Friday, December 10, 2010

What Script is Your Business Following?

I was speaking to a large gathering of business owners and was asked whether there was an inherent conflict between planning for growth and the more free spirited entrepreneurial-like approach - where you stay agile and react to opportunities as they arise (i.e., operate without a plan). This was a great question as it addresses a big misconception about planning - that it somehow hand-cuffs a business in any way.

To answer the question I asked the audience to imagine themselves accidentally walking onto the set of a movie production. Then imagine grabbing the megaphone and asking everyone on the set to freeze for a moment and to please hold up their script for the day. In this case, none of us would be too surprised to see that the cameraman, the director, the soundman, the actors, and even the caterers will all be able to produce a script for that specific day.  The cameraman will know which cameras he has to have ready and where they should be staged.  Because of the script, the actors will know the lines and the scenes they are expected to be ready for.  And the script will reveal to the caterers how many meals they have to prepare for and where they will be served that day. You see, a movie will never come together without a script.

Now take that same megaphone into your own business and ask your leadership team and employees to produce their script for the day. How will they react to this request? I suspect most will give you that “deer in the headlights” look.

There is not a producer in the world or investor that would pursue a movie production without a well written script. The idea is simply preposterous. Yet most of us will run our businesses without one.

The script for your company is a plan - a simple concise document which aligns your team around a common objective or end-state that is consistent with your vision and market conditions. And, like the script for a movie, there are portions written specifically for specialized roles. Sales, operations, finance, human resources, marketing should each have a script which defines the specific tasks they must complete (and when) to keep your “movie” progressing.

The script governing the day-to-day operations are process documents which describes how a product or service is produced and delivered within your company.

You will find that businesses that grow consistently year after year operate to a well vetted long-term (3 yr.) and short-term (1 yr.) plan. It is the plan they refer to BEFORE making a hiring decision, investing in capital equipment, or spending precious cash on marketing campaigns and website improvements. It is also the plan that will guide them when building and executing a sales strategy.

These same growing companies also recognize that the process by which they produce a product or service can impact competitiveness. By documenting critical processes they eliminate the risk of being dependent on any one person’s memory or contribution. It also gives them a foundation from which to explore innovative changes that will improve efficiency and thus increase profitability.

Now I hope I have convinced you that, like a movie, your business too requires scripting. Can you imagine actors, cameramen, and set designers coming to a specific location and then left to their own to interpret the verbal instructions of the producer’s vision for a movie. It would be chaotic at best with numerous costly ventures down one frustrating dead-end after another. Entrepreneurial or not, is this the atmosphere for a growing thriving business? No.

So, where is the script for your business? It is worthwhile to note that since 1980 over 70% of the winners of the Academy Award for best picture also received the Oscar for best screenplay – the script.