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Category: Articles » Business » Management » Article » Article Code

Strategic Business Planning - Part 3 - Exhibits

EXHIBIT A The Critical Success Factors SENIOR SUPPORT The top people should "walk the talk". The board of directors and the senior managers should present the concept of business planning to all levels, in all programmes, to all functional support units, to financial officers, personnel officers and operational managers ACCOUNTABILITY Ultimate accountability for the strategic business plan being developed, carried out and evaluated lies with top management. The maxim is to ensure that each person is responsible for achieving each goal stated by the business OWNERSHIP In simple language this ... read more

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EXHIBIT A 
 
The Critical Success Factors

SENIOR SUPPORT 
 
The top people should "walk the talk". The board of directors and the senior managers should present the concept of business planning to all levels, in all programmes, to all functional support units, to financial officers, personnel officers and operational managers

ACCOUNTABILITY 
 
Ultimate accountability for the strategic business plan being developed, carried out and evaluated lies with top management. The maxim is to ensure that each person is responsible for achieving each goal stated by the business

OWNERSHIP 
 
In simple language this means that the managers should be responsible and accountable for the content, time frames and deliverables for the specific area they supervise

MECHANISMS 
 
It is important that the strategic planning process is seen as a "hierarchical" process that links the higher to the lower levels of the business structure. It begins with the long-term business objectives and moves down into individual performance objectives and targets

FEEDBACK 
 
Strategic business planning must be INTERACTIVE - it can only improve through trial, evaluation and feedback. Important milestones are periodic meetings at top management levels to assess and, if necessary correct the plan

REWARD/RECOGNITION PROGRAMME 
 
Employees need to be motivated and encouraged to ensure an efficient cost/benefit approach. Recipients of rewards/recognition will signify to their colleagues that this kind of behaviour is what the organisation wants

EXHIBIT B 
 
The Benefits Of Business Planning

Provides guidance and direction to the business itself

Promotes cross fertilisation opportunities, for example sharing of resources/knowledge and cost ascertainment initiatives

Enhances managerial alertness to change and opportunities

Creates, fosters and energises a results-oriented climate

Provides managers with a rationale for evaluating competing interests regarding budget requests, staffing allocations, critical proposals

Steers resources where they are most needed

Helps to unify the myriad of decisions made throughout the business, by providing horizontal and vertical links

Co-ordinates disparate and diverse activities

Encourages pro-active thinking and responsive programme delivery

Provides a business culture throughout the organisation which facilitates the flow of information up and down its hierarchy

EXHIBIT C 
 
The 8 Rules of Business Planning

Open with a summary
 
Should be no longer than a page and ensure reader's attention. It enumerates the key points; gives some facts for the overall case.

Focus on the audience and the final result 
 
It must arouse the reader's interest, leaving out details which may be relevant only to yourself.

Avoid ambiguity 
 
Use plain language. Organise your message through references, clear figures and illustrations and make good use of graphs and tables.

Project your achievements 
 
A business plan backed by good, solid management is what the reader looks for. Highlight important achievements of management.

Use clear narrative and figures 
 
The reading must be interesting, logical and provide clear flow through to the end.

Do not forget the underlying evidence 
 
The data (both external and internal) should be of high quality, relevant and easily communicated to the reader.

Provide for feedback 
 
Involve the active participation of the reader through his/her comments, enquires and explanations.

Ensure senior support 
 
Most business plans originate at the bottom echelons of the management structure. The champion of the plan must be supported by a mentor on the board of directors.

EXHIBIT D 
 
An Effective Executive Summary 
 
• Booboo Ltd is a family-owned confectionery business established 50 years ago by the father of the present owner. Turnover has grown rapidly over the past five years to $750,000 and pre-tax profits to $150,000. A new outlet has been opened this year, to make up for the increased demand. This has also reduced operating costs by 10%. 
 
• Present market analysis indicates that there is demand to increase the number of outlets by another two. These will be serviced and controlled by the Main Area Outlet. Management believes that they could win business from local competitors who cannot compete on neither price nor quality. 
 
• The investment cost involved in setting up the two units is $300,000, whilst average running costs at to-day's prices will amount to around $85,000 annually. The funds required will be financed as to 30% from the additional funds invested by the owner and the rest by means of an assets-secured 10-year bank loan. 
 
• This investment together with a projected increase of 8% on present day turnover would boost up the pre-tax return from the present 19.6% to 25% of turnover.

EXIDBIT E
 
Good Quality Data 
 
Not...This rapidly growing massive market will soon become absolutely vast and once we have conquered it in a few years time we will also start on the even enormous international market, where there is even more potential and no competition. And in any case, nobody can copy our unique product.

But...The local market is estimated to be worth around $4.5 million per annum and to be growing at about 12% per annum. If development follows the course for neighbouring states, the potential market size is around $7.6 million, which provides considerable room for growth. Trade sources suggest that current market players are finding difficulty meeting demand, with the current demand/supply ratio running at 1.15. This supports our sales forecasts.

We believe there are further opportunities for expansion in the international arena, where the market is approximately at a similar stage of development as it was two years ago. Our plans show a modest entry into other international markets within 18 months...

Our products have minor improvements compared with competitors, which are protected by both local and international registrations.

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