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How to write a business plan in seven simple steps

When written effectively, a business plan can help raise capital, inform decisions, and draw new talent.

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Writing a business plan is often the first step in transforming your business from an idea into something tangible . As you write, your thoughts begin to solidify into strategy, and a path forward starts to emerge. But a business plan is not only the realm of startups; established companies can also benefit from revisiting and rewriting theirs. In any case, the formal documentation can provide the clarity needed to motivate staff , woo investors, or inform future decisions.  

No matter your industry or the size of your team, the task of writing a business plan—a document filled with so much detail and documentation—can feel daunting. Don’t let that stop you, however; there are easy steps to getting started. 

What is a business plan and why does it matter? 

A business plan is a formal document outlining the goals, direction, finances, team, and future planning of your business. It can be geared toward investors, in a bid to raise capital, or used as an internal document to align teams and provide direction. It typically includes extensive market research, competitor analysis, financial documentation, and an overview of your business and marketing strategy. When written effectively, a business plan can help prescribe action and keep business owners on track to meeting business goals. 

Who needs a business plan?

A business plan can be particularly helpful during a company’s initial growth and serve as a guiding force amid the uncertainty, distractions, and at-times rapid developments involved in starting a business . For enterprise companies, a business plan should be a living, breathing document that guides decision-making and facilitates intentional growth.

“You should have a game plan for every major commitment you’ll have, from early-stage founder agreements to onboarding legal professionals,” says Colin Keogh, CEO of the Rapid Foundation—a company that brings technology and training to communities in need—and a WeWork Labs mentor in the UK . “You can’t go out on funding rounds or take part in accelerators without any planning.”

How to make a business plan and seven components every plan needs

While there is no set format for writing a business plan, there are several elements that are typically included. Here’s what’s important to consider when writing your business plan. 

1. Executive summary 

No longer than half a page, the executive summary should briefly introduce your business and describe the purpose of the business plan. Are you writing the plan to attract capital? If so, specify how much money you hope to raise, and how you’re going to repay the loan. If you’re writing the plan to align your team and provide direction, explain at a high level what you hope to achieve with this alignment, as well as the size and state of your existing team.

The executive summary should explain what your business does, and provide an introductory overview of your financial health and major achievements to date.  

2. Company description 

To properly introduce your company, it’s important to also describe the wider industry. What is the financial worth of your market? Are there market trends that will affect the success of your company? What is the state of the industry and its future potential? Use data to support your claims and be sure to include the full gamut of information—both positive and negative—to provide investors and your employees a complete and accurate portrayal of your company’s milieu. 

Go on to describe your company and what it provides your customers. Are you a sole proprietor , LLC, partnership, or corporation? Are you an established company or a budding startup? What does your leadership team look like and how many employees do you have? This section should provide both historical and future context around your business, including its founding story, mission statement , and vision for the future. 

It’s essential to showcase your point of difference in your company description, as well as any advantages you may have in terms of expert talent or leading technology. This is typically one of the first pieces of the plan to be written.

3. Market analysis and opportunity

Research is key in completing a business plan and, ideally, more time should be spent on research and analysis than writing the plan itself. Understanding the size, growth, history, future potential, and current risks inherent to the wider market is essential for the success of your business, and these considerations should be described here. 

In addition to this, it’s important to include research into the target demographic of your product or service. This might be in the form of fictional customer personas, or a broader overview of the income, location, age, gender, and buying habits of your existing and potential customers. 

Though the research should be objective, the analysis in this section is a good place to reiterate your point of difference and the ways you plan to capture the market and surpass your competition.

4. Competitive analysis 

Beyond explaining the elements that differentiate you from your competition, it’s important to provide an in-depth analysis of your competitors themselves.

This research should delve into the operations, financials, history, leadership, and distribution channels of your direct and indirect competitors. It should explore the value propositions of these competitors, and explain the ways you can compete with, or exploit, their strengths and weaknesses. 

5. Execution plan: operations, development, management 

This segment provides details around how you’re going to do the work necessary to fulfill this plan. It should include information about your organizational structure and the everyday operations of your team, contractors, and physical and digital assets.

Consider including your company’s organizational chart, as well as more in-depth information on the leadership team: Who are they? What are their backgrounds? What do they bring to the table? Potentially include the résumés of key people on your team. 

For startups, your execution plan should include how long it will take to begin operations, and then how much longer to reach profitability. For established companies, it’s a good idea to outline how long it will take to execute your plan, and the ways in which you will change existing operations.

If applicable, it’s also beneficial to include your strategy for hiring new team members and scaling into different markets. 

6. Marketing plan 

It’s essential to have a comprehensive marketing plan in place as you scale operations or kick off a new strategy—and this should be shared with your stakeholders and employees. This segment of your business plan should show how you’re going to promote your business, attract customers, and retain existing clients.

Include brand messaging, marketing assets, and the timeline and budget for engaging consumers across different channels. Potentially include a marketing SWOT analysis into your strengths, weaknesses, opportunities, and threats. Evaluate the way your competitors market themselves, and how your target audience responds—or doesn’t respond—to these messages.

7. Financial history and projections  

It’s essential to disclose all finances involved in running your company within your business plan. This is so your shareholders properly understand how you’re projected to perform going forward, and the progress you’ve made so far. 

You should include your income statement, which outlines annual net profits or losses; a cash flow statement, which shows how much money you need to launch or scale operations; and a balance sheet that shows financial liabilities and assets. 

“An income statement is the measure of your financial results for a certain period and the most accurate report of business activities during that time, [whereas a balance sheet] presents your assets, liabilities, and equity,” Amit Perry, a corporate finance expert, explained at a WeWork Labs educational session in Israel.

It’s crucial to understand the terms correctly so you know how to present your finances when you’re speaking to investors. Amit Perry, CEO and founder of Perryllion Ltd.

In addition, if you’re asking for funding, you will need to outline exactly how much money you need as well as where this money will go and how you plan to pay it back. 

12 quick tips for writing a business plan 

Now that you know what components are traditionally included in a business plan, it’s time to consider how you’ll actually construct the document.

Here are 12 key factors to keep in mind when writing a business plan. These overarching principles will help you write a business plan that serves its purpose (whatever that may be) and becomes an easy reference in the years ahead. 

1. Don’t be long-winded

Use clear, concise language and avoid jargon. When business plans are too long-winded, they’re less likely to be used as intended and more likely to be forgotten or glazed over by stakeholders. 

2. Show why you care

Let your passion for your business shine through; show employees and investors why you care (and why they should too). 

3. Provide supporting documents

Don’t be afraid to have an extensive list of appendices, including the CVs of team members, built-out customer personas, product demonstrations, and examples of internal or external messaging. 

4. Reference data

All information regarding the market, your competitors, and your customers should reference authoritative and relevant data points.  

5. Research, research, research

The research that goes into your business plan should take you longer than the writing itself. Consider tracking your research as supporting documentation. 

6. Clearly demonstrate your points of difference

At every opportunity, it’s important to drive home the way your product or service differentiates you from your competition and helps solve a problem for your target audience. Don’t shy away from reiterating these differentiating factors throughout the plan. 

7. Be objective in your research

As important as it is to showcase your company and the benefits you provide your customers, it’s also important to be objective in the data and research you reference. Showcase the good and the bad when it comes to market research and your financials; you want your shareholders to know you’ve thought through every possible contingency. 

8. Know the purpose of your plan

It’s important you understand the purpose of your plan before you begin researching and writing. Be clear about whether you’re writing this plan to attract investment, align teams, or provide direction. 

9. Identify your audience

The same way your business plan must have a clearly defined purpose, you must have a clearly defined audience. To whom are you writing? New investors? Current employees? Potential collaborators? Existing shareholders? 

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10. Avoid jargon

Avoid using industry-specific jargon, unless completely unavoidable, and try making your business plan as easy to understand as possible—for all potential stakeholders. 

11. Don’t be afraid to change it

Your business plan should evolve with your company’s growth, which means your business plan document should evolve as well. Revisit and rework your business plan as needed, and remember the most important factor: having a plan in place, even if it changes.

A business plan shouldn’t just be a line on your to-do list; it should be referenced and used as intended going forward. Keep your business plan close, and use it to inform decisions and guide your team in the years ahead. 

Creating a business plan is an important step in growing your company 

Whether you’re just starting out or running an existing operation, writing an effective business plan can be a key predictor of future success. It can be a foundational document from which you grow and thrive . It can serve as a constant reminder to employees and clients about what you stand for, and the direction in which you’re moving. Or, it can prove to investors that your business, team, and vision are worth their investment. 

No matter the size or stage of your business, WeWork can help you fulfill the objectives outlined in your business plan—and WeWork’s coworking spaces can be a hotbed for finding talent and investors, too. The benefits of coworking spaces include intentionally designed lounges, conference rooms, and private offices that foster connection and bolster creativity, while a global network of professionals allows you to expand your reach and meet new collaborators. 

Using these steps to write a business plan will put you in good stead to not only create a document that fulfills a purpose but one that also helps to more clearly understand your market, competition, point of difference, and plan for the future. 

For more tips on growing teams and building a business, check out all our articles on  Ideas by WeWork.

Caitlin Bishop is a writer for WeWork’s  Ideas by WeWork , based in New York City. Previously, she was a journalist and editor at  Mamamia  in Sydney, Australia, and a contributing reporter at  Gotham Gazette .

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The Business Planning Process: 6 Steps To Creating a New Plan

In this article, we will define and explain the basic business planning process to help your business move in the right direction.

What is Business Planning?

Business planning is the process whereby an organization’s leaders figure out the best roadmap for growth and document their plan for success.

The business planning process includes diagnosing the company’s internal strengths and weaknesses, improving its efficiency, working out how it will compete against rival firms in the future, and setting milestones for progress so they can be measured.

The process includes writing a new business plan. What is a business plan? It is a written document that provides an outline and resources needed to achieve success. Whether you are writing your plan from scratch, from a simple business plan template , or working with an experienced business plan consultant or writer, business planning for startups, small businesses, and existing companies is the same.

Finish Your Business Plan Today!

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The Better Business Planning Process

The business plan process includes 6 steps as follows:

• Do Your Research
• Calculate Your Financial Forecast
• Draft Your Plan
• Revise & Proofread
• Nail the Business Plan Presentation

We’ve provided more detail for each of these key business plan steps below.

1. Do Your Research

Conduct detailed research into the industry, target market, existing customer base,  competitors, and costs of the business begins the process. You may ask yourself the following questions:

• What are your business goals?
• What is the current state of your business?
• What are the current industry trends?
• What is your competition doing?

There are a variety of resources needed, ranging from databases and articles to direct interviews with other entrepreneurs, potential customers, or industry experts. The information gathered during this process should be documented and organized carefully, including the source as there is a need to cite sources within your business plan.

You may also want to complete a SWOT Analysis for your own business to identify your strengths, weaknesses, opportunities, and potential risks as this will help you develop your strategies to highlight your competitive advantage.

2. Strategize

Now, you will use the research to determine the best strategy for your business. You may choose to develop new strategies or refine existing strategies that have demonstrated success in the industry. Pulling the best practices of the industry provides a foundation, but then you should expand on the different activities that focus on your competitive advantage.

This step of the planning process may include formulating a vision for the company’s future, which can be done by conducting intensive customer interviews and understanding their motivations for purchasing goods and services of interest. Dig deeper into decisions on an appropriate marketing plan, operational processes to execute your plan, and human resources required for the first five years of the company’s life.

3. Calculate Your Financial Forecast

All of the activities you choose for your strategy come at some cost and, hopefully, lead to some revenues. Sketch out the financial situation by looking at whether you can expect revenues to cover all costs and leave room for profit in the long run.

Begin to insert your financial assumptions and startup costs into a financial model which can produce a first-year cash flow statement for you, giving you the best sense of the cash you will need on hand to fund your early operations.

A full set of financial statements provides the details about the company’s operations and performance, including its expenses and profits by accounting period (quarterly or year-to-date). Financial statements also provide a snapshot of the company’s current financial position, including its assets and liabilities.

This is one of the most valued aspects of any business plan as it provides a straightforward summary of what a company does with its money, or how it grows from initial investment to become profitable.

4. Draft Your Plan

With financials more or less settled and a strategy decided, it is time to draft through the narrative of each component of your business plan . With the background work you have completed, the drafting itself should be a relatively painless process.

If you have trouble writing convincing prose, this is a time to seek the help of an experienced business plan writer who can put together the plan from this point.

5. Revise & Proofread

Revisit the entire plan to look for any ideas or wording that may be confusing, redundant, or irrelevant to the points you are making within the plan. You may want to work with other management team members in your business who are familiar with the company’s operations or marketing plan in order to fine-tune the plan.

Finally, proofread thoroughly for spelling, grammar, and formatting, enlisting the help of others to act as additional sets of eyes. You may begin to experience burnout from working on the plan for so long and have a need to set it aside for a bit to look at it again with fresh eyes.

6. Nail the Business Plan Presentation

The presentation of the business plan should succinctly highlight the key points outlined above and include additional material that would be helpful to potential investors such as financial information, resumes of key employees, or samples of marketing materials. It can also be beneficial to provide a report on past sales or financial performance and what the business has done to bring it back into positive territory.

Business Planning Process Conclusion

Every entrepreneur dreams of the day their business becomes wildly successful.

But what does that really mean? How do you know whether your idea is worth pursuing?

And how do you stay motivated when things are not going as planned? The answers to these questions can be found in your business plan. This document helps entrepreneurs make better decisions and avoid common pitfalls along the way. ​

Business plans are dynamic documents that can be revised and presented to different audiences throughout the course of a company’s life. For example, a business may have one plan for its initial investment proposal, another which focuses more on milestones and objectives for the first several years in existence, and yet one more which is used specifically when raising funds.

Business plans are a critical first step for any company looking to attract investors or receive grant money, as they allow a new organization to better convey its potential and business goals to those able to provide financial resources.

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How to Write a Business Plan, Step by Step

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1. Write an executive summary

2. describe your company, 3. state your business goals, 4. describe your products and services, 5. do your market research, 6. outline your marketing and sales plan, 7. perform a business financial analysis, 8. make financial projections, 9. add additional information to an appendix, business plan tips and resources.

A business plan is a document that outlines your business’s financial goals and explains how you’ll achieve them. A strong, detailed plan will provide a road map for the business’s next three to five years, and you can share it with potential investors, lenders or other important partners.

Here’s a step-by-step guide to writing your business plan.

» Need help writing? Learn about the best business plan software .

This is the first page of your business plan. Think of it as your elevator pitch. It should include a mission statement, a brief description of the products or services offered, and a broad summary of your financial growth plans.

Though the executive summary is the first thing your investors will read, it can be easier to write it last. That way, you can highlight information you’ve identified while writing other sections that go into more detail.

» MORE: How to write an executive summary in 6 steps

Next up is your company description, which should contain information like:

Your business’s registered name.

Address of your business location .

