I’m delighted that the latest version of LivePlan now includes what we’re calling the Scoreboard, meaning the best-yet positive step on the way to what business planning is really supposed to be, today, which is a tool for managing a company.

This step is classically simple: two visuals only, one for sales and the other for expenses, comparing planned results to actual results. Which means it’s also very easy to use. For sales, you already have your plan in place, and as the months roll by you type in a single number, just one, once a month. For expenses, you have your detailed plan in place, and you type in a single number, just one, once a month.

The result, however, is not so simple. In fact it’s a powerful tool. The scorecard lights the way to a monthly management meeting in which each of these two line charts is the focus for discussion. Simple plan vs. actual analysis is the best possible way to make planning a management function. You look at the difference between what you did and what you planned, and you discuss the implications. Have assumptions changed? Did we execute properly? Should we focus our priorities differently? These are not just numbers. These are the keys to executing better, month by month, and then year by year. Steering is a matter of long-term direction with constant course correction. So is planning. And so is management.

This is the essence of my latest book on business planning, The Plan as you Go Business Plan, which is all about planning as management.

This is just a beginning. There’s a lot more we can do with LivePlan to enhance the management features. And that’s going to happen, soon enough. For now, however, this is a good step forward.

January of 1995. Few people knew of the Internet, Mozilla, and the world-wide web. The so-called “Internet” had existed for years, but seemed to the rest of us (anybody outside of a few spook havens and ivory towers) like a nerdy background utility for emails.  And I started bplans.com.

I hope you’ve noticed big changes at bplans.com lately: more information, more tutorials, and better organized, making what you’re looking for easier to find. And especially a new membership group. I hope it shows because we’ve put a lot of effort into it.

As part of the recent boom, the team asked me for stories of the so-called old days. When, how, and why did bplans.com get started. So here we go. Let’s call this a collection of loosely related stories:

1. A friend came by my office and showed me Mozilla, the first web browser, and the world-wide web. It knocked my socks off. I’d been active in Compuserve and its competition, but here was the whole new world. I was hooked.
2. I immediately registered a few obvious domain names. Businessplan.com had already been registered, but bplans.com was, so I registered it.
3. I did the earliest bplans.com sites myself, in my spare time, while running a company growing about 50% per year. In 1997 we hired an NYU undergrad to create a better bplans.com site, focusing on business planning and especially publishing sample plans. He worked for us remotely from New York. He’s now in his middle 30s, has become known for his success as CTO of Huffington Post and as of this month as founder of rebelmouse.com. He created a beautiful site very quickly. Within a couple of months it was getting national awards. And yes, that’s my son Paul.

From the beginning, bplans.com was always intended to be a resource site, offering free information. We did the software selling and support business at paloalto.com and gave people free content at bplans.com.  I’m not saying it was all generous and altruistic, because from the beginning – and still today – the smart people browsing at bplans figured it was dumb to not spend $99 (or less) on the software behind it. But I am saying it was all free, and we’ve kept it that way.

As the song goes, it’s not easy being green. Well, it’s not easy being the Technical Support guy either. While the rest of us in the Marketing and Customer Service departments tend to get a lot of the fun sides of talking to our customers, that isn’t always the case with Tech Support.

So imagine our glee when Josh, our main Techie Guy, got a present in the mail!

Josh Havener is part of our technical support team. He is the first wave of support for anyone who calls in with any questions or technical issues with our software.

Typically, the calls that Josh receives aren’t full of long thoughtful conversation as generally people who get Josh are looking for some immediate help to get them working again.

So when Josh received a package in the mail on Friday from a happy customer, he was ridiculously excited.

Josh:
Sue Van Fossen (from http://www.granolasnacks.com) originally contacted us because she was having some issues with her plan file not adding things up properly. Thankfully I was able to quickly determine and fix the issue. She was so ecstatic and really grateful. She mentioned sending me something as a thanks, but since I rarely get things like that, I wasn’t really counting on it happening.

