Is the Traditional Business Plan necessary?
One of the first things that a new venture planner is told is that they need a business plan. A quick look at what this involves is usually enough for most of them to either give up on the idea or just go and do it anyway. Those that take the second option are not alone as a study of the Fortune500 companies found. In this study, 60% of these high growth ventures did not prepare a traditional plan and of those that did, more than half completely changed their plan anyway.
So why the big push to write a traditional business plan? Well, the answer is simply that Business Plan writing has become a huge business in its own right. Entrepreneurial educators the world over have built courses on the premise that we need one and there is no shortage of books and consultants prepared to take our money in order to deliver one.
It has also been cynically suggested that you are told to go and prepare a business plan so that the investor or bank need not tell you NO to your face. They know the energy sapping task they are asking you to do and they will not see you again for 6 months ... if ever.
Now planning for a new venture is essential but the traditional business plan is not. What is needed is a planning tool that reflects the way entrepreneurs create and develop their opportunities and not a planning tool that is an adaptation of large corporations.
See my article on the traditional business plan where I offer some suggestions on what should replace the Traditional Business Plan. Business Planning for Entrepreneurs
NVArchitect9/1/2008 8:32 AM
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