John Mullins, an associate professor of management practice at London Business School, has analyzed hundreds of business plans. His conclusion: "Most aren't even read in full. Their shortcomings tend to be obvious even in a two-page executive summary, largely because they are written before enough real work has been done to create a solid foundation." He details the five most common flaws of business plans and tells how to fix them in “Why Business Plans Don’t Deliver,” a June 22 article for The Wall Street Journal and the MITSloan Management Review. The article is aimed primarily at tech start-ups seeking investors. But, any company that needs a formal business plan either to satisfy a lender or to grow its market share should find it valuable reading as well. Every plan, writes Mullins, should have three key elements: “a logical statement of a problem and its solution; a battery of cold, hard evidence; and candor about the risks, gaps and other assumptions that might be proved wrong.” When plans go astray, they typically do so in one or more of these ways: • Here I Am, Never Mind the Problem—failure to define a “pain,” need, or problem that the business can address. • A Coke For Every Kid in China—unrealistic or poorly researched expectations about market potential. • Just Look At Our (Paper) Profits—Mullins says, “As one entrepreneur told me, ‘With a couple of beers and an Excel spreadsheet, you can make a lot of money in no time,’ or so it will seem.” • Our Team Walks on Water—over-hyping personnel qualifications while failing to acknowledge skills gaps. • Everything is Wonderful—according to Mullins, the type of plan that goes most quickly into the trash “is the one in which the writer can’t find anything but good things to say about the opportunity and plans to pursue it.” Words and phrases Mullins doesn’t like to see in business plans include Huge; Conservative; Revolutionary; Assumptions; We believe; No competition. One of the wisest things a business plan writer can do, he adds, is to “get out from behind his or her Internet connection and actually talk to prospective customers.”