At the end of my last post I promised to provide more detail on the specific operations identified in the Tiny Business Mentor. This material is going to undercut my sales of SOHO Operations Planning in the Kindle section of Amazon.com available at the amazing price of $1.99. So if you keep reading this blog long enough you’ll have all the material provided in that treatise (its 12 pages long) plus a whole lot more. Who said reading blogs doesn’t pay?
In addition to the Vision or Overall approach I discussed in the last post you’ll also need a business plan. There are many excellent resources for writing a business plan but your first stop should be the Small Business Administration (SBA). Many parts of the Vision/Approach document will be reused in the early parts of any business plan and parts of the business plan will be used in the operations plan … “write once, use many times!!”
In my mind the terms “Tiny Business” and “Small Office / Home Office” are synonymous. They both refer to a business that consists of no more than 5 or so people who are offering a service of some kind. An operations plan is something that describes how you operate your business, i.e. the things you do that are directly related to providing your service to your customer. This is different than the business plan which focuses on marketing, structure and financing and it is definitely different from the financial and legal planning that is often involved in running a business.
There are multitude of books and other resources on these subjects so I’m not going to repeat that material here. I encourage readers of this blog to post your recommendations, experiences, etc. concerning these areas.
Tiny Business or Small Office / Home Office (SOHO) Operations Planning
So what is an operations plan and why should a tiny business spend precious resources, especially time, working on it? An operations plan focuses on the planning of all aspects of the delivery of your service, from determining the need, through workforce activities to service delivery. Your Operations Plan should enable you to answer the following questions:
- Is what you delivered what the customer ordered? (Requirements Management)
- What are the major steps required to do the work? (Work Planning)
- Did you fulfill all your contractual obligations? (Service Delivery)
- Are you spending too much and as a result will you take a loss on this contract? (Work Monitoring and Control)
- How will you work with your partners, prime and/or sub-contractors? (Supplier Agreement Management)
- Are you doing the right things AND are you doing things right? (Process and Product Quality Assurance)
- How will you know you are making a profit? (Measurement and Analysis)
- Are you’re delivering the right stuff? (Configuration Management)
In the earlier part of this post I said “write once, use many times!!” and here is the first area where you can start to reuse previous efforts. The high level answer to many of these questions should be in your Business Plan so copy and paste the appropriate answers from your Business Plan into your Operations Plan and add details as needed.
What Vision and Planning Provides You
With this set of vision and planning documents you should be able to quickly and consistently describe your service to any potential customer or partner, respond to any request for proposals and apply for financing or capital with a minimum amount of additional effort. This is assuming that you have actually thought through each of the parts of each of the planning documents and provided the appropriate answers or the reason(s) why a particular part doesn’t apply to your business.
The documents are not as important as going through the process and thinking it through. The documents just help you remember what you did and communicate it to others.
That’s it. It may sound like a lot but you should only have to go through this once and then as your business changes you can go back and make modifications to your plan(s) as appropriate.
When it comes time to response to a request for proposal you should be able to find the majority of your material in these plans which means you’ll be able to respond with much less effort and your response should be of high quality. You can also state in your proposal that you have these plans, use them on a regular basis and provide a few examples of how they have helped you and especially your customer in the past. This will definitely give you a competitive edge over other proposals.
When you begin negotiations with potential partners, prime contractors and/or sub-contractors you can use these plans to establish credibility and the appropriate level of visibility into your business. This could give you a stronger negotiating position helping you ensure that you establish an agreement that is good for your customer, your business and you.
Up next: The first set of operations