42 CHAPTER 3 GETTING DOWN TO IT
times of the year, you can hear a collective sigh of relief at the moment when executives
complete the annual planning process and then consider that they can forget about it for
another 11 months.
This means that the objectives of the planning process itself are usually different from
the priorities in writing the business plan. It would be pleasing to think that they are one
and the same; that every planning exercise aims to produce an effective and documented
plan that will be used to steer the business. This is the ideal. A written business plan is a
formal incarceration of the planning exercise. The very action of writing up the plan usu-
ally improves the output of the planning process.
When you don’t want to be a big fish
Whenever you approach investors, or your boss, it’s not really your size or the relevance of
your ideas that are important. You have to look at it from the other person’s perspective.
How big are you and your ideas relative to his or her other interests? The less important
you are in relative terms, the easier ride you’ll have – providing that you know what you
are doing and you are not so small that you are overlooked or rejected.
‘Intelligence lies in recognising opportunity.’
CHINESE PROVERB
The fast track to getting started on your plan
1 Identify your priorities for writing the plan.
2 Identify likely readers and their needs, preferences and prejudices.
3 Draw up a list of contents (see Figure 3.1 later).
4 Write a first draft of the Executive Summary.
5 Think about what the Conclusion will say.
6 Make a start on a list of strengths, weaknesses, opportunities and threats.
You will want to order the four broad priorities listed here and then expand
on each one. Identify what you are trying to achieve in each instance. Then
make a list of each person who will use the business plan and think about
what you would say to them if they were sitting in front of you. This should give you
a fairly good idea – at the broadest level – of what you have to write about.
WHEN YOU DON’T WANT TO BE A BIG FISH 43
Note how each one of the entrepreneurs in the example above experienced different
levels of interest and interference (and incidentally how none of the financiers could or
would have invested in the other businesses). These are the situations that you have to
consider when writing and presenting your plan. The smaller you are in the eye of your
boss or investor, the more you have to demonstrate that you are capable of surviving
alone – and the more you can expect to be left alone once you have proved yourself.
Case study
Three sh on vacation
Three successful entrepreneurs met at an exotic beach hotel. Over sunset daiquiris
by the pool they exchanged stories.
One was a businessman who had needed an extra couple of million dollars
to take his ideas to market. He was funded by a company that made a dozen
such investments every year, on the basis that nine would fail, two would
do reasonably well, and one would be really successful. They didn’t have the
resources to manage these investments closely. So at the outset they assured
themselves that the idea was sound, the market demand was there, and the
management team could handle the business. Then they left the business
pretty much alone.
The second tycoon had required $35 million to fund a major expansion.
He was financed by one of the big US investment houses. They made only
two investments every year, normally for around $50 million each. They had
examined his business in minute detail, employed industry experts to analyse
it to death, and drawn up their own extensive financial projections. When
they did invest, they moved the tycoon aside to be chairman and brought in
their own high-profile chief executive with specifically relevant experience.
The third vacationer was a software developer who had once needed just
$50,000 to package his software and deliver it to the public. He was funded
by a friend who had just received the golden boot after 30 years in a big
manufacturing corporation. The friend had plenty of time on his hands, no
other major investments, and thought he knew a thing or two about running
a business. He made himself general manager and was a constant irritation to
the computer expert.
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