BusinessPlanning.ppt

8/10/2019 BusinessPlanning.ppt

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Business & Strategic Planning

Why do we need a Business Plan?

Opportunity

to develop

new ways of

working

Helps to workout what your

priorities are

Opportunity for

other organisationsto inform the plan

Shows how

you are different

to other similar

organisations

Increasingly

part of the

funding process

Shows

the seriousness

of your goals to

funders &

commissioners

Helps

to identifyproblems early &

take appropriate

action

Helps to

reflect on

where you

are now

Provides

direction toall staff &

volunteers

WHY?

EXTERNAL

REASONS

INTERNAL REASONS


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Before you get started

Developing a business plan should be a dynamic and creativeprocess, give those involved the opportunity to take a step back

and reflect, review the progress made and develop a new sense ofpurpose and direction.

When

It is important to consider the timing of developing your business plan-ensure the organisation undertakes the process at an appropriate timeand schedules it into calendar- as they say if you fail to plan, you plan tofail!

Effective Time Management and Support

Managing the time effectively and supporting individuals and tasks willhelp keep things on track during the process reducing the likelihood ofthings getting dragged out, people gain a real understanding of what isinvolved in its development and tasks are completed.


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Difference between Strategic

Plan and Business Plan While a strategic plan is a type of business plan,

there are several important distinctions between

the two types that are worth noting.

A strategic plan is primarily used for implementingand managing the strategic direction of an

existing organization. A business plan is used to

initially start a business, obtain funding, or direct

operations. The two plans cover differenttimeframes as well. A strategic plan generally

covers a period of 3 to 5+ years, whereas a

business plan is normally no more than one year.Business & Strategic Planning


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A strategic plan is for established businesses,

organizations and business owners that are

serious about growing their organization.

Whereas a business plan could be for new

businesses and entrepreneurs who are startups.

A strategic plan is used to provide focus,

direction and action in order to move theorganization from where they are now to where

they want to go. Whereas a business plan is

used to provide a structure for ideas in order to

initially define the business.



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A strategic plan is critical to prioritizing resources

(time, money and people) to grow the revenue

and increase the return on investment. Whereasa business plan is critical if the business is

seeking funding.

A strategic plan focuses on building a

sustainable competitive advantage and isfuturistic in nature. Whereas a business plan is

used to assess the viability of a business

opportunity, and is more tactical in nature.

A strategic plan is used to communicate the

direction of the organization to the staff and

stakeholders. However, a business plan is used

to present the entrepreneursideas to a bank.Business & Strategic Planning


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Who can we consult with?

Staff

Volunteers

Local Schools

Centre Users Local groups

Local Parish/TownCouncil

Local Churches

Childrens Centre

Local District/BoroughCouncil

Local businesses

County Council Health organisations,

local PCT

Police

Shelteredaccommodation

Housing associations

ome examples


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Key Steps to devising your

Business Plan1. Clarifying the vision and the values of the organisation

2. Review the organisations current position

3. Identify Ideas- explore assumptions, strategic opportunities anddirection

4. Agree the strategic direction

5. Identifying the resources required and the organisations capacity todeliver

6. Produce the Business Plan Document

7. Implement the Business Plan


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Step 1: What are our Mission,

Vision and Values?Mission and Vision statements are two different thingsalthough they are closely linked and may overlap.

A mission statementconcisely describes theorganisations key purpose and primary objectives-what the organisation is in operation to do.

The unifying, localised statement should answer 3questions from your communities (as your

customers) perspective;

- What you do - How you do it - Who you do it for


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Tips on developing your Mission

Statement1. Begin with thinking about the role your organisation plays

2. Ensure you take time writing the Mission Statement. Its achallenging but vital task- it needs to be both positive andinspirational!

3. On separate lists write down: What you do and how well you doit, the people involved in and participating with yourorganisation, your community- who are they, how you helppeople and your organisations values, beliefs and philosophy.

5. Pick out the most important points

6. Gain input from other people

7. Select your most important words and combine in one sentence

or put your most important sentences together in one shortparagraphyoull then have a Mission Statement!


