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- Andrew Lutts CEO, Net Atlantic Inc.

Just What Is A SWOT Analysis Anyway?

I realized recently that I have never written a post entirely devoted to what is a SWOT Analysis. What?! The weird thing is that I have referred to SWOT analyses in various posts like this one or this one. This tool can help you design your strategic plan, objectively see how you and your small business are performing and even provide a few other advantages.

A straightforward tool
SWOT analysis and small business

You wouldn’t mind but I encourage people to do a SWOT analysis every time I present my webinar, Living Business Plan-The Best Kept Secret For Small Business Success. (Typically, I recommend to clients to make it a part of their quarterly review.)

It sounds so business-y and arcane but it’s really a straightforward tool. The four parts of the SWOT analysis are: Click here to read more »

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Of Living Business Plans and Disaster Recovery

You might know that you can find more posts by me on KaizenBiz.com and TweakYourBiz.com. Just this month, I started blogging on a small business site, Corpnet.com. Check out my latest posts here…

On TweakYourBiz.com

Preparing and Responding When Natural Disaster Hits Your Small Business Since any one of us can be affected by a natural disaster, this summation post offers links of resources and advice for preparation and recovery. I wish you every success for the recovery of your small business if you’ve been affected by Hurricane Sandy or any of other recent severe weather events.

On Corpnet

Running a Small Business: What Is a Living Business Plan? As a reader of this blog, you are probably familiar with my encouragement that using a living business is good business sense so you stay focused and clear about planning and implementation of your business vision and goals. If you have missed some of my past posts on living business plans, this post is a good introduction.

Thank you for taking the time to read my posts on these other sites. I appreciate any time you share my small business posts with your followers on your favorite social media sites.

About the author:  I’m Elli St.George Godfrey, a small business coach and trainer who guides established small business owners to be comfortable in their own skin. I have a deep appreciation for learning and understanding my client’s business style and culture. Whether you are expanding in your own backyard or into another country, my 3 keys coaching process helps clients move from being excited about a new business opportunity to having the tools to make it actually happen. Curious? Schedule your complimentary coaching session here.

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Using Your Living Business Plan: Measuring Results

Measuring your small businessHave you been using your living business plan? As many of you know,  a living business plan is the internal business plan that is written for your use and that it follows this basic outline;

Basic Outline:

  • Executive summary
  • Services and/or products offered
  • Marketing plan
  • Financials
  • Goals and objectives

This is all well and good but how do you know if your business plan is working? Click here to read more »

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Living Business Plan: Financials For Non-Money Small Business Owner

SME Finanical ReportsNot a money person? You’re not alone. Many small business owners are not money people. And there is nothing wrong with being a great idea person or adept at business development. However, thinking that just paying attention to your “cash in, cash out” is the only information you need means you are missing a great deal more information.

In previous posts about living business plans here , here and here, I’ve written about the importance of having a living document and designing it so you use it on a quarterly basis. It’s great to have well written goals that keep you in action and being clear about what you want to accomplish is crucial. But, at the end of the day, how do you know if what you’re doing is working? How do you know if you’re making money? It’s all in the financial reports.

The 3 most important reports

1. The Balance Sheet is like a snapshot of your small to mid-sized business (SME) for a given moment in time. It details the company’s assets, liabilities and net worth.

Now, before you let your eyes glaze over and shut off your brain, let’s take a closer look. It is highly recommended that you read more about   these definitions at AllBusiness.com (highly recommended site) as this post is using just the basic definitions for brevity.

Asset: an economic resource that is expected to provide benefits to a business. A few examples of this include real estate, cash, inventory, machinery or a patent. There are also sub-categories that may be important to understand if you are planning to speak with investors or a banker. In your living business plan, it is important to know what your business owns that carries a tangible or intangible value.

Liability: a debt or financial obligation. A few examples  of this are money owed to vendors, estimated tax payments or loan payments. For those of you who offer a money-back guarantee or warranty, this may also be a liability.

Net Worth: total assets less your total liabilities. This is also sometimes referred to as retained earnings. Imagine it like a simple math problem Assets – Liabilities = Net Worth

If you aren’t using accounting software or have an accountant creating this document for you, you can find a good template here to get you started. Seeing it all lined up in categories and numbers can help you see the overall picture of what your small business is doing right now.

2. The Profit and Loss Statement is another sort of picture of the health of your SME. Simply put, it lists how much revenue (money coming in) is being generated and your expenses (money going out) during a set period of time. This can be done monthly, quarterly, biannually or yearly. Other terms that mean the same thing are income statement or operating statement. This report cuts to the chase. Are you making a profit or posting loss after loss? If you find your business is consistently losing money, it may be time to revisit other parts of your business plan or consider an exit strategy (closing the business, selling it or hiring someone with better skills to run it).

3. The Cash Flow Statement reports revenue and income as well as expenses derived from selling services or products, investing in long term measures for the growth of the company and borrowing and/or selling common stock. This report really highlights the solvency of your business by showing how easily financial obligations can be met.

You can be a “money person” some of the time

You may not become totally enamoured with all kinds of financial reports but you can discover how useful they are as tools. There are moments that you will discover good or bad news. I remember one time in the early days of my business when I was sure things were going south. I was pleasantly surprised to discover that the cash flow was healthy and trending upward. There is plenty to lose sleep over. Knowing what is going on financially will help you sleep better and make proactive decisions.