Names of key people in the business. Make sure to highlight unique skills or technical expertise among members of your team.

Your company description should also define your business structure — such as a sole proprietorship, partnership or corporation — and include the percent ownership that each owner has and the extent of each owner’s involvement in the company.

Lastly, it should cover the history of your company and the nature of your business now. This prepares the reader to learn about your goals in the next section.

» MORE: How to write a company overview for a business plan

The third part of a business plan is an objective statement. This section spells out exactly what you’d like to accomplish, both in the near term and over the long term.

If you’re looking for a business loan or outside investment, you can use this section to explain why you have a clear need for the funds, how the financing will help your business grow, and how you plan to achieve your growth targets. The key is to provide a clear explanation of the opportunity presented and how the loan or investment will grow your company.

For example, if your business is launching a second product line, you might explain how the loan will help your company launch the new product and how much you think sales will increase over the next three years as a result.

In this section, go into detail about the products or services you offer or plan to offer.

You should include the following:

An explanation of how your product or service works.

The pricing model for your product or service.

The typical customers you serve.

Your supply chain and order fulfillment strategy.

Your sales strategy.

Your distribution strategy.

You can also discuss current or pending trademarks and patents associated with your product or service.

Lenders and investors will want to know what sets your product apart from your competition. In your market analysis section , explain who your competitors are. Discuss what they do well, and point out what you can do better. If you’re serving a different or underserved market, explain that.

Here, you can address how you plan to persuade customers to buy your products or services, or how you will develop customer loyalty that will lead to repeat business.

» MORE: R e a d our complete guide to small business marketing

If you’re a startup, you may not have much information on your business financials yet. However, if you’re an existing business, you’ll want to include income or profit-and-loss statements, a balance sheet that lists your assets and debts, and a cash flow statement that shows how cash comes into and goes out of the company.

You may also include metrics such as:

Net profit margin: the percentage of revenue you keep as net income.

Current ratio: the measurement of your liquidity and ability to repay debts.

Accounts receivable turnover ratio: a measurement of how frequently you collect on receivables per year.

This is a great place to include charts and graphs that make it easy for those reading your plan to understand the financial health of your business.

» NerdWallet’s picks for setting up your business finances:

The best business checking accounts .

The best business credit cards .

The best accounting software .

This is a critical part of your business plan if you’re seeking financing or investors. It outlines how your business will generate enough profit to repay the loan or how you will earn a decent return for investors.

Here, you’ll provide your business’s monthly or quarterly sales, expenses and profit estimates over at least a three-year period — with the future numbers assuming you’ve obtained a new loan.

Accuracy is key, so carefully analyze your past financial statements before giving projections. Your goals may be aggressive, but they should also be realistic.

List any supporting information or additional materials that you couldn’t fit in elsewhere, such as resumes of key employees, licenses, equipment leases, permits, patents, receipts, bank statements, contracts and personal and business credit history. If the appendix is long, you may want to consider adding a table of contents at the beginning of this section.

Here are some tips to help your business plan stand out:

Avoid over-optimism: If you’re applying for a business loan at a local bank, the loan officer likely knows your market pretty well. Providing unreasonable sales estimates can hurt your chances of loan approval.

Proofread: Spelling, punctuation and grammatical errors can jump off the page and turn off lenders and prospective investors, taking their mind off your business and putting it on the mistakes you made. If writing and editing aren't your strong suit, you may want to hire a professional business plan writer, copy editor or proofreader.

Use free resources: SCORE is a nonprofit association that offers a large network of volunteer business mentors and experts who can help you write or edit your business plan. You can search for a mentor or find a local SCORE chapter for more guidance.

The U.S. Small Business Administration’s Small Business Development Centers , which provide free business consulting and help with business plan development, can also be a resource.

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Start » startup, writing a business plan here’s how to do it, step by step.

At the foundation of every strong business is a solid business plan. Looking to develop a business plan for your new venture? Here’s what to include in each step.

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At the foundation of every strong business is a solid business plan. A business plan outlines important information regarding a company’s operations and goals, and serves as a blueprint for how to achieve those goals. This document not only helps entrepreneurs think through and research their venture thoroughly, it also demonstrates to investors the viability of the business idea.

If you’re looking to develop a business plan for your new venture, it’s important to include all the necessary information. Here are the nine sections to include in a strong business plan, step by step.

1. Executive summary.

Your business plan should begin with an executive summary, which outlines what your company is about and why it will succeed. This section includes your mission statement, a brief description of the product or service you are offering, a summary of your plans and basic logistical details about your team.

2. Company description.

Your company description should further detail the logistics of your business, such as its registered name, address and key people involved. Here, you should also provide specific information about your product or service, including who your business serves and what problem you solve for that population.

3. Market analysis.

Conducting thorough market research can help you understand the nature of your industry, as well as how to stand out from competitors. Include a summary of your research findings in this section. Consider any trends or themes that emerge, what other successful businesses in the field are doing (or failing to do) and how your business can do better.

[Read: How to Conduct a Market Analysis ]

4. Organization and management.

This section should include your business’s legal structure — for example, whether you are incorporating as an S or C corporation, forming a partnership or operating as an LLC or sole proprietor. Provide pertinent information on your leadership team and other key employees, including each relevant individual’s percent of ownership and extent of involvement.

Describe how you will attract and retain your customer base, including what makes you stand out from competitors, and detail the actual sales process.

5. Products/services.

Your product or service is the crux of your business idea, so you’ll want to ensure you make a strong case for it being on the market. Use this section to elaborate on your product or service throughout its life cycle, including how it works, who it serves, what it costs and why it is better than the competition. If you have any pending or current intellectual property, include this information here. You can also detail any research and development for your product or service in this section.

6. Marketing and sales.

In this section, you should explain what your marketing and sales strategies are, and how you will execute them. (Note that these strategies will likely evolve over time, and you can always make adjustments as needed.) Describe how you will attract and retain your customer base, including what makes you stand out from competitors, and detail the actual sales process.

[Read: 5 KPIs to Measure Your Business’s Marketing Success ]

7. Funding request.

If you’re seeking funding, this section is critical for investors to understand the level of funding you need. Specify what type of funding you need (debt or equity) and how much, as well as how that capital will be used. You should also include information on any future financial plans, such as selling your business or paying off debts.

8. Financial projections.

The goal of your financial projections section is to show that your business is viable and worth the investment. Offer a financial forecast for the next five years, using information from current or projected income statements, balance sheets and cash flow statements to support it. Graphs and charts can be an especially helpful tool in visualizing your business’s finances.

9. Appendix.

Finally, use the appendix for any information that could not fit or did not apply to other sections of the document. Information such as employee resumes, permits, credit history and receipts are often included in this section. If you have a long appendix, consider adding a table of contents to make it easier for the reader.

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What Is a Business Plan?

Understanding business plans, how to write a business plan, elements of a business plan, special considerations.

• Business Plan FAQs

Business Plan: What It Is, What's Included, and How To Write One

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

Investopedia / Ryan Oakley

A business plan is a document that defines in detail a company's objectives and how it plans to achieve its goals. A business plan lays out a written road map for the firm from marketing , financial, and operational standpoints. Both startups and established companies use business plans.

A business plan is an important document aimed at a company's external and internal audiences. For instance, a business plan is used to attract investment before a company has established a proven track record. It can also help to secure lending from financial institutions.

Furthermore, a business plan can serve to keep a company's executive team on the same page about strategic action items and on target for meeting established goals.

Although they're especially useful for new businesses, every company should have a business plan. Ideally, the plan is reviewed and updated periodically to reflect goals that have been met or have changed. Sometimes, a new business plan is created for an established business that has decided to move in a new direction.

Key Takeaways

• A business plan is a document describing a company's core business activities and how it plans to achieve its goals.
• Startup companies use business plans to get off the ground and attract outside investors.
• A business plan can also be used as an internal guide to keep an executive team focused on and working toward short- and long-term objectives.
• Businesses may create a lengthier traditional business plan or a shorter lean startup business plan.
• Good business plans should include an executive summary and sections on products and services, marketing strategy and analysis, financial planning, and a budget.

Want Funding? You Need a Business Plan

A business plan is a fundamental document that any new business should have in place prior to beginning operations. Indeed, banks and venture capital firms often require a viable business plan before considering whether they'll provide capital to new businesses.

Operating without a business plan usually is not a good idea. In fact, very few companies are able to last very long without one. There are benefits to creating (and sticking to) a good business plan. These include being able to think through ideas before investing too much money in them and working through potential obstacles to success.

A good business plan should outline all the projected costs and possible pitfalls of each decision a company makes. Business plans, even among competitors in the same industry, are rarely identical. However, they can have the same basic elements, such as an executive summary of the business and detailed descriptions of its operations, products and services, and financial projections. A plan also states how the business intends to achieve its goals.

While it's a good idea to give as much detail as possible, it's also important that a plan be concise to keep a reader's attention to the end.

A well-considered and well-written business plan can be of enormous value to a company. While there are templates that you can use to write a business plan, try to avoid producing a generic result. The plan should include an overview and, if possible, details of the industry of which the business will be a part. It should explain how the business will distinguish itself from its competitors.

Start with the essential structure: an executive summary, company description, market analysis, product or service description, marketing strategy, financial projections, and appendix (which include documents and data that support the main sections). These sections or elements of a business plan are outlined below.

When you write your business plan, you don’t have to strictly follow a particular business plan outline or template. Use only those sections that make the most sense for your particular business and its needs.

Traditional business plans use some combination of the sections below. Your plan might also include any funding requests you're making. Regardless, try to keep the main body of your plan to around 15-25 pages.

The length of a business plan varies greatly from business to business. Consider fitting the basic information into a 15- to 25-page document. Then, other crucial elements that take up a lot of space—such as applications for patents—can be referenced in the main document and included as appendices.

As mentioned above, no two business plans are the same. Nonetheless, they tend to have the same elements. Below are some of the common and key parts of a business plan.

• Executive summary: This section outlines the company and includes the mission statement along with any information about the company's leadership, employees, operations, and location.
• Products and services: Here, the company can outline the products and services it will offer, and may also include pricing, product lifespan, and benefits to the consumer. Other factors that may go into this section include production and manufacturing processes, any patents the company may have, as well as proprietary technology . Information about research and development (R&D) can also be included here.
• Market analysis: A firm needs a good handle on its industry as well as its target market. This section of the plan will detail a company's competition and how the company fits in the industry, along with its relative strengths and weaknesses. It will also describe the expected consumer demand for a company's products or services and how easy or difficult it may be to grab market share from incumbents.
• Marketing strategy: This section describes how the company will attract and keep its customer base and how it intends to reach the consumer. A clear distribution channel must be outlined. The section also spells out advertising and marketing campaign plans and the types of media those campaigns will use.
• Financial planning: This section should include a company's financial planning and projections. Financial statements, balance sheets, and other financial information may be included for established businesses. New businesses will include targets and estimates for the first few years plus a description of potential investors.
• Budget: Every company needs to have a budget in place. This section should include costs related to staffing, development, manufacturing, marketing, and any other expenses related to the business.

Unique Business Plans Help

The best business plans aren't generic ones created from easily accessed templates. A company should entice readers with a plan that demonstrates its singularity and potential for success.

Types of Business Plans

Business plans help companies identify their objectives and remain on track to meet goals. They can help companies start, manage themselves, and grow once up and running. They also act as a means to attract lenders and investors.

Although there is no right or wrong business plan, they can fall into two different categories—traditional or lean startup. According to the Small Business Administration (SBA) , the traditional business plan is the most common. It contains a lot of detail in each section. These tend to be longer than the lean startup plan and require more work.

Lean startup business plans, on the other hand, use an abbreviated structure that highlights key elements. These business plans aren't as common in the business world because they're short—as short as one page—and lack detail. If a company uses this kind of plan, it should be prepared to provide more detail if an investor or lender requests it.

Financial Projections

A complete business plan must include a set of financial projections for the business. These forward-looking financial statements are often called pro-forma financial statements or simply the " pro-formas ." They include an overall budget, current and projected financing needs, a market analysis, and the company's marketing strategy.

Other Considerations for a Business Plan

A major reason for a business plan is to give owners a clear picture of objectives, goals, resources, potential costs, and drawbacks of certain business decisions. A business plan should help them modify their structures before implementing their ideas. It also allows owners to project the type of financing required to get their businesses up and running.

If there are any especially interesting aspects of the business, they should be highlighted and used to attract financing, if needed. For example, Tesla Motors' electric car business essentially began only as a business plan.

Importantly, a business plan shouldn't be a static document. As a business grows and changes, so too should the business plan. An annual review of the company and its plan allows an entrepreneur or group of owners to update the plan, based on successes, setbacks, and other new information. It provides an opportunity to size up the plan's ability to help the company grow.

Think of the business plan as a living document that evolves with your business.

A business plan is a document created by a company that describes the company's goals, operations, industry standing, marketing objectives, and financial projections. The information it contains can be a helpful guide in running the company. What's more, it can be a valuable tool to attract investors and obtain financing from financial institutions.

Why Do Business Plans Fail?

Even if you have a good business plan, your company can still fail, especially if you do not stick to the plan! Having strong leadership with a focus on the plan is always a good strategy. Even when following the plan, if you had poor assumptions going into your projections, you can be caught with cash flow shortages and out-of-control budgets. Markets and the economy can also change. Without flexibility built into your business plan, you may be unable to pivot to a new course as needed.

What Does a Lean Startup Business Plan Include?

The lean startup business plan is an option when a company prefers a quick explanation of its business. The company may feel that it doesn't have a lot of information to provide since it's just getting started.

Sections can include: a value proposition, a company's major activities and advantages, resources such as staff, intellectual property, and capital, a list of partnerships, customer segments, and revenue sources.

Small Business Administration. " Write Your Business Plan ."

