Business Plans Overview and Implementation
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Questions and Answers

Which feature is essential for a successful business plan?

  • Vague objectives
  • Clear objectives (correct)
  • Inconsistent reporting
  • Delaying actions

What is a crucial aspect of monitoring and evaluating changes in business plans?

  • Setting deadlines (correct)
  • Avoiding assessments
  • Limiting communication
  • Ignoring feedback

What role do business plans play for investors and external stakeholders?

  • To provide personal opinions of management
  • To obscure facts about business feasibility
  • To limit the scope of potential activities
  • To communicate the business’s vision and main activities (correct)

How should a business respond to disruptive innovation according to its plans?

<p>Incorporate proposed changes thoughtfully (B)</p> Signup and view all the answers

Which element is not typically included in financial planning within a business plan?

<p>Employee personal profiles (C)</p> Signup and view all the answers

What is the primary purpose of an executive summary in a business plan?

<p>To summarize key points of the business plan (B)</p> Signup and view all the answers

Which factor is NOT typically included in a SWOT analysis?

<p>Market share (B)</p> Signup and view all the answers

Which aspect is essential for evaluating the effectiveness of marketing and sales strategies?

<p>Frequency of promotional methods used (A)</p> Signup and view all the answers

What is a key consideration when planning human resources for a business?

<p>Determining how to evaluate employee performance (B)</p> Signup and view all the answers

Which element is typically examined in the competition section of a marketing plan?

<p>Competitors' strengths and weaknesses (B)</p> Signup and view all the answers

What should a company consider when setting compensation and incentives for employees?

<p>Salary, stock options, and bonuses (D)</p> Signup and view all the answers

In financial planning, which strategy is essential for understanding market demand for a new product?

<p>Carrying out market research (D)</p> Signup and view all the answers

Which of the following best describes the purpose of customer service policies in a business?

<p>To define interactions with customers (A)</p> Signup and view all the answers

What is essential for a business plan to remain effective over time?

<p>It should be regularly reviewed and updated. (A)</p> Signup and view all the answers

What type of monitoring should be employed by a board to assess the performance of a business plan?

<p>Regular performance reporting. (B)</p> Signup and view all the answers

Which of the following is considered a source of funding for a business?

<p>Personal contributions from the owner. (C)</p> Signup and view all the answers

What defines a characteristic of disruptive innovation?

<p>It often attracts low-end customers and creates new markets. (D)</p> Signup and view all the answers

What aspect of financial planning involves projecting future revenues and expenses?

<p>Cash flow forecasts. (C)</p> Signup and view all the answers

How can a business ensure that it meets legal concerns when producing goods or services?

<p>By consulting with legal experts. (D)</p> Signup and view all the answers

Which financial statement gives a snapshot of a company's overall value including assets and liabilities?

<p>Net worth statement. (C)</p> Signup and view all the answers

What is one of the benefits of having a performance measure system in place?

<p>It allows for timely adjustments based on real data. (C)</p> Signup and view all the answers

Flashcards

Executive Summary

A brief overview of a business plan, highlighting key points and unique selling proposition (USP).

Marketing Plan

A strategy for reaching target customers.

Target Market

Specific group of consumers a business wants to reach.

SWOT Analysis

Evaluating strengths, weaknesses, opportunities, and threats (for a business).

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Competition Analysis

Study of competitors to identify their strengths, weaknesses, and market share.

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Human Resources Plan

A plan for managing employees in a business.

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Market Research

Studying current market trends and demand.

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Compensation & Incentives

Strategies for rewarding employees based on their roles and performance.

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Business Plan

A written document outlining a business's goals, strategies, and how it will achieve them.

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Clear Objectives

Specific, measurable, achievable, relevant, and time-bound goals that guide the business's direction.

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Contingencies

Backup plans for situations where the original plan might not work.

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Responsiveness to Changes

The ability of a business plan to adapt to changing market conditions or unexpected events.

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Regular Reporting

Periodic updates and evaluations to track progress and make necessary adjustments to the business plan.

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What makes a business idea disruptive?

A disruptive innovation is a new product or service that challenges existing markets and business models by offering simpler, cheaper, or more accessible solutions. It often starts by targeting neglected or underserved customer segments and gradually expands.

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Why is analyzing your market crucial?

Understanding your target market is vital for a successful business. It helps you identify potential customers, their needs, preferences, and spending habits. This knowledge guides your marketing strategies, product development, and overall business decisions.

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What is a cash flow forecast?

A projected statement of how much money will come into and go out of a business over a specific period. It helps determine the business's financial health, identify potential cash shortages, and plan for future needs.

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What are capital expenses?

Capital expenses are significant investments in long-term assets that benefit a business for an extended period. These can include buildings, equipment, software, and land.

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How to evaluate your business's progress

Regularly monitoring and evaluating your business performance using key metrics allows you to adjust your strategy, optimize operations, and identify areas for improvement.

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What are sources of funding for a startup?

Startups often raise capital through various sources like personal investments, loans from banks or investors, grants, or crowdfunding. Each source comes with its own terms and conditions.

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How to get customers to return?

Building customer loyalty involves consistently delivering high-quality products or services, providing excellent customer experience, and engaging with your customers. It fosters a sense of value and encourages repeat business.

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What are legal considerations?

