Call me a hedonist for believing that writing a business plan is an essential step to bringing clarity to your business proposal. I understand the rationale behind a lean methodology that promotes continuous iteration and pivots in search of product optimization. Yet how many of us can systematically research, analyze, and catalogue a strategic plan for a new product or service in our heads?
There is no shortage of well-credentialed business leaders taking aim at the once obligatory business plan. Steven Blank and Bob Dorf, authors of The Startup Owner’s Manual advocate “Startups should dump the business plan and adopt the flexible business model.” Brad Feld, managing director of the Foundry Group, wrote in the Wall Street Journal “Today, it’s clear to me that business plans for startup companies are a historical artifact”… .
Yet, a report from the Small Business Administration, Are Planners Doers? , concludes that entrepreneurs who write a business plan are more likely to take the needed action to launch their business. To determine for yourself if writing a business plan is worth the invested time, here’s a short list of scenarios where a formal plan may be of benefit.