• Business Development: Basic Overview of Activities 1 of 46
• Business Ethics: Definition, Principles, Why They're Important 2 of 46
• Business Plan: What It Is, What's Included, and How To Write One 3 of 46
• Organizational Structure for Companies With Examples and Benefits 4 of 46
• Which Type of Organization Is Best For Your Business? 5 of 46
• What Are the Major Types of Businesses in the Private Sector? 6 of 46
• Corporate Culture Definition, Characteristics, and Importance 7 of 46
• What Is an S Corp? 8 of 46
• LLC vs. Incorporation: Which Should I Choose? 9 of 46
• Private Company: What It Is, Types, and Pros and Cons 10 of 46
• Sole Proprietorship: What It Is, Pros & Cons, Examples, Differences From an LLC 11 of 46
• Bootstrapping Definition, Strategies, and Pros/Cons 12 of 46
• Crowdfunding: What It Is, How It Works, Popular Websites 13 of 46
• Seed Capital: What It Is, How It Works, Example 14 of 46
• Venture Capital: What Is VC and How Does It Work? 15 of 46
• Startup Capital Definition, Types, and Risks 16 of 46
• Capital Funding: Definition, How It Works, and 2 Primary Methods 17 of 46
• Series Funding: A, B, and C 18 of 46
• Small Business Administration (SBA): Definition and What It Does 19 of 46
• Upper Management: What it is, How it Works 20 of 46
• What is the C Suite?: Meaning and Positions Defined 21 of 46
• Chief Executive Officer (CEO): What They Do vs. Other Chief Roles 22 of 46
• Operations Management: Understanding and Using It 23 of 46
• Human Resource Planning (HRP) Meaning, Process, and Examples 24 of 46
• Brand: Types of Brands and How to Create a Successful Brand Identity 25 of 46
• What Is Brand Personality? How It Works and Examples 26 of 46
• What Is Brand Management? Requirements, How It Works, and Example 27 of 46
• What Is Brand Awareness? Definition, How It Works, and Strategies 28 of 46
• Brand Loyalty: What It Is, and How to Build It 29 of 46
• Brand Extension: Definition, How It Works, Example, and Criticism 30 of 46
• What Is Social Networking? 31 of 46
• Affiliate Marketer: Definition, Examples, and How to Get Started 32 of 46
• What Is Commercialization, Plus the Product Roll-Out Process 33 of 46
• Digital Marketing Overview: Types, Challenges, and Required Skills 34 of 46
• Direct Marketing: What It Is and How It Works 35 of 46
• Marketing in Business: Strategies and Types Explained 36 of 46
• What Are Marketing Campaigns? Definition, Types, and Examples 37 of 46
• How to Do Market Research, Types, and Example 38 of 46
• Micromarketing Explained: Definition, Uses, and Examples 39 of 46
• Network Marketing Meaning and How It Works 40 of 46
• Product Differentiation: What It Is, How Businesses Do It, and the 3 Main Types 41 of 46
• Target Market: Definition, Purpose, Examples, Market Segments 42 of 46
• Outside Sales: What They are, How They Work 43 of 46
• What Is a Sales Lead? How It Works and Factors Affecting Quality 44 of 46
• Indirect Sales: What it is, How it Works 45 of 46
• What Is Inside Sales? Definition, How It Works, and Advantages 46 of 46

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The 4 Phases Needed to Develop a Successful Business Plan

David gordon.

• January 5, 2021
• Type Articles

As they say in the military, “The enemy has a say.” The key to winning is adjusting. In 2021, expect COVID-19 will continue to impact the first half of the year, while the second half could represent different opportunities. Further, a new presidential administration, with its new initiatives, could impact your market looking toward 2022 and 2023.

This is where business planning comes into play.

Planning is about understanding the landscape, knowing what you want to achieve and then determining how to achieve it. It requires gathering information to understand your environment; determining current deployment; resources; where you can solicit assistance and then determining what you need to do (or procure) to give your team the resources needed to achieve the goal. Then, it is all about execution – developing a plan to achieve your future goals.

The phases of developing a plan include:

1. Introspection, Research & Insights

2. idea generation, 3. aggregation & execution, 4. ongoing evaluation and refinement.

While it sounds comprehensive, and it can be, it can also be streamlined. It all depends upon your organization, style and, if you use an outside facilitator, their ability to ask the right questions, understand your business/industry and add ideas.

This first step is critical. It is about gathering information: quantitative information and qualitative insights.

This can comprise macroeconomic information, marketplace information, industry insights and data analysis. The goal is to have a sense of where the economy and market are going while understanding your strengths, weaknesses, opportunities, and threats (SWOT), which comes from information gathering.

Understand your relationship with your market, your company, your customers, and the potential of each. Data can deliver these insights. Internal business intelligence data, combined with external economic data, can be powerful tools.

Some additional areas to consider include:

• Do you “plan” expecting today’s COVID-19 environment or a different one? For how long?
• What is your expectation of the market? Future macro trends and the potential opportunities that they can create? For example, how will the new presidential administration’s likely focus on clean energy and the climate impact your markets?
• How have your processes been impacted?
• More importantly, how are customers and their customers being impacted? What are their new expectations? What is their outlook?
• What is your staff’s input?

As part of this process, “customer” insights can be beneficial. This should be 360-degree input. From end-customers/contractors, distributors (if you are a manufacturer), salespeople (and reps/RSMs), perhaps even employees or suppliers. Ask their opinion about the market, their opportunities, how “you” can improve and more. Those who contribute want you to succeed.

Next, ask departments how they can improve. How can “you/they” be easier to do business with? What additional value can each bring to their customers? What processes need to be improved? How can utilization, and productivity, increase? What is their value proposition, and the company’s, today and what could it be?

If you are in sales, the issues are the same, but focus on their goals and account package. Where are customer needs? Where are they going? What is your value proposition, according to your sales organization? How can you generate more? What do you need to be successful (or, more importantly, what does your company need to do to be more successful with your customers/in your territory?)

Ask what is important for account retention as well as for taking share. Then prioritize.

It is about asking for information, seeking opportunities, developing ideas, changing models and anticipating the future, becoming knowledgeable. Going into 2021, many companies will be more conservative with investments and will seek to reallocate funding. Focus and enhancing models will be critical. Opportunities abound.

Once you have gathered information and know the current and projected state, the next phase is identifying what strategies you want to continue. Conduct an idea generation exercise to determine what’s next.

This brainstorming exercise helps identify what new strategies will emerge. Consider what competitors are doing. Look at distributors/manufacturers in other industries or markets. Ask customers what would be of benefit to them.

Next it is about aggregating the ideas, developing a project plan and calendaring the activities to ensure time implementation.

For some initiatives, you may want advance time to present the strategy to your key suppliers or distributors to gather their input, or perhaps get their buy-in. For distributors, remember your 2021 earned co-op funds will probably decline, as they are based upon 2020 performance.

Gather the thoughts, determine the feasibility, gain budgetary insight and then prioritize. Inevitably, you cannot do everything. Every company is, at some point, resource-constrained.

An area that is challenging for most companies is ongoing evaluation of strategy with periodic reviews that allow the company to refine its strategy. It is like taking a road trip and finding out that there is construction on a segment of the highway. You can slow down or consider a detour/alternate route that enables you to continue. Adjustments are needed in plans. The key is achieving the end goal within the defined timeframe.

Reporting these metrics to various stakeholders also helps earn buy-in for future initiatives.

Strategic planning is a commitment to intentionally succeed. It is a leadership decision that reinforces to your staff that the company has a roadmap to achieve success and is committed to profitable growth. Involving your team helps develop a better “product” as well as earns their buy-in to the strategy, to implementation and to success.

Planning can be a process, or it can be a workshop. The key is, have a plan so you can be intentional in your actions.

David Gordon is president of Channel Marketing Group, a distribution strategy and marketing consulting firm helping distributors, manufacturers and representatives in the industrial and construction industries generate insights and ideas to drive growth. For more information on Channel Marketing Group, visit channelmkt.com . Reach Gordon at [email protected] . 

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How to Write a Business Plan

When how to write a business plan is at the top of the SBA list of the ten steps in how to start a business, it tells you something about how important the experts consider it to be. Planning a business and writing a business plan is more than just having a location picked and a product or service to sell. Financing, marketing strategy, and future growth all require a well-researched and thought out business plan.

• Chapter 1 – Getting Started
• Chapter 2 – The Key Elements of a Business Plan
• Chapter 3 – Executive Summary
• Chapter 4 – Business Description
• Chapter 5 – Business Environment Analysis
• Chapter 6 – Industry Analysis
• Chapter 7 – Competitive Analysis
• Chapter 8 – Market Analysis
• Chapter 9 – Marketing Plan
• Chapter 10 – Operations Plan
• Chapter 11 – Team and Management Plan
• Chapter 12 – Financial Projections
• Chapter 13 – Appendix

Getting Started

There are many articles and resources available on the Internet explaining how to write a business plan, but writing a business plan is more than merely following a business plan template or copying someone’s business plan examples. A business plan can be as simple as a few notes scrawled on a paper napkin. It can be a 40-page document with multiple sections and subsections describing every minute detail of its operations, products, and finances.

Writing an effective business plan is easier if you take time before starting the writing process to conduct your research and gather the information you need to incorporate into it. Business owners of new startups or established companies can benefit from thinking through and researching such success-determining issues as:

• Marketing strategies
• Regulatory environment
• Capitalization requirements
• Financing opportunities
• Organization
• Competition

From this list, you quickly realize that a business plan is more than a document a business uses to get financing or to attract investors. It is a roadmap of how your business will operate to succeed. Before you can begin writing your business planning roadmap, you need reliable information about your industry, your competitors, your product, and your customers for inclusion in it. An industry analysis, competitor analysis, product feature comparison, and market research will give you the information you need.

How to Conduct an Industry Analysis

Understanding the market and industry in which your company will do business is accomplished through industry analysis. An industry analysis conducted before you begin to write a business plan will help you to:

• Recognize and analyze ways of reducing business risks
• Identify industry trends including potential problem areas within the industry
• Project capitalization requirements for your business
• Identify product and service trends and opportunities

Industry analysis is specific to the particular industry in which a business is currently operating or plans to venture. It provides information from which a business owner can create a long-term strategy to minimize risks and take advantage of growth opportunities.

Porter’s Industry Analysis Method

A method developed by Michael E. Porter of Harvard University has become the most frequently used method for analyzing any industry to create a strategy to compete within it. According to Porter, five forces influence all markets and industries.

The five forces are:

• Ease of entry: When new companies can enter an industry with relative ease, those companies already in operation will love their competitive advantage. Profits will suffer unless existing companies have a way to block or slow new entries. Government regulation, customer loyalty, and patents and copyrights can be barriers to new businesses entering a market or industry.
• Power held by suppliers: Suppliers of products, services, or materials that a business needs can affect a company’s ability to compete. If there are few alternative products or only a few vendors offering the materials, the suppliers can dictate prices, quantities, and delivery times to businesses that must purchase from them.
• Power of buyers: Strong customer bargaining power, as in industries where there are many competing products from which a buyer can choose, can affect a company’s ability to price its products without fear of losing customers.
• Availability of substitute products or services: If two companies with similar products compete within an industry, they will each benefit as advertising and marketing by the companies will generally increase customer demand. For example, two businesses selling different house paint brands will mutually benefit as customer demand for their products increases due to the competing marketing campaigns. A company that sells and promotes vinyl siding as a substitute for painted surfaces will reduce the market share’s size for paint.
• Competitive rivalry: This factor in the analysis takes into consideration the number of competitors in an industry and their relative strength. An industry with many companies offering similar products will offer a company little opportunity to control consumers’ or suppliers’ ability from going elsewhere.

Porter believed that an analysis of the five forces that exist in every industry could help forecast a company’s ability to compete and remain profitable. You will obtain sufficient information on your industry from the five forces analysis to formulate long- and short-term strategies to incorporate into your business plan.

A business plan for startup companies will benefit from an industry analysis that provides ownership with information to make decisions and formulate policy in certain key areas. You should be able to answer the following key questions about the industry and your company’s ability to successfully compete in it when you have completed the industry analysis:

• What are the primary economic characteristics of the industry?
• How strong are the competitive forces that exist within the industry?
• What trends or changes can be expected in the industry, and from where will they come?
• What response will competitors make to the entry of a new company into the industry?
• What are the factors that will determine your company’s ability to succeed?
• What are the industry prospects for profitability and potential for growth?
• Will the company compete on a local, national, regional, or international basis?
• What modifications or changes must be done to the company’s products or services to make them competitive in this industry?

Industry Analysis Resources and Tools

There are several free industry analysis resources and tools available to entrepreneurs preparing to write a business plan. A few of the more popular sources of industry information include:

• BizStats (www.bizstats.com): It offers statistics and financial data on businesses in a variety of industries as well as tools to calculate business valuation and cost of goods sold.
• Securities and Exchange Commission (www.sec.gov/edgar.shtml): The SEC makes annual reports and other financial filings of publicly traded companies available for review at its website.
• FreeLunch.com: This site from Moody’s Analytics offers data on economic trends and financial data from around the country.
• Hoover’s Online (www.hoovers.com): This is a Dun & Bradstreet offers a searchable database of financial information and profiles of public and private companies.
• U.S. Census Bureau (www.census.gov): Government agencies can offer a treasure-trove of information. The Census Bureau has searchable databases with industry overviews, economic data by region, and population statistics.
• Thomas Register (www.thomasnet.com): Originally published in book form, the Thomas Register is a searchable database of product information and market trends for various industries. It publishes an annual survey it calls its “Industry Market Barometer” that shows where reporting companies are, where they have been and where they are heading.
• Library of Congress Legislative Information (https://beta.congress.gov/): The primary source for information about recently enacted federal legislation that could affect a business or an entire industry.
• Websites of individual companies or trade associations: Most companies have websites that provide information about the business, including products and management structure. Trade associations usually have websites that offer glimpses into what is happening within an industry from those working in it.

Industry analysis is not to be confused with a market analysis or a competitor analysis, both of which are included in a business plan for entrepreneurs. Industry analysis will describe the products offered within a particular industry and the marketplace parameters concerning economic, regulatory, and political issues. An industry analysis establishes the marketplace’s scope; a market analysis tells a business owner if a particular industry’s market will be profitable for a company’s product.

How to do a Competitor Analysis

Competitor analysis is when a business obtains information to identify and learn more about key competitors to predict how the competition will react. Competitive analysis plays a vital role in strategic planning, so writing a great business plan becomes easier if you do your research before writing your business plan.

Unlike the competitive rivalry factor of industry analysis, a competitor analysis focuses attention on each competitor’s strengths and weaknesses instead of focusing on the overall competitive climate within an industry. A competitor analysis offers a detailed profile of each competitor along with an analysis of marketing strategies that can be used to counter position your company to improve market share or profitability.

At the completion of your competitor analysis, you should be able to:

• Identify your primary competition within your industry and marketplace
• Know the company profile of your competitors
• Identify the geographic location in which competitors operate
• Identify competitor’s market share and profitability
• Know and understand your competition’s strategies and objectives
• Identify benefits, such as increased customer awareness, derived from your competitors’ marketing
• How to identify and understand competitor strategies that are successful and those that are not
• How to anticipate your competition’s response to implementation of your strategies and plans
• Learn how to turn your competition’s anticipated response to your benefit

The following steps will guide you through your competitor analysis:

• Create a list of your current and future competitors
• Gather data and information about your competitors, their products, and their marketing and pricing strategies
• Review and analyze the data
• Create a list of your competitors’ strengths and weaknesses
• Create strategies to take advantage of competitors’ weaknesses while a minimizing threats posed by their strengths

Sources of Competitor Information

Information for competitor analysis is available from several sources, including news stories and press releases, advertising, company websites, promotional campaigns, patent and copyright applications, price lists, and, in the case of publicly traded companies, annual reports, and SEC filings.

Sometimes, getting information about a competitor might require a bit of sleuthing on your part. If your competitor has a store that is open to the public, no rules are prohibiting you from visiting it and taking a look around. Becoming a member of a competitor’s mailing list to receive promotional material and updates on new products and pricing is a quick and easy source of information.