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Vision and Values

Vision

A vision statement is the long-term change the organisationwould ideally like to see if its work is successful. It shouldset out your ideal destination- where your organisation wantsto be. It should be challenging, innovative and forward-looking. The vision should be motivating and enable staff,volunteers and others to see how their effort contributes toan overall inspirational purpose.

Values

The beliefs of an organisation, the expression of what itrepresents and how it will conduct itself. Values are the heartof an organisation's being. Values underpin policies,objectives, procedures and strategies as they provide ananchor and a reference point for all things that take place.

S i i l d i i


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Some mission, values and vision

examplesCommunity Action HampshiresMission Statement;

To strengthen and promote voluntary and community action

Community Action HampshiresValues;

To remain an independent advocate for the voluntary andcommunity sector in Hampshire

To conduct ourselves in an open and transparent way

To be responsible to the needs and views of our members

To value the diversity of the voluntary and community sector

YouthnetsVision statement;

"Youthnet's vision is of an inclusive and equitable society thatvalues children and young people and actively enables andcelebrates their contribution to this."


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Step 2:Reviewing your

organisations current position

Services,

facilities &

Project performance

Financialperformance

Management

& Governance

capabilities

Organisational

structure

Current & future

Trends both internal

& external

Review and evaluation

areas for your

organisation to consider


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Where are we now?

In order to develop a realistic and effective business plan thattakes the organisation into the future it is important that a review

of the organisation as it stands now is undertaken. Youll need to

consider where you are now, what you do and how you do it, how

did you get to this point, what has gone well and what hasnt,

who do you serve? These are just some of the questions you willneed to explore and answer.

To help you analyse your organisation, recognise trends, identify

what is happening both within and outside the organisation thatimpacts on the work that you do and get a true picture of where

you are there are a number of reflection and reviewing tools you

can use, you can use one or all of them, whatever suits your

organisation

Reflection & Reviewing Tools


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Reflection and Reviewing tools

SWOT AnalysisThe SWOT analysis looks at your

organisations Strengths,Weaknesses, Opportunities andThreats.

Think about what these are andrecord them down, perhaps in atable. By doing this you will be able

to pull out what you do well and canbuild on, what needs to be improvedand developed. It will also identifythe opportunities the organisationmay be able to capitalise on andidentify obstacles and barriers that

may get in the way of developing theopportunities. In turn this will aidyou to identify what the organisationas a whole can do to overcomethese challenges.

Strengths Weaknesses

Opportunities Threats


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PESTLE analysis

A PESTLE analysis explores and identifies the external environment

factors that surround your organisation which have an impact onthe business what you do or want to do.

Community

Association

Political

Economical

Social

Technological

Legal

Environmental


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7S Model

This tool is frequently adopted toassess and monitor changeswithin the organisations internalsituation.

The 7S model is based on thetheory that, for an organisation toperform effectively, the 7 elementsneed to be aligned and mutuallysupporting. Use the model toreview the organisation under

each element to see if you canidentify any elements that need tobe realigned to improveperformance.


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Step 3: Identify Ideas-Explore assumptions, strategic opportunities & direction

After reviewing and understanding your organisations currentposition, activities, services, structure, strengths, weaknesses,opportunities etc as well as your community needs and externalimpacts and trends it is now time to use this information andthink about what, as an organisation, you would like to do in the

future. Gain ideas from all stakeholders and explore

What areas of work will you continue to deliver and why?

Explore why you deliver the work you do. Should you continue todeliver this work? Look into the areas of work that the organisationcurrently delivers which are important to the community, effectiveand are in line with your mission, values and vision for the future.

You may then wish to prioritise areas of work in relation to thosethat are significant to achieving your aims, meet community needand are financially viable.

Id tif i id d t t i


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Identifying ideas and strategic

choices

What new areas of work do you need to develop and move intoand why?

