4. Willingness to look at risk. A great CEO isn’t afraid to look at downside and answer hard questions he or she hopes will never become a reality. The CEO needs a backup plan—one that is designed by looking at company’s worst-case scenarios. This plan addresses questions such as: What if your industry experiences a slump? What if new governmental regulations affect your business? What if you lose client that accounts for 50 percent of your sales? Preparing yourself and your company for these eventualities may be difference between a tough year or two and bankruptcy. If you are in business for 20 years, some of your worst-case scenarios will probably happen. The key is to be ready and able to take immediate action to reduce loss.

5. Foresight. It seems some CEOs have an uncanny ability to predict future. They may have unusual insights into their particular markets, and luck may play a part as well. In addition, they are prepared to create their own luck by cultivating an ability to see opportunities for their company and to make deals that convert those opportunities into realities. Some things that may seem like amazing foresight are actually result of hard work and discipline it takes to constantly look forward to build a successful company. Great CEOs must also constantly develop new products to build and retain a customer base. Foresight is also ability to hire and retain right people, looking ahead toward growth of company. Finally, over time, each company must develop a steady source of business during both good economic times and bad, because there are sure to be bad economic times during life of a business.

The Optimum Solution: A Blended Approach

At best, planning process should not be at either end of spectrum, but squarely in middle. In my experience, plans that win funding come from a true collaboration between a skilled consultant/facilitator and entrepreneur’s team of employees and advisors.

A business planning consultant can act as a coach, first assessing job to be done, and then recommending who is best to do it. The business plan should be a compilation of work between vision and goals of entrepreneur, technical understanding and expertise of his or her accountant and other professionals, a consensus of employees or others, and research and writing abilities of business planning consultant. The consultant should meet with all parties involved, talk about what is needed for plan, and use all resources available to get work done as quickly and cost effectively as possible. It is consultant’s responsibility in process to take all pieces and make final plan into a readable, accessible document that will stand up to investor/lender scrutiny. My final caveats:

•Don’t pay more than a few thousand dollars for a plan unless you are looking for capital of well over $1 million. I have heard more than a few horror stories by people who have hired university professors assuming they are experts (they aren’t) and paying tens of thousand of dollars for a poorly written or incomplete plan. Ask your banker for business planning consultant recommendations, or better yet, talk with someone who had a good experience having a business plan written for them. It is reasonable for a consultant to expect you to pay half of fee up front and other half at completion of plan. And you can’t hold consultant responsible if you don’t get funding based on plan – too much is based on your own credit and management skills.

•Don’t expect to get a finished plan that is a roadmap of everything you need to do to have a successful business. That isn’t purpose of business planning process. A traditional business plan is intended only to document your strategies for business very briefly – but well enough to get funding. If you are hoping for something that will tell you how to market or how many people you need to hire, you will have to start with a deep strategic planning process, and probably buy lots of consulting time to get you going.

•Don’t expect a great a business plan from a poor business model. If your costs are too high to make your business profitable, business planning process will help you discover that. Then it will be up to you to make hard decisions about changing your costs structure to make business work. The business planning consultant is a skilled professional, not a miracle worker. A good business plan can help you highlight your strengths and minimize your weaknesses, but it cannot make an unworkable business model into a thriving business.

And one final thought: Don’t go on to start a business or make changes in your current business if everything in business planning process tells you it won’t work. Things don’t get better out in real world if they don’t work on paper. Deal with weaknesses – get more training, consider product redevelopment, or have a home-based business to reduce costs until you can sustain rent for an office. Businesses fail finally because they’ve run out of money. If your plan tells you that you can’t make enough money to make business work for long run, pay attention to that reality.