The information gathered about competitors might not seem like much when looked at separately, but it can be mosaic-like in what it reveals about your competition when viewed as a whole. A random conversation with a supplier might reveal information about a change in a competitor’s product line. The point is to take advantage of every opportunity to acquire data about the marketplace in which your business operates. It might reveal something about your competitors that could be used in developing or refining your marketing strategy.

How to do a Product Feature Comparison

A product feature comparison allows you to compare your company’s product with products produced by competitors. Unlike a competitor analysis that allows you to determine how your business measures up to competing businesses, product feature comparisons limit their focus to the products themselves. When used as part of creating an easy business plan, product features comparison data can provide critical information to making marketing decisions.

1. Conducting the Research

The first thing you should do is purchase or acquire your competitor’s product. This gives you the chance to evaluate your competitor’s sales process while acquiring the product to test. Using the product, you can compare features on the competitor’s product with your own product. If the features of the competing product give it a performance advantage over your own, you can evaluate how important those features are to determine if your product should be redesigned. Another source of information on the product is the internet. What are consumers saying about your product versus the product sold by your competitor? Product reviews by websites that specialize in testing products could also tell you how your product is faring in the marketplace compared to other products.

2. Product Comparison Tables

The information you obtained through your research and product testing is easier to compare if compiled in a simple table format. Each product’s features can be listed under separate columns for each feature, and each product feature can be judged to determine which one was the best. The best feature gets one point while the other product’s feature gets no points. The winning product is the one that ends up with the most points.

Another method of evaluating the features of different products is to assign a score of 1 to 10, with a higher score going to features deemed to be the most important as far as product performance. The winning product is the one that ends up with the highest overall score.

3. Coming to a Conclusion

Comparing a competitor’s product features with those of your own product is only useful if you use the information to make worthwhile improvements to your product. Redesigning your product just to make it look more like your competitor’s product only makes sense if the redesign meets a customer need that your product is not currently meeting.

The conclusions you reach from the data a product feature comparison gives can be incorporated into the market analysis, competitive analysis, and marketing plan sections when writing a business plan. The information will also be useful in guiding decisions made for the future development of new products.

How to Conduct Market Research

Market research provides businesses with information about their customers and the markets in which they do business. By analyzing its data, business owners offer products that consumers want at competitive prices with other sellers. For the new entrepreneur who is learning how to start a business, market research performed before preparing a business plan can help formulate strategies to reduce risks, recognize marketplace and industry trends, and identify opportunities to increase sales.

The marketplace for many businesses is no longer limited to one country. The growth of internet commerce has made it possible for even small businesses to participate in the global economy for many products and services. Market research can help owners of businesses to evaluate the feasibility of expansion into international markets.

The data collected through market research should give a business owner the answers to the following questions:

• Who are the customers for a company’s product or service? What factors influence consumers to purchase this product or service?
• What improvements or changes in current products would encourage customers to purchase more of them?
• What price range will cause customers to switch to other competing products?
• What features of a competitor’s product do customers like or dislike?
• What other uses of the product exist that can be introduced into new markets?
• Marketing research allows you to compile a profile of your current or potential customers to provide answers to the following questions:
• How old are they?
• Where do they live?
• What is their highest level of education?
• How large is the customer base?
• What are their favorite leisure time activities
• What do they do for a living?
• How much do they earn?
• Where are they employed?
• What technology do they use and prefer?
• What are their beliefs, values or opinions?
• Where do they prefer to shop?
• For whom do they shop?

Market Research Tools

The methods of gathering information about consumers do not have to be complicated. Frequently used methods include: Interviews by telephone or face-to-face Surveys are conducted online, by telephone, or through the mail. Questionnaires are completed online, in person, or through the mail. Focus groups to solicit feedback from people representing a cross-section of potential customers

Steps in Market Research

Any of the tools used to gather information can be employed using a five-step approach.

• Step 1: Identify what you want to learn or find out. Be specific about what you want to learn. Working on a single issue or question is easier than trying to create a survey or interview covering a wide variety of topics. For example, if your company is attempting to develop a new and improved widget to replace widgets currently being sold, you might focus your research on customer experiences with the old widget. Are they satisfied with how it performs? Do they believe there is a need for a new and improved model? Would they buy a new and improved model? How much are they willing to pay?
• Step 2: Draft questions to allow for follow-up questions depending upon the answer given.
• Step 3: Identify the target group for your research. Interviewing people who have never used your product will not generate data to determine how your product users react to its design changes.
• Step 4: Select the most effective tool for obtaining the information you need. If your company is in the telecommunications industry, surveying by telephone might be more effective than one conducted through the mail.
• Step 5: Analyze the results of your research. Market research data is only as good as the use to which you can put it. Go back and review the purpose of your research. Determine if the data you gathered allows you to answer the question or solve the problem. If it does, develop a strategy and implement it. If it does not, then decide what additional data you need and return to step 1.

The Key Elements in Writing a Business Plan

The answer to the question “How do you write a business plan?” depends upon the type of business and the purpose for which you are going to use it. Too many business owners think of a business plan as they need to convince a bank to lend their company a loan or convince a venture capitalist to invest in it.

In fact, business plans come in all shapes and sizes, depending upon the audience for which the plan is intended. For example, a startup company would want a business plan containing all of the bells and whistles to serve as a comprehensive guide for the new owners and management. Should the time come when financing is needed for new equipment or expansion, a revised business plan that focuses on the company’s financial growth and ability to repay, the debt would be needed.

Business plans are written with an audience in mind. Internal business plans are written for a company’s management team to use as an operational guide. It can also be written with a specific project in mind to allow owners and managers to evaluate its feasibility and profitability. These types of plans might include projections about profitability and growth ten or more years into the future.

External plans are written for the benefit of an audience located outside of the company. Prospective investors or venture capitalists and lending institutions are examples of the types of audiences for which external business plans are created. These types of plans are created to answer a question or address a particular problem. For instance, prospective investors want a business plan that demonstrates their future growth and profitability to generate a return on their capital investment.

Too many businesses start with inadequate planning. No one goes into business to lose money. If you start a business, you expect that it will be profitable and succeed. Writing a business plan forces you to focus on the strategies that will make your business a successful one. That is why learning how to write a plan is important for new businesses or established businesses that might be venturing into new markets or launching new products.

Business plans come in all shapes and sizes, so what you choose to include in your business plan will depend upon your audience, the question it seeks to answer or the problem it seeks to resolve, and your personal preferences. The most frequently included elements of a business plan are the following:

• Executive summary
• Business description
• Business environment analysis
• Industry analysis
• Competitive analysis
• Market analysis
• Marketing plan
• Operations plan
• Team and management plan
• Financial projections

The Executive Summary

Regardless of the business plan format chosen, the executive summary always appears first in the document. Its purpose is to educate and inform the reader about the company. It should explain where the company is at present, where it is going, and how it plans to succeed. In a plan prepared for an external audience, such as investors or bankers, the executive summary is the first opportunity the business owner has to engage the reader’s interest.

Even though it appears first in a business plan, the executive summary should be written last. The executive summary is a snapshot of your business plan that a reader can quickly look at to become acquainted with your business. Writing it last allows you to highlight your plan’s strengths in the first section your audience reads.

Your executive summary should include the following information

• Mission Statement: This explains to the reader why your company exists. Its mission statement should guide the activities of your company.
• Company Information: This is a brief statement giving a historical perspective of your company. It should include the date of formation, locations, company founders, and current employees.
• Highlights: This is an opportunity to tell the reader about profit or market milestones achieved by the company since its inception.
• Products and Services: Briefly mention and describe the company’s products or services.
• Financial Information: This section is particularly important for companies seeking financing and should include mention of bank references and investors.
• Future Projections: Explain the direction in which ownership and management plan to take the business.

Remember that even though it might be the last thing you write for your business plan, the executive summary is the first thing people will read. You have to grab the reader’s attention and hold it. Think of the executive summary as a highlight reel showcasing your business. One of the reasons for saving the executive summary until last to write is to give you the chance to include the best parts from each of the sections of your business plan in it.

Write the executive summary with a particular audience in mind. If you are trying to attract investors, you should focus on those sections of your business plan that establish how your company’s product fills a consumer need. Reference the market research and marketing strategies that demonstrate how your company will take advantage of this.

After completing the executive summary, read it aloud. It should convey your intended message is clear, unequivocal terms that flow without sounding like a sales pitch.

Business Description

A business description tells the reader more than simply, “We sell things.” This section of the business plan is an overview of the company, including its legal structure, its owners and management, a brief company history, information about the products or services it offers, markets the company will serve and other information to demonstrate how the company plans to introduce its product into the marketplace.

The purpose of the business description is to help a reader to quickly grasp the goals the company has set and how it intends to meet those goals. By the time people are finished reading, they should have a clear picture of the nature of the company’s business, its business structure, its goals and objectives, and its strengths and advantages.

Begin the description with a few sentences that give a capsule view of the company, its product, and its position in the industry in which it competes. This is an elevator pitch to get the reader interested in learning more about the company. Let the reader know if this is a new venture or a business for a while.

The business description should continue with a statement about the type of business structure adopted by the company. Explain whether it is a corporation, partnership, sole proprietorship, or limited liability company, and list the principals’ names along with brief profiles for each one showing how their presence benefits the company.

Part of the business’s description should include information about the company’s products and services, the potential customers, supply and distribution channels, competitive advantages offered by product features, and how the company plans to exploit those advantages. End the business description by explaining the specifics of how the company plans to be profitable.

The business description section of a business plan should not be overly long. Depending upon the company’s size and the number of products offered by it, a description that is one to two pages in length should suffice.

Business Environment Analysis

Business planning is an ongoing process that does not begin and end with writing a business plan. Periodically taking stock of how a company is doing is essential to ensuring that it meets its goals and will become or continue to be successful and profitable. A business plan should be flexible by incorporating tools to analyze company performance compared to other industry businesses.

A business environmental analysis accomplishes section accomplishes this by providing useful information to management and company owners. Analyzing this data allows the management team to identify those plans and strategies that are not.

The environment in which a company operates involves internal and external factors that influence how business is conducted. Internal factors include a company’s business culture, its organizational structure, and the methods by which it is managed. External environmental factors might include government activities such as laws and regulatory actions, economic changes such as recessions, social trends and movements that shift consumer preferences, and innovations in technology that can help or damage a business’s profitability and productivity.

A systematic process of analyzing the environment to identify those environmental factors affecting a company determines its impact on the business and developing strategies to take advantage of them or limit their effects. After a business has implemented a strategy, the process will monitor the business environment to ensure that it is working and does not require modification or change.

Business plan tools that give management a constant source of current and accurate information about the marketplace and the industry and competitive forces at work in both are essential to an effective analysis of the business environment. Three of those tools are the industry analysis, the competitor analysis, and the market analysis that should be included when writing a business plan.

Industry Analysis

The industry analysis you performed before sitting down to write your business plan can be incorporated into it to provide data on the industry and markets in which your company conducts business. Drawing upon the data you collected using the various industry analysis resources mentioned earlier allows you to identify the risks and opportunities confronting the company as it prepares to enter the marketplace with its products or services. This information permits you to develop strategies to take full advantage of business opportunities while minimizing or avoiding the identified risks.

When written as a section of a company’s business plan, an industry analysis can be presented as a five-step process.

• Step 1: Give a brief overview of the industry. Define the industry in terms of historical background, the geographic area it services, and its products.
• Step 2: Review trends and growth patterns that have existed within the industry.
• Step 3: Identify factors that influence the industry. These might include government regulatory policies and competitive practices of other businesses.
• Step 4: Using data gathered through research, the industry forecast anticipated growth. The predictions should be both long- and short-term.
• Step 5: Describe how your company will position itself within the industry. Focus on how your company can take advantage of opportunities identified within the industry.

Competitive Analysis

You want your business plan to tell you how your company compares to others in the industry. It is difficult to predict how your company’s product or service will perform in the marketplace without knowing what your competitors are doing. A competitive analysis section draws upon the research you did before writing your business plan to offer the data and analysis to support your performance assumptions.

Writing an effective competitive analysis can be accomplished in five steps. Keep in mind that the data you will need about your competitors should have been gathered earlier when you conducted the industry analysis before starting work on creating your business plan.

• Step 1: Identify and list your competitors. You can do this in paragraph format or a spreadsheet. You should include each competitor’s name and location along with the products they offer, sales volume, market share, pricing information, marketing strategy, and other details of their business.
• Step 2: List your competitors’ strengths and weaknesses.
• Step 3: Analyze the strengths and weaknesses of your company. Focus on how your company can exploit its strengths while overcoming or minimizing identifiable weaknesses.
• Step 4: Describe your company’s role in the marketplace. Explain how your company can compete for a market share, given the information you acquired about your competitors. This is where you support marketing decisions and strategies with the data you previously gathered through your marketing research, product feature comparison, competitive analysis, and industry analysis.
• Step 5: Give a detailed description of your company. Use this opportunity to describe how ownership, management, location, business structure, and other resources possessed by your company will allow it to succeed in the marketplace.

Market Analysis

You should use this section of your business plan to describe the market into which you intend to introduce your company’s products or services. This is where you draw from the data you collected earlier when you did your preliminary market analysis before getting to work on preparing your company’s plan.

Ideally, the market analysis should offer an overview of the marketplace, the positions held by your competitors, and other facts to support your company’s strategies about marketing, production, and distribution.

Some of the key topics that should be addressed in this section include:

• A description of the industry and the market. This should include information about projected growth, potential changes in consumer demand, and anticipated trends or cycles that could affect product performance.
• Describe your customers. Describe the customer need that the product or service satisfies. Provide demographics about your customers and show how the product your company offers falls within those demographics.
• How big is the market? If your market research shows that the market has been shrinking, a decision to enter or continue in the market should be supported by research supporting a prediction for future growth.
• Describe and explain the pricing structures of your company and its competitors. Describe how your marketing and pricing will give your company an advantage in the market, or describe what changes must be made to give your company an edge.
• The data collected in the competitive analysis can be incorporated into the market analysis to show how your company will compete with other companies offering the same or similar products or services.

Marketing Plan

The purpose of a company’s marketing plan is to attract customers willing to purchase a particular product or product line. Creating a market for the product or service your company offers began with the business environment analysis and continues by developing a marketing strategy. A marketing strategy must be flexible and should be evaluated periodically to determine if it must be reworked due to changes in the marketplace.

Marketing plans frequently include strategies for four stages.

• Penetration strategies represent the company’s plans for its initial entry into the market.
• Growth strategy builds upon a product’s success by introducing it to different users or into new markets.
• Another strategy analyzes new or alternative methods of distributing a company’s product to increase sales, such as hiring salespeople or developing new retail outlets.
• The fourth strategy controls the communications process between the company and its customers. Methods of advertising and audiences to be targeted are just two of the issues that a communications strategy should address.

