Starting a Business – Page 28 – Management Library

May 29, 2010March 28, 2023

“Best” Business Planning Books

Finding a good business plan book can be overwhelming. Type “business planning guide” into Amazon and you’ll get almost 5000 citations. Your local bookstore or library is more selective, but it’s still hard to sort through them.

And, truth be told, there’s no one book for everybody. So, for that reason, we’ve listed the “best” business planning books in three categories. (Full disclosure: I’m the author of the last book.)

“Best” General Business Planning Book

The Ernst & Young Business Plan Guide by Brian Ford, Jay Boorstein, and Patrick Pruitt (2007), is a solid, competent book that will help you create a solid, competent business plan. Written by accountants, it might not be inspiring, but it’s a good “how to” book for getting started.

“Best” Business Planning Book for Finding Investors

There are two books in this category. Raising Venture Capital for the Serious Entrepreneur, by Dermot Berkery (2008), is a comprehensive guide on how to attract investment dollars. Written for a business school class, it’s thorough to a fault (all 288 pages worth), but you’ll find it worth the time you spend reading it.

Angel Financing for Entrepreneurs, by Susan Preston (2007) describes how to create a compelling ten minute PowerPoint presentation to attract angel investors. It’s also used in business school classes, but does not address how to write a business plan; for that, you’ll need one of the other books too.

“Best” Business Planning Book for Social Enterprise

Venture Forth! by Rolfe Larson (2002). Endorsed by Paul Newman of Newman’s Own, this book provides instructions on how to write a compelling and complete business plan, and includes detailed examples and case studies. Written for nonprofits, it’s been used by numerous for-profit entrepreneurs as well.

——————

For more resources, see our Library topic Business Planning.

Copyright © 2010 Rolfe Larson Associates – Fifteenth Anniversary, 1995 – 2010
Author of Venture Forth! Endorsed by the late Paul Newman of Newman’s Own
Read my weekly blogs on Social Enterprise and Business Planning

May 27, 2010February 21, 2022

How to Change Your Strategic Plan

A business team coming up with a strategic plan

Few plans are implemented as intended. That’s one of the reasons that people lose faith in planning. They expect their plans to be implemented exactly as described in the plan. One of the unfortunate aspects of this situation is that many consultants assert that “planning doesn’t work.” It does work when it’s done well.

During Planning, Clarify How to Change the Plan Later On

When doing the planning (when identifying goals and other priorities to address and how to address them), also talk about how to change your plan as it’s being implemented in the future.

A good approach is to require that any changes be approved by the Board if the changes might be to the overall mission, vision, values and top-level goals, but not to the action plans. (Action plans usually are about how each goal is to be achieved.)

Include a Date on the First Version of the Plan

When the Plan is approved by the Board, be sure the cover of the Plan includes the date of approval. Include that date on each page of the Plan.

Include a Revision Page Near the Front of the Plan

On that page, list the original date of approval of the first version of the Plan. Then for each approved change, on the Revision Page, list the date of approval of the change, and the pages that were changed and how.

Update the Revision Date On Each Page of the Plan Document

For example, on each page, put the last date of approval of the last change to the content on that page.

If Frequent Changes Are Made, Produce a New Version of Plan

If changes are made, for example, more than once a quarter, then produce a new Plan document that includes all the approved changes, and on the cover of the Plan include a new date. On its Revision Page, explain that a new version was produced and reference the previous versions.

If Changes Require Board Approval, Re-Issue to Stakeholders?

If changes were to top-level, strategic matters (mission, vision, values and goals), and you had issued copies of the Plan to various stakeholders, then consider issuing a new version to them as well, along with descriptions of why you produced the new version.

A plan should be a set of guidelines to follow during the year. The Plan should not be considered as a law or regulation.

What do you think?

———————————————————————————————–
Carter McNamara, MBA, PhD – Authenticity Consulting, LLC – 800-971-2250
Read my weekly blogs: Boards, Consulting and OD, Nonprofits and Strategic Planning.

May 27, 2010February 21, 2022

The Bloom is off the Tylenol Rose

Team members having a brainstorming session

For nearly 30 years the heroic story of Johnson & Johnson quick action to remove Tylenol from the shelves after a deadly tampering incident has been folklore in business circles. So what do we make of the news today that The Food and Drug Administration is considering “additional enforcement actions” that might include criminal penalties against the Johnson & Johnson unit that makes Tylenol.

As reported by the Wall Street Journal:

According to written testimony of the FDA’s principal deputy commissioner prepared for a U.S. House committee hearing later Thursday about a wide-ranging recall of children’s Tylenol and other medicines, the agency said it was working with the company “to address its systemic quality issues.”

