Boush Street Offices

Saturday, June 30, 2012

The Best Worst Idea is your Business Plan

Didn't they always tell you that you needed a business plan?

Just read this blog post by Chuck Blakeman.....good stuff.

One of the worst things you can ever do is write a business plan. But easily the worst thing you could do is follow it. It’s a great way to go out of business. It’s the 97% rule.




97% of all businesses leave their prime objective in order to find the thing that eventually makes them money. Good businesses almost always start with a bad plan.


You just can’t make this stuff up.


Harmonica Tuners Gave us Silicon Valley


In the late 1930’s two guys started a company for $538 and were messing around in a garage. They made an automated bowling lane violator, a harmonica tuner, an automated toilet bowl flusher and a few other stupid products. Somebody came along with something called an oscillator and asked them to build it. They didn’t think it was a very good idea, but that bad idea became the first thing they made money at – HP was born and became the foundation of silicon valley.


Model Rockets Gave us the First Personal Computer  In the very early 70’s a couple guys were messing around with a simple automated launching system for model rockets. They put the kit in a magazine and thought they would sell a few dozen. They sold thousands. They used that experience to focus more on technology than on model rockets. In 1975 they put another kit in a magazine for something called the Altair 8800, and thought they would sell a few dozen. It was the first personal computer and it sold thousands. They ended up building the kits and selling them as finished computers. Five years later this stuff became the basis for Microsoft’s Altair BASIC language.


HP Gave us Apple


Around the same time some 12 year old kid called HP and demanded to talk directly with Bill Hewlett because he wanted to buy parts (for his Altair?). Bill took the call, was really impressed and a few years later gave the kid an internship. Later in his life that kid, Steve Jobs, who also met Steve Wozniak at HP, said, “Without HP, there would be no Apple.”


Xerox’s Business Plan Gave Apple the GUI


In 1979 Jobs visited Xerox and saw something called a graphical user interface – GUI. Xerox invented it but couldn’t find it on their business plan, so they sold it to Jobs for $50,000. Bill Gates visited Apple later and poached the idea.


All of this, from the 1930s to the 1980s involving a few dozen people from all walks of life in many different places, came together to give us the personal computer. It wasn’t on a business plan, and the only guys with a business plan – Xerox – ignored it because it wasn’t on their business plan.


Bagels or Ice Cream?


Ben and Jerry make ice cream. What few people know is that the ONLY reason they make ice cream is that a bagel machine was too expensive. They were all set to go into the bagel business but hadn’t bothered to price out the machine. When they did, they found out an ice cream machine would be cheaper, so they did that instead. Wasn’t on the business plan.


Panty Lines or Millions of Dollars?


Sara Blakely looked in the mirror just a few years ago and saw panty lines under her slacks. She couldn’t find underwear that didn’t show, so she started Spanx, which is now a huge international clothing line success. Not a business plan – a mirror.


Webvan Followed Their Plan


In the late 1990’s Webvan decided people would buy groceries on the internet and have them delivered by van. They put together one of the most elaborate and detailed business plans ever concocted, raised $2billion, hired the best talent in the technology and distribution businesses, and followed their business plan right off the end of the earth. They took $2billion of investor money with them – a lot of people were really impressed with their business plan.


Let it Collect Dust!


97% of businesses leave their prime objective to become profitable. Webvan stuck to theirs, none of the others above had one, or if they did, they left it behind as the world interacted with their “plan”. If you can’t help yourself and just have to do a business plan, at least have the common sense to put it on the shelf and ignore it like most people.


You won’t find success in a business plan or in an MBA program. You’ll find it in the trenches by being willing to adapt and execute exceptionally on what may seem ordinary or throw-away ideas.


Do Something.


Ask the successful people. It’s never how good your plan is that matters. It’s how committed you are to the bad plan you’ve got.


Speed of execution. Stop planning. Get moving.

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