Crafting a business plan and building a solid strategic plan
Benefits of creating a business plan
Three tests of a business plan
Competitive test
Value test
Reality test
Elements of a business plan
Competitor analysis
Market entry strategy
Business and industry profile
Marketing strategy
Description of product or service
Entrepreneurs' and managers' resume
Mission and vision statement
Plan of operation
Executive summary
Pro forma (projected) financial statements
Title page and table of contents
What lenders look for in a business plan
Collateral
Character
Capacity
Conditions
Capital
The Pitch: Making the Business Plan Presentation
Building a strategic plan
Intellectual plan
Structural capital
Customer capital
Human capital
Building a competitive advantage
Pricing they offer
Way they sell
Service they provide
Value to which they are committed
Products they sell
Sustainable competitive advantage: Core competencies
Strategic management process
- Analyze the competition
- Create company goals and objectives
- Identify the key success factors in the business
- Formulate strategic options and select the appropriate strategies
- Scan the environment for significant opportunities and threats facing the business
- Translate strategic plans into action plans
- Assess the company's strengths and weaknesses
- Establish accurate controls
- Develop a clear vision, translate into meaningful mission statement
Benefit
Context
Target customers
Point of differentiation
Clincher
feature
benefit
strategies
image
strengths, weaknesses
success
key competitors
how distinguishing differences produce competitive edge
Showing customer interest
Documenting market claims
Target market
Advertising and promotion
Market size and trends
Location
Pricing
Distribution
Content
Delivery
Description (simple terms)
Business model
Problem to be solved
Competitive edge
Company, product, services
Hook investors quickly
Visual aids
Communicating dynamic opportunity, plan to capitalize
10/20/30
Enthusiasm without being overly emotional
Solve problem, unique
Practice
Proof
Prepare
Highlights
"Crisp"
Avoid technical terms
"What's in it for me", exit
Close by reinforcing potential
Be prepared, anticipate questions
Clear exit plan
Be sensitive to most important issues (pattern of questions)
Follow up
game plan to guide company as it strives to accomplish vision, mission, goals, objectives, keep from straying off course
battery of tools to help entrepreneurs subject ideas to last test of reality
attract lenders, investors
Benefits of a strong vision
Decisions
Inspires
Direction
Perseverance in adversity
Mission statement
Creating a vision
core values defining operations
problems business solve over next 10 years
3-10 years, great (even if others say unachievable), as if happened
target market
how it solves target problem
achievements: relative industry rank, financial success, quality, contribution to community, awards and recognitions
Most important product lines or services
Products or services refuse to offer
distinct customer shopping experience
Management style
People hired
Relationship with employees, what do they say about their jobs
community image
supplier views, industry expert views about buiness
Who to serve?
Principles and beliefs forming foundation of the way of doing business
What purpose, how to accomplish?
How to beat the big guys
- Hire the best - and train them
- Bring back what the big boys have eliminated
- Hit 'em where they ain't
- Use the cost advantages of the internet to gain an edge
- Emphasize the unique aspects of your company, how they benefit customers
- Be great at something customers value eg service, personal attention
- Don't play their game
- Get involved in the community
Writing a mission statement
Reflect values, beliefs
Inspire
Keep it current
Concern for the future
Get everyone involved
Positive, upbeat
Focus on value proposition
Ethical foundation
Revise when necessary
Simple
Use it
Short
Objectives: more specific targets of performance, commonly addressing areas like profitability, productivity, growth, other business key aspects
Goals: broad, long-range attributes business seeks to accomplish
(tend to be general, sometimes abstract)
eg. market share, cash balance, new market, increase sales in current market
Focus
Differentiation
Cost leadership
Strategy
Contribution
Resource requirements
Scope
Purpose
Timing
Internal business perspective
Innovation and learning perspective
Customer perspective
Financial perspective
Controlling the strategy
Corporate citizenship
Direct competitors
Significant competitors
Indirect competitors
Assignable
Realistic yet challenging
Action commitments
Timely
Measurable
Written down
Specific