Disagree with some of the book

[ClaytonAlbright]

I apologize if this is the wrong area as I didn't see a specific area to discuss the book.

At least for me, what really stood out was the bashing of the business plan. I get the whole "charts and graphs" thing that people like to do which usually just ends up being worthless as the market takes a hold of them and steers them into new directions, but at least were I'm at feel that a business plan is a good chart to go by. Not as in numbers, but rather outlining probable outcomes instead of being blindsided and not thinking about it in advance. Such as if X happens then move towards Y instead -- take feedback into account of course and yes, the plan may become completely sidetracked and worthless but I think it's worth having a well thought out plan of possible outcomes and were to go from there so I don't think it's nonsensical to have a well thought out business plan in advance -- so long as you actually take action on it.

Saying that, what I took from the book is the action is much more important that "the plan" -- but I still believe having a good plan is well worth it before moving forward instead of just being blindsided by the market and having to think about it on the go (which may end up being the case anyways).

 

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[The Grind]

 

[EvanOkanagan]

I apologize if this is the wrong area as I didn't see a specific area to discuss the book.

At least for me, what really stood out was the bashing of the business plan. I get the whole "charts and graphs" thing that people like to do which usually just ends up being worthless as the market takes a hold of them and steers them into new directions, but at least were I'm at feel that a business plan is a good chart to go by. Not as in numbers, but rather outlining probable outcomes instead of being blindsided and not thinking about it in advance. Such as if X happens then move towards Y instead -- take feedback into account of course and yes, the plan may become completely sidetracked and worthless but I think it's worth having a well thought out plan of possible outcomes and were to go from there so I don't think it's nonsensical to have a well thought out business plan in advance -- so long as you actually take action on it.

Saying that, what I took from the book is the action is much more important that "the plan" -- but I still believe having a good plan is well worth it before moving forward instead of just being blindsided by the market and having to think about it on the go (which may end up being the case anyways).

Can you share with us your successful business and how using a business plan worked for you?

 

[GuestUser113]

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[ZCP]

Like anything in business, use what works for you. Watch, learn, ask...... Then adapt to you, your situation, and your business.

Now, @ClaytonAlbright , could you go into a little more detail with 'why' and some working examples that support your stance?

Me first..... Initial business plan helped me make sure I had turned over all stones and made the banker happy...... Haven't touched it since........

 

[randomnumber314]

This meme response thing is getting old. Especially considering this is a pretty well thought out counter-point.

IMO, short business plans are good, because it shows you thoroughly vetted your idea through market research (validation) I think the business plan go awry when it's a reason to keep researching in place of action. BUT, it's still a good foundation to refer to when you are selling X and the market asks for Y.

To respond to OP, I think it's a blend of your interpretation of the book and the advice given: Yes you should do some due diligence on your idea before you invest sizable cash into anything, BUT there are ways fail fast without a plan and pivot as the market tells you to, with no discernible map. I would speculate that the person who needs a business plan is the person who is starting a company that needs capital to move forward (capital intensive industries such as spaceX) but most start up entrepreneurs just need to act now and prove they can execute on ideas, and ideas don't need much of a plan, they just need hustle.

Did any of that make sense?

 

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[ClaytonAlbright]

Can you share with us your successful business and how using a business plan worked for you?

No, but I can share a business that had no plan at all and failed miserably, will that work as well?

 

[ClaytonAlbright]

This meme response thing is getting old. Especially considering this is a pretty well thought out counter-point.

IMO, short business plans are good, because it shows you thoroughly vetted your idea through market research (validation) I think the business plan go awry when it's a reason to keep researching in place of action. BUT, it's still a good foundation to refer to when you are selling X and the market asks for Y.

To respond to OP, I think it's a blend of your interpretation of the book and the advice given: Yes you should do some due diligence on your idea before you invest sizable cash into anything, BUT there are ways fail fast without a plan and pivot as the market tells you to, with no discernible map. I would speculate that the person who needs a business plan is the person who is starting a company that needs capital to move forward (capital intensive industries such as spaceX) but most start up entrepreneurs just need to act now and prove they can execute on ideas, and ideas don't need much of a plan, they just need hustle.

Did any of that make sense?

Yes, I agree with this and again, this is a part of the book that I don't agree with. I think it's good to have *at least* some type of business plan, meaning not investing a shitload of time into it, but rather a plan for a way forward and be able to adjust it accordingly. Not saying that no plan will never work, the first person who turned me on to businesses wrote everything on a wall. Action is much more important, but I don't think the statement "A business plan is worthless" is correct. I can give plenty of businesses that had a thorough plan that were successful that made it big as well as many that didn't that also made it big.

