Using Innovation To Grow Your Business Plan

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Using Innovation To Grow Your Business Plan

By Cynthia K. McCahon , MBA

© SamplePlan, Inc.

Sometimes just the day-to-day challenges of running a small business can keep you fairly distracted from remembering the bigger picture of why you launched a business in the first place. Simply managing the business is often more than a full-time job. And actually growing the business can seem like a second full-time job. All of which can lead to the phenomenon of inertia--the dreaded quicksand of the small business world. The problem with inertia is that it keeps you from the real challenge of your business: innovation.

So let’s talk about inertia and innovation. Specifically, let’s talk about how inertia prevents your business from innovating. My trusty Webster’s describes inertia as the tendency of matter to remain at rest or to continue in a fixed direction unless affected by some outside force. Now let’s compare inertia to the definition of innovation. Innovation is the process of making changes.

How do we overcome inertia and become better innovators? We plan. Then we execute the plan. Then we plan again. Changing inertia into innovation is most easily managed by reviewing and updating our business plans. Like building blocks, we can consistently incorporate what we’ve learned into a steady state of growth.

Finding The Gold In Your Business

The business plan you wrote in preparation of launching your business, and I know you did a business plan, was most likely a good road map. What’s happened in the time between your completing your business plan and now? Probably quite a lot, both good and bad. Go back and carefully reread your business plan, taking copious notes about your present-day situation as you read. What actually happened to your business versus your original concept?

The information you uncover in reviewing the planned concept of your business compared to the actual performance is a veritable goldmine of information. This review provides you with the information, scratch that, with the ammunition you need to grow your business. Identifying this information and incorporating it into your updated business plan is the key to your future growth and success. Your goal is to revise your business plan by incorporating more of the good performance metrics and eliminating the bad. Identify what’s working and do more of it. Just as importantly, let go of what isn’t working. At the heart of this information is your core business.

Re-Identify Your Core Business

As you review your plan, identify the truly profitable components of your business. Financially, what were the leading products or services that you offered that provided the most net profit? What were the laggards? This simple analysis represents your identifying, or re-identifying, your core business. It’s what you do better than your competition. Often, the core business turns out to be different than what was identified in the original business plan.

Look at the financials and compare your projected versus your actual financial performance. Refine your core business to capture more of what’s working. This is where you’ll find your competitive advantage. Your core business is also something of a moving target, which forces you to continually review and update your business plan. This isn’t an option for growth, it’s a requirement. How often should you formally update your business plan? Every six months at minimum. More importantly, constantly reviewing your financial performance on a weekly basis--and comparing that information to your past week's, month’s and year’s performance--is critical to understanding the direction of your company.

Innovation can come from simple diligence in reviewing and comparing your company’s progress. And we see farther when our eyes are wide open.

I wish you the best of success in your venture.