Business Planning - Facilitation

The Case for Business Planning

If, in a planning sense, Vision and Strategy form the head, heart and soul of a business, then Business Plans comprise the rest of the corpus.

Business Plans are the aggregate of the tangible, detailed analyses that comprise the targets, budgets, cashflows and resource allocation plans of the business.

Every properly managed business requires Business Plans in one form or another – at a level of sophistication and complexity appropriate to their circumstances and expectations. 

In fact, every properly managed business, by definition, already has Business Plans of some sort.  It's businesses that are not properly managed that lack such plans - and, of course, it's these businesses that are many times more likely to be defeated by commercial problems, competitive challenges, disputes and conflicts, economic downturns and succession issues.  

The Business Planning Process

The final, and in some respects most important part of the business planning process, is a methodical exercise that follows and builds on the energising "mind games" work that was undertaken during Visioning and Strategic Planning. 

Assuming that the Visioning and Strategic Planning processes have been successfully completed, we commence facilitating an exercise based on financial results and projections, cashflow and funding models, resource allocation and investment requirements (including premises, plant and equipment needs), and possibly corporate and tax structuring issues:

• Select key personnel for involvement in the Business Planning process (if different to those involved in Visioning and Strategic Planning).
• Brief, engage and inspire selected key personnel with the newly adopted Strategic Plan for the business.
• Obtain appropriate financial reports for the business.  Ideally, this will include detailed management accounts, project plans and feasibility studies for current and future projects and operations.
• Identify key features of past and current business performance – both financial and operational - at an appropriate level of detail.
• Evaluate strengths and weaknesses of past, current and proposed operations, including consideration of markets, products and services; competitive advantages and threats; key blockers and other limitations etc. (this is an extended SWOT Analysis).
• Prepare a Business Plan Template for the selected timeframe (3, 5 or 10 years) based on the format of existing management accounts / financial reports.  (Using the existing format simplifies data extraction and comparison, although these may need upgrading in the future).  Include revenue targets (per Strategic Plans) with matching expense budgets, capital budgets, personnel and associated resource requirements etc.
• Appoint Plan co-ordinator (usually MD, GM, CEO or CFO).  Allocate specific roles and responsibilities for completing the Business Plan at a divisional level (this devolves responsibilities to managers).  Agree timetable for completion of divisional plans.
• Develop and agree a system of support, monitoring and feedback for Business Plan completion.  This usually requires the CFO, or a senior member of the accounting staff, to be available to help divisional heads and managers to complete their plans.
• Gather and review divisional plans.  This is usually done by way of group meeting(s).  Consider commercial feasibility and compatibility with the agreed strategic direction of the business.  As plans are approved and accepted, they are consolidated into a whole of business plan, which becomes the new Business Plan.
• Determine and implement the actions required to commence achieving the required results per the new Business Plan.

Benefits of Business Planning

Business Plans are a powerful tool for leading, managing and measuring the operations of businesses.  They make staff accountable for their own performance commitments and provide measurement criteria (targets and budgets) against which those accountabilities can be assessed.  They also provide opportunities to introduce managed systems of incentives and rewards.

The allocation of specific roles and responsibilities over tasks and time identifies misfits, deficiencies and redundancies in the organisation – encouraging major staffing decisions through a focus on business, rather than historical, personal or family needs.

In many organisations the Business Planning process facilitates the making of difficult ownership, management and staffing decisions.  As such, they are particularly useful for dealing with Succession Planning and Leadership/Ownership Transition issues.