the day-to-day administration of the business. The two documents work hand-in-hand to set a course to prosperity.

Check out this related article "How to Draft a Business Plan to Get Your Entrepreneurial Journey Started" to learn more about drafting a business plan.


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