Yes, it's a controversial title. I can practically hear the bank managers and business advisors spitting their tea across the room. Please just indulge me for the next few paragraphs, and perhaps you'll come around to my way of thinking.
By the way, when I refer to 'brand identity', I'm including everything that it entails - particularly vision, values, positioning and brand guidelines. Regular readers will know that I do not simply mean the obligatory logo, letterhead and website design.
Harrumph. On with the article.
I recently read a thought provoking article entitled 'Are start-up business plans a total waste of time?', written by Mark Williams of The Start Up Donut. Mark makes an interesting case - that having a traditional business plan is no guarantee of success, and might actually become a barrier to flexible growth (read the article - it's very good). Certainly the traditional business plan seems to be at odds with the lean startup model that many leading gurus now advocate. Mark quotes entrepreneur Kate Lister; "The result usually is a long-winded missive that's out of date almost the moment the ink dries."
Mark, and those entrepreneurs referenced in his article, make a compelling point. So if we assume that the traditional business plan has only limited value, is there a case for brand identity to take up the mantle, and be recognised as the indispensable resource for steering a startup business towards success?
The fact is that both set out to achieve much the same goals, albeit in different ways. Both are meant to endow a business with a sense of direction and a clear purpose. Both help to focus minds and promote consistent decision making. But whereas a business plan traditionally focuses on dry details and prescriptive targets, brand identity offers a more thoughtful and flexible guide that maintains its relevance even when unexpected occurrences force a change in strategy. To my mind, this is a better fit for the lean startup model, and for any modern, agile startup enterprise.
Clearly brand identity is not an outright replacement for a business plan. Essentials like financial forecasts - whether they form part of a formal plan or not - have no logical place in either identity development or brand guidelines. Equally, there are crucial aspects of brand identity that a typical business plan simply wouldn't cover (tone of voice for company communications), or often deals with clumsily (vision statements).
I suspect that a combination of both would be a particularly potent formula for startup success. Whether you go down the traditional business plan route or opt for something more lean like Andy Fox's success plan (thanks again Mark!), the document itself would benefit from the consistency, credibility and polish that the visual design aspect of brand identity delivers - that can only improve your chances of making a good impression with investors. Also, incorporating a carefully crafted vision statement, values set and brand story into a business plan sets out the broader strategy that will help steer decision making when the detailed plan inevitably needs to be recalibrated.
If only because traditional lenders will accept nothing else, the 40-page business plan is unlikely to disappear any time soon. That said, perhaps the time has come to consider whether the flexibility, vision, credibility and clear sense of shared purpose engendered by effective brand identity might offer a more relevant route to startup success.
If you're starting a business and appreciate the value of effective brand identity, explore the Brandsworth website and discover the affordable branding agency for startups in Wales.