Why you should be planning for the long term future of your business.
Many entrepreneurs start a business because they have what author Michael Gerber in his book The E Myth terms “an entrepreneurial seizure”, meaning you’re really good at what you do and you think you could run your own business better than your boss, or you want the freedom of owning your own business.
So you start your business and you go along for a few years, running it by the seat of your pants, and once you’ve had some success and want to grow, you get some advice from other business owners, from your trade association and from consultants and put more structure into your business in order to grow it and keep more of the profits.
At that point many businesses, even some of the very successful ones, drift into doing year by year planning, thinking one step down the road, until the owner wakes up and realizes, Wow, I’m 50 years old and I don’t want to be doing this forever in the same way I’m doing it now.
I often hear things like this from business owners: “How can I plan 5 to 10 years out? Who knows what the economy will be like? Who knows what the labor market will be like? I’m not even sure what I want to be doing 5-10 years from now. Lots of stuff can change! So I’ll just keep planning in the short term…it’s served me well so far.”
That kind of thinking can keep you in a holding pattern in your business. Sooner or later, you’ll need to think about the future. Do you want to work in the business until you drop? Unlikely.
Do you want to sell your business at some point? Would you like to transfer your business to your children or employees? Do you want to keep receiving a good living from your business without having to work in it? If you really want to make a change and see the kind of results that will help you achieve your dreams for your life and your business, you need to take the long term view and start planning for your future.
What does long term strategic planning look like and how do you do it? See Taking the Long View – Part 2