Start
Image is not available

50% of businesses fail for non financial reasons

80% of businesses centralise their planning

65% of businesses fail to integrate plan with implementation and monitoring

80% of businesses solely rely on financial measures for monitoring

10% of businesses use planning and plan development as a management development tool

6% set operational targets for continuous improvement (CI)

What should be in the better business plan?

Start
Image is not available
A series of questions to make your business plan
fully functional and comprehensive
Does the plan clearly...?

Does the plan clearly resolve the key business planning questions?

Image is not available

Where we are?

Where do we want to be (and when)?

How are we going to get there (cost effectively)?

Successes, Failures

Successes, failures, lessons learnt

Image is not available

What did we do well?

What changes to build market and competitive position?

What do we do badly?

Should we continue with these, withdraw, or change our behaviour?

Legacy

Legacy
Have we reviewed impact of past decisions?

Image is not available

Location
Plant Effectiveness
Customer Base
Reputation
Environmental Footprint
Litigation
Structure
Staff
Skills
Style
Suppliers
Pricing

Facilities Management
Industrial Relations
Products Services
Contracts
Record Keeping
Competitive Position
Systems
Shared Values
Strategy
Support
Covenants

Structure

Structure
Are we clear about

Image is not available

Authority and responsibility
The best operational format (SBU) with operational freedom
The best ownership format
The best span of control/ hierarchy
Diversity (age, gender, language, country of birth)

Temporary vs permanent
The best legal format
The best tax format
Special units
Intrapreneurialism
Staff vs line
Dunbar number

Coprporate Governance

Corporate Governance

Image is not available

OECD guidelines? Directors?
Manual?
Calendar of events?
LBE?
Good faith?

Best practice on ESG?
Management manual?
Nepotism?
Moral hazard?

Indistrial Relations

Industrial Relations

Image is not available

Code of conduct?
Job description and employee contracts?
Universal bonus system?
Appeals?
Disciplinary code and grievance procedure?
Communication?
Good faith?

Health and safety?
Job description and employee contracts?
Agreements with employee groups?
Universal fringe benefits?
Intranet?
Whistleblowing protections?
Communication?
Promises?

Change Management

Change Management
Does the company have a systematic approach to defining and implementing major change?

Image is not available

Chesterton’s Fence?
Scenario building?
Change tunnel?
Project based planning (Agile emphasis)?
Stagegate?

Detailed end goals?
Cost/benefit analysis?
Consultation with stakeholders?
Team based implementation?
Nudge theory?

Management Practices

Management Practices
Does the company follow best practice?

Image is not available

Recruitment
Appraisals
Counselling
Team building
Communication
Employee satisfaction survey
Meeting management
Management sign off and approval for expenditure
Investment Appraisal
Absenteeism
Exit interview

Induction
Mentoring
Motivation
Access to training, development
Communication
Employee suggestion scheme
MBWA
Rule of eight
MBO
Cascade
Time management
FUD policy

Location

Location
Are we clear about the best location for?

Image is not available

Clustering
Customers
Staff?
Virtual office functions
Working conditions – space, layout, noise, light, pollution
Advisors
Tax

Logistics
Reducing trade barriers
Security
Premises design
Finance
Grants
Cost
Delivering productivity

BETTER PLANNING
BETTER PLANNING
Negotiation

Negotiation

Image is not available

Importance
Team
Location
Project plan
Cultural skills
External validation
Break clauses
FSF
Dispute resolution

1st, 2nd, 3rd Objectives
MIS
BATNA
Negotiation skills
Authority
Preparation
Review method
Sign off
Good faith

The Planning Horizon

The planning horizon
Are we clear about:

Image is not available

What are short term issues (and how long does short term cover)?

What constitutes the medium term (and how long does medium term cover)?

What is the long term that makes sense for our operation?

Decision Making

Decision Making
Are we clear about how we reach decisions?

Image is not available

Authority & responsibility
Bureaucratic
Record keeping
Use of advisors
Common language
Standard approach to investment appraisal
Manuals, journals, best practice literature

Speed of decisions
Democratic
Authoritarian
Accessibility to decisions
Problem Solving Techniques
Sign off decisions
Ideas day
Work circles

Advisors

Advisors
Are we clear about, and have we recruited our necessary advisors?