Ask and work out, based on your review and need information,what services, activities, events or programmes should theorganisation establish and deliver. Again you may wish explore

in depth why the organisation should move into the new areas ofwork and prioritise them in relation to achieving your agreedmission, vision and values, organisational capacity and financialviability.

Other ideas can be identified by exploring

What partnerships, networks and forums do you need to

participate in and why? What do you need to develop internally to improve your

performance?

What areas of work are you not going to deliver or move into andwhy?


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What are your assumptions?A business plan should outline clearly and define its core assumptions

as those stakeholders (including funders) reading it may wish tounderstand the assumptions upon which the rest of the plan is based.

Assumptions need to be credible, openly discussed and frequentlyreviewed. The danger of delivering services, activities, programmesand events where an assumption no longer applies is common place.It may be helpful to identify elements that may challenge or conflict with

the assumption and to test out how secure and concrete theassumption is.

Examples of assumptions could include;

The numbers of young people attending the youth club will stay thesame over the next three years

Local government grant to our organisation will decrease by 8% a year

Other community centres and halls in the area will continue to charge asimilar fee for their facilities as we do

We will need to recruit more volunteers to help run our services andactivities.


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tep 4:Agree the strategic direction

Having a clear strategic direction with which the trustees andstaff are highly engaged is a critical factor in building asustainably successful organisation.

Strategic direction is about establishing your strategic

goals/aims and methods you will use to achieve them. Itimplies a definition of intent, (what should the organisationachieve and why) as well as identification of the key means ofachieving it, the main effort.

Agreeing the strategic direction and aims involves constantreferral to the mission statement, values and vision for theorganisation. The process will encompass a continualmovement between generating opportunities, formingpriorities and working within the resources the organisationhas and will have to utilise.


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Setting your strategic direction

It is important to set strategic aims that:

specify a clear direction;

focus on intended outcomes;

interlink with other aims;

are realistic and achievable;

In order to have a plan that is fluid, concise, well planned and has aclear direction it is important to restrict the number of strategic aimsyou devise (ideally no more than 6 or 7).

Developing a future strategy usually involves making challengingdecisions. You may have to decide to discontinue an area of work,reduce resources for a project or not develop a staff membersproposal all of which will most likely cause conflict and anxiety. It is

just as vital you consider the areas of work you will not be deliveringas to those areas you will.


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p 5:Identifying resources required &

he organisations capacity to deliver

Before finalising the organisations priorities, areas of work andprogrammes of activity you wish to deliver within the business planstimeframe, it is vital you work out if you can realistically achievethem.

Youll need to ask yourself, explore and answer some questionsincluding;

Do we have the finances to deliver all of our intended work streams?

How much will it cost to deliver our activities, projects, services etc?

Do we have enough members of staff and volunteers to run andmanage the work?

What facilities and equipment will we need?

Do we have the appropriate policies, procedures and systems inplace?


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Financial Resources


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Financial information in a business

plan?In an increasingly tough market place a voluntaryorganisation needs to demonstrate in a business planthat;

It is financially viable has considered its financial policyand expected income and expenditure in an articulate

and realistic manner Made realistic predictions about the organisations

financial future

Has calculated its services, activities and programmescosts using accurate figures and taken a full cost

recovery approach with contingency plans attached Has consistent and reliable financial management

policies and procedures


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Financial position

A good starting point is to look at reviewing your currentfinancial position-

Where do you gain income and what do you spend yourmoney on?

Is this likely to continue in future years?

How much do we rely on particular income streams?Can we predict what financial trends will occur in thenext 3,5 and 10 years time?

What can we do to secure these income streams?

Where else can we gain income?

Income stream Current position Prediction of trend Action required


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Where could we gain income from?

Grants from localauthorities

Sponsorship

Contracts and servicelevel agreements

Grants from trusts,other funding bodies

and companies Hire of facilities and

resources

Membership

Income from sale ofservices/goods

Management fees Legacies

Fundraising

Profit from trading

arms


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How much money will we need to

meet our strategic objectives?