It depends on your mentality and what business it is, so making blanket statements saying "a Businesses plan is worthless" is counter productive.

 

[AntEmpire]

Yes, I agree with this and again, this is a part of the book that I don't agree with. I think it's good to have *at least* some type of business plan, meaning not investing a shitload of time into it, but rather a plan for a way forward and be able to adjust it accordingly. Not saying that no plan will never work, the first person who turned me on to businesses wrote everything on a wall. Action is much more important, but I don't think the statement "A business plan is worthless" is correct. I can give plenty of businesses that had a thorough plan that were successful that made it big as well as many that didn't that also made it big.

It depends on your mentality and what business it is, so making blanket statements saying "a Businesses plan is worthless" is counter productive.

No offense to you, but why make such a big deal (thread) over such a minor disagreement? If you don't agree with that portion of the book, then that's cool. I can't think of a single business type book I agree with 100%, but my disagreement is not going to change the reality of the author. And nor will yours.

 

[ClaytonAlbright]

No offense to you, but why make such a big deal (thread) over such a minor disagreement? If you don't agree with that portion of the book, then that's cool. I can't think of a single business type book I agree with 100%, but my disagreement is not going to change the reality of the author. And nor will yours.

Thanks Ant, I'm not attempting to "change anyone's reality". This is a forum and was simply giving feedback on the book in the hopes of productive responses that can sway my thoughts is all.

I know this sounds impossible but I've used many forums and my opinions have changed over time at some points in them, so it was more of a matter of listening to feedback to something I didn't agree with in the book.

 

[AgainstAllOdds]

Just to support @ClaytonAlbright 's viewpoint: if everyone was required to write a business plan before starting a business, then we wouldn't have all these threads where people quit their jobs or drop out of school with no idea or plan on how they'll make money.

A business plan should serve as a roadmap for prioritizing what gets you results and what doesn't. It identifies who your consumer is, what your product offering is, how you plan to sell, and the numbers required to pull off that feat. Obviously you're going to pivot once things get going, but a plan is a valuable starting point to have you looking in the right place. Without a plan, you're more likely to take on pointless tasks than with a plan.

Now to counter my points: business plans are also often associated with action faking. That's what I'm assuming MJ had a problem with. A lot of people think that starting a business consists of: 1) Writing a business plan; 2) Buying a domain or retail location; 3) Spending most of their startup funds on a marketing scheme or idea that they think will work; 4) getting sales; 5) Being super rich.

The thing is, for people with a mindset like that, the business plan was completely pointless instead of taking action and learning right away that their plan is based only on assumptions. Sometimes those assumptions are valuable, but more often than not they're worthless without real "market data".

 

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[RogueInnovation]

Well,

I think the book is talking about the "convention" of "needing it". MJs really good at one part of biz imho, which is beating the cr#p out of what he senses is funky.

There are other layers to business of course, but I think what he is saying is that "first thing is first, don't rely on old funky advice to get you anywhere, because it can really hold you back".

The idea of course, is that after shedding the old, you be open to forming your view new, and based off of what YOU feel and what has results.



I think that all business planning is a process, not something you do once, and BAM you have X magic result, and the inherent distrust in business plans is because often people do not use it as a tool in a well rounded process, they might just use it to try to "look good" or to distract themselves, rather than actually use it to develop the ideas and concepts everyday and keep yourself on track, and have a meta-view of things happening and how to adapt to circumstances etc.

That said, there actually are not a LOT of surprise circumstances... Mostly all surprises boil down to better organisation of things, and getting certain stuff done ahead of time.

Most of what you need to adapt to is in your own mind, and you need to be ready to feel right about things and not stall and sabotage. Once you get that attitude straight, your plans will be fairly light weight, unless the business is hugely complex, and in that case huge plans are used to simplify the information into a few meaningful directions etc.



Don't avoid getting out sheets of paper and planning, thats great stuff, just don't rely on it to do anything other than what it does for YOU and your thoughts on things.

Personally, my advice is, create a creative plan, use images, feelings, ideas, so you can better pinpoint your own thoughts.


Business isn't sitting at a desk and acting serious, it is just about having a thought process that allows you to think through business as you go about your day.
Plopping down a wad of paper at a bankers desk, is... encouraging to him perhaps (because he is ignorant of how businesses work in the real world) but you have to in the end own your own direction and choices and not off load it to anyone else.

If you want to plan, then plan.
But honestly, there are so many markets, so many market opportunities are changing, and there is so much to wrap your head around, that you might just find a notepad to be sufficient.

