Many contractors create a business plan when launching their operation. What happens after that, says Scott Siegal, president of Certified Contractors Network (CCN), a peer networking and consulting organization, is that owners get “wrapped up in the everyday stuff” and come to view the plan as an artifact. They use various reports on a catch-as-catch-can basis to steer the business. But this leaves a company vulnerable to the unexpected.

Understanding where your business is, and where it's going, is “not just a matter of sitting down and looking at the sales reports once a week,” Siegal points out.

KEY METRICS At its three-day Business Plan Boot Camps, held twice a year, CCN presenters — which include both contractors and accountants — show how to develop a plan as a document containing regularly updated key metrics.

Scott Barr, owner of Southwest Exteriors, a siding and window company in San Antonio, says that his business plan evolved into a strategic plan, organized around the company's major goals — in sales, production, marketing — and what's being done to advance them. To avoid endless meetings, Southwest Exteriors went to a “daily huddle” system where each department starts the day with a five-minute all-employee consultation about what needs to be accomplished.

At Legacy Remodeling, in Pittsburgh, developing an annual plan takes four to six weeks, according to CEO Ken Moeslein. That discussion and plan includes “what's worked in the past and what we need get rid of,” he says. Moeslein credits the ongoing planning document with helping his firm make the transition to a new product — design/build projects — when revenue from several other lines the company provides declined.

TEAM ACTION Tim Berry, author of The-Plan-As-You Go Business Plan and a business planning expert, says that an ongoing yearly business plan should provide “the knobs to adjust” when the unforeseen, say an unexplained drop in sales or a sudden rise in service calls, happens. In a well-run organization, he says, that plan consists of “self-managing, self-perpetuating metrics” provided to the owner or general manager by team leaders. “It's live, it gets reviewed often and it helps you to steer your business,” Berry says.

Siegal adds that a big reason why well-meaning owners ignore the business plan they put so much effort into creating is that it's a solo project. That's why CCN asks owners coming to the business plan boot camp to bring two key managers.