After a few days had passed, I received a package in the mail. I say this with a bit of wonder because I never get mail at the office. Curious about what was in the package, I tore into it like a 5 year old on Christmas. Lo and behold, it was a bag of Sue’s Gourmet Rocky Road Granola! This is the first gift that I’ve gotten from an appreciative customer, so I had to share the wealth with some of the people here in the office! It was unanimous, this granola was a hit!

Thanks Sue! Thank you for letting me play a small role in getting your business plan done, and thank you for the delicious granola snacks!

There’s a certain element of sunshine and laughter in the way Sue Van Fossen speaks. It comes through on the phone and you find yourself smiling almost immediately. And to be honest, it’s the exact feeling you get when you taste her Granola Snacks.

I spoke with Sue and her team on a Friday. They had just confirmed getting their snacks into a local winery, The Terra Cotta Vineyards, so they were celebrating a win. Champagne was flowing while we chatted a bit about the background of her company to go along with our review of her delicious snacks.

“I made my first sale to friends and family in 2008. I made $700 in the first month!”  Sue’s friends knew she had a gift. And as friends and family do, they encouraged her to turn what she was doing for free into a business. And if all that encouragement didn’t get her motivated, that first sale of her granola snacks sure did.

Sue quickly realized that working out of her own kitchen wasn’t going to work. Overrun with orders, she needed a better commercial kitchen and more help to keep it going.

Randy Baker brought an extra pair of hands and strong marketing to the business. He saw that they were “maxed out” production wise. They couldn’t make enough granola snacks to keep up with the demand of them.  Randy knew they needed to expand to keep up, but they couldn’t keep funding the expansion with credit cards.

In the middle of this, they realized they wanted to relocate and in their research, realized Columbus, Ohio had stimulus money still available to small businesses. But to access it, they knew they needed a plan. So Randy started a new search, this time for business planning software.

“I love the software for this reason,” Sue breaks in. “The software helped me get a broad view of everything we needed to present as a company.  A real high view of everything. And I realized I could get a high level view of what we were doing and then change it to see everything on a more granular level. What Business Plan Pro did was help me get down on paper what we were doing and which directions we were going that we never stopped to think about before. We had to stop and think about the why and where of our business. Then we could look and see the whole plan which helped us move forward.”

That Friday, as Granola Snacks was celebrating, the three of them, Sue, Randy and Kate Olkonnen, their production manager (aka the Boss) all gathered there, happy and enthusiastic about the business and the possibilities that were coming. It seemed that taking the time to put their plan down and make sure it was the right one was a strategy that was really working.

I didn’t want to take them from their celebration for too much longer,  so I asked what it was that Business Plan Pro had helped with specifically.

It was Sue that answered.

“It helped us see how great of a company we really are! We could see everything we accomplished in a year. It was so exciting! As I was writing it all out on paper, I’d show it to Randy and say, ‘We look so great!’”

There was that sunshine again.

“I was going through a divorce and feeling that I couldn’t keep up. I told my neighbor that I wanted to quit. She said, ‘No! You can’t! Tell me what your next step is? You have to take your next step!’. When I think now that I can’t do this, I remind myself that I can just take one more step. I can take one.”

Walk on, because you can’t go back now, Sue. We’re depending on that sunshine and those delicious treats.

**Update**
We received the following email from Sue last week.

Chelle!
We were approved to apply for the money from the city of Columbus!
We will know 100% in 30 days but pretty much it’s a done deal.

The approval was based solely on our business plan!! Thank you and please thank Josh. We are huge fans of Palo Alto!!

-Sue

Company:  Granola Snacks
Founded: 2008
Website: http://granolasnacks.com
Owned by:  Sue Van Fossen
Description: Granola Snacks is a company comprised of individuals who love to eat, listen to music, and are huge OSU Buckeye fans. We think having a business should be a ton of fun and that’s pretty much our first vocational rule. We are simply what our name says we are.  We believe Granola Snacks should come in delicious crunchewy chunks that are broken by hand and tasted a lot before they are bagged.

Having just completed my spring business plan season — three big business plan contests and our angel group investment — I think it’s a good time to poke some holes in several damaging and far-too-common myths about startups.

