There are many misconceptions about the value and results of writing a business plan. Of course in theory the reason behind making a plan is completely sound but in practice, business plans are a waste of time. When starting a new business venture you want to know what to expect and what to plan for.
You want to show others that you have an overall plan for your business pursuits and that you are committed to making that happen. Obviously as an entrepreneur you will want to be taken seriously and professionally. There is nothing wrong with being prepared and thinking about your business’s future, but wasting your time writing a lengthy business plan is not the way to do it!
One of the biggest misconceptions about the merits of creating a business plan is that it increases your odds of being funded. This business myth is highly misconstrued and has been proven to hold no merit. Not only are you wasting your time preparing a business plan, but you are also wasting effort and energy.
Professors of Management and entrepreneurship David Kirsch and Brent Goldfarb conducted a business study at the University of Maryland’s School of Business. The study showed that amount of content had no absolutely affect whatsoever on the odds of receiving venture capital funding. As a matter of fact, neither did the quality, make up, or the business model. Your odds were not even affected if you failed to turn in a plan or not!
This goes to show that potential investors are not interested in wasting their time sorting through papers and papers to see if they should have a stake in your business. The entrepreneurial spirit lies in the ability to make social connections and extend that reach further. This further concludes that business plans are a waste of time and redundant documents.
Another misconception about developing a business plan is that you think your plan is going to be read. Although it is unfortunate, investors are just simply not going to waste their time flipping through your lengthy written plan. This is most likely why the above study provided the results that it did.
There are other ways to express the overall outcome you expect to come from your business ventures. All a business plan really shows is that you are invested and interested in your business, but so does a business card that has better odds of being read.
So do you really want to spend so much time on a document that most likely will ever be read? I believe you, like most entrepreneurs, have better more productive things to do with your time.
At the end of the day making a business plan should be for the individual’s use only. It is always beneficial to have an outline of what you expect to gain from your pursuits and to organize your ideas, but not in a way that waste your time, efforts and energy. The fact is that almost as soon as you are done writing up your business plan it is already obsolete and will need revising.
Instead of wasting your precious hours constantly revising and reviewing a business plan, you should instead be concentrating your efforts and time elsewhere.
Business plans are a waste of time and potentially harmful to your business they tend to “box in” your thoughts and ideas about your business. Instead of being open to adjusting and compromising to meet your constantly changing business needs, you kind of set yourself up for following these guidelines you have set up for yourself and your future.
So what is that you should concentrate on instead? What is it that should replace making a business plan? The answer is people or networking. To the entrepreneur social connections has and always will be more important and beneficial than any type of plan.
Entrepreneurship is all about creating the future one step at a time. In order to do this you must stay in contact with people and network yourself through those connections. So instead of wasting your time sitting down and writing down all of your ideas about your business go out and share them with people! Open up the lines of communication and you will also start to realize that business plans are a waste of time.
Another alternative I suggest is to write an overall outline that focuses on short term goals. Not an entire book but instead a page or less that lists what you need to get done in the next few weeks or months to get your ideas rolling and on the road to success.
As mentioned early it is always good to organize your thoughts and ideas, but not so far ahead that you lose precious time and energy in the process. Consider it like dieting! It is much more healthy and beneficial to have a lot of smaller meals and snacks throughout the day, rather than just one huge meal. Keep your notes light and open, just as you should be as a modern day entrepreneur.
This also enables you to organize and think about a lot of different plans at once and inspires the creativity that must drive you. In order to succeed once you must fail a lot more than that. This tool will help you see all the different ways you can go about finishing you want to accomplish and free up a lot of time to do so!
So in today’s business market business plans are a waste of time. It will hold no sway when trying to get venture capital funding. It will more often than not even be read at all. It boxes up your thoughts and ideas about how to pursue your goals, and is just simply a waste of time and energy.
Action and social connection is what the entrepreneur truly needs to get a business off the ground and running. Time and mental space is also very necessary to come up the ideas that won’t work so that you can find the one idea that does. Keep that entrepreneurial spirit alive!
Always keep eyes on your future but not so far ahead you miss the present.