On our third and fourth week of classes, I found learning about the precedence diagram, business strategy, and forecasting extremely interesting and helpful. In one of my school organizations, I work with a team to plan several cultural events per semester; and a problem we had last year was that we had to cram many tasks a week before the big event. Also, we planned for 400 people when only about 250 actually attended. I believe learning about these operational components will help me better plan for events this year.
As the precedence diagram, business strategy, and forecasting relate to the general idea of having a business plan, I found an article on ‘Forbes.com’ that seems to disagree with having a business plan at all. The article, “Bob Dorf: Throw Out The Business Plan”, talks about a “serial entrepreneur” who gives a speech about business plans being all fiction. He believes that time and money should not be spent on forecasting the number of customers a new start-up business will have because these forecasts are never right. Instead, businesses should spend their time and money on gathering “aggressive feedback” to truly understand whether a product would or would not sell. A start-up team should have members falling into one of the three categories: the hackers, hustlers, and artists. The hackers are for coding, hustlers for gathering feedback, and artists for designing graphics.
In my opinion, I do agree that sometimes forecasts can be extremely off; however, I also believe that there is no harm to having predictions. Forecasting allows you to set prices, deadlines, and goals to reach. With this, I do not disagree with his advice. Aggressive feedback should be taken and I like the three categories he’s created. In another post that I have commented on, I learned the importance of product design and how it suades the decision of a consumer.
Should a company have a business plan? Should a business look at past data to forecast or possible future data through feedback?
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A business plan is a must have for any company since it helps the company to clarify its vision, understand the risks that is involved, and helps to identify potential problems and opportunities. However, I must agree with Bob Dorf it’s wasteful to invest time and money on forecasting the number of customers for a new start-up business. A new business is in the introductory phase of the product life cycle and here the product or service is still being fine tuned. Thus, a company should invest more in market research in order to find out how consumers view the company, what knowledge do consumers have of the company and its products or services, and how can the company make the lives of its consumers better. Once a company has discovered this and the product or service has begun to stabilize then forecasting can be done.
Should a company have a business plan? Should a business look at past data to forecast or possible future data through feedback?
In my opinion, I do definitely think that before we decided to start a business, one of the first things that need be done is to work on a business plan. It is important because the plan actually serves as a scope for the direction of business that will take in the future. This also helps the business achieve its goal. Without a plan, it is hard to focus and get thing done on time. Even students need to plan ahead, why not business.
Also, it is important for the company to forecast in order to help the business straight to its goal without wasting their time and money much on something that will fail.