*Want to learn more about living business plans? Join me for a 2-hour interactive Business Planning Workshop on Monday, October 17, 2011 from 6:00pm to 8:00pm at the Lowell Small Business Assistance Center, 88 Middle Street, Room 202, Lowell

Participants will:

  • Revisit their vision, core values, and core purpose to make sure they are on track
  • Learn simple methods to analyze and measure how their business is progressing so you can make course corrections before it’s too late
  • Fine tune their current goals and map out steps so they stay focused on what their customers really want and stop wasting time

During the workshop, there will be written exercises using information from case studies and the participants’ own businesses. At the end of the workshop, participants will leave with a written version of their living business plan. To learn more about the Lowell Small Business Assistance Center, you visit their website or call (978) 322-8400.

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Living Business Plan: Design It So You Use It!

Designing Your Living Business PlanIt’s been awhile since I’ve written about living business plans. (This post might be a good place to start if you’re not familiar with this type of business plan). While my mantra is “Make your business plan usable for you”, it’s not always clear how to design this plan so to fits you. I remember being interviewed by an interested small business owner who wanted to know if she had to use an outline form. The short answer was, and is, no. So what can you use instead?

There certain parts that are necessary so that this document actually reflects that you are running a business.

No matter how visual, linear or whatever ways you write out your business plan, you still have to include:

1. Executive Summary

2. Services and products offered

3. Marketing strategies

4. Desired client profile

5. Financials

6. Company goals and objectives

This is entirely about how you work.

Keep in mind that this is not the business plan you’re showing to the bank or investors. It exists so you can keep focused as you lead and manage your business. It’s way too easy to get sidetracked by the day to day work, exciting opportunities or negative events. There’s a host of stuff out there that can get you off your game.  Couple this with your thinking and learning styles and it makes sense to write or draw your business plan your way.  And, of course, any goals that you include will include specifics, measurements and deadlines 

So, what are my choices?

Style 1:  Outline form- This is probably the most traditional.  With an outline format, list each category and use bullet points to specify the details. 

Style 2:  Fish Diagram-This style reads left to right with each category branching out into the specific components.   The Executive Summary is the “head” of the fish and the other parts of your business plan make up the body of the fish.  This diagram creates a visual image of what you desire for your small business.  The lines coming off the “body” of the fish are the details that you want to remember and/or implement as actions steps.

 Style 3:  Bubble Chart- This method is well suited for people who like to take a creative and/or visual approach to goal setting.  Write your executive summary in the center bubble and in the radiating bubbles, write the other sections of your business plan.  Each radiating bubble contains important details or the goals you wish to execute. The bubble chart allows you to keep track of  each section while having fun with your strategic and operational planning. 

Try out the different styles suggested here to see what works best for you. 

Your business plan is supposed to be a guide and a reference. It’s a live document that you can review, writing comments in the margins, scratch out what you don’t want, add on new ideas and use continuously. Consider how you learn.  Do outlines make things sensible to you or do you prefer pictures?  Do you tend to think in a step-wise way or in “stream of consciousness”?  These important details will aid you in designing how you think about and plan the actions in your business plan.  The cliché, “Keep it simple” also applies here because simplicity will prevent or manage feelings of overwhelm or distractibility.  It makes no sense for your business plan to become forgotten in a desk drawer or a computer file that it never opened. It’s a tool to keep you focused and motivated as you lead and manage your small business to successful outcomes. Make your business plan a living business plan!

What style makes sense to you?

What suggestions do you have that would help other small business owners create a written business plan?

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Why Use a Living Business Plan?

Is your business plan digestible and practical?

With the end of the year in sight, many of us are thinking about 2010 and what we want for and from our businesses. As entrepreneurial small business owners, we are not content to hunker down and hope for the best. If you follow tweets on Twitter or talk to people at networking events, you hear enthusiasm, reluctance, and musings about what is in store with the economy still looking grim.

So, what keeps us from using our business plan regularly? I’ve noticed in coaching entrepreneurs and small business owners that writing and reviewing their business plan takes time they would rather be using to meet with prospects, strategic alliance partners, or do product/service development. Yes, it takes time to find out what your market needs the most right now. And for some of us, analyzing our financials is about as much fun as having a root canal. And…there are some who just come undone while writing out their goals.

May I suggest a different point of view? Converting your current business plan into a living business plan makes it more palatable. Even easier to use! This is the in-house, dog-eared, marked up, easy-to-pull-up file (on paper or on your computer) that you look at on a quarterly basis. Imagine you have such a pulse on your business that you can respond to your market, your industry, even your life on a moment’s notice!

Where do I begin? Start with the basic outline and include:

  • Executive Summary-Provides the direction and purpose of your business 
  • Goals and Objectives-List your 3 month action plan of succinct, realistic, measurable goals and how you plan on achieving them
  • Services and/or Products Offered-List what you are really offering and which of these are your real money-makers
  • Target market-Describe your ideal client. Has this person changed since you founded your business?
  • Marketing Strategies-There are so many possiblities and this is where you identify which of the strategies you are using. You may need to give yourself more than two quarters to see how effective they are.
  • Financials-Using a profit and loss report and a balance summary, analyze how your cash flow is increasing, decreasing, or staying flat. It can be a great way to see hard evidence about how your business is performing.

Notice what is working and what is not working. Asking questions about what are your real moneymakers, cutting costs, or making changes becomes clearer. By reviewing each quarter, you get the opportunity to intervene when something is not working or to give yourself a pat on the back.

How do you experience writing your business plan?
 
What is the purpose of your business plan?
 
How can I help you?
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