There is a lot of emphasis in business on planning and predicting, but is this a complete waste of time?
Dean says:
Both James and I recently read a book called ‘Rework” by the founders of 37signals… to quote the back cover of the book “planning is guessing”.
They acknowledged that for a billion dollar company looking to build 500 factories in China, a 5-year plan is essential, but for everyone else, it is “guessing” and “pointless”.
My personal stance is to agree with them… I often laugh when I watch the TV show ‘Dragon’s Den’ and there is huge emphasis on a 5-year forecast from a company that has nothing more than an idea.
If the inventor could predict that, then he would be more useful picking lottery numbers instead.
Granted, I am sure James will tell me the importance of it being able to help with scaling and cost issues, but for me, I would prefer to just get started.
What’s more, when asked for a profit prediction over 5 years, why not just say “300 trillion” in your best Dr Evil voice?!? If you are gonna guess, you might as well aim high 
Let’s face it… The Internet and technology is changing so darn quickly, who knows what is going to be the next big trend. 5 Years ago, it cost a fortune to host videos, now it is free, tools like Twitter and the iPhone didn’t exist, the economy was drastically different.. etc…
I believe it was Gary Vaynerchuk who said that “you have to be able to react” and he strongly believes that anything more than a two week plan is BS.
I keenly await James’ thoughts on the matter, as I know he also enjoyed the book, but at the same time, he is very organised, and has a plan for everything… so I am not sure which way he will go with this one.
James says:
Dean has keenly anticipated my answer to this topic and has guessed that I might be in favor of detailed plans. The fact is I hate detailed plans. Further proof (in case you need it) that planning is guessing! Mwuh Huh Ha!
When I read ‘rework’ I was nodding in agreement the whole way through. Having run a large business for a swanky multinational corporation I have had more exposure to nonsense plans than any human ought to. This forced me into my current scenario of being the master of my own destiny. There are too many spreadsheet jockeys out there who micro analyze things to death and miss the entire game. I would rather play it than sit on the sideline analyzing and trying to predict the score.
Small is good and when your advantage is being nimble why hamper it with SWOT analysis fests and create rigid train tracks! I love how General Patton said: “A good plan, violently executed now, is better than a perfect plan next week.” Keep it fast and fluid.
How to create a ‘focus’ plan so you are more like a versatile ninja
Every so often (usually about once a week) I sit down with my whiteboard and marker pen. Then I do this step-by-step process:
Step 1: I write down on the board where most of my current income came from. Some of those things may be repeatable and others may wane.
Step 2: There will also be things coming up that are obvious cash cows so I will note them too. (For example, events, launches, seasonal niche campaigns, licensing deals)
Step 3: Next I then think about the very highest and best use of my resources and energy right now for the current phase of my business (usually a week) and write that down on the board. This will include leverage strategies for current campaigns, and adding new innovations.
Step 4: Now that I have my current ‘focus’ I set about doing. This is where the money is made.
Keep it simple and be open to change on the run
It is very hard to steer a parked car. Get in motion and make adjustments as you move. I don’t mean to break character here however you need to allow for creativity and innovation because “the sky is never the limit” according to business management genius Eliyahu Goldratt. I strongly recommend his book “The Choice” because it demonstrates that locking into to too firm a plan can cause you to lose out on massive profits!
Your turn
What are your thoughts on planning? An essential part of any business? Or a waste of time? Comment below.
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My philosophy when it comes to planning -
make sure you know who your customer is.
Make sure what you are selling is what they want.
Make sure you know where those people are and that you are there too.
check in on a regular basis to see if the answers have changed
Simplicity is magic.
Anything more than that for a small business or startup is just baggage when it comes to planning in the short to medium term
Great collaborative blog post. It’s way better to ‘know what to do next’ than to think and wonder what you ’should be doing’ next.
If you look at planning more as a map then it is a good tool. You can not get where you want to go if you don’t know how where you are going. However if you are trying to follow a long or mid range plan with out updating it daily with new data to make course corrections, then it is a tool of self destruction.
AKA ‘life is what happens when you made other plans’.
Failing to plan is planning to fail. Or is it? Oddly enough, I bought REWORK at the weekend and it’s the next on my list. I flipped through it in the store and yes, I agreed with lots of the points I skimmed through. As I’ve said, it’s next up on my reading list.