The strategies created by a company under its marketing plan are affected by or affect other aspects of the business plan. For instance, a business’s decision to expand into new markets by acquiring a company already selling in the new market might be hampered by a lack of capital to complete the transaction. It might force the company to seek additional capital by adding investors or borrowing money.

Operations Plan

The operations plan is closely tied to the team and management plan section of a business plan. An operations plan is the engine that runs the machine you call a business. Without an operations plan, nothing else in your business plan will get done. The operations section of a business plan created to obtain bank financing or some other external purpose does not require the details to go into a plan that will guide ownership and management in running the business.

This section should be crammed with details and instructions to direct people within the business’s day-to-day operations. The personnel covered in the team and management plan section of a business plan should refer to the operations plan to carry out the strategies and tasks needed to run the business.

An effective way of including an operations plan when writing a business plan is to combine it into a single section entitled “Operations and Management Plan.” Writing the section begins with creating an organization chart showing each business member’s title, duties and responsibilities, and supervisory role.

Team and Management Plan

The people who make up your ownership and management team focus on the team and management portion of a business plan for entrepreneurs. Whether intended for internal or external use, readers of this section of a business plan should have a clear understanding of who is in charge. The length and complexity of this section will depend upon the size of the company. The business plan written by a sole proprietor will be much shorter than one prepared for a corporation with multiple management teams, a board of directors, and multiple locations.

The team and management section includes a list of owners and key management personnel and a description of the role each plays in running the organization, the compensation and benefits each one receives, and the criteria used for giving promotions and increasing compensation. Brief biographical information for each of the owners, key personnel, and members of the board of directors offers readers insight into the qualifications each person brings to the organization.

Other information about the company that should be included in this section includes:

• Business structure
• Length of time business has existed
• Mission statement and values
• Background and history of the company

Financial Projections

This section of the business plan provides readers with a picture of where your company has been and where it is going from its finances. Established companies should include financial data on past performance. Banks, venture capitalists, and other lenders usually want at least three years of financial data, but some might want to see up to five years of information.

Financial data that should be included in the plan include income and cash flow statements and balance sheets. Some lenders might ask to include accounts receivable statements, accounts payable statements, and documentation of other company debt obligations.

Regardless of how long a company has been in existence, this section must include projections of its future financial picture. These projections must be supported by data the company has compiled through its research and analysis of the industry, competitors, markets, and products.

Financial forecasts should include the following documents:

• Statements of projected income
• Balance sheets
• Cash flow statements
• Capital expenditure budgets

Assumptions that a company makes about future market trends or other factors that could influence the financial projections should be explained. People outside of a company want to see that financial projections in a business plan are supported by accurate data or an analysis based on assumptions having a historical basis.

Financial projections can be supported by graphs, charts, credit history, order history, reference letters, or anything that a business believes will lend credibility and support the plan’s predictions. Such items might work best if they are included in the appendix section of the plan.

The information supporting projections, strategies, and assumptions made in a business plan will be found within the body of each section of it. An appendix usually contains financial information to which company owners and managers might want to limit access. For example, a company that prepares a plan specifically to obtain lender financing could use the appendix to submit tax returns, credit histories, and confidential data such as customer information only to those lenders requesting it. It can also be used for supporting reports, photographs, and other information that takes up more than a couple of pages.

An appendix should begin with a table of contents corresponding to the organization of the business plan sections. Even if it only contains information on some but not all sections of the plan, the appendix should always be located after its last section.

Resources on How to Write a Business Plan:

Business plan examples.

http://www.bplans.com/sample_business_plans.php http://www.score.org/resources/business-planning-financial-statements-template-gallery http://www.businessplans.org/businessplans.html http://www.businessballs.com/freebusinessplansandmarketingtemplates.htm http://www.businessplanarchive.org/

Business Plan Writing Resources

http://www.carnegielibrary.org/research/business/bplansindex.html http://www.hbs.edu/entrepreneurship/resources/businessplan.html http://www.entrepreneur.com/businessplan/index.html http://www.sbdcnet.org/small-business-information-center/business-plans http://www.inc.com/business-plans https://www.sequoiacap.com/grove/posts/6bzx/writing-a-business-plan http://www.sba.gov/tools/business-plan/1 https://business.usa.gov/start-a-business http://www.startupconnection.net/premium-resources/business-plan-disconnect/

Article References on How to Write a Business Plan:

• William A Sahlman. How to Write a Great Business Plan. Harvard Business Press Books 2008. ISBN-1422121429
• Bruce R. Barringer. Preparing Effective Business Plans: An Entrepreneurial Approach. Prentice Hall 2008. ISBN-0132318326
• http://www.hbs.edu/entrepreneurship/resources/businessplan.html
• http://www.gsb.stanford.edu/ces/resources/business_plans.html
• http://www.sbtdc.org/pdf/industry_analysis.pdf
• http://www.quickmba.com/strategy/porter.shtml
• http://www.sec.gov/edgar/searchedgar/webusers.htm#.U7Wr6bG9Ztk
• http://www.sba.gov/content/market-analysis
• http://www.entrepreneur.com/article/78002
• http://www.sba.gov/writing-business-plan
• http://www.sba.gov/content/company-description
• http://smallbusiness.chron.com/environmental-business-analysis-43238.html
• http://edwardlowe.org/digital-library/how-to-develop-and-use-a-business-plan/

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7 Steps to Develop a Successful Business Plan

Jonathan Farrington

Most people who spend a little time searching on the Internet or in a bookstore can quickly find  a guide on how to write a business plan . However, just following these templates doesn’t guarantee that the business plan produce will be successful or even good. A successful business plan needs quite a bit more to actually be useful and even more to be functional and successful. As the elements come together, if done correctly, the most important component of success will come from the business owner and leadership versus the company itself.

Your business plan needs seven specific elements that will make it stand out beyond just the basic pile of applications and home printer documents everyone regularly sees.

1. Research

If your company is going to run a viable business plan and investors are going to put their money into it, your information has to be top notch. And that includes  knowing every topic involved , not just your internal operations. Research and critical analysis are key to developing and communicating a business plan properly. The information used has to be relevant, valuable, and objective. However, you’re not writing a novel, so the presentation also needs to be concise. That means choosing the right research to include versus just a brain dump of anything about the company’s situation.

2. Have a Purpose

What is your business plan being written for? A road map on how to operate? An investor or loan pitch? Both? A historical document? The purpose has to be clear and definitive. If you don’t know why you’re writing a business plan, the effort will be a waste of time. Knowing also means having a target audience you expect the plan to be ready by. With both defined, it will help dictate what information is included and how.

3. Craft a Company Snapshot

Some people call it a company profile, others a snapshot. Either way, your business plan needs a section that gives a reader a clear view of what your company is, does and provides in a few paragraphs. This should be the same information that one would find if they looked on the business’ website. It’s designed to be quick and digestible mentally because it needs to stick in a reader’s mind quickly, especially as more information is provided later in the plan. If the reader remembers nothing else, he or she will have the profile well entrenched in memory. And that matters when your plan is being considered with others.

4. Detail the Company in Total

Some folks write their business plan to only highlight what they think are the selling points and good features of their venture. That’s a mistake. Most readers have a pretty good idea where the company sits in the big picture. Detail the company’s status in full, good and bad. And where there are weaknesses, include plans on how they will be addressed given the right support. Details should also include key features like patents, licenses, copyrights and unique strengths no one else has.

5. Write the Marketing Plan Beforehand

A simple mistake made by most startups is that people think they can write a business plan without knowing first  how something is going to be sold . A strategic marketing plan is essential; it shows how your product or service is going to be delivered, communicated and sold to customers. It covers where, when and how much, all the key pieces that later on feed into the financial statement projections in the business plan. No surprise, marketing has to be nailed down before planning out the rest of the business.

6. Be Willing to Change the Plan for Your Audience

Another common mistake folks often make is writing only one business plan. The document given to a lender is going to be very different than the one for internal direction. Smart startups have multiple versions, just like candidates have multiple resumes for different prospective employers. Match the plan and message to the audience you are addressing.

7. Include Your Motivation

This is the most important piece in a successful plan – your motivation and goals. Why are you going through all this effort, work, sweat and effort? Your motivation needs to be a reason that will convince people the business will succeed, through thick and thin. A business needs a mission that drives it, not just selling to make money. Your motivation defined in the business plan is that mission.

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How to create a business plan: a step-by-step guide.

From entrepreneurs with the seed of a great idea to established companies, every business needs a business plan.

But what is a business plan exactly? Is it worth the time and effort to write one?

Let’s take a look at why your organization needs this business roadmap and how it can set you up for long-term success.

What Is a Business Plan?

The easy answer, of course, is right there in the name—it’s a plan for your business. It serves as a guide for how you manage your organization.

Considered a basic business principle for startups, business plans are helpful for all kinds of companies.

For example, a plan for a startup might be a simple one or two-page document, sometimes referred to as a lean plan. It lays out only the essential information, immediate milestones the firm wants to reach and how to secure funding to meet those goals.

For a larger or established company, the plan might be more comprehensive in a traditional format . It typically includes areas such as financial data, a marketing overview and future plans for each department in the organization.

In either case, the intent is to provide a map for your business. You want to answer questions like how the business works, what your goals are and how your team will reach them.

Business plans can be internal or external, meaning it is used as a guide to get your team on the same page or an overview for those with whom you do business or to pitch to those who want to invest in your ideas.

Why Do You Need a Business Plan?

As with the plan itself, the need and purpose for one vary between businesses.

Let’s take a look at two scenarios, involving ownership of rental property.

1. Growing Business

Imagine you own and rent a handful of condominium properties. You have plans to acquire more and turn it from a hobby to a full-time pursuit. This means a lot is going on in the early stages of your organization’s development. A business plan breaks down the moving pieces into more manageable portions.

For your growing real estate portfolio, those pieces include acquisition and capital improvement costs. Also important are income projections and growth or financial benchmarks. Plus, many tasks exist with finding a property, securing loans and closing deals.

One of the central uses of most startup business plans is for raising investment funds . A business plan conveys what the new company needs and convinces others to help fund its growth. For banks, lenders or investors, the business plan shows them the who, what and how of the business operations. Then it communicates why the new business is a solid investment.

2. Established Firm

A second scenario involves an already established real estate firm. You own several different types of properties and rent and manage them with an in-house team.

A business plan for an existing company takes on a much different purpose than for the startup.

Even if profitable, your company still needs a pathway to future growth. You need strategies for responding to a changing market or tracking current projects. You also want to establish goals or metrics to define your success.

An established owner might use a business plan to determine what it takes to move into a new market. You might tweak that same plan in response to new competition entering the market.

For firms currently on solid footing, the business plan helps assess where they stand. It can then detail their next steps for achieving further success and how to accomplish more, faster.

Updating Your Plan

After writing a plan, one of the key questions becomes how often do you update it. The answer is—it depends.

There are times when you might need a “one-off” version. For instance, those that are provided to a specific shareholder or future partner.

In other cases, you may develop a plan for the fiscal year 2020. Then that plan will serve as the basis for your 2021 plan, then the 2022 plan and so on.

You should approach your plan as a living, breathing document. Create a master business plan, one kept up to date based on your company’s activity. You can then tailor that plan to a specific request or need without having to recreate it from scratch.

Elements of a Business Plan

Contrary to popular belief, business plans don’t need to be thousand-page documents. The critical factor is that they meet the needs of your business.

Business plans themselves come in various forms. As we noted, startups might use a one-page document to ask for initial funding. A legacy company might use a 10-page analysis to showcase its financial health.

Both could even be for the same audience , such as a financial institution. Or it could be used for customers or suppliers. Whoever it’s directed toward, the narrative of the plan serves the company that is creating it.

Despite a difference in style or purpose, every business plan includes a handful of central elements.

View these as your jumping-off point when writing the first draft of your plan. Hone in on the information that’s important to your organization to create a plan that reflects your company’s needs.

Executive Summary

The one universal aspect for every plan is the inclusion of an executive summary . This is your plan’s introduction to the reader, so be sure it’s well-constructed.

The key to your executive summary is providing meaningful, relevant information in a brief description. Your main points should cover:

• Why your company’s expertise provides the best solution in your particular field.
• Why your specific area of focus is a favorable market in which to take part.
• Why your firm is best positioned to meet the market’s needs in this area.

To stand out, allow your introduction to mirror your firm’s culture and voice. If you produce and sell skateboards, let your passion for those unique boards shine through in the summary. If your organization is a financial services company, your summary should reflect a firm grasp of investment trends and customer needs.

To captivate your audience, both internal and external, start out with a compelling summary.

Company Overview

This second section in a business plan is straightforward and includes the background and history of your organization. Keep your firm’s bio short and to the point. Summarize your location(s), history, significant accomplishments and ownership or legal data.

If your group has a mission statement , include it in this section as well.

Some internal plans often leave out the company bio. Write one anyway. It’s good practice to convey your organization’s story. Plus, if you have it written, it’s ready to go should you ever need to publicly share it.

Product or Service Information

In this section, you’ll detail what your company does. This includes the goods you produce and sell or the services you provide. Make this section effective by capturing the following:

• How your solution is a benefit to customers.
• How you produce that solution, such as the lifecycle of product production or philosophy and method behind a service.
• Is your solution proprietary? Does it feature copyrights or patents?
• What is your company’s market advantage in what you do?

With product details, it’s best to paint a picture of the marketplace then detail how your business is positioned as a leader in that specific market.

Marketing or Sales Plan

Within your business plan, it’s not necessary to drill down into the finer details of every area. This is most true with your marketing or sales strategy. You don’t have to list every advertising source, but you should convey a grasp of your target demographics and how to reach them. You can include key points such as:

• How you price your offerings.
• How you promote and generate interest and sales from new customers.
• How you will keep those customers.

While product data shows your current market position, marketing data focus on your tactics to keep and grow that market share .

For potential investors to know whether or not to invest, they need to know financial information. While the level of financial detail varies based on the audience’s need, the best financial plans feature the following:

• Financial forecast—this varies with industry but should include at least a five-year forecast.
• Income statement.
• Balance sheet.
• Cash flow statement.
• Capital expense expectations.
• Financials show both the current monetary health of your firm and what your future success may look like.

If you’ve got a lot of good data, don’t hold it back. This is especially true if the plan is to attract investors. The more comprehensive your financial data, the better.

Organizational Team

Your team summary is an extension of your company bio. The goal is to clearly define your company’s hierarchy and the key players at the top. This induces any influential department heads or partnerships you’ve built.

You also want to identify the principles that govern your company’s management style. Company culture is an underrated aspect of today’s business climate. Placing importance on it in your business plan will set yours apart from those that don’t. This is also a good spot to detail any personnel plans or challenges to consider.

Additional Elements

Depending on the purpose of the business plan or its intended audience, there are two other sections worth noting.

In creating a comprehensive plan, you may need to include supporting documentation. The appendix helps organize requested materials or information that did not fit within your primary plan. These inclusions may consist of the following:

• Contracts or legal documents.
• References.
• Permits or licenses.
• Product specs or images.
• Organizational charts.
• Detailed financial reports.