It is important for voluntary organisations toensure that when calculating the cost ofservices, activities and programmes that bothdirect and indirect costs are worked out for

effective financial management.

Direct costs: the costs only incurred as a directresult of delivering a particular service/activity forexample staff, equipment, room hire.

Indirect costs: the shared organisational costsfor example management time, administrationcosts etc.


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Other financial considerations

Develop a budget

Create a cash flow forecast

What % of the organisations turnover would be

reasonable to use as a reserve or contingency? What financial policies and procedures do you

have in place?how effective is your chargingpolicy? What type of charging strategy do you

use? Who authorises payments? Who monitorsfinancial activity of the project/service/programme and organisation as a whole?


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Staff and volunteer resources

When developingservices/activities andprojects it is vital for theorganisation to work out

the staff and volunteerimplications

who do we need to meetour goals and ensure wehave the capacity to

deliver them? What staffing structure do

we need in place?


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Step 6:Produce the Business

Plan document

When compiling the document itself it is important to consider thereaders who will usually be those you are requesting support from.

Thestyle, layoutand tone of the document will all make an impact onthe reader and it would be wise to think about first impressions- somereaders may only look at the front page or simply flick through thedocument briefly.

It would be advisable to identify the key messages the organisationwishes to get across (no more than about 5), organise the plan aroundthese, find someone outside of the organisation to review and

feedback on a draft copy, use practical and active language to ensurethe reader understands how you got to this point and how will achieveyour goals. The use of charts and diagrams can be effective inillustrating information and avoid using abbreviations and jargon.

You will also need to consider different reading audiences and ensure it isaccessible to all people in the community.


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Business Plan sections

1. Front Cover Organisation name and logo2. An executive

summary

An outline summary of the mission, values and

context. It should emphasise the proposed strategic

direction, main benefits and present a case for the

organisation (no more than one page)

3. Introduction

and mission

Explanation of the kind of organisation you are and

what you stand for, complete mission statement and

organisational values and the outcomes you wish to

achieve.

4. Background The origins and development of the organisation.

What you have delivered and achieved, what area

you cover, who are the beneficiaries, number of

projects, staff, volunteers and your annual turnover

figures

B i Pl i


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continued

5. Asummary

review

A current overview of the organisation- emphasise thesuccesses and strengths of the organisation and positive

recognition that the organisation has received externally.

Demonstration of a honest appraisal highlighting areas for

development- SWOT is usually used to illustrate this

information.6. Future

trends

An overview of the organisations identified future external

and internal environment trends that will impact on its

strategic aims.

7. Strategic

direction

The explanation and demonstration of the direction of

travel the organisation wishes to take- the assumptionsthat have underpinned the identified direction, what work

will the organisation focus on, what are the main priorities

and what will be changed?


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continued8. Strategic

aims

The medium term aims are listed in this section and an

outline of the objectives that fall under each aim can be

included.

9. Implications Identified legal, organisational and other implications of

the work to be included in this section. Clarificationmade if services/activities are to be delivered differently

or halted altogether

10. Financial

information

Clear explanation of how the strategic aims and

objectives will be achieved financially and how these

assumptions were made. Details should includeincome and expenditure forecasts for the years the

business plan relates, main financial policies and

evidence of effective financial management systems.


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continued11. Track record

of the

organisation

This section gives the opportunity to present the

case for the organisation to the reader highlighting

successes- the strengths, experience, knowledge,

capacity and positive reputation the organisation

possesses. All of which will demonstrate the

capacity of the organisation to effectively implementthe business plan.

12. Immediate

action

A clear action plan which demonstrates the next

steps within the short term time frame.


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Step 7:Implementing the Plan

It is important to consider how the business plan will beimplemented across the organisation after it has been created. Theplan should not sit on the shelf collecting dust- it is a activedocument that supporters, beneficiaries and other stakeholders willbe interested in particularly if they have provided the organisationwith funding.

If staff, volunteers and stakeholders have been engaged in theprocess from the beginning then the implementation of the plan willusually be effective.