My humble two cents’ worth. Ideas come first, then a small amount of planning (to see what floats), THEN ya test viability, run with the winners, and KILL whatever stinks.
In a primitive form, think: hunter gatherer meets slash and burn agent! Got that idea in your head? Good. Let’s run with it. Why? Because it’s what created the cradle of modern society—way before nomads settled down and began growing crops and raising livestock in one area. Before that, nomads WERE NOMADIC. They had a CYCLE, but they did not use, nor did they need … a plan.
You need a plan if you’re building a house. Or a bridge. But once the structure is finished PUT THE GOD DAMN PLAN AWAY and sprint … do NOT run, SPRINT for the exits and onto the next assignment.
Which means? All this stuff about long range planning?
No. Forget it. It’s mostly crap and DANGEROUS crap at that.
Here’s why: By all means have an OUTLINE, begin with an overview and sketch out a list of points or performance markers to hit along the road in order to measure your progress. But the thing about a plan is that for most people, it’s FIXED. SOLID. UNYIELDING.
For years I’ve been a perfectionist. I trained as a graphic designer and, up until two months ago when I lost my job, I’d laboured under the delusion that everything must be perfect BEFORE it went to press. That was then. This is now. Now, moving upward into the world of IM, now, I see a really clear necessity, and it’s this: for me to succeed, my overviews of perfectionism MUST DIE!
Plans are CLOSELY related to perfectionism: joined at the hip really. One drags down the other, and they limp along like an old married couple: together … till death. True love? Only if all either can see is the other. And love IS BLIND!
Along comes a little kid: a grand child—just a few years old and of course, they’re bouncing around and wanting to explore EVERYTHING! So they are way happier (ever noticed how little kids are only ever scolded for having too much fun, for, in essence, BEING LITTLE KIDS? Hateful. Little kids are IMMUNE to plans, rules, and guidelines. That’s why they kick up a fuss when it’s time to put on the Jim Jams.
Other than this, little kids are as happy as anything JUST PRETENDING … just MAKING STUFF UP as they go along. True, it’s NOT the corporate or “business” way, but it’s for this reason that most businesses are poorly run: their leaders have forgotten how to pretend! They’ve become obsessed with rules, measures, quotas, and numbers that they forget about having fun and using their imagination. Without which THERE IS NO NEW BUSINESS GROUND BROKEN!
Need proof? One word: Zappos. I rest my case.
But there’s more:
In business, traditional thinking is that a fixed plan is great. Which might well be the case but in many of those cases, the PLAN is written by someone with little interest in the outcome, OR by an outside consultant. Either way, when that person walks, as they invariably do, they’re sitting pretty but the plan is in place and most people on the receiving end of the plan either don’t want to mess with it, OR, they don’t understand it or have had no input (and therefore have no buy in ) into it.
Warning! Warning! Danger Will Robinson! THIS IS BAD. REALLY REALLY BAD!
Why?
Because it turns “the plan”—something that was originally meant to equal SALVATION—into a trap. Think pointy sticks, dangerous side up, at the bottom of a deep, slick sided pit. Think trip wires connected to Claymore anti personnel mines. Think ENRON. Think Bernie Madoff. Think DOOM!
Are ya seeing a pattern here?
The thinking becomes “Well, such and such a change is not part of the plan!” But 99 times out of 100, the odd idea that’s NOT on the plan ROCKS!
But because it’s “not part of the plan” the gleaming jewel that could change EVERYTHING gets sidelined by inflexibility.
OK. I’m done. For the time being.
To clarify: The example of Zappos above COUNTERS the “rule” I mentioned. HENCE THEIR SUCCESS!
The best thing about planning for people, is it provides a sense of direction, a less stressful existence and focus.
I know for me unless I have a clear direction, I am open to looking at every opportunity and getting distracted and in the end achieving nothing.
I agree keep it simple and being flexible to respond is essential, in business it is about making profits, not generating reports.
Review often and adjust when needed.
Time frames are up to you, sometimes though decisions require time to achieve traction.
A journey without a long term aim, will be a great ride and full of new experiences, but in the end make you NO money, unless that is what you wanted in the first place.
Gary,
That comment should be a post of it’s own
Dean