:: planning ::
Part 4 - Planning. I wonder how many books there are and software programs there are on how to do a business plan? Last count - 22 software programs and over 800 books on how to do a business plan. How is it, and why is it, that they never work, no one reads them, and all they end up is a nice way to collect dust on your bookshelf?
Strategic business planning is really a road map. If I said to you "How do you get from A to B?" the first thing you'd get out, when you get in your car, is the map. If I said to you "What is your business going to look like in 2 years time?" we just go back to the business plan. It's a map.
So what are we going to do with this map? We follow a list, so as we're working down the list of people, market, operations, production, finance, etc. we tick them off, so at the end of it we don't go "Whoops! I forgot something!"
Who reads the business plan? Customers, suppliers, bankers, staff, family and friends.
The business plan is a document of seduction. The business plan is about selling. The business plan is about communicating what you want, why you want it, and how you're going to get there.
| So why write an Executive Business Plan? | Positive and negative steps |
| Table of Contents |
So why write an Executive Business Plan?
Surely we can start our venture from screening an opportunity?
If only it was that easy! You will find the business planning process will help you to secure commitment. It will also help you consolidate the opportunity. If working with others, it will also help you communicate the concept and value of the venture. Above all, it will definitely be a reality check - can you and should you do 'it'?
I have found that this is a time for quiet reflection before the launch occurs (some call it a crisis!!). If you can plan to put an executive business plan together and actually complete one, this is the first commercial test for you and the team.
Executive Business Planning has to start somewhere. The questions to get things rolling along include:
Asking these questions will help you integrate and concentrate your knowledge and skills - in other words, bring all your ideas and research together.
The executive business plan is and always will be a selling document. The plan has to be able to convince all that read it that what you are proposing makes sense and they should either:
Another characteristic of the executive business plan is that it is a risk control document. It has to be able to answer the "What ifs!" - What and where are the risks? - and the strategies that are in place to minimise those risks.
The executive business plan can be used at any stage of the business life cycle. Most people think that the plan is used when starting a new venture - this is not true!
Table of Contents
As with most business activities we start with a list - a list that will help you 'assemble' an executive business plan. Ever been shopping without a list? You know what it's like to come home and suddenly say "Whoops I forgot something!".
This list tries to cover everything - I mean everything! If there are elements of the following table of contents that do not 'fit' your venture, simply leave them out.
In the table of contents, you will see a list of - what? Not another list? Yes, another list so you don't go "Whoops! I forgot something!".
The table of contents is outlining the Executive Business Plan. You'll see at the top of that table of contents the Executive Summary. The Executive Summary is the most important part of the Executive Business Plan for you only have 2 to 3 pages to convince the reader to invest or provide finance to you.
As you work through your Plan you will see far more detail that will support your executive summary.
The table of contents is just like anything else we've been exploring in this subject. Just another list, but please don't go "Whoops! I've forgot something!".
You might be thinking this looks like a lot of work - you are right! After all, this plan involves people, money, assets and - unlike cooking - it is very expensive if you get the recipe wrong!
Positive and negative steps
A number of steps can be followed to enhance the effectiveness of the executive business planning stage. These are shown in the following table.
| Positive Steps | Negative Steps |
| Involve all the management team. Be logical, concise, comprehensive and readable. Demonstrate commitment by the time, energy and financial effort to complete the plan. Point out the risks and outline the assumptions. Identify all the problems and the strategies to overcome the risks. Put forward several sources of financing. Spell out the deal. Be creative in presentation and the way you attract the attention of potential investors. The plan is the focus, it is not the business. Do accept orders and customers that will create a positive cash flow - delay the plan. Understand the investment audience - know what they are looking for. Be realistic, not optimistic. |
Don't have mysterious names on the team. Don't be vague, ambitious or presumptuous. Don't use jargon - you will lose the reader. Don't be all show - demonstrate substance. Don't waste the time in writing a plan when you could be closing deals and collecting the cash. Don't assume the deal is done until the cheque is cleared. Don't assume that your assumptions will not be checked out - they certainly will. You are dealing with professional investors, with a network of contacts that is superior to yours. |