On April 30, McNeil Consumer Healthcare announced a recall of more than 40 kinds of liquid formulations of infant and children’s Tylenol, Motrin, Zyrtec and Benadryl products because of manufacturing problems at its Fort Washington, Pa., plant, which remains shut down.

“FDA is also considering additional enforcement actions against the company for its pattern of non-compliance which may include seizure, injunction or criminal penalties,” Joshua Sharfstein said. “Over the last several years, FDA has had growing concerns about the quality of the company’s manufacturing process,” he said.

What happened to the fabled J&J Credo? What is going on within the culture that is causing J&J to be seen by the FDA as slow to address quality issues?

Every manufacturing company faces quality issues that impact production. Companies with a healthy ethical culture however have the ability to respond quickly to issues internally, as well as keep regulators and externally stakeholders appropriately informed.

After seeing the issues faced this year by stalwart brands such as Toyota and now J&J, one wonders whether their core values are being taken for granted?

—————————————————————————————–
David Gebler is the President of Skout Group, an advisory firm helping global companies manage ethics risks. Send your thoughts and feedback to dgebler@skoutgroup.com.

May 27, 2010February 18, 2022

Four Types of “Broken” Boards

Over the years, I’ve noticed four common types of “broken” Boards. One of the ways you can recognize them is by the comments that members make. Here’s the types of Boards and what you might hear members saying.

1. Detached Board

“Why are you calling me to come to a meeting? What Board are you talking about?”
“We need a strategic plan. Let’s have the CEO just write one for us.”
“I’ve not heard from CEO, so everything must be fine.”

2. Servant Board

“I’m here to help the CEO in any way I can.”
“All the CEO has to do is ask.”
“How can I help?”

3. Personalities Board

“Recruit Jim for the Board! He’s a nice guy.”
“Get whoever will come to meetings!”
“Keep him on the Board! He’s a ‘big name’.”

4. Micro-managing Board

“Give us your todo list every week!”
“Give us your manager’s todo list every week!”
“We want to know when you’re in the office and when you’re not!”

In Contrast, the Strategic Board

In contrast, in an active strategic Board, members’ comments would be like the following:

“Are our products and services high-quality? How do we know?”
“What’s our role? What’s the CEO’s role?”
“What’s the status of implementing our Strategic Plan?”
“Are we attending to the most important matters? How do we know?”
“We’ve got some Board members who don’t come. What are we going to do about it?”

The best way to “fix” a “broken” Board is Board development, not a Board orientation or Board training. See my post Board Orientation vs. Training vs. Development.

What do you think?

May 25, 2010February 18, 2022

Why Leaders have Trouble Restoring Trust

The challenges facing Paul Levy, the embattled CEO of Boston’s Beth Israel Deaconess Medical Center, highlight the issues faced by many leaders: once in hot water, how to start on the road to recovery.

The problem is that many leaders don’t appreciate the nature of the ethics risks they face and what is in fact needed to restore trust. Most leaders don’t get that merely by being a successful manager and even a nice guy aren’t enough. Moreover, even coming clean with a confession of wrongdoing and a commitment to do better isn’t enough.

Blanket statements don’t work. Leaders have to get to the heart of what caused the problem in the first place. In this situation Levy faces two challenges to restoring trust: systems and relationships that inhibit trust as well as overcoming skeptical employees who only last year believed in him.

Levy recently contacted a local reporter for the Boston Globe as a step to get his story told. The reporter, Brian McGrory, was not impressed. As McGrory wrote in his column of May 19, 2010:

So I found myself in Levy’s office on Brookline Avenue on Monday afternoon, face to face with a man who is widely considered to be among the most charming members of Boston’s leadership elite. I came away with two distinct thoughts: This guy is good, and he just doesn’t get it.

The good part: Levy is thoughtful, he is expansive, he is conciliatory. He has been a force of nature in returning Beth Israel to the powerhouse that it is today.

Yet, forty-five minutes with him provided an extraordinary view into so much of what’s wrong with life in the city’s higher altitudes, where macho favor-trading, undue influence, and complicit governing boards are the way of the day.

McGrory goes on to discuss how despite rumors of an improper relationship circulating for years, the Board did not take any action until an anonymous letter was delivered.

The bottom line: words aren’t enough if the systems that perpetuate the distrust aren’t fixed.

The challenges of rebuilding trust also extend to the employees.

As a thoughtful CEO, Levy knows what he needs to do.Levy said to Adrian Walker, in yesterday’s Boston Globe:

“Ultimately, the authority to do this kind of job, to be a CEO — as important as the board is — does not derive from the board. It derives from the people you work with. And maintaining their trust and confidence is important,’’ Levy said in an interview last week.

