Our current monthly installment of coaching entrepreneurs focuses on the second challenge of moving toward planning and commitment in the face of indecision and procrastination. Last month we talked about perceiving the need for change which calls for a perceived market demand and funding for your business. Much of the work was drawn from my personal experience of starting a home-health business in 1986. This month we will continue our series with the importance of planning.

 

How many times have you heard yourself or others day “I wish I had thought of that?” You pick up your garbage bag with built-in ties that eliminate the need and aggravation of your kitchen garbage falling to the newly scrubbed tile floor. Or you take your car in for a tune up and receive a loaner car for the day. Or that pencil you just bought looks just like a number two pencil but the lead automatically advances eliminating the need for a pencil sharpener (I’m not talking about mechanical pencils). Yes, products and services are born everyday. In a recent issue of Fortune magazine, Steve Jobs’ commencement address this past May to Stanford graduates resonates around water coolers even today, in an era when commencement addresses are politically correct and sanitized and forgotten immediately. Jobs had three points to deliver to his audience: (1) connect the dots; (2) stay hungry; and (3) stay foolish. His admonition to this year’s grads was that “your time is limited, so don’t waste it living someone else’s life.” (Jobs, Fortune, 9/5/05).

 

Leaders often languish in indecision and uncertainty failing to commit time and resources to a fledging business or idea. I had a friend some years ago who bought a Maaco franchise after losing his job with a major software manufacturer, only to discover that the books were “cooked” by the previous owner and he spent the next two years of his life working 80-hour weeks because he failed to perform the “due diligence” necessary to evaluate the profitability of the business he had bought. Too often, we are lulled into a false sense of security that “hard work and luck” will win the day and make us successful. We’ve all heard the same success stories: starting a KFC conglomerate at age 76, a fledging open-source web browser (Fire Fox) that now rivals Microsoft, a softer cookie that is packaged to last longer and micro waved to taste just like grandma’s tollhouse cookies.

 

The major mistake entrepreneurs make is that they delegate the planning to others. Entrepreneurs by their very nature are impulsive—they do not plan well. They are concrete random thinkers and they envision results—e.g. what the product or service will look like. Like Steve Jobs said in his commencement address, entrepreneurs have no idea “how to connect the dots.” The planning dimension is more than an academic exercise; it is necessary for securing a line of credit, selling your idea to private investors, or creating new markets to fund your enterprise. Many small businesses begin in someone’s garage on hopes, dreams, credit card debt, and family loans. This is like offering your manuscript for your mom to read as to its suitability for publication.

 

Before your business plan is developed one must develop a strategic plan: vision statement, mission statement, and most importantly how to connect the dots using an action plan. Entrepreneurs are keen on staying hungry and foolish but they lack the persistence and due diligence in bringing ideas into products and services. And why not? Entrepreneurs are visionaries by their very nature. They are more likely to be abstract random thinkers where they envision products and services without constraints, timeframes, quality control, delivery times, and product consistency. That’s why KFC’s “seven secret ingredients” will remain its brand. It’s easier to make a sauce than to sell it; look at the thousands of would-be food mavens who are labeling their jars in their garage only to find deaf ears for shelf space at their neighborhood grocery chain. What’s missing with this picture? An excellent idea, perhaps, but without a plan to place the product on the shelf or in the catalogue or a delivery system that relies on inflated inventory costs rather than “just in time” inventory perfected by Dell Computers.

 

So I would add a fourth dimension to Jobs Commencement Address to the 2005 Stanford graduates (remember Jobs never graduated from College; he spent six months at Reed College before dropping out). Besides connecting the dots, staying foolish and hungry, I would execute a plan—remember George Peppard’s infamous remarks in the weekly TV series of the 80s—“the A-Team?” I’ll never forget it—“I love it when a plan comes together.”

 

Helpful Hints:

 

1. Next time in the grocery store, read a label of a new product in the specialty sauce section and see where the sauce is made. Write to the address and see if you get a response on how the idea became a reality.

 

2. Talk to a business lending banker and ask for an information packet to apply for a business loan. Read the material and ask yourself the question--do I have what it takes to deliver this product or service to the customer? Will my banker believe that I can?

 

3. Go to Office Depot and look for a product that you need in your daily business that they don't carry. Ask the manager why? Go to a competitor and see if they sell the product. If they don't then you might be on to something.