Image is not available

Tax
Banking
Insurance Contract
IPR
Grants
Planning
Plant management
Security
Regulatory environment
Health and safety
Project Management
Logistics
Personnel
Design

Corporate finance
Promotion and public relations
Design
ESG
Architect
Quality control
Customs regulations
Facilities management
Information technology
Waste management
Quality control
Trade associations
Work study

Vision Statement

Vision Statement

Image is not available

Have we stated and agreed a measurable view of the development of the organisation?

Is it short, logical, achievable and motivational (SLAM)?

Business Model

Business Model

Image is not available

Has the current business model been accurately defined?

Benchmarked against industry gold standard?

Balanced Scorecard

Balanced Scorecard
Have we key objectives for the short, medium and long term?

Image is not available

Customer satisfaction
Gross profit
Return on capital employed
Employee skills
New product/ service development

Critical Success Factors

Critical Success Factors

Image is not available

Are we clear about what the critical success factors are for our organisation?

Current percentage achievement?

Assumptions

Assumptions
Are we clear about what assumptions we are making for the future?

Image is not available

Market drivers
Price inflation
Currency rates
Product/ service range
Substitutes
Suppliers
Premises
Grants
Accounting
Litigation

Regulatory changes
Cost inflation
Competitive structure
Entrants
Customers
Employees
Funding
Company ownership
Social responsibility
Competitive reaction

Risks and Uncertainty

Risks and Uncertainty
Are we clear about what risks exist for the future?

Image is not available

Market drivers
Price inflation
Competitive structure
Customers
Credit management
Substitutes
Employees
Funding
Company ownership
Data security
Security
Climate
Project risk
Covenants
Litigation
Warranties
Negotiation

Regulatory changes
Cost inflation
Product / Service range
Currency rates
Entrants
Suppliers
Premises
Grants
Accounting
Fraud or Theft
Pollution
Investors
Interest rates
Quality control
Competitive reaction
Black swan

Forecasting

Forecasting
Has management decided on managing assumptions and risk through appropriate forecasting?

Image is not available

Have the requirements of forecasting been identified?

Have appropriate tools (quantitative, qualitative) been chosen?

Has the source of objective data been identified in each case?

Has the company identified the accuracy of each data source?

Has the company made the necessary investment in appropriate forecasting methodologies?

Cost Implications

Competitive Moat

Competitive Moat
Are we clear about how we are going to maintain and further strengthen the competitive position?

Image is not available

Comparative advantage
IPR (patents, trade marks, branding, GIS, copyright, design)
Quality
Market coverage
Promotional investment
Reputation
Skills

New product/service development
On-line Sophistication
Customer base
Product width/depth
Price
Distribution channels
Customer satisfaction
ESG
Cost base
Funding system
Regulation

Pricing

Pricing
Have we a fully developed cost control and pricing methodology?

Image is not available

Management accounting cost and overhead recovery
Activity based system
Competitive pricing reviewed
Price leadership
Discount policy reviewed
Currency
Sales promotion options

Sales promotion options
Variances
Pricing strategy
Dynamic pricing
Prices reflect intermediaries
Finance option reviewed
Tax
Historic pricing

Speed of Change

Speed of Change
Are we clear about how forecasts match market and competitive change?

Image is not available

Very significantly above market and competition?

Significantly above market and competition?

In line with market and competition?

Below market and competition?

Significantly below market and competition?

Focus
Image is not available

Has the percentage of company activity in core areas increased or decreased over the past planning period (mission creep)?

Have we increased or decreased our core competence over the past planning period?

KISS?

Experience curve?

Prioritization methodology?

Strategy

Strategy
Have we considered the best strategic options for the company using the various portfolio techniques?

Image is not available

Pareto analysis
Diffusion theory
BCG
PIMS
Innovation matrix
International product matrix
Capital allocation models (regions, products/services)
First mover advantage
Walking through
Market position
Simulation
S- curve
Value chain?

