You should track your performance throughout in order to ensure that you spot any possible problems or opportunities as early as possible.
What is the Lean Method of Business?
You may have already heard of the lean method; a new concept for starting and growing successful companies. The lean method, or lean planning as it is sometimes called, is a set of tools which business owners use in order to discover a business model which works well, build an action plan in order to test assumptions, create viable financial models and plans, and track performance in order to easily and quickly adjust your plan. The lean method of business shuns traditional, detailed business plans for a ‘plan-as-you-go’ approach, which is often simpler and less susceptible to failure.
The Plan as You Go Approach
Lean planning began with the ‘Plan-As-You-Go-Business Plan’ by Tom Berry in 2008, which provided entrepreneurs with a new, simpler alternative to in-depth, lengthy planning and predictions. Rather than developing a static business plan, Tom encouraged entrepreneurs to ask a series of questions which identify things such as your target market, business identity and forecast along with developing a plan of action. This method stresses that the business plan should no longer be simply a single event; it should be a living tool and revisited and revised on a regular basis. This method allows entrepreneurs to make changes to the business plan accordingly as soon as any new information is discovered. Entrepreneurs wishing to learn more about this method can do so by completing lean Six Sigma training online.
The Components of Lean Planning
Lean planning is made up of a number of different key components. These include beginning with a pitch that outlines your business idea, creating an action plan which includes real accountability in order to test your hypotheses, building a financial model in order to prove the possibility of forming a viable business, and carrying out more detailed planning by delving further into the specifics. Then, you should track your performance throughout in order to ensure that you spot any possible problems or opportunities as early as possible.
Planning Without the Writing
You may be wondering what exactly is ‘lean’ about the lean business model. The core ideas of the lean method of business involve learning – and often failing – as quickly as possible in order to give startups the best chance of speedy success. In short, lean planning is a methodology and toolset which allows entrepreneurs to plan faster and start the business process without having to commit to long, lengthy document writing. The ultimate goal of lean planning is to enable entrepreneurs to discover business models which work well and give them the best chance of growing a successful business whilst tracking progress in order to make quick corrections when needed. Historically, the business process has been far from lean – it’s a lengthy process which requires entrepreneurs to spend months crafting a detailed plan with little chance of validation from outsiders. Lean planning hopes to achieve less written planning and more action.
For many entrepreneurs, the lean method of business is the best choice so it is definitely worth looking into.