When I consult with folks, one of my first questions is, “What purpose will the plan serve”? Often I hear, “My bank/investors want to see a plan before they will commit capital.” In my opinion, if that’s all one wants, they are missing a major opportunity. A well thought out, detailed plan will certainly increase the likelihood of funding. More important, a detailed plan will serve as a roadmap for future and ongoing operations. The plans I write are a business plan and operating model. I suggest:

• Replace forecasts with “actuals” every quarter.
• Use variances to determine if initial forecasts were unreasonable or if current operations are reflecting less than optimal results.
• Review your plan quarterly. Usually, you will at least be reminded of a key factor that may have slipped from day-to-day focus.

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