Furthermore, as I write this I’m just leaving Disney World, so the myth of the Pied Piper (the illustration here, in case you were wondering) comes to mind too.

1. Be your own boss

Forget it. That’s a myth. Sorry, but if you’re looking for freedom and independence choose wealthy parents, win a lottery, or learn to live on no money at all, and have no relationships you care about. If you’re going to build a business, you’re going to have lots of bosses. In the best businesses, every customer is a boss. And then there are the people you owe money to, the people who owe you money, strategic allies, and your own employees. All of them can be bosses at times.

And if you have investors, you have bosses. One thing they buy with their money is their voice.

2. Finding investors is a win

That’s what we teach in business schools and classic entrepreneurship: you develop a business plan, you get financed, and then you start. And often it is a win, and it is good. But it ain’t necessarily so.

It’s a conditional win. It’s only a win if 1.) you need the investors and you can use the money to grow your business; and 2.) you find compatible investors you can work with. If you don’t have both those conditions met, then winning investment can be a big loss.

Getting investment from the wrong investors can be like a bad marriage. It can spoil your business and your life.

If you can build your company without investment, there are some important advantages, like in that case you own it all yourself. Nobody is looking over your shoulder, or at least nobody with as much power as investors. Owning it yourself is a good thing, if you can make it.

Of course it depends on the opportunity. There are some businesses that need investment badly, and would not make it without it. And there are some that have a choice. They may grow slower on their own, but they can make it.

3. More money is better

It’s out of date now, but if you look for it, you can find the 1997 Dun & Bradstreet research on causes of business failure that listed “too much money” as one of the causes. It seems silly, of course, but they were serious. There’s a lot to be said for spending money wisely, and filtering spending opportunities according to the related business benefits.

I think there’s a startup sweet spot, for most startups, in which the resources available match the opportunity. Money is spent the right way, building the business, but without overspending.

And my own company, Palo Alto Software, might not have survived the dot-com crash in 2001 if we’d had more money to spend in 1999. We didn’t have enough monetary rope to hang ourselves with. That was a good lesson.

(Image: J. Norman Reid/Shutterstock)

Along with effectively creating a branding campaign for the industry and lifestyle of the target audience, companies and organizations oftentimes choose to add a tagline, or motto to describe or create a feeling surrounding their product. Almost anyone can come up with several of these off the top of their head. From “I’m lovin’ it” to “Just do it” we are constantly hearing and seeing complimentary catch phrases to further a company’s brand. One organization that has done an outstanding job of using a tagline is the US Army and their “Army of One” campaign. Let’s take a look at some keys to creating a great tagline:

Taglines should be simple and concise

A tag can’t be too long or complicated. If they become too long or complex they run the risk of (1) overshadowing the actual visual identity of your brand, or (2) become white noise, and thus lost space, in the design. Generally a tagline should be less than 5 short words, however, 3 is even better. “Army of One,” “Just Do It” and “I’m Lovin’ It” all exist as statements. There is enough mass and sentence structure to push an idea. Each one provides a noun, verb and direct object but are concise enough to engage the audience and simple enough for them to remember.

Taglines must be Descriptive

A misnomer regarding a tagline is that it should in some way describe the product itself. The truth, however, is that a tagline is most effective when it describes the target audience’s interaction with the product or organization it represents. In marketing the simple matter of it is that it’s not enough to get people to like your product, you want them to buy it. By using descriptive words regarding the product, you have the opportunity to move the target audience into a position of interaction with the product, and you frame that interaction. “I’m lovin’ it” is a perfect example of this. At Palo Alto Software, the company I work for, we’ve played with two taglines. First, “The Planning People.” While good, this doesn’t exactly talk about how we interact with our customers and the value we bring to them. More recently, we’ve focused our tagline on what we’re passionate about: “Helping you succeed in business.” We want to be interact with our customer and are passion aligns with your goals.

Taglines should point back to the company identity.

