- Realistic. Milestones are makable, projections credible, strategy executable, tactics executable and match strategy.
- Specific. Includes meaningful information. Serves well as a guide to execution, with the right steps, and concrete specifics to follow.
- Trackable. Good metrics, milestones, clear path to useful plan vs. actual analysis, leads to accountability and management.
- Functional. Serves its business purpose. Maybe that's management and steering the business, maybe it's describing the business for potential investors or bankers. Like all business, form should follow function. So the lean business plan for management doesn't include all the summaries and descriptions; but the business plan for investors' due diligence does. It depends on the business use.
- Complete. Includes what it needs to serve its business function.
Most important items, topics, components:
- Cash flow. Monthly cash flow. If it doesn't deal with cash flow, don't call it a business plan. That usually means projecting sales and spending, quite often that includes projected sales, direct costs, operating expenses, profit & loss (which includes the first three), balance sheet, and cash flow.
- Milestones. Dates, deadlines, budgets, tasks, responsibilities. If it doesn't have those then it's not a business plan.
- Metrics. What are the performance measurements that are going to be tracked and managed? How will the company know if it's on track of not.
- Strategy and tactics. It takes tactics to execute strategy. How elaborate the description depends on the specific business purpose. At least bullet points. And tactics have to match strategy. By the way, tactics include marketing plan, product/service plan, and financial plan.
Beyond that depends on the actual use. For outsiders, add summaries and descriptions. For bank loans, add financial projections, ratios, and financial history. For investors, add management team descriptions, market analysis, and potential exit strategies.
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