“The minute you have a back-up plan, you've admitted you’re not going to succeed.” – Elizabeth Holmes, CEO and Founder, Theranos
What happens if you decide to go by this philosophy? How practical it is to not have a backup plan for your business, goals, or targets?
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At first, such quotes seem to drive passion and enthusiasm in entrepreneurs. But if you think critically about them, they might just be another recipe for failure. By definition, a business is an economic activity involving the continuous and regular exchange of good and services for one another or for money. Is it possible to have a business plan without any fall-back options?
2016 has seen more than a few businesses, mainly startups, shutting down operations. The lack of a solid business plan may have contributed to these shutdowns to some degree. As soon as their core business idea started falling apart, their ‘burn the boat’ and ‘stay focused’ strategy couldn't do much for them.
Whatever your ambition is, you know it has a probability to fail. Your proposal can be rejected or your startup pitch might fail. In such instances, having a backup plan works as antidote, giving a sense of security for the bearer of all risks.
For instance, if you were not able to impress your investors, your backup plan could be to join another startup as a consultant or perhaps apply for a position in an MNC that matches your requirement. More often than not, most people join their friend’s startup and help them build a profitable business.
A backup plan is like an emotional safety net. It comforts you, but on the other hand, it also takes you one step closer to failure. This where the confusion starts! The act of devising a secondary plan increases your chance of failure of the primary goal. Now the real question is should you or not have a backup plan for your business? Here are some considerations to look into:
Evaluate your activity
Some activities may require you to have a backup plan – for instance, moving base, planning a trip abroad, and even accepting a new position in the current organisation. On the other hand, activities such as starting a new business would require you to be ‘all in’. Your task is to evaluate the need of the hour. Do you think your next goal can afford diverted attention, or would it require a high degree of commitment? Once you have your commitment in place, you’d know if you are ready to throw all your chips on the table.
Motivation and focus
Your second consideration should be to have the motivation and focus for Plan A. Your Plan A should be extremely thought out, and every step should be a calculated affair. A bad start at Plan A, would always have you look for alternate ways to accomplish your aim, a sign that means that you were not really prepared with the execution of Plan A in the first place. Having a backup plan is essential, but once you have created a practical Plan B, it is best advised to put it out of your mind. Your sole focus should be to execute the original plan without thinking about taking an alternative route as soon as the plan starts blowing up in your face.
My belief ultimately is this: it is sensible to have a backup plan, but it is also important to not consider it as an easy way out of the struggles and contingencies that the original plan will throw at you from time to time. The next step is to be comfortable with your backup plan. It could mean taking a boring nine-to-five job after failing a new venture. That should be just okay. That’s the whole point having a backup plan, right?