Taglines should not only point back to the company identity, but they should only be used if they reinforce it. Nike’s “Just Do It” campaign is a perfect example of this. The tagline calls and the company identity answers. That is, the tagline suggests an “it” and the company identity, which is less name and more Swoosh, affirms that Nike is “it”, or is the portal into which the consumer attains “it.” In this manner, Nike’s “Just do it” mixes user experience, product purchase and Nike’s products ability to enable the athletic consumer to “Do.”

The tagline must also be evocative and in tune with Social Psychology

A company tagline invites the target audience into participation with the company identification. “Army of One” invites the post-modern young adult into what they are most interested in: a community of individuals. This brings up another very important point regarding taglines: they must take into account the demographic they are intending to reach. The US Army marketing team understands the young adult’s (their target audience, no doubt) cultural mindset and plays on their social psychology to engage them. Many older adults do not understand the “Army of One” campaign, because it does not speak to their cultural mindset. However, the Army speaks directly to the generation they are most interested in reaching, using language that resonates with them and in so refines their marketing energies.
There are many other important aspects when deciding on a tagline, but these four are essential.

The 3rd annual  Global Entrepreneurship Week at UnleashingIdeas.org is ending today. Palo Alto Software was pleased to participate once again in this event. As in years past, we added to the conversation about entrepreneurship by offering some one-on-one time with our President and founder, Tim Berry.

On Wednesday, Tim spent an hour going over the lies and myths that are out there about business plans and business planning. He also took some time to answer some questions from the audience. We didn’t get to all the questions asked, but Tim addressed them later in the day and we’ve posted them in a separate blog post here.

Honestly, I think he could have talked more to that subject, but an hour was all we had time for.

If you missed the event, don’t worry. We recorded it and we’re posting it here for people to re-watch or enjoy for the first time.  If you like it, tell us. We want to know if there are other topics you’re interested in hearing about.

For more information on the Global Entrepreneurship Week and Unleashingideas.org check out their website and see how you can participate.

‘Chelle Parmele
Social Media Marketing Manager

The BBC World News – Business Daily speaks with Palo Alto Software CEO, Sabrina Parsons about family succession.

The conversation touches on the topics of “good and bad nepotism” and the worry that if family-run businesses don’t pass down from parent to child, the outcome for the business can in some cases be quite dire.

Both Tim and Sabrina have talked extensively about this topic before, check out their posts Serendipity Succession, Father and Child and Nepotism vs. Family Business.  It’s nice to hear a refresher on the preconceived notions of a daughter stepping into her father’s shoes and how that has personally impacted Sabrina since taking over the company.

Sabrina’s interview starts around the 9:20 mark.

BBC Podcasts – Business Daily News with Steve Evans – Nanny State or caring government? Aug 13, 2010

‘Chelle Parmele
Social Media Marketing Manager

This collection of posts on my unretirement (I think I’m adopting Steve King’s term) came up this week, I guess because of the interview Romy Ribitzky did last week with me and my daughter Sabrina, about how I stepped down from managing the company to focus on blogging, writing, speaking and teaching instead.

That was three years ago last April. In retrospect, I’m even happier about it now than I thought I would be then. It’s worked out fine for me, thanks; and I think the company is much better off, too.

• How to Rewrite Your Job Instead of Retiring | Small Business Trends
  This is my post on Small Business Trends, reflecting on the three years  since I stopped running Palo Alto Software.
• Small Business Labs: Tim Berry’s Baby Boomer Un-Retirement – Part 2
  Steve King of Small Business Labs goes back to earlier posts on my succession safe harbor new job, picking up where we left off.
• Advice For Father Daughter Father Son Businesses – Resources – Portfolio.com
  A good compilation of two-generation family business advice from fathers and daughters and sons who’ve successfully worked together, including me and my daughter, who runs my company.
• Father Child Business Talk About Working Together – Companies & Execs – Portfolio.com
  Romy Ribitzky on Portfolio.com retells the story of Palo Alto Software (among others) …

Warning: there’s a whole lot of me in those posts. The first one is by me, the second one about me, and the last two mixing me and Sabrina with some other stories.

