"Three-In-Four Business Plans Damage Firms" - Pembridge Unveils The Hidden Secrets of the One-In-Four

London, England - Pembridge Partners today makes the claim that "three out of four business plans used by Creative Services Firms (CSFs) are failing their companies". And in Pembridge's view, they are also damaging firms by reducing motivation and innovation - two of the hallmarks of a strong CSF.

This sad revelation comes at a time when Business Plans are becoming more critical for Creative Services Firms - the vast majority of Creative Services Firms say that they are "critical" to running their businesses well.

These conclusions come after an informal review of Business Planning techniques used by 60 Creative Services Firms conducted by Pembridge in November and December 2004. The review shows that there is much work to do to bridge the gap between the reality and expectation of Business Planning. Pembridge believes that urgent work is required to stop business planning damaging firms further, and has commenced work to quantify the issues further in a formal survey to be launched in the Summer of 2005.

The most common problems with business planning were identified as:

1. The inability to predict future business levels
2. The inability to respond during the year to changes in business by cutting people costs
3. The ineffectiveness of new-business targets as a means of incentivising senior staff
4. The negative impact on staff morale of not achieving targets
5. Staff confusion as actions required to achieve financial goals were poorly defined

Pembridge Partner Mark Adams believes the root cause of the problem is that "the business planning process for Creative Services Firms tends follow the same format as that for industrial companies - and it needs to be radically different." The specific drawbacks with the 'industrial model' were identified as: too many spreadsheets, too many pages and references, too much emphasis on capital expenditure budgeting and insufficient attention to the actions, participation and ownership by staff of the business issues.

The Top 5 lessons learned from the companies who found their business plans motivating, productive and helpful included:

1. Let actions, not numbers, dominate Business Plans
2. Keep plans short and simple
3. Make them look and feel good
4. Write Business Plans for all staff
5. Make the process for developing Business Plans open and participative

For more information, contact Eve Daniels