3 Reasons Why Entrepreneurs Should Embrace Planning

I never leave for any vacation without making a plan. I start my packing list the month before. My gadgets and gear are assembled into piles the preceding week. And no less than three nights before I leave there is a dry run for packing. I plan my vacations with the precision of a general going into battle.

I cannot say the same for planning in business. I have a tendency to launch into new initiatives with little more than a back-of-the-envelope plan and bullish enthusiasm. My entrepreneurial side favors a bias for action over analysis. I am more excited by the opportunity to start something new than getting bogged down in details. Instead of identifying barriers in advance, I rely on my optimism and persistence to work through any obstacle.

Over the last year I have focused on improving my planning. I have found it to be an aid to thoughtful action, not an invitation to paralysis by analysis. It assists me in articulating my vision and helps to de-risk any new venture.  I now see it as a necessary compliment to entrepreneurial enthusiasm.

Reflecting on my experience, I wanted to share three reasons why entrepreneurs should embrace planning.

Planning injects reality into your vision.

It has been said many times. No one has access to unlimited time, money and resources. Planning identifies what is required for each task and helps determine what it is going to take to accomplish a project. But perhaps most important, especially for an entrepreneur, it  forces you to inject reality into your vision. For example, last year we launched our first direct mail campaign. Following the advice from the book “Guide to Guerrilla Marketing” I stipulated we should hand address the mail pieces. The book said this would increase our open rate. I failed to calculate the time required to hand address 1500 pieces of mail. (Three minutes per envelope X 1500 envelopes = 25 hours!) In reality it took three days for a team of people to complete the task. Good planning would have injected the reality of the effort required to meet the vision of a personalized letter opening experience.

Planning leads you to reification.

Reification generally refers to bringing into being or turning concrete. Reifying your plan identifies the issues that you will encounter when executing the project. In the direct mail example, we wanted to use a Business Reply Mailer (BRM) to facilitate responses. When we started to reify the plan we contacted the post office to inquire about setting up a BRM account. This is different than asking for information such as processing fees and set-up times. Reifying involves simulating the execution. We asked a broad question about setting up the BRM account.  It turned out that someone else in our office building had a BRM account. The post office could only accommodate a single BRM per street address. Planning facilitated reifying and reifying de-risked this element of the program.

Planning inspires confidence in your leadership.

Any new initiative will face questions. This is true whether you are a software designer proposing a new site architecture or a CEO asking for a second round of investor funding. Answering “I don’t know” to any question raises doubts about why you can’t answer. This lowers confidence in your competence and may prejudice the success of your proposal. Planning identifies in advance the questions that could be asked by any stakeholder. A sales trainer once told me the key to answering objections is to identify every possible objection and then identify the corresponding response. And to do that before making the sales call. At a minimum planning identifies the questions that need to be asked and the domain expertise that need to be developed within yourself or your company.