Funding Request

For startups, or even established firms, seeking investment, you’ll want to include a dedicated section that outlines the request . You should specify the type of funding you need, how you’ll apply the funds and over what timeframe. It also helps to include a note on the financial endgame for your organization.

Final Thoughts

Whether for securing funding or getting your established team on the same page, business plans are invaluable for providing a pathway to success.

Develop a plan that best serves your company and its future growth. Keep it up to date and focused on the elements vital to your success, including where you’ve been, where you want to go and how you plan to get there.

A great business plan doesn’t need to be expertly written to be effective. It should, however, be written so you can expertly execute it.

Advance Your Business Expertise

In a degree program at PGS, you’ll expand your knowledge, skills and experiences in practical areas such as developing a business plan. Check out business programs from the associate to master’s level to discover your next step in growing your career and achieving your business goals.

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Kacey Spencer

Kacey Spencer (B.S. ’12, MBA ’20) previously served as development coordinator for Cornerstone University’s WCSG Radio. She also served as an enrollment counselor for Cornerstone University’s Professional & Graduate Studies division. She graduated in 2012 with a bachelor’s in business management. She enjoys cooking, reading, event planning and being outside in nature.

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• What is strategic planning? 5 steps and ...

What is strategic planning? 5 steps and processes

A strategic plan helps you define and share the direction your company will take in the next three to five years. It includes your company’s vision and mission statements, goals, and the actions you’ll take to achieve those goals. In this article we describe how a strategic plan compares to other project and business tools, plus four steps to create a successful strategic plan for your company.

Strategic planning is when business leaders map out their vision for the organization’s growth and how they’re going to get there. Strategic plans inform your organization’s decisions, growth, and goals. So if you work for a small company or startup, you could likely benefit from creating a strategic plan. When you have a clear sense of where your organization is going, you’re able to ensure your teams are working on projects that make the most impact. 

The strategic planning process doesn’t just help you identify where you need to go—during the process, you’ll also create a document you can share with employees and stakeholders so they stay informed. In this article, we’ll walk you through how to get started developing a strategic plan.

What is a strategic plan?

A strategic plan is a tool to define your organization’s goals and what actions you will take to achieve them. Typically, a strategic plan will include your company’s vision and mission statements, your long-term goals (as well as short-term, yearly objectives), and an action plan of the steps you’re going to take to move in the right direction. 

Your strategic plan document should include: 

Your company’s mission statement

Your company’s goals

A plan of action to achieve those goals

Your approach to achieving your goals

The tactics you’ll use to meet your goals

An effective strategic plan can give your organization clarity and focus. This level of clarity isn’t always a given—according to our research, only 16% of knowledge workers say their company is effective at setting and communicating company goals. By investing time into strategy formulation, you can build out a three- to five-year vision for the future of your company. This strategy will then inform your yearly and quarterly company goals. 

Do I need a strategic plan?

A strategic plan is one of many tools you can use to plan and hit your goals. It helps map out strategic objectives and growth metrics. Here’s how a strategic plan compares to other project management and business tools.

Strategic plan vs. business plan

A business plan can help you document your strategy as you’re getting started so every team member is on the same page about your core business priorities and goals. This tool can help you document and share your strategy with key investors or stakeholders as you get your business up and running.

You should create a business plan when you’re: 

Just starting your business

Significantly restructuring your business

If your business is already established, consider creating a strategic plan instead of a business plan. Even if you’re working at a relatively young company, your strategic plan can build on your business plan to help you move in the right direction. During the strategic planning process, you’ll draw from a lot of the fundamental business elements you built early on to establish your strategy for the next three to five years.

Key takeaway: A business plan works for new businesses or large organizational overhauls. Strategic plans are better for established businesses. 

Strategic plan vs. mission and vision statements

Your strategic plan, mission statement, and vision statements are all closely connected. In fact, during the strategic planning process, you will take inspiration from your mission and vision statements in order to build out your strategic plan.

As a result, you should already have your mission and vision statements drafted before you create a strategic plan. Ideally, this is something you created during the business planning phase or shortly after your company started. If you don’t have a mission or vision statement, take some time to create those now. A mission statement states your company’s purpose and it addresses what problem your organization is trying to solve. A vision statement states, in very broad strokes, how you’re going to get there. 

Simply put: 

A mission statement summarizes your company’s purpose

A vision statement broadly explains how you’ll reach your company’s purpose

A strategic plan should include your mission and vision statements, but it should also be more specific than that. Your mission and vision statements could, theoretically, remain the same throughout your company’s entire lifespan. A strategic plan pulls in inspiration from your mission and vision statements and outlines what actions you’re going to take to move in the right direction. 

For example, if your company produces pet safety equipment, here’s how your mission statement, vision statement, and strategic plan might shake out:

Mission statement: “To ensure the safety of the world’s animals.” 

Vision statement: “To create pet safety and tracking products that are effortless to use.” 

Your strategic plan would outline the steps you’re going to take in the next few years to bring your company closer to your mission and vision. For example, you develop a new pet tracking smart collar or improve the microchipping experience for pet owners. 

Key takeaway: A strategic plan draws inspiration from your mission and vision statements. 

Strategic plan vs. company objectives

Company objectives are broad goals. You should set these on a yearly or quarterly basis (if your organization moves quickly). These objectives give your team a clear sense of what you intend to accomplish for a set period of time. 

Your strategic plan is more forward-thinking than your company goals, and it should cover more than one year of work. Think of it this way: your company objectives will move the needle towards your overall strategy—but your strategic plan should be bigger than company objectives because it spans multiple years.

Key takeaway: Company objectives are broad, evergreen goals, while a strategic plan is a specific plan of action. 

Strategic plan vs. business case

A business case is a document to help you pitch a significant investment or initiative for your company. When you create a business case, you’re outlining why this investment is a good idea, and how this large-scale project will positively impact the business. 

You might end up building business cases for things on your strategic plan’s roadmap—but your strategic plan should be bigger than that. This tool should encompass multiple years of your roadmap, across your entire company—not just one initiative.

Key takeaway: A business case tackles one initiative or investment, while a strategic plan maps out years of overall growth for your company. 

Strategic plan vs. project plan

A strategic plan is a company-wide, multi-year plan of what you want to accomplish in the next three to five years and how you plan to accomplish that. A project plan, on the other hand, outlines how you’re going to accomplish a specific project. This project could be one of many initiatives that contribute to a specific company objective which, in turn, is one of many objectives that contribute to your strategic plan. 

A project plan has seven parts: 

Success metrics

Stakeholders and roles

Scope and budget

Milestones and deliverables

Timeline and schedule

Communication plan

Key takeaway: You may build project plans to map out parts of your strategic plan. 

When should I create a strategic plan?

You should aim to create a strategic plan every three to five years, depending on your organization’s growth speed. That being said, if your organization moves quickly, consider creating one every two to three years instead. Small businesses may need to create strategic plans more often, as their needs change. 

Since the point of a strategic plan is to map out your long-term goals and how you’ll get there, you should create a strategic plan when you’ve met most or all of them. You should also create a strategic plan any time you’re going to make a large pivot in your organization’s mission or enter new markets. 

What are the 5 steps in strategic planning?

The strategic planning process should be run by a small team of key stakeholders who will be in charge of building your strategic plan. 

Your group of strategic planners, sometimes called the management committee, should be a small team of five to 10 key stakeholders and decision-makers for the company. They won’t be the only people involved—but they will be the people driving the work. 

Once you’ve established your management committee, you can get to work on the strategic planning process. 

Step 1: Determine where you are

Before you can get started with strategy development and define where you’re going, you first need to define where you are. To do this, your management committee should collect a variety of information from additional stakeholders—like employees and customers. In particular, plan to gather:

Relevant industry and market data to inform any market opportunities, as well as any potential upcoming threats in the near future

Customer insights to understand what your customers want from your company—like product improvements or additional services

Employee feedback that needs to be addressed—whether in the product, business practices, or company culture

A SWOT analysis to help you assess both current and future potential for the business (you’ll return to this analysis periodically during the strategic planning process). 

To fill out each letter in the SWOT acronym, your management committee will answer a series of questions:

What does your organization currently do well?

What separates you from your competitors?

What are your most valuable internal resources?

What tangible assets do you have?

What is your biggest strength? 

Weaknesses:

What does your organization do poorly?

What do you currently lack (whether that’s a product, resource, or process)?

What do your competitors do better than you?

What, if any, limitations are holding your organization back?

What processes or products need improvement? 

Opportunities:

What opportunities does your organization have?

How can you leverage your unique company strengths?

Are there any trends that you can take advantage of?

How can you capitalize on marketing or press opportunities?

Is there an emerging need for your product or service? 

What emerging competitors should you keep an eye on?

Are there any weaknesses that expose your organization to risk?

Have you or could you experience negative press that could reduce market share?

Is there a chance of changing customer attitudes towards your company? 

Step 2: Identify your goals and objectives

This is where the magic happens. To develop your strategy, take into account your current position, which is where you are now. Then, draw inspiration from your original business documents—these are your final destination. 

To develop your strategy, you’re essentially pulling out your compass and asking, “Where are we going next?” This can help you figure out exactly which path you need to take. 

During this phase of the planning process, take inspiration from important company documents to ensure your strategic plan is moving your company in the right direction like:

Your mission statement, to understand how you can continue moving towards your organization’s core purpose

Your vision statement, to clarify how your strategic plan fits into your long-term vision

Your company values, to guide you towards what matters most towards your company

Your competitive advantages, to understand what unique benefit you offer to the market

Your long-term goals, to track where you want to be in five or 10 years

Your financial forecast and projection, to understand where you expect your financials to be in the next three years, what your expected cash flow is, and what new opportunities you will likely be able to invest in

Step 3: Develop your plan

Now that you understand where you are and where you want to go, it’s time to put pen to paper. Your plan will take your position and strategy into account to define your organization-wide plan for the next three to five years. Keep in mind that even though you’re creating a long-term plan, parts of your strategic plan should be created as the quarters and years go on.

As you build your strategic plan, you should define:

Your company priorities for the next three to five years, based on your SWOT analysis and strategy.

Yearly objectives for the first year. You don’t need to define your objectives for every year of the strategic plan. As the years go on, create new yearly objectives that connect back to your overall strategic goals . 

Related key results and KPIs for that first year. Some of these should be set by the management committee, and some should be set by specific teams that are closer to the work. Make sure your key results and KPIs are measurable and actionable.

Budget for the next year or few years. This should be based on your financial forecast as well as your direction. Do you need to spend aggressively to develop your product? Build your team? Make a dent with marketing? Clarify your most important initiatives and how you’ll budget for those.

A high-level project roadmap . A project roadmap is a tool in project management that helps you visualize the timeline of a complex initiative, but you can also create a very high-level project roadmap for your strategic plan. Outline what you expect to be working on in certain quarters or years to make the plan more actionable and understandable.

Step 4: Execute your plan

After all that buildup, it’s time to put your plan into action. New strategy execution involves clear communication across your entire organization to make sure everyone knows their responsibilities and how to measure the plan’s success. 

Map your processes with key performance indicators, which will gauge the success of your plan. KPIs will establish which parts of your plan you want achieved in what time frame. 

A few tips to make sure your plan will be executed without a hitch: 

Align tasks with job descriptions to make sure people are equipped to get their jobs done

Communicate clearly to your entire organization throughout the implementation process 

Fully commit to your plan 

Step 5: Revise and restructure as needed

At this point, you should have created and implemented your new strategic framework. The final step of the planning process is to monitor and manage your plan.

Share your strategic plan —this isn’t a document to hide away. Make sure your team (especially senior leadership) has access to it so they can understand how their work contributes to company priorities and your overall strategic plan. We recommend sharing your plan in the same tool you use to manage and track work, so you can more easily connect high-level objectives to daily work. If you don’t already, consider using a work management tool .

Update your plan regularly (quarterly and annually). Make sure you’re using your strategic plan to inform your shorter-term goals. Your strategic plan also isn’t set in stone. You’ll likely need to update the plan if your company decides to change directions or make new investments. As new market opportunities and threats come up, you’ll likely want to tweak your strategic plan to ensure you’re building your organization in the best direction possible for the next few years.

Keep in mind that your plan won’t last forever—even if you do update it frequently. A successful strategic plan evolves with your company’s long-term goals. When you’ve achieved most of your strategic goals, or if your strategy has evolved significantly since you first made your plan, it might be time to create a new one.

The benefits of strategic planning

Strategic planning can help with goal-setting by allowing you to explain how your company will move towards your mission and vision statements in the next three to five years. If you think of your company trajectory as a line on a map, a strategic plan can help you better quantify how you’ll get from point A (where you are now) to point B (where you want to be in a few years).

When you create and share a clear strategic plan with your team, you can:

Align everyone around a shared purpose

Proactively set objectives to help you get where you want to go

Define long-term goals, and then set shorter-term goals to support them

Assess your current situation and any opportunities—or threats

Help your business be more durable because you’re thinking long-term

Increase motivation and engagement

Sticking to the strategic plan

To turn your company strategy into a plan—and ultimately, impact—make sure you’re proactively connecting company objectives to daily work. When you can clarify this connection, you’re giving your team members the context they need to get their best work done. 

With clear priorities, team members can focus on the initiatives that are making the biggest impact for the company—and they’ll likely be more engaged while doing so.

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6 Steps to Make Your Strategic Plan Really Strategic

• Graham Kenny

You don’t need dozens of strategic goals.

Many strategic plans aren’t strategic, or even plans. To fix that, try a six step process: first, identify key stakeholders. Second, identify a specific, very important key stakeholder: your target customer. Third, figure out what these stakeholders want from you. Fourth, figure out what you want from them. Fifth, design your strategy around these requirements. Sixth, focus on continuously improving this plan.

Why is it that when a group of managers gets together for a strategic planning session they often emerge with a document that’s devoid of “strategy”, and often not even a plan ?

I have one such document in front of me as I write this. It starts with a “vision” statement, moves on to “strategic themes” (six in all) and culminates in 28 “strategic goals.” The latter is a list of actions interspersed with a sprinkling of desired results, all utterly useless in terms of strategy. It’s more like a dog chasing its tail. As the managing partner of a client law firm recently explained to me: “Before we adopted your approach we lacked the keys to effective strategic planning. It was seat-of-the-pants stuff. I would spontaneously go about saying how about we do this/how about we do that. I was buried in the enterprise.”

This problem is the lack of an effective “method” — a systematic or established procedure to undertake something, step by step. But methods can be learned. I’ll let you in on the six-step technique I have developed over many years, working with clients and in teaching my public seminars on strategic planning .

Step one is to recognize your dependencies , i.e. your key stakeholders . You may think that this will be easy. And in a small business, like a convenience store, it initially is: customers, employees, suppliers, and owners. But then you become aware that some of the employees are also owners, and the complexity grows.

