Week 2: Business and Business Planning

When organizations start a business, many first start drafting business plans to help achieve their goals. A business plan is a formal document that displays the business goals, the means to achieve these goals, the difficulty and risks, and any planning in order to start the business. Depending on the type of industry, each business plan is different. For example, the business plan for Swifters duster towels would differ from the business plan for a new smartphone because dusting products are essential to every home. They are products that people would buy every now and then, and is also a lot cheaper to get than a smartphone. With smartphones, the product is a much long lasting item that has many more features to consider, making the business plan for smartphones much more complex.

The advantages to compiling business plans are that it organizes the business leader’s thoughts and ideas. It gives a clear outline as to what the project should be and what are some of the things to consider when planning for that specific business. It also could provide all the possible information needed, as well as research, to investors, sponsors, banks, etc. to show a clear idea of the business. If in the future more employees were to pick up on the business, they would have a clear idea as well, since everything would be laid out for them and it shows them that this particular business has done their homework, which makes the business look professional. In terms of research, businesses would have richer ideas about the possible trends, environment, and competition when they write out business plans. This allows them to update and review these trends as their project goes on.

Although many business plans are advantages, some business plans tend to fail because they copy exemplars from Google, or other sources when the example could be for an entirely different industry. Business plans then fail because of the lack of sufficient information. Some business owners also avoid taking risks or believe that there are ways around risks, ignore flaws and problems, put irrelevant information in the plan, etc., which are fatal flaws to business and business planning. Other times, business owners may make too many high risks and gain minimal profit in return. These types of flaws makes business plans insufficient to start or continue a business because it creates too many uncertainties to the business itself.

In reading Sahlman’s and Pirouz’s articles, these articles helped me determine not only what good business plans should have, and some things to avoid when writing. Although both articles were dated back to 1997 and 1998, some of the factors mentioned within the articles, such as the failures of business planning, were facts to be considered even today. It gives me a general idea what to include in my final report if I were to create a business plan for it.

An example of a successful indie game would be Minecraft. Minecraft is one of the most popular games that have been launched for the Xbox, computer, mobile systems, etc., and are played by over 20 million people. A possible reason as to why Minecraft became so successful is because they have a very good platform. The player is allowed to move around freely and have his or her own independent choices as to what to do in every “day and night” cycle in the game. The player is able to explore the world on his or her own, build structures, mine, and fight monsters in the game, which targets to audiences who are interested in adventure and action genres. Aside from the good gameplay and platform, the game is successful because it probably had a very good business plan behind it. They probably planned out how long it would take to build the game and how much labour will be put into it in order to create Minecraft. The business also took excessive amount of time perfecting and balancing the game, in order to make it playable.