Is your engineering firm meeting its goals in this recession? Do you have more business or less? When do you expect the economy to recover? If your company is like many other engineering companies, you were caught off guard at the beginning of the recession. Are you sure that the current and expected market changes are reflected in your business plan? These are all questions that need to be answered in your business plan; your company’s business road map.
Without a doubt most business owners know that they need to have an up-to-date business plan. All that is required of any business owner to keep the plan current is the time to review, analyze, and update the plan, which can be difficult. So if you have not already, now is the time to review your plan and periodically make modifications.
In a prolong recession a proficiently ran business is more important than ever. Professional engineers are extremely knowledgeable about their career, but are rarely the experts in operating their company’s. An engineer will have spent 8 to 10 years in college and post graduate training before being licensed as a Professional Engineer without ever taken one class in business.
When the projection of incoming revenues slow or stop coming in the door your first reaction is to find more clients from the same source and second to cut costs by downsizing. This may not be the right business steps to take. Usually the better action is to re-examine each of your markets and clients in those markets, and to determine if those markets change in direction is temporary or long term, and then to careful review your company’s services and products. Operating any business should be a constant review of the process of that business, and whether it is operating at its best. Mistakes in the operation of the business during the good times are easy to compensate, but during the not so good times the same mistakes can close the business. A careful review may also show that your company is relying on one market to heavily and may need to diversify into other markets.
The kitchen table sketch may have been the beginnings of an engineering business plan, but as the company continues to operate and grow, the business plan needs to be formalized and updated periodically. The engineering business plan is nothing more than an outline, summarizing how the company will operate to be a successful business. Within the plan there are estimates based on industry research and personal experience which determines how much the company can expect to profit. This is established by quantifying the amount of services and products to be sold minus the expenses. It is one of the business owner’s primary responsibilities to work on the business through the process of reviewing and updating the business plan.