The trick is to identify stakeholder roles. The same group of stakeholders can occupy more than one role. Take the example of a dairy cooperative I worked with recently. It was a national distributor of milk and other dairy products and in it, farmers occupied two roles. We described these as: farmers-as-shareholders and farmers-as-suppliers. Its other key stakeholders were distributors; customers-retail; customers-industrial/food service; consumers; and employees. Once you get the knotty key-stakeholder problem sorted out you can move on — but not too fast.

An essential second step, and one that I’ve been guilty of not stressing enough with clients, comes with the word “target.” It’s vitally important to identify your “target customer” before moving forward. Take, for example, the international accounting firm KPMG. Its target customers aren’t mums and dads lodging their annual tax returns, or small businesses that need help with their accounts. That work falls on the shoulders of the suburban accountant. Nor is KPMG’s target mid-size firms with limited budgets. That’s for so called “second-tier” accounting firms. No, KPMG targets large corporates and big government.

Isolating the target customer has massive implications, including in other stakeholder groups. For example, KPMG only hires staff who are qualified to offer services for large corporate and big government customers. Your strategic plan can’t be all things to all customers. So, take your time here to clearly define your target customer.

The third step requires you to work out what your organization wants from each key stakeholder group for your organization to prosper. For some managers, this seems initially like putting the cart before the horse. The reason? They’re so used to thinking operationally rather than strategically that putting “self” first seems like heresy. Nowhere is this more apparent than with the stakeholder “employees.”

Take the case of a recent client of mine, an architectural firm. The HR team and senior management would bend over backwards to identify what would satisfy staff. But they placed little attention on, and certainly failed to measure, the return volley. That is, what the organization wanted from employees. Once it adopted the six-step method, these outcomes were identified as “reducing employee turnover and increasing productivity and innovation.” Metrics were developed to monitor these, and targets were set before moving on.

The fourth step is to identify what these stakeholder groups want from you . These are the key decision-making criteria that stakeholders use when interacting with your business. For example, these might include the factors influencing the decision to purchase from you (customers), work for you (employees), supply to you (suppliers) or invest in you (shareholders).

It’s essential that you know how each stakeholder group thinks about these — that you focus on their point of view, not your own. This can come from a variety of sources including: in-depth interviews of stakeholders, listening to stakeholder stories about their experience with you and the competition, feedback via your complaint and suggestion systems, focus groups and even casual conversations with stakeholders. It can even involve immersing yourself in the stakeholder experience by going through it, e.g. the senior executives of an airline might travel at the back of the plane  to get a feel for what economy passengers experience.

For example, at a manufacturer of specialized air conditioners for computer rooms, “customer service,” as you’d expect, meant “handling enquiries and dealing with complaints.” But research showed that “customer service” had additional dimensions in the minds of their customers, namely “technical support pre- and post-sale.” Getting to grips with the full extent of the customers’ expectations led to insight which drove the company’s strategy.

Strategy design , your fifth step, involves deciding what your organization’s positions will be on the identified strategic factors for each key stakeholder group. This is shaped by the objectives you’ve set for your organization and the knowledge you’ve gleaned about your stakeholders’ current and future needs on strategic factors. This is where “focus” again delivers in spades. I’ve assisted a rural bank which decided that its target customer was “commercial family farms.” This ruled out large corporate farms and hobby farms. It then built strategy based on these customers’ opinions. It went further to co-create with farmers its positions on product range, customer service, and price to drive revenue and profitability. Stakeholders can be great strategists. Tap them in designing strategy.

The sixth step is continuous improvement . Recognize that no matter what you decide, there is no certainty in the result once you embark on implementation via an action plan and scorecard . You can’t be sure, for instance, in the case of the manufacturer of specialized air conditioners, that ramping up technical support pre- and post-sale will drive more revenue. Be prepared to adjust . View your strategic as being locked in an intimate tango with your key stakeholders. This dynamic perspective encourages openness, innovation and a preparedness to change.

Organizations which practice this system-design approach to strategic planning turn out to be gob-smackingly great. Toyota and McDonald’s are two that I deal with that fall into that category. They’re stakeholder-focused, no-stone-unturned companies that defy expectations in their ability to pull together a diverse population of employees to produce amazing results. You can too — if you become systematic in your approach.

• Graham Kenny , CEO of  Strategic Factors , is a recognized expert in strategy and performance measurement who helps managers, executives, and boards create successful organizations in the private, public, and not-for-profit sectors. He has been a professor of management in universities in the U.S., and Canada.  You can connect to or follow him on  LinkedIn .

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Whether you've just started out or have been running your business for years, business planning can be the key to your success. Having a business plan:

• helps you to prioritise – it gives your business direction, defines your objectives, maps out how you'll achieve your goals and helps you to manage possible bumps in the road
• gives you control over your business – the planning process helps you learn about the different things that could affect your success. If you're already in business, it helps you to step back and look at what's working and what you can improve on
• helps you seek finance – if you're seeking finance for your business, you'll need to show banks and investors why they should invest in your business.

Use our Business plan template for detailed business planning or seeking finance.

Choose the Lean business plan template to quickly focus your business and set some goals for the year ahead.

Business plan template

Lean business plan template

Our templates step you through the process of developing a business plan with links to extra information if you need it.

If you're developing a detailed business plan, you may want to check our tips below before you start.

1. Determine what your plan is for

Does your business plan have more than one purpose? Will you use it internally, or will you share it externally, for example with potential investors or banks?

Deciding what the purpose is, can help you develop your plan for the right audience. If the plan has been developed for third parties, you will need to determine what they’ll be most interested in.

2. Prepare your finances

If you're looking for finance, lenders and investors will want to know if your finances are in order and your business is in a strong financial position. They'll want to know how much money you currently have, how much money you need and how much you expect to make in the near future. While a bit of extra funding will help you ensure you’re covered for unexpected costs, be realistic and avoid asking for more than you need.

If you're starting out and don't have financial information yet, our business plan template provides resources to help you get your finances ready.

3. Write your summary last

Summarise the main points of your business plan using as few words as possible. You want to get to the point but not overlook important facts. This is your opportunity to sell yourself, but don't overdo it. The summary should include details about your business, market, goals and what makes you different from other businesses.

4. Get help

Don't leave your business plan to the last minute. It takes time, research and careful preparation to develop an effective business plan.

If you aren't confident in completing the plan yourself, consider getting a professional to look over it and provide advice.

There are a number of government services available to help you plan, start or grow your business. These services can provide general advice, workshops, seminars and networking events, and can even match you with a mentor or business coach.

Get expert help from a business adviser in your area .

5. Review your plan regularly

As your business changes, your plan will need to change to ensure your business is still heading in the right direction. Having your plan up-to-date can keep you focused on where you are heading.

It's a good idea to keep a record of each version of your business plan.

6. Protect your plan

Having an understanding with third parties when distributing a plan could be enough protection for some businesses. But if you have innovative business practices, products or services, you may want people to sign a confidentiality agreement to protect your innovations.

It may also be a good idea to include some words in your plan asking the reader not to disclose the details of your plan.

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A Manager’s Guide to Successful Strategy Implementation

• 25 Feb 2020

To address new challenges and business concerns, organizations must constantly monitor, evaluate, and adjust their strategic initiatives. When a new strategy needs to be implemented, it’s typically up to managers to ensure it rolls out successfully.

Whether you’re an aspiring, new, or seasoned manager, understanding the strategy implementation process and how it relates to organizational change is critical to ensuring you can be effective over the course of your career.

Here’s an overview of strategy implementation, as well as a step-by-step guide you can use to more effectively bring about change within your business.

Access your free e-book today.

What Is Strategy Implementation?

If you're relatively new to management, you might be wondering what the term “strategy implementation” means.

Strategy implementation is the process of turning plans into action to reach a desired outcome. Essentially, it’s the art of getting stuff done. The success of every organization rests on its capacity to implement decisions and execute key processes efficiently, effectively, and consistently. But how do you ensure that implementing a strategy will be successful?

In the online course Management Essentials , Harvard Business School Professor David Garvin says successfully implementing and executing strategy involves “delivering what’s planned or promised on time, on budget, at quality, and with minimum variability—even in the face of unexpected events and contingencies."

While developing a strategy is one of the first steps to implementing organizational change, the implementation itself is vital to a company’s success. Without an efficient implementation process, even the best-laid plans may not come to fruition.

If you're a manager who wants to implement strategic change within your organization, follow these seven steps to introduce and roll out a new strategy successfully.

7 Key Steps in the Implementation Process

1. set clear goals and define key variables.

The first step of the process is straightforward: You must identify the goals that the new strategy should achieve. Without a clear picture of what you’re trying to attain, it can be difficult to establish a plan for getting there.

One common mistake when goal setting—whether related to personal growth, professional development, or business—is setting objectives that are impossible to reach. Remember: Goals should be attainable. Setting goals that aren’t realistic can lead you and your team to feel overwhelmed, uninspired, deflated, and potentially burnt out.

To avoid inadvertently causing low morale, review the outcomes and performances—both the successes and failures—of previous change initiatives to determine what’s realistic given your timeframe and resources. Use this past experience to define what success looks like.

Another important aspect of goal setting is to account for variables that may hinder your team’s ability to reach them and to lay out contingency plans. The better prepared you are, the more successful the implementation will likely be.

2. Determine Roles, Responsibilities, and Relationships

Once you’ve determined the goals you’re working toward and the variables that might get in your way, you should build a roadmap for achieving those goals, set expectations among your team, and clearly communicate your implementation plan, so there’s no confusion.

In this phase, it can be helpful to document all of the resources available, including the employees, teams, and departments that will be involved. Outline a clear picture of what each resource is responsible for achieving, and establish a communication process that everyone should adhere to.

Implementing strategic plans requires strong relationships and, as a manager, you’ll be in charge of telling people not only how to interact with each other and how often, but also who the decision-makers are, who’s accountable for what, and what to do when an unforeseen issue arises.

3. Delegate the Work

Once you know what needs to be done to ensure success, determine who needs to do what and when. Refer to your original timeline and goal list, and delegate tasks to the appropriate team members.

You should explain the big picture to your team so they understand the company's vision and make sure everyone knows their specific responsibilities. Also, set deadlines to avoid overwhelming individuals. Remember that your job as a manager is to achieve goals and keep your team on-task, so try to avoid the urge to micromanage .

4. Execute the Plan, Monitor Progress and Performance, and Provide Continued Support

Next, you’ll need to put the plan into action. One of the most difficult skills to learn as a manager is how to guide and support employees effectively. While your focus will likely be on delegation much of the time, it’s important to make yourself available to answer questions your employees might have, or address challenges and roadblocks they may be experiencing.

Check in with your team regularly about their progress and listen to their feedback.

One effective strategy for monitoring progress is to use daily, weekly, and monthly status reports and check-ins to provide updates, re-establish due dates and milestones, and ensure all teams are aligned.

Related: How to Give Feedback Effectively

5. Take Corrective Action (Adjust or Revise, as Necessary)

Implementation is an iterative process, so the work doesn’t stop as soon as you think you’ve reached your goal. Processes can change mid-course, and unforeseen issues or challenges can arise. Sometimes, your original goals will need to shift as the nature of the project itself changes.

It’s more important to be attentive, flexible, and willing to change or readjust plans as you oversee implementation than it is to blindly adhere to your original goals.

Periodically ask yourself and your team: Do we need to adjust? If so, how? Do we need to start over? The answers to these questions can prove invaluable.

6. Get Closure on the Project, and Agreement on the Output

Everyone on the team should agree on what the final product should look like based on the goals set at the beginning. When you’ve successfully implemented your strategy, check in with each team member and department to make sure they have everything they need to finish the job and feel like their work is complete.

You’ll need to report to your management team, so gather information, details, and results from your employees, so that you can paint an accurate picture to leadership.

7. Conduct a Retrospective or Review of How the Process Went

Once your strategy has been fully implemented, look back on the process and evaluate how things went. Ask yourself questions like:

• Did we achieve our goals?
• If not, why? What steps are required to get us to those goals?
• What roadblocks or challenges emerged over the course of the project that could have been anticipated? How can we avoid these challenges in the future?
• In general, what lessons can we learn from the process?

While failure is never the goal, an unsuccessful or flawed strategy implementation can prove a valuable learning experience for an organization, so long as time is taken to understand what went wrong and why.

Learning How to Oversee Strategy Implementation

Successful strategy implementation can be challenging, and it requires strong leadership and management skills. Effective delegation, patience, emotional intelligence, thorough organizational abilities, and communication skills are crucial.

If you’re looking to build your skills and become a better manager , consider taking a leadership or management course that aligns with your personal and professional goals. Management training courses are often flexible in design but offer critical, hands-on learning opportunities provided by leading industry experts that can be applied to any profession.

Do you want to improve your management skills? Explore our eight-week online course Management Essentials , and learn how you can spearhead initiatives that enable your organization to improve and innovate.

About the Author

• A 7 Step Guide to Developing a Business Plan

By Hanh Truong

How to develop a business plan.

• Executive Summary - This is oftentimes referred to as the company's elevator pitch. This page can highlight the firm's purpose, financial standing, and competitive edge. Executive summaries can also include a table of contents and background information.
• Business Description and Structure - This part of the business plan outlines what services or products the company is selling. It can go into detail about raw materials, manufacturing processes, inventory practices, fulfillment methods, and their value. Entrepreneurs can also explain administrative structures, property, and legality in this section too.
• Market Research and Strategy - Any statistics, data analysis, testimonials, or market research should be written out here. It is also important to include strategies for departments, as well as projects, forecasts, and deadlines.
• Workforce Structure - The business plan should have a section that describes all executives and managerial employees, and how their skills and experience can help enhance goal attainment.
• Financial Information - This section will have projections of profit and loss statements, cash flow, and balance sheets. Data insights should be based on predictions for the following years, not current outputs.

1. Identify Objectives

An important puzzle piece to a business plan is creating operational goals. Identifying key objectives will ensure the entire business plan and strategies align with the targets the company wants to meet. Some common goals include increased revenue, purchase orders, and customer retention.

Important -: The Small Business Association recommends that a business plan entails an executive summary, budget or funding information, and marketing strategies.

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2. Set a Budget

Creating a budget will allow managers to make sure their bottom line is always protected. This step involves assessing gross revenue, subtracting fixed costs, and preserving a set amount for unanticipated emergencies. Any capital leftover can then be used for business development and growth projects.

3. Determine Target Consumers and Their Needs

Next, company leaders need to research and identify who their ideal customer base is and what their preferences are. Defining buyer personas through data will also highlight important attributes of consumers. Doing so will guide marketing and development efforts, ensuring they effectively capture customers' attention.

4. Select Purchasing and Marketing Channels

Purchasing channels refer to mediums in which customers can purchase goods and services. This can be through a website, a brick-and-mortar store, or a mobile app. On the other hand, marketing channels are platforms where companies can raise brand awareness and engage with shoppers. Similar to purchasing, these channels can be a website, social media ad, or mobile apps. Selecting these channels for the business plan will enable intricate strategies.

