When Should a Business Plan be Modified?

When you make your business plan, you set out what you want the future of your business to be. No matter how experienced the planner, no one can accurately predict the future, and it’s good to recognise when it’s time for the business’s path to change.

There’s a few situations where going back to your business plan is a good idea. Some of them should be part of your regular Board routine, while others are more reactive. When the need arises, it may be time for a strategic review

Including regular reviews

Reviewing your strategy should be a regular occurance in your business. Exactly how often you do it may vary from business to business, but creating a schedule to revisit your plan is a great way to keep on top of things.

You want to leave enough time for any strategies you try to have a genuine effect, so don’t do them too often. At the same time, there should be enough time after the review to be able to make any real changes. 

If you have a 2 year business plan, you could use the one year mark as a good time to go back and check up on things. If you’re a large business with a lot going on, it may be that quarterly meetings are more effective.

Whatever schedule you use, these meetings give an opportunity to review your progress. If you find that you’re far off what you expect, now is the time to modify your plan. This could mean trying something new in place of a strategy that isn’t working out, but it could also be extending a fast working one. 

What are your targets?

When you created your business plan, you would have set targets to meet. Keep track of your progress towards these targets, as this can inform you when reviews are needed. 

Regular review meetings aren’t the only way to know how targets are progressing. If your strategy required discrete steps such as finding a marketing agency, it should be fairly obvious when they’re complete. Likewise, you may be able to see from your normal financials when certain changes are taking effect.

If you’re finding that your objectives are being achieved faster than you expected, bringing everyone back to discuss the next steps can help you keep up your momentum. Afterall, if you’ve clearly met your 2 year goal after 18 months, why wait the next 6 to move forwards?

Change leads to change

Has something important changed in the operations of your business? This is the kind of situation where you should be reviewing your business plan.

There are lots of changes that can affect a business, both positive and negative. If your plan doesn’t take them into account, you could be stifling your growth opportunities or putting yourself at risk.

Seizing opportunities

Sometimes an opportunity will open up that you never expected. Maybe a new scheme is opened up that your business could benefit from, a partner approaches you out of the blue, or a competitor retires from the market. 

An agile business can make the most of these and pivot their strategy to take them into account. If that investment scheme makes R&D much easier, maybe you should reprioritise that new product. Maybe you don’t need to change, but it’s important to know that things are fine as they are.

Reassessing your priorities in the face of even positive changes is never a bad idea. You may find that your business plan limits your ability to gain from them. That plan should be a tool to help you onwards, not a restriction to hold you back.

Adapting to crisis

A very significant form of change, a crisis is usually unexpected and carries a risk to your business. Making sure your plan is still suitable in the midst and aftermath of a crisis could be the key to you surviving it. 

A crisis can have massive global impact, but it can be much smaller too. What matters is that you now need to decide how you’ll respond to it. This usually needs quick thinking and is when being agile is at its most important.

It could be that there’s a price increase from a supplier, a new competitor, or the unexpected loss of a key team member. They will all carry their own challenges that can, in part, be mitigated by planning, but will still need you to respond in some way.

If your business plan focused on increasing your marketing, for example, and your Marketing Director had to leave suddenly, can you still complete your objectives? Again, this is a time to reassess your priorities and decide what really works best for your business.

Modifying a business plan

No matter the cause, when you review your business plan, the question you should be asking is: what does my business need now? Either you’ve made progress from your first planning meeting or change has been thrust upon you, but things aren’t as they were at that time.

What suited you then may not suit you now, so it’s fine to change what you were going to do to adapt and thrive. Agile businesses are much more survivable than overly rigid ones. Our Part-time Strategy Directors could be what your business needs to keep on top of reviews and provide you with advice on when it’s time for a change.

Contact your Regional Director of Boardroom Advisors

Written by: John Courtney

John is highly ranked in the Top 100 UK Entrepreneurs list by City AM and is winner of the Lifetime Achievement Award from techSPARK. He has been a Board Director himself for over 40 years and first started placing Non-Executive Directors over 25 years ago. John founded and ran six of his own businesses including a Management Consultancy for 10 years, a Corporate Finance offering for 10 years and a mid-sized Digital Agency for another 10 years.