Market profit / market entry
Segmentation
SWOT/TOWS
GE
PLC
Market growth/business position
Gravity models
EFG
Blue skys
Market Structure
PEST
Kinsey technology

Golden Circle

Golden Circle
Are we clear about the emphasis placed during the short, medium and long term on the various golden circle components?

Image is not available

Gap analysis

Consolidation (withdrawal, cost management)

Market share increase (market penetration)

New market access (market development)

New product/service development

Knowledge Centres

Knowledge Centres

Are we sure that there are individual(s) in each of the key areas of the company to manage and direct operations, build teams, drive skills, enable succession planning, lower costs, reduce meeting volumes, improve motivation through group recognition, and improve control?

Key Performance Indicators

Key Performance Indicators

Has the company defined key performance indicators (KPI’s) for each key area for the business?

Image is not available

Administration

Finance

Personnel

Marketing / Sales

Information Technology

Production/service delivery

New product/service development

Benchmarks

Benchmarks

Has the company established benchmarks and targets for key performance indicators in all areas of operation?
Are company targets established for continuous improvement (CI)?

Image is not available

Administration

Finance

Personnel

Marketing / Sales

Information Technology

Production/service delivery

New product/service development

Action Plan

Action Plan

Does each operational area develop an action plan?

Image is not available

Administration

Finance

Personnel

Marketing / Sales

Information Technology

Production/service delivery

New product/service development

Action Standards

Action Standards

Does the organisation set action standards for key operational performance activities?

Image is not available

Administration

Finance

Personnel

Marketing / Sales

Information Technology

Production/service delivery

New product/service development

Bottom up planning

Bottom up planning

Has each operational area developed their own plan for their area of responsibility, including strategy and implementation?

Image is not available

Administration

Finance

Personnel

Marketing / Sales

Information Technology

Production/service delivery

New product/service development

Technology Audit

Technology Audit

Has the company a system to evaluate available technology to improve competitive advantage, speed, quality, scalability, security, cost management, customer satisfaction, pricing, profitability, complexity?

Image is not available

Administration

Finance

Personnel

Marketing / Sales

Information Technology

Production/service delivery

New product/service development

Legal Framework

Legal Framework

Have the current and future legal frameworks been identified?

Image is not available

Administration

Finance?

Personnel

Marketing / Sales

Information Technology

Production/service delivery?

New product/service development?

Project Management

Project Management

Does the organisation emphasise project management techniques to improve performance?

Image is not available

Help to identify risk (risk register, Equator principles)?

Control time, specification, and budget?

Improve control over investment through stagegate techniques, hurdle rates, HACCP?

Buy in through agile approach?

Are major projects always reviewed on completion?

Production/service delivery?

Use external advisors to review project design and monitor performance?

Standard Operating Procedures

Standard Operating Procedures

Does the company have a well established system for incorporating standard operating procedures in all areas of company activity to standardise response, improve quality, speed, while incorporating a paper trail for review? Are software solutions continually explored? Intranet available?

Image is not available

Administration

Finance?

Personnel

Marketing / Sales

Information Technology

Production/service delivery?

New product/service development?

Complaints

Complaints

Has the organisation a formal method of responding to internal and external complaints, including recording, effectively responding, and reviewing outcomes?

Image is not available
Management Information Systems (MIS)

Management Information Systems

Does the organisation have a functional system to integrate all information in a system which is widely available and useful (SATURNS mnemonic) for most employees? Is the system secure and safely duplicated? Is vital information maintained off-line?

Image is not available

Project management
Forecast trends
Regulatory information
Products/ Services
Market research – on going and ad hoc
Production/ service delivery
Customer activity
Premises performance

Regulation
Accounting
Employees
Products/ Services
Market data
Customer complaints
Premises performance
Data analysis methodology

Review Frequency

Review Frequency

Are we clear about how we will use the MIS for effective decision making. Who will review what and when?

Image is not available

Daily

Weekly

Monthly

Quarterly

Annually

Customer Plan

Customer Plan
Are we clear about the future management of customers?

Image is not available

Product/service modification
Retention
Joint planning
Individual media plan
Skills
Warranties

Specific individual/team
Transition
New customer development
Training
Buying behaviour
Logistics

Region Plan

Region Plan
Are we clear about how we are going to manage regions:

Image is not available

Operational location?
Product/service range choice and pricing?
Logistics?
Distribution channels?
Warranty?
Media channels?
Sales channels?
Currency?
Buying behaviour?
IPR?

