10 Questions to Ask Before You Finish Your Business Plan - dummies

10 Questions to Ask Before You Finish Your Business Plan

By Steven D. Peterson, Peter E. Jaret, Barbara Findlay Schenck

You’re ready to dot the last i and cross that last t of your written business plan. But before you sign off, review the plan one last time. If you have the luxury to let your plan sit for a week or so before reading it through before you finalize it, that’s even better. Consider this list of ten questions to ask about your plan.

Does the plan realistically assess your business idea?

We’re all for enthusiasm, especially when it gives you the motivation and inspiration you need for the hard work of putting a business together. But we’ve learned from hard experience that a clear-eyed assessment of the strengths and weaknesses of a new enterprise is crucial to success.

Identifying weaknesses doesn’t mean you have to scrap your idea. In fact, it can help you develop a strategy that plays on your strengths and minimizes your weaknesses. Read over your plan, taking the point of view of a very skeptical investor. Make sure that it offers a convincing argument that your business idea will succeed.

Does the plan adequately describe your customers and what they want?

One thing that all successful businesses have in common is the ability to deliver what their customers want. To keep your customers satisfied, you have to know them as well as you possibly can.

As you review your plan, consider it from the perspective of potential customers. Ensure that the marketing plan reaches them with the message you want to convey

Does the plan establish specific timelines?

An effective plan spells out, step by step, what steps you need to take to achieve your goals. Just as importantly, it establishes a schedule for when you should take each step. Without a firm timetable, projects and plans have a way of slipping. Include a timetable for when you’ll accomplish each action step described in your plan. Be sure that you specify the important milestones along the way.

Your timetable should be ambitious, but realistic. Give yourself and your key players time to get the job done.

Do the financials add up?

One of the biggest reasons new ventures go belly up is poor financial planning at the beginning. No plan can prepare for everything, but your financial plan should be conservative enough to give you some breathing room if the business doesn’t get off the ground as quickly as you’d like. Review your financials. Make sure that the numbers are realistic. If you have any doubts, review your financial forecast.

Does the plan spell out specific goals and objectives?

Your plan should be as specific as possible, especially in spelling out your goals and objectives. Each one should set out specific actions that will be taken, along with a precise way of determining when it has been accomplished. Review your plan from the point of view of the key employees who will carry it out. Make sure that your plan is clear in what your business wants to accomplish.

Will your plan guide and inspire employees?

Telling your key people what they need to accomplish is important, but inspiring them is equally critical. An effective plan lays out a strategic course. At the same time, it inspires employees by making them feel part of a team where everyone matters and every job is important.

As you review your plan one last time, think about whether it makes a convincing case for success? Does it acknowledge (and encourage) the contributions of all employees? Does your mission statement offer inspiration as well as guidance?

Is the writing clear and jargon-free?

Your business plan should be understandable to as wide an audience as possible, from investors and employees to the general public. As you review the draft one last time, be on the lookout for unnecessary jargon. Is your plan easily understood? Just as important, is it persuasive?

If your plan absolutely positively requires technical words, consider including somewhere up-front a glossary that defines these crucial terms. Such a glossary is helpful in making your plan understandable to everyone. It can also convince readers that you know what you’re talking about.

Is the plan concise?

It’s easy to confuse the heft of a plan with substance. The more concise and to the point your plan is, the more likely people are to read it and be guided by it. Be on the lookout for empty phrases and unnecessary verbiage. If you find your attention wandering as you read, look back over the section to see if there are ways to remove fluff.

Sometimes it helps to have an outsider read and review the final draft before it goes to print. If you don’t have an in-house communications team for the task, hire a freelance editor to read and red-pencil the plan.

Does your strategy allow for the unexpected?

By its very nature, a plan is an attempt to tell the future. Your financial forecasts, your customer and competitor analyses, and your strategic plan are all based on assumptions about the year ahead. That’s fine. But especially during these economic times, make sure you engineer some flexibility into your plan to account for the uncertainties in the economy and the marketplace.

As you review your plan one last time, be alert to places where your assumptions may be a little too cozy. Wherever possible, give your strategy and the procedures for carrying it out the flexibility you’ll need in the face of the unexpected.

What would your competitors think?

Here’s the final test. Imagine, as you review your plan, how one of your biggest competitors would respond to reading it. You can bet they would be on the lookout for weaknesses in your strategy or glaring holes in your business forecast. Using this perspective, you may find weaknesses you didn’t recognize. Now’s the time to bolster your strategy or fine-tune your forecasts to anticipate competitors’ counter moves.