Does the entrepreneur need a business plan?
Let’s get straight to the point.
Pay attention to this study performed by Endeavors Center for High-impact Entrepreneurship about key strategies for the success of startups. They interviewed 55 high-impact entrepreneurs in 11 different countries and among other questions, asked which one of them had created business plans for their enterprises.
The results were surprising (or not): 71% of them, whose companies grow an average of 20% a year, had not written a business plan (BP). Among all the interviewed, 80% had made changes to their projects during the startup phase — the ones who had put their plans on paper but also the ones who had made plans only in their minds.
I don’t mean to discourage anyone, since creating a business plan can be a very helpful tool for certain types of entrepreneurs; a tool that can help them start a company through analyzing the risks, defining strategies and understanding necessary investments in order to achieve their goals.
The problem is when they try to turn the business plan into a compass, a set of rules for their work.
Imagine you follow all the steps and come up with a beautiful business plan, print it out and put it on your office’s wall, your home’s wall and even paste it on your datebook page, determined not to lose focus. You attribute so much importance to that piece of paper that you forget to pay attention to the current scenario, the tendencies, and the way people and the market are changing. Needless to say that soon enough you might miss the train and your business might become obsolete.
Another relevant issue concerns the mindset of new entrepreneurs and businessmen. Endeavours’ research is an indicator that those people tend not to like structured, restricted plans. The entrepreneur’s mind is dynamic, interactive and flexible; it observes and feeds back ideas all the time. Change is a constant in his route, what allows several adaptations to be made on an original idea and on the strategies used to achieve it. So he creates a RAF of the Project and starts adding values at the same time things happen in the real world.
However and essentially, the most important part of a structured or mental business plan is the consistency of the vision when allied to its purpose; to what level the needs of the market or target audience can be figured out in order to provide them with a simple, killer solution!
Building that vision requires a high dose of passion and enthusiasm. You should lead your team towards this killer vision and awaken a learning culture in them, in order to create something that truly contributes to our society and our world.
To sum up: vision with a purpose + understanding of the market and the target-audience + simplicity + knowledge. Add two cups full of passion, two cups of enthusiasm, shake well and…create your dream!
Source study: Endeavor Global Entrepreneurship Blog.