After the story erupted, Levy didn’t help himself by issuing a series of statements that apologized for a “lapse in judgment’’ that didn’t explain anything about the lapse, or the circumstances. He says now that his statements — which were downright Nixonian in their evasiveness — had to be approved by the board, and that he could not be more forthcoming while it was still deliberating his fate.

“I could go in front of them and say ‘I want to do what I can for the low-income workers but that means everyone will have to take a bigger sacrifice.’ I was able to do that because I had the moral authority to say those things,’’ he said. “If it were today, would I have the same amount of moral authority? I think not quite. I’d like to get back to the point that I do again.’’

The good news is that our human nature allows us to forgive. But we don’t want to feel like we’ve been duped. Levy has to do more than simply acknowledge a lapse of judgment and empathize with his staff’s feelings. He needs to acknowledge how and why he ended up doing what he did in order to allow his staff to hold him accountable for future actions that could lead to the same issues happening again.

Regaining moral authority means that Levy has to acknowledge his human foibles AND do what is needed to ensure that he won’t walk down that same path again.

_____________________________________________________

David Gebler can be reached at 617-314-6280

dgebler@skoutgroup.com www.skoutgroup.com

May 22, 2010February 18, 2022

Be Nimble, Be Quick; Be Disruptive, Too

In a world with dynamic markets and fickle customers, it’s best to build into your plan strategies to respond quickly to new opportunities and threats. Long gone are the days when you could just create a valuable product, price it to attract customers while making a profit, and then just keep doing the same thing year and after.

Today, that’s a formula to go under before your banker invites you to the annual golf outing. And that’s assuming anyone will put money into your business in the first place, which is unlikely if you can’t convince them that your business will adapt quickly when the reality of your business plan meets the reality of the marketplace.

So how do you build adaptability into your plan? First, do your homework so you come out of the box with a solid plan with real world assumptions, but also create systems to keep gathering that data to test those assumptions. Successful entrepreneurs keep collecting data about their customers, competitors, supply chain, industry trends, and so on long after they’ve written their business plan.

Then they act on it. Be sure your plan includes a management structure that enables quick decisions, without more process than is needed to properly vet things.

One way of looking at the CEOs job is s/he needs to be constantly disrupting things as a means to achieve that kind of adaptability.

A recent Business Week article describes successful CEO’s who intentionally disrupt the status quo, their own business models, and institutional analysis paralysis; that’s when slow moving organizations seek complete clarity before acting. For most important business decisions, that’s too late. Your goal should be to understand just enough about the problem to make your next decision.

It might be the wrong decision sometimes, but often there are even greater risks from inaction, moving too slowly, or just taking too long to act.

So make sure you build decisiveness into your business plan.

——————

For more resources, see our Library topic Business Planning.

May 21, 2010February 18, 2022

Here’s a Procedure for Making Decisions

Business professionals deliberating over a business decision

Why a Policy for Making Decisions?

How often have you heard Board members assert that they’d made a decision, when they really hadn’t — all they had done was talk about a topic for a long while?

Or, how often have some Board members or the Executive Director asserted that a decision had been made, but other members didn’t remember making that decision at all?

Or, how often had Board members made a decision by a majority vote, but the members in the minority claimed it was “not their decision”?

First, a Necessary Prerequisite for Good Decisions

For good decisions to be made about a topic — and for all to recognize that indeed a decision had been made, the organization should have:

Sent out the Board meeting materials well before the meeting
Put the topic on the meeting agenda
Listed the type of action needed for the topic, e.g., a decision needs to be made
Associated a specific amount of time in the meeting to address that topic

Sample Procedure to Make Formal Board Decisions

As long as a quorum of Board members is present in the meeting:

Board members discuss/debate and then decide within the time allotted on the agenda.
Consensus is attempted within that time.
If consensus cannot be achieved, then a seconded motion is sufficient to call a majority vote to delegate to a committee to gather more information by a certain time frame.
If delegation is not selected by a majority vote, then a seconded motion is sufficient to call a vote about a certain suggested outcome of the decision.
The decision outcome goes to the majority vote.
The decision is documented in the next issue of Board minutes.
In the future, all Board members must support the decision – they must speak from “one voice.”

What do you think?

———————————————————————————
Carter McNamara, MBA, PhD – Authenticity Consulting, LLC – 800-971-2250
Read my weekly blogs: Boards, Consulting and OD, Nonprofits and Strategic Planning.

