A broad framework for the business planning process answers the following questions:
• Where is the business now? • Where would we like it to be? • How are we going to get there? • How will we know we are succeeding?
The process
Here is an outline of the stages of the planning process:
1. A ‘health’ check We look at all aspects of the present situation. Broadly speaking, we seek answers to these questions relating to the business:
Internally: • What are the strengths of the business and its owners? • What are the weak areas?
Externally: • What opportunities do we perceive? • What threats are we aware of?
It is desirable that we update the company’s financial performance for the current year to date as well as the current position before we commence the ‘health check’, if this has not been done.
You will find that the information gathered in this part of the process is very useful once the business goals are being decided, as well as during the analysis of the present situation as outlined above. We’ll give you some preparatory information to help you focus on all areas of your business such as marketing, production/operations, finance, personnel, administration, systems and procedures, then work through an analysis of the current situation with you.
2. Goals identification
The major objectives of the business need to be recognised and documented. It is essential to consider these in tandem with the business owners’ personal financial, family, retirement and other goals.
We will then assist you to clarify your goals for all areas of the business over the next 3 – 5 years.
3. Strategies and tactics
We’ll help you to decide on a number of strategies and tactics to implement in support of each goal, the tasks required in executing each strategy, who is responsible and the time by which each should be completed. A schedule showing the periods of activity for each task will be used so that the time frame is reasonable having regard to other demands on your time.
4. Measurement of results
We’ll set up systems that will allow regular comparison of results being achieved with the goals adopted. The tools used will include comparison of financial budgets with actual results, and cash flow projections monitored against the bank position. The results of certain initiatives against desired targets using performance indicators other than dollar values, or extra to the budgets will also be used. Examples of these can include for sales and marketing, for instance: sales volumes at a particular point, dollar value earned per sale or contract secured, sales per geographic area, or salesperson. These will depend on the type of business. The tools used will signal whether any ‘fine-tuning’ of the plan is necessary at any time.
5. Implementation
The implementation date should be decided early in the planning process.
Although all of this may sound somewhat daunting, we have structures available to make the process easy to work through.
We’ll give you checklists and other information to use as we tackle each part of the process. It is important, though, that you decide first whether you are:
prepared to commit the time and money to maximise any business development opportunities that are available committed to working hard to achieve the goals adopted convinced that the goals are worth achieving
