If you're fortunate enough to be running a growing business, it's easy to let your business plan gather dust rather than updating it. After all, with business booming you don't exactly have a lot of time free for anything that's not urgent.
Wrong, wrong, wrong. It's precisely that kind of thinking that can easily turn a growing business into a bankrupt one. It may be the case the business plan you drew up in the early days no longer has much relevance to the way your business is now operating. But the upshot of that isn't that you should now fly blind assuming that things will continue to go well indefinitely, it's that you need to revise your business plan to reflect changed circumstances. Albeit for different reasons, a well thought-out plan is as crucial for a business that is growing as for one that is launching.
Here are four reasons why:
You now need to put systems in place
When you're doing everything yourself, possibly with the assistance of a handful of staff, you can make all the decisions and ensure everything is done the way you like it. Inevitably, an expanding business means you have to progressively surrender control and delegate to others. The only way this will work out well is if you have clearly stated procedures in place. Your revised business plan is the place where you can articulate your wishes in terms of how you want managers to run their departments and make decisions on your behalf.
You now need to bring in people with different skill sets
The competencies required to manage a high-growth business are different to the ones required to get a startup off the ground. As your business expands and becomes more complex, you will need to create new positions and bring in people with the skills neither you nor your original staff members possess. How will you know what positions to create and what to look for in candidates? You guessed it - an up-to-date business plan.
You're now the hunted, not the hunter
If your business is kicking goals, existing and potential competitors will have taken note and will be furiously brainstorming ideas on how to eat your lunch. Revising your business plan will force you to consider how you can maintain your current competitive advantages and alert you to how changing market conditions or the entry of new competitors could undermine your business model.
You'll now need to make a lot more decisions about what opportunities to pursue
Many a flourishing business can fall victim to bright shiny object syndrome. Precisely because the business is growing, it is presented with a wide range of opportunities it can potentially pursue. It can be nigh on impossible to tell in advance which of those opportunities will pay off, but if you have an up-to-date business plan you can at least determine which of them play to the strengths of your growing business and fit in with your vision of where it is heading.
Regardless of how your business is travelling, your business plan should always be a living document rather than an ossified snapshot of how things were at some point in the past.
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This article represents the views of the author only and not those of American Express.
Nigel is a freelance journalist and web content provider. Over the past 15 years he has worked for many of Australia's major print media companies and written for a wide range of newspapers, magazines, trade publications and websites. Nigel most enjoys writing about entrepreneurship, popular culture, politics, social trends and small business.