May 21, 2010February 18, 2022

When Strategizing, Use “Sanity Solution”

Over the years, I’ve noticed that when things get really tough or it’s difficult to identify strategies during planning, there are always three strategies you can try. My clients seem to love it when I describe the Solution to them. Try it yourself.

Strategy #1: Try Get More Resources?

This is the most popular, but usually the least successful and the most maddening. This strategy, more than the other two, usually results in working harder, rather than smarter. Inexperienced leaders usually prefer this approach, thinking that if only they could get more money or more people, then they’d throw more quantity (not necessarily more quality) at the problem. Experienced leaders usually opt for one of the other strategies.

Strategy #2: Extend Deadlines to Get Things Done?

Ironically, this is the approach that’s most frequently used – and used by default. Regardless of our plans in life, reality usually overtakes them – and we become so busy doing other things, that the deadlines in our plans tend to slip. Sure, we lament that deadlines have slipped (if we even admit that to ourselves), but still we’re a little relieved – and surprised to realize the world hasn’t crashed around us.

Strategy #3: Reducing Our Expectations?

In today’s hectic and goals-based world, even the mere mention that we should do less very often evokes strong reactions from others, especially from bosses and collaborators. “Well, aren’t you a leader? Then do more with less! Motivate yourself and your people!” The irony is that very experienced leaders have learned that you’re often far better off to do a few things very well, than continue to live with the continued frustration and disillusionment over unsuccessful attempts to reach unachievable goals.

So the next time you’re in a tough situation, think of these three strategies – what I call the “Sanity Solution”. Think especially about strategies 2 and 3, and live a longer and saner life.

What do you think?

May 17, 2010March 29, 2023

Business Plan Software Recommendations

Writing a business plan takes time. Using software can help organize your work and save you some time, especially if you haven’t written one before.

Here’s a quick summary of what, from my experience, are the three best choices:

Business Plan Pro by Palo Alto Software claims it’s the best selling business planning software for the past ten years. It offers more than 500 sample business plans. Standard Edition sells for $100; Premier for $200 (allows managing cash flow and importing Excel content)
Business Plan Pro Social Enterprise Edition was developed by the Social Enterprise Alliance in partnership with Palo Alto Software. It’s contains everything in Business Plan Pro along with business plan examples from social enterprises. It sells for $200 ($174 for SEA members).
BizPlan Builder by JIAN has versions available for Mac or Windows, is also highly rated and sells for $129.

Can’t decide? Take a look at this review of ten different business planning software programs to help you pick the one that’s right for you.

But remember, these are only tools. Ultimately you have to do the research, make the important decisions, and write your plan. Software can only do so much.

Good luck!

——————

For more resources, see our Library topic Business Planning.

May 17, 2010February 18, 2022

Should I Use Goals-Based or Issues-Based Planning?

Far too often, organizations choose the wrong approach to strategic planning. As a result, strategic plans sit untouched on shelves and planners become even more cynical about the strategic planning process. This occurs especially with 1) new organizations, 2) organizations having many current issues, and 3) organizations having very limited resources. Here’s how to fix the problem.

What’s Goals-Based Planning?

Goals-based (or vision-based) planning works from the future to the present. Planners pick some time into the future and then suggest specific goals to be achieved by that time. Often, goals are specified in terms of specific accomplishments, for example, achieve to 1 million in sales revenue or a 20% profit rate at the end of the next three fiscal years.

Hopefully, planners also associate actions plans with each goal. Action plans clarify who is going to do what and by when in order to achieve the goal. The planning process might also include clarifying the mission statement, and even scanning the environments external and internal to the organization in order to identify priorities to address in the plan. Goals-based planning is usually based on a rather long-range plan, at least 3-5 years into the future.

What’s Issues-Based Planning?

In contrast, issues-based planning starts from the present and works to the future. Planners identify major issues facing the organization right now. It’s best if issues are described as questions, for example, “How will we activate our Board of Directors?” or “How can we manage our finances much more effectively?”

Then planners specify action plans about who is going to do what and by when in order to address each issue. They might scan the external environment, but they focus especially on the internal environment of the organization in order to ensure the organization accomplish strong internal systems. Issues-based planning usually produces a plan with a short time range, for example, one year.

Which Approach to Planning Should I Use?

If your organization is 1-2 years old, has many current issues and/or has very limited resources in terms of people and funding, then you should strongly consider doing issues-based planning for now. Then, after a year or so, after you’ve implemented your issues-based plan, your internal systems will be much stronger and ready for doing more future-based planning.

An added benefit of issues-based planning is that it usually gets much stronger buy-in from planners because their minds are not ruminating on current major issues, while they’re being asked to fantasize far-reaching goals that might result in even more issues to address very soon.

What do you think?