Most bank managers quite rightly advise clients to plan their business in an orderly commercial manner and the preparation of a business plan is often the focus of this process. But what the bank does not tell clients is the experience of their fellow customers who undertook similar planning exercises but either got into trouble in the implementation phase or simply strayed away from the plan due to lack of resources or operational pressures. In other words, its been an easy out for banks to advise and in some cases pressure clients to undertake the process but accept no responsibility for the outcome and add no value to the process. This is not to dispute banks legitimate concern for the business planning process, rather, there has been only a cursory investment by our banks in doing something about the problem. Our major banks still remain the most fertile source of information on Australian small business simply because they capture so much information about their clients which, if sensibly harnessed and re packaged could be used to commercial advantage by customers.
Banks paint confusing messages for customers.
Once this happens the customer quite rightly shops around and the bank is forced to drop the rate because they are at threat of losing a client. Many business operators who were clients of our major banks would jump at the opportunity to have access to information, which will assist their business. In many cases the same information, if used by bank mangers, would enhance their own awareness levels and raise standards within the banking industry as well. Operators of successful businesses and their advisers have now learnt that business planning is not a one off exercise but a long term process of business improvement which needs to be broken down into manageable stages. In the past it has been common practice, and one actually supported and endorsed by major banks that the business plan should be produced as a one off project.