Before starting any business, it's crucial to understand and comply with relevant legal regulations such as licensing, permits, tax obligations, and intellectual property rights.

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Study Notes

Learning Objectives

  • Be able to revise business objectives and plans to incorporate proposed changes

Business Plans

  • Structure of business plans
  • Use of business plans
  • Evolution of business plans
  • Changes to business plans

Action Plans

  • Plans to implement change
  • Monitoring and evaluating changes
  • Measuring outcomes
  • Setting deadlines

Components of a Business Plan

  • Executive summary
  • Business Profile/Description of a Business
  • Markets business will operate in/Business environment
  • SWOT Analysis
  • Management Team and Personnel/Human Resources
  • The products/Services offered
  • Marketing Plan
  • Financial Plan
  • Monitoring and Evaluation

Business Profile/Business Description

  • Details of goals and customers to be served
  • Company structure
  • Location
  • Customer needs and wants

Executive Summary

  • Overview of the business plan
  • Summarizes key points of the document
  • Helps reader quickly grasp key elements of the business plan
  • Main Products and services, with emphasis on unique selling proposition
  • The Market: Who will buy product and why; how you are going to market to them
  • Money needed and how it will be paid back

Marketing Plan

  • Market research
    • Present markets and trends
    • Target market, size, and demographics
    • Ideal consumer profile
    • Projected market share
    • Geographic boundaries
    • Seasonal trends
    • Customer service policies
    • Strengths and weaknesses
    • Market survey results
  • Competition
    • Current competition, size, and market share
    • Future competition
    • Competitors' strengths and weaknesses
    • Strengths and weaknesses of your business
    • Your competitive edge
    • Your ongoing cost to stay competitive
  • Marketing and sales strategies
    • Promotional and media methods
    • Special services or policies
    • Effectiveness of each method
    • Frequency of use
    • Channel selection
    • Incentive or sales bonus schemes
    • Sales force reach

SWOT Analysis

  • Strengths
  • Weaknesses
  • Opportunities
  • Threats

Human Resource Plan

  • What kind of employees are needed to run the business?
  • Where will employees be recruited from?
  • What kind of compensation incentives will be offered?
  • How will employees be trained and developed?
  • How will employees be evaluated?

Markets Business Will Operate In

  • Research the market
  • Typical buyer characteristics (e.g., income levels)
  • Identify the hallmarks of disruptive innovation

Financial Plan

  • Projection of income and expenses
  • Cash flow forecasts
  • Financial position
  • Capital expenses
  • Net worth statement
  • Sources of funding

Sources of Funding

  • Capital contribution (amount invested by owner)
  • Existing loans
  • Other funding sources (e.g., loans)
  • Utilization of loan proceeds (e.g., asset purchase, working capital)

Products and Services

  • Description of products/services to be produced
  • Cost of sales
  • Future prospects
  • Legal concerns (intellectual property)
  • How you'll get repeat customers

Monitoring and Evaluation

  • Monitoring by the Board
    • Plan progress
    • Performance against budget
  • Performance Measures
    • Customer satisfaction
    • Productivity
    • Time cycle
    • Defect-free production
    • Financial performance
  • Reporting
    • Regular performance reporting, weekly, monthly, quarterly, and semi-annually
    • Report on key performance indicators (KPIs)

Action Plans to Implement Changes

  • How to manage change in a business

Action Plan

  • Simple list of tasks
  • Checklist outlining steps to achieve goals
  • Objectives, tasks, team, planning, and scheduling

Change Management Process

  • Steps are typically included
  • Identifying change, process, and approach
  • Evaluating, implementing, and monitoring change

Types of Change

  • Strategic
  • People-Centric
  • Structural
  • Technological
  • Unplanned
  • Remedial

Common Areas of Change

  • Mission & Strategy
  • Organizational Structure
  • People
  • Culture
  • Knowledge
  • Policies & Legal Agreements
  • Processes
  • Technology
  • Products, Marketing & Customer Relations
  • Integration

Negative Effects of Change Management

  • Employee retention levels dropping
  • Insufficient focus on managing impact of change on people
  • Risks not being highlighted
  • Increased resistance to change
  • Negative impact on productivity
  • Drop in customer service
  • Lack of ownership or shared vision

Tips for a Less Painful Change Process

  • Employee involvement
  • Past experience
  • Continued communication
  • Myth-busting
  • Understanding the psychological impact
  • Consultation
  • Additional support

How to Write an Action Plan

  • Define objectives
  • Break down objectives into tasks
  • Assign tasks to a team
  • Detail planning and resource allocation
  • Schedule deadlines and milestones

What Should an Action Plan Include?

  • Key Action Steps
  • Timeline
  • Expected Outcome
  • Data Source and Evaluation Methodology
  • Person/Area Responsible
  • Comments

Example Action Plan for ABC Co.

  • Objective 1: Improve meal quality on Male' to Srilanka flights
  • Objective 2: Improve inflight customer services
  • Detailed actions, milestones, timelines, expenditure, and resources.

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Related Documents

SBE BY1 Business Plans July 2024 PDF

Description

This quiz focuses on understanding the structure, components, and evolution of business plans. It also addresses how to implement changes effectively through action plans, including monitoring and evaluating outcomes. Test your knowledge on the critical aspects of business planning and execution.

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