29 March 2006

The Plan or the process

In an earlier post, I described why I believe that consultants do their clients few favours if they persuade them that a Business Plan is the answer to all their problems. Providing that you don't need to persuade a 3rd party that the business is managed by people who understand the business, then why have a formal plan? In its place, I recommend a thorough and regular planning process which reviews the short term plan.

The things that throw the long term Strategic Plan or Business Plan off balance allow the short-term internal planning process to deliver its real power. A robust planning process is one which looks at real performance on a regular basis and asks difficult questions:
  • given our performance this month, can we hit our budget?
  • with the changed demand at this customer, how can we bring our revenues back on track?
  • now that we have lost this source of supply, what can we do that will protect our financial position?
  • how should we redeploy our resources if we want to beat our budget?
A planning process like this needs to include people from across the business because it requires their cooperation to succeed. The outputs aren’t a formal planning document – they are action points in a loosely structured short-term plan which provides the context for decisions being made over the next few weeks.

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