The fifth annual Small Business Summit is almost here!  The date to remember is March 16th in New York City and Palo Alto Software is once again sponsoring the event.

What goes on at the Small Business Summit? I’m super glad you asked!  This year the event is focused on Strategies for the New Economy and some of the highlights include:

• HOT TECH Demo (60+ companies have submitted their entries)
• Exhibitors including Google, Intuit, Microsoft, and Dell and many more
• Strategies for Growth Panel (Representatives from Intuit, Wasp, Elance and Google)
• Keynotes include: Mel Parker, Director of Small Business at Dell (IT Strategies), Seth Godin (Being Indispensable), Melanie Atta, Campaigner (Boosting Email Marketing), Tim Davis (Using Comedy for Boosting Sales)
• Women of Success Share Their Community Building Secrets
• 10 Minute Power Presentations (Social Media;  Business Card Design Tips;  Optimize Your Time)

This is the hottest ticket going right now.  And speaking of tickets… we’ve got some to give away! Free!

To enter to win a full-day conference ticket, answer this question:

What is a SWOT?

The first three people to email hello@paloalto.com with the correct answer will win a free ticket – that’s a full day’s conference admission!

Fifth Annual Small Business Summit (http://www.smallbiztechsummit.com) – March 16, 2010

Here’s a question I received in an e-mail (edited to hide the sender’s identity):

“The major question I have is how you found the courage to pull through when the times were tough? I know that is a very generic question. but it’s what I am going through right now . . . [omitting the author's personal information, a description of a tough business situation]. I guess I want to know, when you were at your lowest point and everything seemed to go against you, how did you find the will to keep going? What caused you to keep pushing yourself past your limits?”

Courage is a flattering word. Saying we had no choice is more accurate. And not something I recommend for anybody.

I mistrust the “rah-rah” stories about entrepreneurship that make it about courage and pushing past limits. You should plan, reduce uncertainty, and go ahead with caution and awareness, not courage. And never bet what you can’t afford to lose.

Yes, there was a point in the history of Palo Alto Software at which my wife and I had three mortgages and $65,000 in credit card debt. Suffice to say that one thing worse than not getting your products into the retail channels is getting them into the channels, with all the associated costs, and then having them not sell.

Point No. 1: It wasn’t just me; it was my wife and me together.

Point No. 2: We did have a plan. I wouldn’t recommend doing what we did, because we bet more than we could have afforded to lose, which is dumb. We were painted into a corner, which is also dumb. But we did have a plan instead of just wild guessing. Dull and boring packaging had been identified as the problem, but instead of just repackaging the products we had, we decided to improve the product at the core. We did spend money we didn’t have on new packaging. More important, we contracted programmers for monthly minimums plus a percent of future revenue, to create a much better product. We didn’t just hope. We had reason to believe we could get through it by introducing a new product and getting that into the channels, with better packaging as well.

Ironically, the worst financial problems came after the product had taken off in channels. This is typical in small business–growth can cause cash-flow problems. We were really broke, but we had money owed to us that would eventually be paid.

Point No. 3: We had no choice. That’s not something we’re proud of. We had moved from Palo Alto, Calif., to Eugene, Ore. We’d been in our own business for more than 10 years. Entrepreneurs with 10 years’ or 15 years’ staying power aren’t considered great hires by many companies, and Eugene didn’t have a lot of jobs.

If our business plan hadn’t worked, we would have had to sell our house to pay the debts. We would have had to pull three children out of private colleges. We put that off, increasing the risk with borrowed money and, happily, the result was Business Plan Pro. It became No. 1 in its category within seven months of initial release.

This story is dangerous because it seems to imply that business is about persistence in the face of very high risk. In fact, in front of groups, when this comes up, I say, “Do as I say (better planning, to avoid ever having no better alternative), not as we did.” Take a good hard look at your business and your other alternatives and keep your options open. We survived, but don’t think courage and the will to keep going will ever substitute for a realistic business plan, sales, customers and capital. Used wrong, you can end up digging yourself deeper into a hole.

(Image: Mare Salerno/Shutterstock)