These elements are a summary of the introduction to Ibis business plan training and business plan development. They refer to a plan for an established business; there are some separate elements for a start up plan, and a different emphasis in certain areas. An example of how all these are integrated is available as a download of Castellan.
The aim of the plan should always be to answer the three central questions:
Where are we?
Where do we want to be (and when)?
How are we going to get there?
Bottom up rather than top down
“If you want to go fast, go alone, if you want to go far, go together”
Plans that are based on a reasoned individual analysis of customers, markets, competitors, internal company conditions and suppliers are far more likely to succeed than those that are created from an overview assessment. Such plans are also more consensual, as the enterprise works with people rather than through them.
A bottom up approach also helps in breaking down organizational boundaries and spreading planning and control concepts throughout the enterprise.
Employee satisfaction survey
Incremental change through integrated monitoring
“Planning is everything, the plan is nothing”
Any plan should be considered as a snapshot in a rolling process of change and development. This makes continuous plan modification and review essential.
Clearly defined responsibility and authority
“Expectations drive outcomes”
The involvement of employees at all levels in decision making and implementation is essential in creating a unified and productive enterprise.
“Go to sleep in a dream, wake up in a nightmare”
Creating a rolling plan with short, medium and long term perspectives provides the enterprise with a clear road map for how short term actions will affect long term objectives.
Successes, failures, lessons learnt
“Those that fail to learn the lessons of history are doomed to repeat them”
Enterprises make mistakes, and achieve often unexpected success. Planning should attempt to ensure that mistakes are minimized and opportunities exploited.
Plan outcome review
Project outcome review
Contingency plan outcome review
“If you do not have competitive advantage, and cannot develop it, don’t compete”
Competitive advantage drives margins, repeat purchase, customer satisfaction, cash flow, new product development.
“Jack of all trades and master of none”
Pareto’s Law is one of the most powerful planning tools in stating clearly that a limited number of business components will be the most important.
“Turnover is vanity, profit is sanity”
The established business increasingly depends on repeat business as it grows; repeat business comes from satisfying existing customers.
Internal quality systems – ISO 9000, ISO 14000, Kanzen, Deming rules
“Time and tide wait for no man”
There is no point in creating a plan that fails to take detailed account of the external and internal constraints as well as opportunities, dealing with the world as it is rather than as it should be.
Legal review (health and safety, corporate, contract, environment, product)
“Intrepidity is stupidity recalled in tranquility”
Policies must be put in place to reduce the impact of minor or major changes in the external and internal environment.
Golden circle balance
Implementation option balance
Project risk management
Cash is king”
The plan must add up – returns must be achieved from investment for medium and long term viability.
Profit and loss
“Ignorance is strength”
The enterprise must ensure that all stakeholders are aware of their part in a plan which is designed for the benefit of all.
What does a comprehensive business plan provide?
When properly structured, the most effective way of allocating resources
When properly structured, creates a virtuous circle
Better planning and control forces the enterprise to manage better, which leads to better planning and control
When properly structured, improves decision making
Enterprises have a framework against which decisions can be measured; poor decisions will be reviewed; good decisions will be learnt from.