Business owners and entrepreneurs are, by nature, risk takers and adventurers. If we didn't have that optimism gene floating around, not much of any progress would ever get done. But every so often the adventurous get in trouble. They plan a new venture perhaps a new product, service, expansion into new geography whatever, and they hardly pause in their quest for the golden ring to plan a strategy that will minimize their exposure in case that great idea turns out to be an Edsel. Unless we are talking about a bet the company type of venture (and Im not!), contingency planning for most new ventures a small business undertakes can be done with the addition of four simple paragraphs to the plan written at the planning stage of the new venture (you do have a written plan, dont you?). Paragraph One: How will we measure to see if this project is producing the desired results? Paragraph Two: How many resources (time, money, effort, etc.) will we invest to make it produce the desired results? Paragraph Three: How will we close down a project that will not produce the desired results? Paragraph Four: How will we minimize losses in a project that will not produce the desired results? Just by having Plan B thought out and written lessens the difficult task of making decisions in the heat of a battle if things are not going well. If results are not going as planned, pull out Plan B and read it. Compare the current results to the projections. Realize that when Plan B was written, it was based upon assumptions. The data you have, once the project is underway, will be different from those assumptions you based Plan B so it can, and probably should, be changed based on the hard data that is now at your disposal. Hopefully all your new initiatives will be hugely successful, but just in case, minimize your losses by being prepared with Plan B. |