5. Establish Key Performance Indicators (KPIs)

Key performance indicators are measurable values that business teams can use to monitor performance. These metrics include Return on Investment (ROI), profit generation, sales, and customer retention rates. The business plan should define KPIs that the company is tracking and why it matters.

6. Create a Sales Process

• Prospecting - The practice of looking for potential customers online or in-store.
• Approaching - A sales representative engages and connects with the prospect via phone or in-person.
• Researching - The sales representative then gathers information about the prospect and their needs and helps highlight their pain points.
• Presenting - At this stage, the sales representative will present the company's service or products as a solution to the customer's pain points. This can entail performing product demonstrations and giving pitches.
• Closing - The final step of the sales process is when the sales representative finalizes the deal and drafts a contract.

Important -: Statistics show that planning a business can help a company grow 30% faster.

7. Execute the Business Plan and Review

At this stage, the business plan is ready to go into action. Executives should share this document with key stakeholders and employees to ensure everyone is on the same page. After a specified time period, they should review the plan and make any necessary changes to reflect new markets or fluctuations.

Key Takeaways to Developing a Business Plan

• Business plans are documents that outline a company's goal, strategy, and mission.
• Having a business plan will guide executives and ensure they are focused on their objectives.
• Key components to a business plan include an executive summary, business description, and market research.
• Steps to creating a successful business plan include identifying goals, establishing KPIs, and making a sales process.

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• Skills Needed to Navigate International Business Development
• The Importance of Research and Development in Business
• The 4 Main Stages of Business Development
• What is Business Development and Why Does it Matter?

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5 Steps to Developing a Solid Business Plan

Choncé maddox.

You have a great business idea and want to jump right in. The one thing holding you back may be lack of a clear business plan . While some would say having a business plan is an absolute must, others would argue that you can get started and be successful without one.

I think the answer lies in how confident you are in your idea and how organized you are in terms of executing it. If you already have a clear plan in your head along with the steps you need to take and the means to take them, you may not see the need to create a 20-page business plan.

On the flip side, if your idea lacks clarity and you are considering seeking out funding from others sources, it would be best if you came up with a solid business plan. The good news, is that you can sit down and create a business plan in under a day. It doesn’t have to be super extensive so long as you hit all your main points and follow stick to outlining these steps.

Table of Contents

1. Executive Summary

The executive summary is the first part of your business plan. This is where you capture the reader’s attention be explaining the specifics of your business. What is the name? What will you be doing? What is the mission of your business and what are your goals?

Be sure to include what makes your business unique and summarize why you feel it will succeed.

2. Market Analysis

Next you want to analyze the market in order to prove that there is a need and target audience for your business. This is a great way to validate your business idea as well. If you can’t narrow down your target market or find that they aren’t interested in what you are offering, that could be a huge red flag.

Be sure to clarify who you wish to serve along with some detailed statistics that describe them, their interests, what products and services they buy, along with and their needs and wants.

3. Financial Projections

The financial projections section is where you get to have some fun with numbers. Map out the financial progress you plan to make with your business over the next 3-5 years. Include revenue goals and you might want to specify how much you’d need from an investor or a loan to bring those goals to fruition.

This is also a great place to mention various different start-up costs you’ll have so investors can know why you need money to support your business.

4. Organizational Structure

Have you ever thought about how your business will operate and be structured? Will you act as the CEO? Will you have a team or hire interns ? Will you eventually need to work with accounting, sales, and marketing experts? Or will you be more of a solopreneur.

This is a great section to answer all of those questions and map out how you might expect your business to grow in the future and which roles you’ll have and need.

5. Products or Services

Finally, in step 5 you want to go into more detail about your products and services. Most people start with this step (especially if they don’t consider making a business plan) but it’s best to end here after you’ve covered your bases in the previous steps.

Discuss what makes your product or service unique and how you plan to execute it in a competitive marketplace. If you’re going to be selling products include descriptions and images along with whether you’d need to trademark anything.

A business plan can be a crucial tool to help you get organized and perform neccessary research before moving forward with your new venture. If you’re considering asking for funding or financial assistance, a solid business plan is usually a requirement.

Even so, it’s a great way to get crystal clear on your goals and intentions so you can focus in on carrying out your plans and being successful.

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Six steps to an effective business plan

• Your business
• Developing your business
• Planning and strategy

At Lancasters we can provide objective assistance with writing a business plan, based on our experience in helping businesses in the Haddenham area. Here are six elements of a good business plan...

If you think your business performance can improve and, amidst the meetings, phone calls, e-mails and office crises, you find it difficult to know how to begin, then you will benefit from reviewing your business planning.

Don't confuse business planning with crisis management. The former should prevent the latter. Making time for planning now can reduce the time you spend fighting fires later. Here are six key steps that can lead to an effective plan for your business:

Step 1: Establish your mission

In essence, your mission statement explains why your business exists. When you encounter a problem or a key decision, the answer will be informed by your mission. Think about why you started the business, and imagine where you want it to be in the future. These two elements will provide your mission statement.

Step 2: Analyse your SWOT

With your mission statement in mind, analyse your business's s trengths, w eaknesses, o pportunities and t hreats. List each category in full and be honest. Done correctly, this 'SWOT' analysis will help you to take an objective, critical, unemotional look at your business in its entirety.

Step 3: Develop a plan

Try this exercise: from each SWOT category, choose three to five important items. Then set goals to maximise your strengths, correct your weaknesses, make the most of your opportunities and nullify your threats. For example, you could decide to focus more strongly on a particularly successful product or service (a strength), and abandon a side-project which is costing time and money for little return (a weakness). Remember that you can't do everything yourself. Think about how you will delegate tasks and involve all the staff. Avoid dwelling on the negatives - set yourself realistic strategies for improving the business.

Step 4: Create a budget

All missions and strategies need money to succeed. A smart budget will help you to regularly review your expenses and make financially beneficial decisions. You may need to take a wide variety of factors into account when setting your budget. This is where we can help you - why not give us a call?

Step 5: Put it in writing

Make sure you write down your finished plan. Include the mission statement, SWOT analysis, goals and plans, budget and forecasts, and make it clear who is responsible for doing what. Share it with your key staff and shareholders, and encourage their input.

Step 6: Make it a living document

This is vital! Make your business plan a living document that you and your staff can frequently update and improve. Consider reviewing it monthly to track your progress and readjust your strategy as necessary. Hold yourself and your staff accountable for meeting the plan's goals, and think about introducing an incentive programme to keep everyone motivated.

Remember, a good business plan is as much about the process as the final document. Creating your plan will open your eyes to the realities of your business. Keeping it updated will help you stay on the right track. For help with developing your plan, call us .

Start-ups and established businesses in the Haddenham area looking for help with writing a business plan should contact Lancasters for more help and advice.

8 Ways You Can Improve Your Communication Skills

Your guide to establishing better communication habits for success in the workplace.

Mary Sharp Emerson

A leader’s ability to communicate clearly and effectively with employees, within teams, and across the organization is one of the foundations of a successful business.

And in today’s complex and quickly evolving business environment, with hundreds of different communication tools, fully or partially remote teams, and even multicultural teams spanning multiple time zones, effective communication has never been more important—or more challenging.

Thus, the ability to communicate might be a manager’s most critical skill. 

The good news is that these skills can be learned and even mastered. 

These eight tips can help you maximize your communication skills for the success of your organization and your career.

1. Be clear and concise

Communication is primarily about word choice. And when it comes to word choice, less is more.

The key to powerful and persuasive communication—whether written or spoken—is clarity and, when possible, brevity. 

Before engaging in any form of communication, define your goals and your audience. 

Outlining carefully and explicitly what you want to convey and why will help ensure that you include all necessary information. It will also help you eliminate irrelevant details. 

Avoid unnecessary words and overly flowery language, which can distract from your message.

And while repetition may be necessary in some cases, be sure to use it carefully and sparingly. Repeating your message can ensure that your audience receives it, but too much repetition can cause them to tune you out entirely. 

2. Prepare ahead of time

Know what you are going to say and how you are going to say before you begin any type of communication.

However, being prepared means more than just practicing a presentation. 

Preparation also involves thinking about the entirety of the communication, from start to finish. Research the information you may need to support your message. Consider how you will respond to questions and criticisms. Try to anticipate the unexpected.

Before a performance review, for instance, prepare a list of concrete examples of your employee’s behavior to support your evaluation.

Before engaging in a salary or promotion negotiation, know exactly what you want. Be ready to discuss ranges and potential compromises; know what you are willing to accept and what you aren’t. And have on hand specific details to support your case, such as relevant salaries for your position and your location (but be sure that your research is based on publicly available information, not company gossip or anecdotal evidence). 

Before entering into any conversation, brainstorm potential questions, requests for additional information or clarification, and disagreements so you are ready to address them calmly and clearly.

3. Be mindful of nonverbal communication

Our facial expressions, gestures, and body language can, and often do, say more than our words. 

Nonverbal cues can have between 65 and 93 percent more impact than the spoken word. And we are more likely to believe the nonverbal signals over spoken words if the two are in disagreement. 

Leaders must be especially adept at reading nonverbal cues. 

Employees who may be unwilling to voice disagreements or concerns, for instance, may show their discomfort through crossed arms or an unwillingness to make eye contact. If you are aware of others’ body language, you may be able to adjust your communication tactics appropriately.

At the same time, leaders must also be able to control their own nonverbal communications. 

Your nonverbal cues must, at all times, support your message. At best, conflicting verbal and nonverbal communication can cause confusion. At worst, it can undermine your message and your team’s confidence in you, your organization, and even in themselves. 

4. Watch your tone

How you say something can be just as important as what you say. As with other nonverbal cues, your tone can add power and emphasis to your message, or it can undermine it entirely.

Tone can be an especially important factor in workplace disagreements and conflict. A well-chosen word with a positive connotation creates good will and trust. A poorly chosen word with unclear or negative connotations can quickly lead to misunderstanding. 

When speaking, tone includes volume, projection, and intonation as well as word choice. In real time, it can be challenging to control tone to ensure that it matches your intent. But being mindful of your tone will enable you to alter it appropriately if a communication seems to be going in the wrong direction.

Tone can be easier to control when writing. Be sure to read your communication once, even twice, while thinking about tone as well as message. You may even want to read it out loud or ask a trusted colleague to read it over, if doing so does not breach confidentiality. 

And when engaging in a heated dialogue over email or other written medium, don’t be too hasty in your replies. 

If at all possible, write out your response but then wait for a day or two to send it. In many cases, re-reading your message after your emotions have cooled allows you to moderate your tone in a way that is less likely to escalate the conflict.

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5. Practice active listening

Communication nearly always involves two or more individuals.

Therefore, listening is just as important as speaking when it comes to communicating successfully. But listening can be more challenging than we realize. 

In her blog post Mastering the Basics of Communication , communication expert Marjorie North notes that we only hear about half of what the other person says during any given conversation. 

The goal of active listening is to ensure that you hear not just the words the person is saying, but the entire message. Some tips for active listening include:

• Giving the speaker your full and undivided attention
• Clearing your mind of distractions, judgements, and counter-arguments. 
• Avoiding the temptation to interrupt with your own thoughts.
• Showing open, positive body language to keep your mind focused and to show the speaker that you are really listening
• Rephrase or paraphrase what you’ve heard when making your reply
• Ask open ended questions designed to elicit additional information

6. Build your emotional intelligence

Communication is built upon a foundation of emotional intelligence. Simply put, you cannot communicate effectively with others until you can assess and understand your own feelings. 

“If you’re aware of your own emotions and the behaviors they trigger, you can begin to manage these emotions and behaviors,” says Margaret Andrews in her post, How to Improve Your Emotional Intelligence .

Leaders with a high level of emotional intelligence will naturally find it easier to engage in active listening, maintain appropriate tone, and use positive body language, for example.  

Understanding and managing your own emotions is only part of emotional intelligence. The other part—equally important for effective communication—is empathy for others.

Empathizing with an employee can, for example, make a difficult conversation easier. 

You may still have to deliver bad news, but (actively) listening to their perspective and showing that you understand their feelings can go a long way toward smoothing hurt feelings or avoiding misunderstandings.

7. Develop a workplace communication strategy

Today’s workplace is a constant flow of information across a wide variety of formats. Every single communication must be understood in the context of that larger flow of information.

Even the most effective communicator may find it difficult to get their message across without a workplace communication strategy.

A communication strategy is the framework within which your business conveys and receives information. It can—and should—outline how and what you communicate to customers and clients, stakeholders, and managers and employees. 

Starting most broadly, your strategy should incorporate who gets what message and when. This ensures that everyone receives the correct information at the right time. 

It can be as detailed as how you communicate, including defining the type of tools you use for which information. For example, you may define when it’s appropriate to use a group chat for the entire team or organization or when a meeting should have been summarized in an email instead. 

Creating basic guidelines like this can streamline the flow of information. It will help ensure that everyone gets the details they need and that important knowledge isn’t overwhelmed by extraneous minutia. 

8. Create a positive organizational culture

The corporate culture in which you are communicating also plays a vital role in effective communication. 

In a positive work environment—one founded on transparency, trust, empathy, and open dialogue—communication in general will be easier and more effective. 

Employees will be more receptive to hearing their manager’s message if they trust that manager. And managers will find it easier to create buy-in and even offer constructive criticism if they encourage their employees to speak up, offer suggestions, and even offer constructive criticisms of their own. 

“The most dangerous organization is a silent one,” says Lorne Rubis in a blog post, Six Tips for Building a Better Workplace Culture . Communication, in both directions, can only be effective in a culture that is built on trust and a foundation of psychological safety.

Authoritative managers who refuse to share information, aren’t open to suggestions, and refuse to admit mistakes and accept criticism are likely to find their suggestions and criticisms met with defensiveness or even ignored altogether. 

Without that foundation of trust and transparency, even the smallest communication can be misconstrued and lead to misunderstandings and unnecessary conflict.

Communicating with co-workers and employees is always going to present challenges. There will always be misunderstandings and miscommunications that must be resolved and unfortunately, corporate messages aren’t always what we want to hear, especially during difficult times.

But building and mastering effective communication skills will make your job easier as a leader, even during difficult conversations. Taking the time to build these skills will certainly be time well-spent. 

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About the Author

Digital Content Producer

Emerson is a Digital Content Producer at Harvard DCE. She is a graduate of Brandeis University and Yale University and started her career as an international affairs analyst. She is an avid triathlete and has completed three Ironman triathlons, as well as the Boston Marathon.

Harvard Professional Development Participant Success Stories

Read about how these skilled professionals used the knowledge and skills they learned in a Harvard PDP to further their career development.

Harvard Division of Continuing Education

A division of Harvard University dedicated to bringing rigorous programs and innovative online teaching capabilities to distance learners, working professionals, high school students, college students, and those seeking higher learning in retirement.