Give Your Business Plan a First Reality Check - dummies

Give Your Business Plan a First Reality Check

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

When you are going through the process of business planning, asking questions like “Is this really such a good idea?” and “Who am I kidding, anyway?” doesn’t mean you lack confidence. What asking these types of questions does mean is that you’ve come to the time to step back and make sure that the road you’re on is leading you where you want to go. You need a reality check.

In many ways, writing a business plan is a series of reality checks. By making you carefully think through every aspect of your business — from the product or service you offer to the competitors you face and the customers you serve — the business-planning process brings you face to face with the realities of doing business.

To help determine whether or not you’re on solid ground, discuss your business idea and preliminary plans with someone outside your company. What you’re really seeking is a mentor with most or all of the following characteristics:

  • Someone who has experience in the business area you’re considering, or at least experience in a similar business.

  • Someone with the courage to tell you the truth, whether it’s “That’s a great idea. Go for it!” or “If I were you, I’d take a little more time to think this over.”

  • Someone you respect and admire and from whom you can take candid criticism without feeling defensive.

Consider turning to colleagues you’ve worked with in the past, teachers or professors, friends from college, or other associates.

Friends and family members sometimes can offer the advice and perspective you need, but emotional ties can get in the way of absolute honesty and objectivity. If you go this route, set some ground rules in advance. Ask for suggestions, comments, and constructive criticism and be prepared to hear both the good and the bad without taking what you hear personally.

In addition to a mentor, consider designating someone to act as the devil’s advocate to guarantee that you address the flip side of every issue that you’re considering. This person’s task is to be critical of each idea on the table — not in a destructive way, but in a skeptical, show-me-the-money, you’ll-believe-it-when-you-see-it kind of way.

In larger companies, you can accomplish this goal by creating two teams — one to defend the idea and the second to criticize it. Ask the opposing team members to think of themselves as a competing firm looking to find weaknesses in the new venture.