Rates of investment return?
Product/service adaptation?
Skills?
Control?
Service support?
Media message?
Competitive reaction?
Tax?
Legislation?

Supplier Plan

Supplier Plan
Have we reviewed our current supplier base?

Image is not available

Vendor ranking methods
Maintain and build effective and profitable relationships

Joint planning for product development/ delivery scheduling
Quality control
Vulnerability
New supplier sourcing

Product Service / Plan

Product / Service Plan
Have we reviewed each product or service?

Image is not available

Future proofing
Product benefit (technical, non technical, attitudinal)
Branding
Created protocols for new products/services
Tested through customer panels or via other testing
Additional revenue opportunities
Expectation fulfillment gap
Halo effect

Product viability analysis
Product stretch
USP
Certification
Design
PVA
Competitive reaction
IPR

Personnel Plan

Personnel Plan
Do we have a clear view about how we are going to manage succession planning, and develop key employees?

Image is not available

Induction programme
Development programme
Succession planning
Job rotation

Maintenance programme
PDP
Apprenticeships
Job rotation
Deputisation

Communication Plan

Communication Plan
Do we have a structured communication plan to service each stakeholder group, what, how and when?

Image is not available

Employees
Customers
Community
Intranet
Work circles
Social events

Government
Suppliers
Investors
Extranet
Networking

Trade Offs

Trade offs

Image is not available

In reviewing the cash flow have all important trade offs been adequately reviewed?

Sensitivity analysis

Sensitivity analysis

In reviewing the cash flow, have the implications of key changes in operating conditions been adequately explored and their impact evaluated?

Image is not available

Changes in pricing
Changes in costs
Changes in customer ordering behaviour
Distribution channels
Changes in bad debts
Changes in payment terms
Changes in currencies

Reality Check

Reality Check
Have the key market, customer and product/service elements in the plan been reviewed to assess their risk and probability of success?

Image is not available

Market growth
Average sales per customer
Percentage of additional services per sale
Customer loss (churn) rate
Distribution channel
New product penetration speed
Employee loss rate
Effective headcount
Covenants
Working practices
Capex

TAM, PAM, RAM
Competitive activity
Competitive entry
Production capacity
Quality control
Pricing and discount levels
Skills
Risk multipliers
Financial headroom
Working capital
Pricing

Contingency planning

Contingency planning
Have we identified?

Image is not available

Team responsibility / KC
Design out failure
Share
How we can identify failure
Progressive response
Communication
Black swan event management?

Key failure points
Fail safe
Mitigate
Action points
Budget
Post event review
Intranet

Cash flow

Cash flow

Have we established a coding system which separates revenues and costs into all functional areas which can be used for control purposes (variance analysis and budgeting including zero based) and for rapid evaluation (what ifs?) of the operating environment?

Image is not available

Customers
Regions
Variable costs
Suppliers

Products/services
Fixed costs
Employees
Investment projects

Budgeting

Budgeting

Are we clear about what budgeting is necessary and how it will be managed?

Image is not available

Zero based?
Fixed costs?
Total costs?
Internal competition for free cash flow?

Funding Plan

Funding Plan

Are we clear about how the plan will be financed, the timescale and risk involved?

Image is not available

Cost of capital rising or falling
Retained earnings
Asset sales
Changes in supplier terms of trade
Changes in customer terms of trade
Long term borrowing
Convertibles

Cash or cash equivalents
Grants
Inventory
Supplier finance
Short term borrowing
Debenture
Equity

Planning Cycle

Planning Cycle

Have we resourced the creation and maintenance of the plan, with firm timelines concerning:

Image is not available

First update?
Third update?
Team structure?
Stakeholder involvement?
Plan mentored?
Location?

Second update?
Plan renewal?
Review and sign off?
KC based team?
Budget?

End
Image is not available
Interested in how an integrated, continually working and updated plan can be achieved?
How such a plan is supported by a detailed manual?
How such a plan is supported by a detailed set of notes (over 400 pages)?