In previous articles you have been asked to consider certain aspects of HOW you plan to operate your business, WHERE you want to set up, and WHEN you want to do WHAT. Now it is time to begin adding some dimension to the generalities of your operating assumptions.
Have you defined some of the basics?
- Where are you going to open your doors?
- What are your hours of operation?
- How many days a week will you be open?
- How will your customers/clients find you?
- How can your customers/clients contact you? Phone, FAX, Walk-in, Website, etc.
- How do you want to contact your customers/prospects/community – calling, direct mail, ads, e-mails, press coverage, etc.?
- What equipment do you need?
- What size space do you need? Want? Wish for?
- How much staff do you need? When?
- What type of staff do you need? What are the tasks to be performed and the skill sets required?
The above questions are some of the dimensions that need to be defined and quantified into operational plans (and ultimately financial projections). There are many business processes and activities that are often so obvious they get skipped in planning the business. One of the easiest ways to identify what you know and what you “don’t know you don’t know” is a simple “exercise.”
The exercise is to observe, consciously observe, and analyze how the businesses you interact with in your daily life – personally and professionally – operate. Whether you are in a restaurant, gas station, dry cleaners, doctor’s office or any other business, watch how they DO business, interact with customers, and deal with payments, complaints, service, marketing, etc. If you can interact with businesses in the same industry and market you are targeting, all the better. You can learn what you want to do and what you definitely don’t want to do in your business through understanding the visible part of other people’s businesses.
If you have to wait along time for service, what is going wrong? Is it staffing or equipment issues? If you or someone else has a complaint , how does the business react? Did they do it “right” or did they lose you and/or the other customer?
Identifying how you want to do your operations is one part vision and other parts planning, observation, exasperation, and experimentation. Utilize the experience and lessons learned through your personal interaction and what you witness to provide direction and guidance to your planning processes. You may have heard the “rule” that you use other people’s money to invest and build your assets. You can also use other people’s experience to choose how to structure and “invest” in your own business success.
Remember, no one will ever live long enough to make all the possible mistakes. We will live long enough to make a significant number. There is no reason we have to experience first hand all the mistakes that can be made in business. We have the opportunity to learn from other people’s mistakes and successes.
There are several levels of planning the operational aspects that coincide with financial forecasts:
- In Six months
- In 1 year
- In 3 years, and
- In 5 years.
It is often easier to visualize and conceptualize the business at year 5, than it is to determine what day one and the first year will be. Year 5 is a distant point in time where all things are possible. Year 3 is where things can be viewed as probable. Year 1 (and today) is where you have to decide what you are CAPABLE of achieving, learning, doing, and building. It is more tangible and near term, so it presents the challenge of filling in the details of who, what, when, where, how, and how much.
The task at hand for you is to focus on the practical and realistic – to define what has to happen to “open the doors” of your business. Make a list of key things that have to be done and decided. Here are a few to get you started:
- What legal structure do I want?
- What are the personal risks of some forms of business?
- What vendors do I need?
- What services do I need – accounting, web, telephone, tax, legal, e-mail, etc.?
- How much money do I have to start?
- How long can I wait for the business to pay me a salary?
- When will I need staff?
- How am I going to get my first customers?
Copyright © 2004 Lea A. Strickland, F.O.C.U.S. Resource, Inc.