Introduction by Matthew A. Griffith, Esq.

Below is a guest blog by Dan Lacy with Dynasty Business Building- http://dynastybuilder.com/home.  Dan is, in a sense, a competitor of mine, in that we both help businesses and their owners avoid risks, maximize opportunities and grow businesses into profitable enterprises through business coaching and plan development.  Nonetheless, I have to give credit where credit is due.  The blog post below may be the best written summary I have ever read on the benefits of business planning.  I can help more clients do more good and avoid more losses through simple planning than can be accomplished through any other business technique or function.  In fact, I use business planning as a tool to reduce legal liability risks, as well as to increase profitability.  Yet, most small to medium sized business do virtually no planning.  Or, they create a plan but fail to implement it.  Hopefully, Dan’s summary in this blog post will encourage a few business owners to start taking planning seriously.  I hope this helps at least one of you.  And thank you Dan Lacy.  Good stuff.

Planning Today – Surviving Tomorrow

GUEST BLOG BY DAN LACY

Dan@dynastybuilder.com. 

In the first and second chapters of the book of Numbers in the Old Testament, we find a detailed description of the Israelite campsite during their wilderness trek.  To the casual reader an outline of the particulars of encampment might seem to be irrelevant minutiae.  What is actually presented, however, is a brilliant model for effectively managing the activities of a large organization.  Moses and Aaron were responsible for governing almost a million people.  By adhering to a carefully structured plan for day-to-day concerns they were able to prepare for long term problems and issues more efficiently.

Of course, what was true for the ancient Israelites is also true today.  Planning is the key for any business owner who wishes to build a company that has a solid foundation for future growth and development.  Yet, less than 15% of small business owners surveyed admit that they are doing an adequate job of planning for the future of their business.  In fact, managers rarely fall short of their real potential for lack of technical competence.  Of all the organizations and businesses I have consulted in the last 30 years, the one principle cause for failure is the inability or unwillingness of the executive staff to logically and consistently plan for the allocation of limited resources – labor, money and time – toward all the viable opportunities that exist. 

While strategic planning is an integral part of maintaining the growth cycle of a large corporation it is even more critical to smaller organizations because they, typically, lack the resources necessary to absorb the cost of mistakes, errors in judgment, or failure to foresee change.  The planning process allows management to evaluate the future where they want to be and how to get there.  It helps them establish goals and then gives them a performance standard by which to measure themselves.  Better yet, planning allows them a process to identify and resolve problems before they become crises.

Before gathering your staff together – either formally or informally – to begin the planning process for the future growth and development of your company, it’s important to understand exactly what this vital activity will accomplish:

            1. Planning formulates the future.  The planning process allows the people in your organization to anticipate and, therefore, shape the future.

            2. Planning motivates people.  Everyone wants to have a part in determining their future.  The greater the feeling of ownership each individual has in determining the objectives of the organization, the more committed they will be to making sure those objectives will be achieved.

            3. Planning establishes the organizational structure of a company.  The planning process will clarify what structural issues need to be resolved in a company.  This will determine what organizational model needs to be implemented to address these issues.

            4. Planning directs delegation.  The key to effective delegation is understanding what assets and liabilities a company has in terms of its human resources.  By determining who is best suited to handle a particular role, the entire organization should be able to live up to its maximum potential. (Tim Collins – Good To Great).

            5. Planning promotes communications.  The planning process affects each division of a company, including the finance, marketing, sales and operations divisions.  Thus, for each area of a company to achieve their respective goals, they must cooperate and communicate with divisions that they normally don’t communicate with.

            6. Planning fosters the process of monitoring.  The planning process establishes standards or goals that an organization must achieve to accomplish their overall objectives.  Without a monitoring system, management will not be able to assess how well these goals are being achieved.

Planning is essential for the survival of the company.  If the organization does not have the time or manpower to do adequate planning, then the company should utilize outside resources to help them set, monitor and achieve their goals.  Time spent on planning is time well spent and money spent on planning is money well spent when the plan is utilized.