Every December, I sit down to write my business plan for the upcoming year. Invariably, however, the lure of pumpkin pie, the razzle-dazzle of holiday lights and the continuous playing of Christmas music take me off track. I find that I’m just too distracted to seriously focus on the business planning at hand.
Instead, I set my sights on January. The merriment is over, and I’m ready to get a grip on my work world again. The only problem is that my inbox is so backed up, and my to-do list has grown so long, that it takes me most of the month to process through the open items that have congregated while I was mentally away for the holidays.
So here I am in the beginning of February, finally ready to knuckle down and work on my business plan for the year. A process that — while I’ve gone through it dozens of times over the years — is always a bit daunting at first, but greatly worthwhile.
I find that my productivity during the year is always enhanced when I have a road map to follow in my business. Even if all the gaps aren’t filled in or the fine details sorted out, just knowing the major stops along the way, and how I plan on getting there, empowers me to be more on purpose and more productive during the year.
Now that I finally have the breathing room to sit back and reflect on my business plan for 2010, I sought assistance from my client Christy Strauch in her new book titled,”Passion, Plan, Profit: 12 Simple Steps to Convert Your Passion into a Solid Business.“ Here’s her take on creating a business plan.
Karen Leland: First off, why did you write this book?
Christy Strauch: I wrote this book for creative types (like web workers) who are in the business world, but haven’t necessarily had a peaceful relationship with making the business side of their business work. Because of that, the first step in any business plan process is to connect with your purpose for being in your business — whether you’re self-employed or working for a company. It’s easier to persevere through some of the challenging times if you have a purpose to pull you through.
Karen: Well, once you know your purpose, then what?
Strauch: You need to determine who your perfect clients are. Take the knowledge that you already have about who hires you and who works with you, and then talk to your clients to gather the rest of the information. You need both the demographic information about them (things like their age, where they live and their level of education) and psychographic information (what they like to do for fun, their attitudes about technology, what they read, who else they go to for help and so on).
Karen: How does knowing who your perfect clients are help you to build a business plan?
Strauch: If you understand how people find you and why they are drawn to you, you can better determine the best way to reach out to them. Is it through a networking event, advertising, cold calling or writing articles? People often choose web workers because a colleague has recommended them.
Karen: In the book, you talk about the importance of looking at the competition as part of your planning process. Why is that so important?
Strauch: Well, to begin with, you need to figure out what you’re best at. What is unique about you? What do you offer that is distinct from your competitors? By taking a look at your competitors, the economy and your own business, you can find a way to position yourself to your clients. That positioning becomes part of the strategies for your business that you pick and put in your business plan.
Karen: Do you recommend any particular tool for this analysis?
Strauch: Yes, I suggest every businessperson do a yearly SWOT (strengths, weaknesses, opportunities and threats) analysis. It will help you, along with knowing your purpose and your customers, to choose business activities that make the most sense in the current year — to serve your current customers and attract the right new ones.
Karen: How important is including financial information in your business plan?
Strauch: It’s critical. At a minimum, you need to have a forecast of your income for the next 12 months and projected expenses for the same period. You also need to choose three or four measurements that you can watch regularly to make sure everything’s on track in your business.
Karen: Is there anything else people should do to stay on top of their business plan after it’s written?
Strauch: Yes. Do a monthly and quarterly review process. Because things begin to change right after you remove your pen from the paper, these reviews help you keep up with (or even stay ahead of) the inevitable changes that happen to all businesses.
Do you have a business plan for this year?