But obviously, please do go ahead with white boards and brainstorms and anything that gets you thinking.
Just don't get all "I am at a desk! I am a business person now!"

You gotta be tough, so you can handle challenges to your nature.
But if you take it on, and don't fear money like its a god, you'll do your best.

 

[Leo Hendrix]

Biz Plan is simply that, a plan.

 

[wade1mil]

Like anything, it can be taken different ways. I agree that a business plan can be a good thing, and also agree that a business plan can be a bad thing.

It's been a long time since I read the book, but I don't think he's saying a business plan is a bad idea. Some people see a business as almost like an end goal, like as soon as they finish the business plan they're done. You need some sort of plan to take action. He talks about when telling the story of driving from one side of the country to the other. But not taking action because you haven't planned out the next five years of your business is covering up the fact that you're scared to do anything. And no matter what you do, your plan will change. That's my take.

 

[Andy Black]

Interesting thread.

...

I liked the road trip story in the book.

I loved going on motorbike tours.

Credit card, toothbrush, change of smalls, waterproofs, new chain, new tyres, a full tank, ferry ticket, map.

(Sh*t... nearly forgot... insurance/breakdown cover abroad.)

Pick a direction that looks interesting. GO.

Bring map to restaurant for evening meal, repeat.

I have so many great stories I wouldn't otherwise have if I had meticulously planned it - or never went.

...

A story that might be relevant:

Years ago I wanted to get a loan to buy an investment property.

In the meeting with the bank manager I showed him my laptop with a little spreadsheet on it.

It showed the asking price, the deposit needed, the rent for similar properties, the interest on the loan, void months, the max loan a couple could get with the average local salaries and the max they could pay for the property, and the max loan that dumb investors would get and pay for.

The numbers stacked up.

I apologised to the bank manager for not having a "business plan".

He was a nice older fella and just smiled and pointed to the screen and said "that's your business plan".

Loan secured.

 

[Digamma]

A story that might be relevant:

Years ago I wanted to get a loan to buy an investment property.

In the meeting with the bank manager I showed him my laptop with a little spreadsheet on it.

It showed the asking price, the deposit needed, the rent for similar properties, the interest on the loan, void months, the max loan a couple could get with the average local salaries and the max they could pay for the property, and the max loan that dumb investors would get and pay for.

The numbers stacked up.

I apologised to the bank manager for not having a "business plan".

He was a nice older fella and just smiled and pointed to the screen and said "that's your business plan".

Loan secured.

As always, Andy swoops in with some wisdom from the trenches. Love it.

I see this as an empty discussion. Of course you need a plan. Knowing what problems people have and developing a better way to fix it and offering that fix to them, well, it's a plan.
Do your homework, that is a given.

So what was MJ talking about? Of course, about lengthy documents filled with management lingo and empty metrics. Does anybody need that?
I know it always held me back from action, and that's the trap.

 

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[ClaytonAlbright]

Thanks for the input everyone. You hear the business plan preached as gospel and I admit it has somewhat held me back from action. Hell it's a pre-requirement to SBA loans and funding from many sources. Looking at my current plan, it's more a list of ideas than a plan, such as how to market, what products I think have demand and places to network.

The rest of my plan will be to see what products sell and sell more of those. That will be my plan.

 

[biophase]

Not as in numbers, but rather outlining probable outcomes instead of being blindsided and not thinking about it in advance. Such as if X happens then move towards Y instead

This is not generally in business plans. You can't account for these things. If you tried your business plan would be 1000 pages.

No, but I can share a business that had no plan at all and failed miserably, will that work as well?

The question is would a business plan have made this business successful? Would you have had a contingency for what happened in this business that caused it to fail? I doubt the business failed because you did not start with a business plan.

 

[MoneyDoc]

What's a business plan?

 

[MJ DeMarco]

instead of just being blindsided by the market and having to think about it on the go

This implies you think you can predict market responses and reactions.

You cannot.

You can only make logical guesses, like looking at a stock chart and trying to predict where a stock will go next week.

Nonetheless, there are probably 300+ things in the book someone could disagree with. I never expected anyone to agree with everything I wrote, that's a fairly unrealistic expectation on my part. The goal was to paint a large picture consisting of many brushstrokes. For the beginning entrepreneur who hasn't done much of anything, yea, IMO, a business plan is an action-faking circle jerk. For the experienced entrepreneur who's looking to create a genuine startup with OPM and employees (not downloading Wordpress and calling it a startup), I can see a BP, or an executive summary of key points as important to the process.

