A business plan is essential for any company that’s serious about success. But unless you’re seeking outside funding from a bank or private investor, the fundamentals of lean business planning are likely to benefit you most.
What is a Lean Business Plan?
Lean planning is simple, efficient business planning that starts with your core strategy and incorporates regular reviews and revisions. Unlike traditional business plans which present the reader with executive summaries, detailed market analyses, and reams of background information, a lean business plan is designed for internal use only.
As a streamlined collection of bullet points, tables, and lists, lean business plans are far from elaborate – but that’s what makes them so effective and malleable. Once initiated, your plan will serve as a running definition of who is responsible for what, what’s going to happen and when, and the expectations surrounding your company sales, expenses, and cash flow.
Advantages of Lean Business Planning
The biggest advantage of lean business planning is the fact that it optimizes the management process. A lean plan does more than just outline ideas, objectives, and the best way to navigate between the two. It provides a practical framework for integrating key operational elements into your company’s daily agenda.
These elements include:
- Management goals and responsibilities,
- Strategy and execution,
- Accountability, and
- Performance metrics
By incorporating ongoing tactics, target dates, and deadlines, a lean business plan is a living document designed to deliver results that can, and should be assessed and acted on regularly. Not only does a lean approach promote planning as a continuous process, reviewing, revising, and revisiting your plan will help keep your business agile and efficient.
How to Get Started with a Lean Business Plan
Let’s take a brief look at the four fundamental areas you’ll need to address with your lean business plan:
- Summary of what your business does, why you do it, and who you do it for
- A simple bullet point list is all you need for this section
- Describe the product or service you sell, your business vision or mission, and your target market
- To be relevant – and ultimately useful – your entire plan should revolve around your answers to what, why, and who
- Strategies for promoting successful business performance
- Create bulleted, easy-to-update action plans for marketing and delivering your product or service, hiring and training personnel, and managing your finances
- A few of the many points to consider include: product or service pricing, marketing channels and messaging, product supply and distribution, service add-ons and launch dates, employee policies, and bookkeeping requirements
- Outlines of time schedules, milestones, and measurements associated with your strategies
- Break action plans into specific task assignments, complete with deadlines, metrics to assess outcomes, and review dates
- Tracking progress and revising your plan is crucial for figuring out what works and what doesn’t, and for ensuring that projects continue to move forward
- You’ll need to hold both yourself and your team accountable for meeting milestones and respecting review dates
- Financial forecast of expected sales, projected costs, and anticipated cash and expenses
- Finances play a key role in all business decisions and management processes, so your forecast should be as realistic as possible
- Consider seeking professional accounting help for advice on forecasting sales, costs, revenues, and cash flow
Too many entrepreneurs let themselves get swept up in putting out fires instead of focusing on strategy. Just remember that a fundamental component of every lean business plan is execution. For best results, resist the temptation to let your plan gather dust and put it to work for the good of your business.