ActionCOACH Business Coaching

I recently met with a business owner who asked to meet me because his business was in dire straits. When I assessed his situation it was apparent that the owner, who had been in business for about a year, had made a litany of mistakes that put his business on the brink. However when I asked to see his business plan, he proudly showed me a 20+ page document that looked great, and had excellent detail. However upon further review, the pro forma numbers were unrealistic, and many of the action plans had either not been done, or were done very poorly. It seemed that his attitude was "If I have a great plan, my business will work."

A recent federal survey of business in the United States found that over 80 percent of new businesses will fail within the first five years. Many of these failures could have been prevented by having comprehensive business plans aimed at guiding the business. Yet how many of these same businesses do have excellent plans, and still fail? I'm sure the numbers are staggering.

Why is this the case? In many cases, the business owner goes out and gets a generic business planning software program, fills in the blanks, and once it allows them to get their SBA loans, goes into a desk drawer to gather dust. The software does not have the intuitive ability to ask the tough questions of the owner, push them to think through where their business is heading, and then stays with them to make sure the plan is executed with discipline and precision. I saw the equivalent of this in my years of career coaching. The prospective client would come into our offices, and express frustration with their job hunting efforts. However, they usually had a "Canned Resume" from one of the many software programs, and then wondered why the resume wasn't working for them. Once they took ownership of their career, the results were dramatic.

It works the same way with business owners. When the owner subjugates their plan to canned software, or to a person who writes it out for them, with minimal input, the results are almost as bad as if they had never had a plan. The magic of the business plan is not the "plan" itself, but the process that the business goes through in putting it together, and then using it as a living document to guide and direct the direction of the business.