Don’t Fall In Love With Your Plan

Over 20 years ago I studied a technology company that provided one of the first management systems for medical and dental practices. It was a pretty good piece of software and the company offered a turn-key system including education and support. Then they recruited the best possible salespeople they could find and educated them. The company only last a few years.

And, it was all because of one error in their business plan assumptions. They had come to a conclusion that the average sales person could sell 3 of these systems per month when they were up and running at full productivity. They were wrong and they were wrong by a factor of at least 50%.

This was cutting edge technology and the salespeople had to convince physicians and dentists to invest their money in something that had never been done before. Perhaps in a few years the average rep would be able to sell 3 systems per month. But, most of these really great salespeople were lucky to sell any systems in the first six months.

And, so the company failed not because they didn't plan but because they were not flexible enough to see the error in their assumptions. I think part of the reason is because there was a good bit of venture money invested and I don't think the CEO wanted to deliver the news that their financial objectives were off by at least 50%. If he had been a leader instead of a manager, he might have been able to save the company.

You don't need a business plan for your new business. The reason you don't need a business plan is that you cannot possibly see far enough ahead to know what is going to happen. I think you need to know as much as possible about the type of business. And, you definitely need a marketing strategy that takes into account creating an extraordinary product and how to spread its story. You need to know where you are going (goals) and you have to take action to reach them. But, while being focused on your goals you  need to be flexible.

Too many people fall in love with their plan and fail to take into account that "things happen."

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