134 CHAPTER 6 THE CORE OF YOUR PLAN
Documenting the operating plan
When you have devised an operating plan, you will find it relatively straightforward to
document. The amount of detail required will depend on your target readers. You need
enough to satisfy them that you have an effective operating plan. In some instances, the
high-level operating plan for the business as a whole will be enough for the business plan
document. In others, you will need to include departmental plans.
Making projects work
You know as well as I do that large projects are rarely completed on time or within
budget. The bigger the project, the more likely it is that it will overrun. In fact, therein
lies the reason. Projects work best when divided into smaller components or steps. The
smaller the better. Moreover, if the steps are very small, measurable and reversible, you
have a perfect approach with minimised risks and every chance of success.
For example, if one of your R&D teams is sent off to develop a new super whatsit
and told to report back in six months – the project will almost certainly disappoint
you and cost you a lot of money. On the other hand, if the assignment is broken
into small steps, each with clear targets, and if the highest-risk steps are tackled
first, you always know where you stand and as time passes you have increasing
confidence that the project will succeed.
My ideal situation is to have targets that are spaced no more than one week
apart. Any longer and things start to go wrong. This is not as extreme as it sounds. It
is fair to say that you might relax this as you move up the ladder. Once every three
months to six months might be acceptable for more senior executives.
I deplore the progress reports that many managers demand for no reason other
than the sake of reporting. In practice, the best reporting is quantified confirmation
that targets are being met together with instant alerts about possible problems,
delays or cost overruns. You will almost certainly need to massage your corporate
culture in order to achieve this. It seems to be part of human nature to report
missed deadlines no sooner than the date of the deadline, even if the overshoot
became apparent weeks earlier.
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One venture capital provider told me that he likes a plan to tell him what the
business managers will start doing on the day after the funding is paid into
their account.
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