Working without a net? The value of having a strategic plan.

It is that time of year again. In Kansas City, the week of my birthday (9/7) is also the week of the Ringling Brothers and Barnum & Bailey circus. I can remember years where my children and I “celebrated” my birthday at the  circus, watching amazing feats and smelling the elephants (the elephants are amazingly large as is their olfactory presence!).  Those high wire acts were something…and when there was no net…your heart was doing flips on the performers behalf! 

Most of us wouldn’t dream of attempting something so difficult without a net, and yet we do everyday! A recent survey conducted by Reynolds Consulting determined that 1/3 of small/medium business people are NOT doing strategic plans as a means of directing their business. They are flying high without a net and apparently willing to risk a lot. They may feel theyhave a plan in their head even if not on paper, or the environment is too volatile to plan. They likely are making one-off decisions as they need to, often without regard to the impact on other parts of the business. No surprise then, than only 25% of our investments in growth efforts generates an ROI.

Why do business leaders NOT do a plan? According to the survey the most common reasons are:

  1. They think they have the skill set to make decisions without one
  2. They have tried it before and didn’t work out well
  3. They are doing fine so far
  4. They don’t really know how to do a plan 

You won’t find many business advocates, from the SBA to your local banker, or even your roundtable chair that would suggest you go without a plan. The excuses above, are just that, excuses. I could debunk each one but I think I have already. Read here for that information.

More importantly is what these business leaders believe is necessary to be inspired to do a plan:

  1. If is not a core strength and/or where we want a second set of eyeballs to review our conclusions.
  2. When there is a lack of expertise internally.
  3. When we’ve tried and failed.

 At the circus the drama is heightened with no net. We worry when the trapeze artist does the triple flip before catching the partners’ hands. There is serious risk if they fail, maybe unrecoverable risk. So why do fully one-third of small business owners feel comfortable running their businesses without a plan for their future–just because they haven’t fallen yet? Don’t plan to avoid risk, plan to maximize the future.

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