We were given a great opportunity to interview Miss Derisma and ask what makes business plans great?
She laid back in her chair and calmly replied, "Many entrepreneurs write research reports instead of strategic business plans. They write dozens of pages about the market, the competition, SWOT analyses (Strengths, Weaknesses, Opportunities, and Threats), industry analyses, and detailed financial projections. Or, they use strategic jargon that they read from a smorgasbord of so-called gurus: "five-part competitive analysis," "first-mover advantage," "sustainable competitive advantage," "leveraged revenue model," and on and on, ad nauseum."
We were pretty impressed with a response to come out like that, so we let her continue to give us a bit more of knowledge.
"Unfortunately, these analyses do not have much to do with getting out into the marketplace and attracting new business. They are interesting, and might get an "A" in a business school class, but they don't guarantee results." ended Miss Derisma.
We certainly got the hint from that period, but we wanted to understand. Isn't all that research what makes business plans valuable?
Miss Derisma kindly responded,
"Please don't misinterpret this point. As we'll see, giving thought to your market and competition is important. You need to know whether the market is big enough, and has enough room, for you to achieve your financial goals. But you don't need to obsess. This type of calculation is easy to do in a simple back-of-the-
We understood pretty well so we went on to ask her what she thought was the most important areas to cover in a business plan.
"A sound strategic business plan must cover three areas. If you miss any of these areas, your plan will be incomplete and will not be nearly as powerful as it needs to be. First, you have to lay a sound strategic foundation. Second, you need to identify a set of priorities that will help you to make your strategic foundation a reality. Finally, you put all these elements together in an action and accountability plan that details who does what, by when, in order to achieve your business goals. For larger firms, this action plan sets out specific accountabilities, resource allocations, and organizational structures to get the work done."
We certainly could tell she knew her stuff. We backed down and thanked her for her time but we were really surprised to know that she did this all by herself with the help of 2 part time college students to aid in research. She admitted that it wasn't that big of a company but stated that "it's all in the quality of your work." We couldn't agree more.
