We have written a lot about the importance of having a Plan B in place. The idea is simple: Before you spend lots of time and/or money on a new project or product, have a backup in case it fails.
Recently, I’ve come to the conclusion that having a Plan B is not enough. Ideally, you should have a Plan C … and maybe even a Plan D.
Let’s say you are the principal investor in a small business. Things have been going along pretty well, but recently it seems like they are starting to fall apart. Plan A, in other words, is unraveling. So it’s time to implement Plan B.
Plan B might involve bringing in a new CEO. But before you do that, you have to ask, “What if the new person fails to turn things around?”
That’s when Plan C comes into play. It might involve you getting involved personally. If that’s the case, you should conjure up a Plan D just in case you can’t fix things either.
Plan D might be to sell the company.
Now here’s the trick: Don’t wait until you have to implement Plan B to start working on Plan D. Even if it feels premature, plant a few seeds. Those seeds will sprout while you are busy with Plan B. By the time you have to initiate Plan C, your ultimate options are already better and clearer.
* Plan A is your first plan — how your business is working right now.
* Plan B is usually a modification of Plan A — one that involves adjustments, not revolution.
* Plan C is a radical departure. You can’t risk another modification. Make a big change.
* Plan D is always the same: Sell the business or close it. But by planting the seeds early, you will be able to do so with a sense of calm and control.
Source: Michael Masterson
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