Regardless, I suggest you do what makes you feel confident in your ability to execute. The BP might instill confidence in your plan, like a placebo. And placebos impact the mind, which IMO, is the most important (and underestimated) asset of the entire process.

 

[CosmicMind]

Who cares.

Just do whatever you think you need to do to create value on a massive scale and create a competitive business.

If you are gonna raise money from investors then you probably need a business plan. If you are not there yet or don't plan to then you probably don't. If you need a business plan because you are a a very organized type of person then do it.

This whole "I agree" or "I disagree" or He is "wrong" and I am "right" is just a complete waste of time.

Every business functions differently and everyone is in a different stage. The truth is it just depends on YOU and your business. Everybody's situation is unique. Focus on yourself and do whatever you think YOU need to do. I think thats the cold hard truth.

 

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[Growth & Learn]

Business plans are not completely useless. It's always helpful to think through strategy, objective and to improve your focus on what you're trying to do. A business plan can help you do that.

The only problem is that business plans become obsolete incredibly quickly once you actually start dealing with real customers and real business problems.

Most of us are action takers and we don't like to hang out in the land of the theoreticals for too long. That's why you'll hear some of us being opposed to business plans.

We get feedback from the market and then adjust.

Whatever works for you though. If writing a business plan helps you succeed and persevere over the long haul is all that matters.

I've never written one personally but sometimes when times get tough I do wish I had more of a map.

 

[ClaytonAlbright]

Regardless, I suggest you do what makes you feel confident in your ability to execute. The BP might instill confidence in your plan, like a placebo. And placebos impact the mind, which IMO, is the most important (and underestimated) asset of the entire process.

Hi MJ, thanks for the tips. I do have a few pages of a "plan" but it's more of a list of ideas and marketing strategies and I do recall me thinking I need more of a plan to move forward and thanks to this thread I've come up with one that I think will work well. Also yes, I cannot predict the market, so my brilliant business plan is to keep finding what sells of my creations and sell more of that. I know, it's a ground breaking plan.

I do agree with you about the psychology being very important. To move in that direction I'm selling my bike to help with some of the startup costs, switching to 2nd shift at the office job and getting a co-working office space at Regus. So every morning I can go work on my business *before* going to servitude, that way I'll have more focus instead of coming home after a long day at work and a shitty commute trying to work on it.

 

[ClaytonAlbright]

The question is would a business plan have made this business successful? Would you have had a contingency for what happened in this business that caused it to fail? I doubt the business failed because you did not start with a business plan.

It failed because there were way to many players in a small market and it was a local business. PC repair isn't quite as prevalent as it used to be because of automated tools, and the price of them is so cheap now you can't charge much for a repair. Most places are now getting into smart phone screen repair which actually will bring in more money and I hated doing it. I think if I had a plan, or rather marketing strategy it may have done better but ultimately wouldn't have been sufficient. The top shop around here on google, I walked into one day and they were like white on rice on me and no other customers were around.

 

[DaRK9]

It failed because there were way to many players in a small market and it was a local business. PC repair isn't quite as prevalent as it used to be because of automated tools, and the price of them is so cheap now you can't charge much for a repair. Most places are now getting into smart phone screen repair which actually will bring in more money and I hated doing it. I think if I had a plan, or rather marketing strategy it may have done better but ultimately wouldn't have been sufficient. The top shop around here on google, I walked into one day and they were like white on rice on me and no other customers were around.

The short answer was no.

 

[tafy]

My business plan is in my head, but I will write it out at one point as investors need to read one to understand the business.

So for me the business plan comes only when you need others to read it.

 

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[AllenCrawley]

I'd suggest learning about the business model canvas. It really is all most of us need to do.

 

[Brentnal]

No, but I can share a business that had no plan at all and failed miserably, will that work as well?

But you can always fail no matter if you have a plan or not. There are more reasons people fail in business.

 

[FastLanePursuer]

I don't think everything that's said in the book is meant to be concrete.

The journey from one entrepreneur is never the same as another.

It really all depends on what works for you. I'm sure there's plenty of people who started with a businesses plan and are now successful.

Same thing can be said about about those who didn't write out a business plan and are now successful as well.

I didn't have a business plan and I'm doing ok. I think the difference maker and the thing you should be focused on is whether or not you take ACTION.

If I had created a business plan originally, then I would still be in the same situation I would be in now, because I would have taken action either way.

As long as you take action then that's all that matters.

 

[Drq]

About the business plan:

Having a defined plan of action helps you separate "thinking" from "doing", and by doing that you get a lot more done, you stay focused on the important tasks (doing sales calls for example) instead of the less important tasks (perfecting your facebook page header).