The grand scheme must be broken down into manageable pieces with which to begin, but it's not necessary to know everything in advance about where a self-directed career will take us. What do these two things tell us about developing a business plan?
The answer, essentially, is that there should be a plan, but the extent of its detail can vary wildly. The greatest flexibility, as noted above, is with organizations that include only you. As soon as you start involving other people-as partners or employees-the demands on careful planning multiply greatly. If you're seeking financing, then your business plan becomes the central focus of your efforts.
We'll discuss the nuts and bolts of specific kinds of business plans in forthcoming chapters. For now, as we consider "choosing a path," business plans can serve another role: providing a framework for evaluating various directions.
In my own career-planning process, I looked at several ways of establishing myself independently and evaluated several types of projects I could pursue. I did this through a very rudimentary and informal business planning process:
- What, specifically, would be the scope of my service?
- What would be my market?
- What could I project for revenues?
- What resources would be required? Therefore, what expenses? What other impact on my career might I expect from this project?
Later, when one or more of these business plans is put into use, the goal will be twofold: to make it complete and accurate, but also to make it flexible. Hawken calls this idea "plan to learn." He tells a story about a biology lab test that puts one frog in hot water (the frog immediately jumps out) and one in tepid water that's being heated. The second frog lolls around in the warming water and, by the time it notices the water's getting awfully hot, has become too weak to do anything about it. The lesson: "Enterprises fail more often because of the sum total of seemingly inconsequential events acting upon them than because of a sudden disaster."
Instead, Hawken says, as soon as a business learns to plan, it must plan to learn. "If a business sets itself up as a 'knowing' organization, confident of its models and sure of its needs and goals, its perception may be right. But will it be able to learn and change? Only an organization that does not presume to know will be able to detect and use fresh information from its environment. Planning must be firmly based on inquiry. Questions keep a business alive."
Product versus Service Considerations
Into which category does your selected enterprise fall? Service organizations dominate the small-business scene, and many of them are professional services. But as a professional, consider this: Your firm's ability to generate revenues is absolutely limited by how many hours you can work and how much you can charge for your time.
This concept also holds, albeit to a lesser extent, in any kind of service business. That is, the steady presence and involvement of the owner is virtually essential to the success of any service business. If, on the other hand, you're creating products, your market can grow exponentially-far beyond the physical limits on your own time-and deliver proportionally greater returns.
Many a professional services provider eventually asks, "How can I leverage my time in order to earn more?" It's a question worth anticipating.
Research, Research, Research
Regardless of what kind of business you establish, don't fail to conduct thorough research, which has the dual effect of informing you as well as leading you to sources who may know of specific opportunities. Business libraries, trade associations and trade publications are obvious place to begin.
When Charles "Tony" Anthony of Dublin, NH, was thinking about entering the executive search field in 1986, he contacted Jim Kennedy, publisher of the leading trade publications in the industry. Jim loaned Tony several books on executive recruiting. Tony subsequently bought all the back issues of Executive Recruiter News and read them-twice!
"When I finished this, I had a very good understanding of the industry and the people in it. I could talk a good game, which helped me substantially in my interviews with people in the industry," Tony recalls.
When Can I Start?
Many would-be entrepreneurs, who aren't being pressed by external factors into finding their next opportunity, ask "When should I quit my job and get started on my own enterprise?" Several factors play into this, including:
- How much of an investment is required?
- How much of a financial cushion do you have?
- What are your on-going financial responsibilities (mortgage, other loans, car payments, school tuitions, etc.)?
- Will it be a home-based business? If not, can you establish your enterprise in another location while still holding down your regular job?
- Can you conduct your new business outside regular work hours?
- Is your family willing to make the necessary sacrifices for you to give up other responsibilities at home so you can engage in getting a new business started in your spare time?
- In sum, can you feasibly begin part-time at home?
But I miscalculated. Though I was able to get started on the book while still holding my regular job, I found it was very difficult to do it off hours. I couldn't reach sources during their business hours. And despite my desire, I found it difficult after a full day's work to muster the energy and creativity to tackle such a large project. Though my family was as forgiving as I could ever imagine, I had a tough time removing myself from all the activities I enjoy and responsibilities I feel in my home life.
So, for me, significant progress on my book didn't take place until I was on my own, could set my own schedule and work priorities, and have big chunks of prime time daytime business hours in which to become immersed in my subject. Even then, it was a challenge. Starting your own business has its own demands.
My conclusion: Know yourself. Be honest about what you can and cannot accomplish in your "spare" time. Be clear about your priorities. And realize that the more significant your new enterprise is, the tougher it will be to get it going with small amounts of effort. Unless you're Super person, be realistic about how much work this will be and make room in your life for it.