“Can I see your business plan?” Has your banker or your strategy coach or some other respected colleague ever asked you that question? You probably answered something like, “Well, yes, absolutely. As a matter of fact, I just finished my semi-annual update to the plan, let me get it for you.”
Sound plausible? No? Why? Oh, you really do not have a written business plan. We hear that a lot. But we are sure you have heard that those who put things to written word are much more likely to achieve things then those who do not. So, while goals are a bit simpler than a business plan, you really need to get it down on paper (digital or real!) and to review, modify and update it regularly. A business plan is truly a living, breathing document and vital to your success.
What should it include, especially if this is your first attempt? Let’s keep it simple:
This section comes first but is written last. After all the work is done, this is the concise overview that is brief and direct.
From a high level, describe what your goals are, who makes up your business, how you operate it, who you serve, and how you will grow. This will include legal structure, markets you will serve, products and services to be delivered, key competitors, financial and marketing/sales/operational plans
Products and Services
Provide a detailed explanation of the way you will be delivering benefits and or solutions to your clients, including how yours will differ and improve upon those offered by competition. Include any relevant proprietary information and data such as key formulas, copyrights, patents, etc.
Analysis and description of key customer/client segments including key data you know about them and how they make decisions related to your line of business or organization. Also include a high-level view of the entire industry in which you operate noting historical and expected trends. This is where you talk about the forest, not the trees! More detail on your competitors would be expected here, including what you see as their vulnerabilities or their key strengths. An ideal client profile would make a lot of sense here.
Ownership, Management and Staff
At the very least, an organizational chart should be included here. Remember that an organization chart does not define lines of communication, only lines of responsibility and authority. Profiles of ideal personality or experience types to put in key roles would be valuable here. If a board is part of your structure, that would be here as well as information on other strategic colleagues like accountants, attorneys, etc.
Financials and Projections
This is the section your banker will turn to first. Often, they do not understand any of the other sections! 😉 Any historical financial data (P&Ls, balance sheets, sources and uses of funds, capital expenditures, and tax documents) would be covered here. Importantly, this is where you include realistic, well researched and analyzed projections for your key financial expectations and goals for the upcoming time period that the business plan covers.
Strategic Implementation and Operations
Here’s the beef! This section is typically the longest, most detailed yet often the most updated and modified as you live out the plan. In this section, lay out exactly your key plans related to marketing, sales, costs, accounting plans, operations, human resources etc. Nitty gritty detail here would include information on key employees and/or job descriptions, hours of operations, an overview of a disaster recovery plan, etc. This is the “how it all gets done” section. This is where Visio charts, checklists and specific “how to” details for key tasks and key departments are included. But, what’s missing?
Remember to include IT here…
A business plan of yesteryear might have had a separate section entitled something like “Management Information Systems.” However, with today’s enhanced reliance on technology hardware and software for all organizations to accomplish their objectives, the IT portions of the business plan would be expected to be replete and detailed in the Strategic Implementation and Operations section. IT tools and software help organizations today to manage their customer relationships, to order raw materials, to invoice customers, to share information, to boost productivity, and most importantly, to improve security. Do not forget to include this important section in your business plan!
Now that you have all your ducks in a row, you’re ready to roll! Head into the new year with an effective business plan and hit the ground running.
For help deciding how best to include IT in your business plan, click here. IT Radix is always ready to make IT work for you!