As an organisation you should think about;

How the plan will be communicated to those delivering it

Clarifying the expectations

How the plan and performance will be monitored and evaluated


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nt forget to consider- Monitoring

& Evaluating

It is important to explore how the business plan will bemonitored and evaluated throughout its life

How will you know if you have achieved your strategic

aims and objectives? How are you going to measure success?

What monitoring and evaluation tools can be used overalland within projects/activities and services? Who will beresponsible for this?

How will these be communicated to beneficiaries, fundersand other stakeholders?

See our E bitesize training on Effective Monitoring and Evaluating at:

http://www.hants.gov.uk/rh/comm/monitoring-evaluation.pdf
http://www.hants.gov.uk/rh/comm/monitoring-evaluation.pdfhttp://www.hants.gov.uk/rh/comm/monitoring-evaluation.pdfhttp://www.hants.gov.uk/rh/comm/monitoring-evaluation.pdfhttp://www.hants.gov.uk/rh/comm/monitoring-evaluation.pdf


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Implementing the plan and

monitoring performance

1. Defining

goals

2. Ensuringdelivery

4.Evaluating

results

3. Monitoringprogress

Ensure all those

delivering the plan

understand what they

are doing, when & why

clear expectations.

Goals, objectives &

targets can then beused to monitor

progress.

Ensure the all

resources are in

place and individuals

supported to deliver

tasks, projects &

programmes.

Use monitoring

tools to measure

the progress of the

plan this

information can

then be used to

work out how well

you are doing.

Using the monitoringinformation you can

then measure the

progress you have

made and make any

necessary changes. It

is important to feedthis back to

stakeholders


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Traffic light monitoring system

An effective and easy method to use to monitor the

progress of the plan is to adopt a traffic lightsystem.

Aims, objectives, goals and targets within the planare listed against either;

Red:No or minimal progress made

Amber:Progress has been made although notcomplete

Green: Target/aim/objective etc has beencompleted successfully

Aim/target/

objective etc

Status Information Required action


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Remember

It is important that all stakeholders are engagedthroughout the process, understand what is

expected so that contributions can be effective inmeeting the needs based aims and objectives of

the business plan. Reviewing, monitoring andevaluating is vital to success and feeding back

helps keep people up to date and involved.

Over to you and Good luck!!!


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Useful links and resourcesMain resource used to aid this bitesize training course;

Lawrie, A.,2007. The Complete guide to Business and Strategic planning for

voluntary organisations. 3rded.London:Directory of Social Change.

Business Linkwebsite linkhttp://www.businesslink.gov.uk/bdotg/action/detail?itemId=1087090196&type=

RESOURCESDirectory of Social Change Website link-

http://www.dsc.org.uk/Home

NCVO website link

http://www.ncvo-vol.org.uk/advice-support/funding-finance/planning

Charities Evaluation Service Website link-http://www.ces-vol.org.uk/index.cfm?pg=474

Big Lottery Website link-

http://www.biglotteryfund.org.uk/prog_ypfnat_business_plan.pdf
http://www.businesslink.gov.uk/bdotg/action/detail?itemId=1087090196&type=RESOURCEShttp://www.businesslink.gov.uk/bdotg/action/detail?itemId=1087090196&type=RESOURCEShttp://www.dsc.org.uk/Homehttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ces-vol.org.uk/index.cfm?pg=474http://www.biglotteryfund.org.uk/prog_ypfnat_business_plan.pdfhttp://www.biglotteryfund.org.uk/prog_ypfnat_business_plan.pdfhttp://www.ces-vol.org.uk/index.cfm?pg=474http://www.ces-vol.org.uk/index.cfm?pg=474http://www.ces-vol.org.uk/index.cfm?pg=474http://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.ncvo-vol.org.uk/advice-support/funding-finance/planninghttp://www.dsc.org.uk/Homehttp://www.businesslink.gov.uk/bdotg/action/detail?itemId=1087090196&type=RESOURCEShttp://www.businesslink.gov.uk/bdotg/action/detail?itemId=1087090196&type=RESOURCES

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