Business plans have long been synonymous with business ventures, more specifically, startup ventures.  There has been much discussion as to whether companies that construct business plans are more likely to succeed compared to those companies who overlook this “holy grail” of documents.  In fact, Guy Kawasaki had posted an interesting study conducted by Babson College on his blog, where they evaluated this exact scenario.  The college analyzed over 100 businesses run by alumni and found no statistical difference in success between those businesses started with formal written plans and those without them.

…no statistical difference in success between those businesses started with formal written plans and those without them.

Could business plans be a thing of the past?  Are business plans an obsolete form of business development?  I would argue that the answer is YES to both of these questions.

Business plans are simply an “old school” method of communicating business ideas, goals, and predictions.  I am a huge proponent of blogging and recommend all entrepreneurs, or individuals for that matter to actively participate in the blogosphere.  If you have something to say, ideas that you would like to publish, opinions/reactions, whatever it may be, start blogging.

Dharmesh Shah, a successful software engineer, entrepreneur, and author of the OnStartups blog speaks about the impact that blogs can make.  In a brilliant video, Dharmesh explains how a “rinky-dink little blog” can attract just as many if not more visitors than a business spending tens of thousands per month on PR and advertising.  Shah makes it very clear that you don’t have to spend a lot of money broadcasting your message for people to take notice of your ideas.  So why not leverage this impact and apply it to building your business this way?  Instead of writing a business plan, why not start a blog?

…you don’t have to spend a lot of money broadcasting your message for people to take notice of your ideas.

Honestly, how many people will read this business plan?
Your blog may not be read by the masses, but I assure you, a passionate, heartfelt post will be read more times than your business plan will.
Business plans are painfully “static” and lack any sort of dynamic dialogue/feedback.
Blogs are delightfully interactive and instantly engage in dialogue through comments and replies.
Business plans are usually long and very boring.
You don’t have to write 20 pages to create an impact.  Some of the greatest and most popular blog posts are short, simple and straight to the point.
After having spent (x) amount of months/days writing this long plan, you will still have exactly zero customers.
Unlike a business plan, blogs give a way for creators to interact with their potential clients before they even buy a product or service.  The effect is felt immediately and constantly builds personal/company brand equity long after your posts are published.

When you’re done writing this long document, there’s a strong likelihood that your business strategy/concept/focus may have changed: [Time to revise and edit]
Blog posts are meant to be written on top of, again and again.  Despite the fact that blog posts have no shelf life and can be referenced for years and years, the most effective bloggers are expected to update their content on a regular basis.
How many people are even going to receive your business plan in the first place?  How many email addresses and mail boxes do you know?
Blog posts are limited by the size of the web.  In other words, your blog has the potential (though unlikely) to reach millions of people around the globe…no address necessary.

Needless to say, I am a huge advocate of utilizing the social web.  It is just too damn powerful not to.  That said, business plans may still serve a purpose, internally at least.  If your company needs a formal document to delegate responsibilities and communicate throughout the organization, I would suggest that you sit down and compile one.  These sorts of documents are still a fundamental aspect in obtaining outside capital as well.  You may not want to approach VCs without a business plan and financial forecasts.

Just remember, it is most important to get yourself and your company into the mainstream (as quick and at any level possible).  Until recently, that required a lot more time and planning, where the company’s business plan acted as the foundation for their work as well as its physical manifestation.  With the introduction and explosion of the social web, a whole new platform has been created.  Startup costs are way down, and there’s a lot of competition.  It is critical for brands to set themselves apart by remaining transparent, genuine, and innovative.  Enter the blog: your company’s new business plan.

Pepsi’s new logos bear a striking resemblance to the logo that Democratic Presidential nominee, Barack Obama has been using throughout his campaign.  I’m sure it’s partly due to the fact that both logos are circular and utilize red, white, and blue.  But I do find it coincidental that Pepsi is spending literally billions on transforming their look and customer appeal with a logo similar to that which has become the symbol for political change, in what is arguably the nation’s most important election, coming up in November.

Coincidence…maybe, maybe not.