Questions

Here are questions for you to answer so we (you and I) can work as a team to give you exactly what you want.  We do not want more or less than what your business needs to be successful.  Please answer the questions on the following pages by typing on this document. Make sure you color your response to each question so we can see where you contributed.  This document will be archived and serve as a reference document in the future when business plan decisions need to be made again.

Answers

Your answers will help us build your plan as thoroughly as you believe is appropriate.  If all you want is a sketch, we’ll do it.  We can be brief and let people improvise as they see fit.

If you want a blueprint for achieving specific objectives, we’ll take the time and create a detailed owner’s manual for your business.  We can create a detailed blueprint for you to work as a “general contractor”.  It will guide your “subcontractors” to be sure they do what you want done.  The business plan we create could be used permanently or temporarily.  The plan could be used as an inflexible measuring device or it could be modified semi-annually as your business develops in the future.

All business plans should include the following items:

q       Strategies are large-scale action plans for interacting with the business environment in order to achieve long-term goals. 

q       Tactics are the specific actions required by the organization to implement its strategy. 

q       Activities are groups of tasks required by organizational units or departments for completing a tactic. 

q       Tasks are defined limited assignments with target completion dates. 

Therefore strategies are implemented as tactics are executed.  Tactics are executed as activities are implemented.  Activities are implemented as tasks are completed. 

Purposes

The US Small Business Administration’s website has the following information at www.sba.gov/starting_business/planning/basic.html. 

A business plan precisely defines your business, identifies your goals, and serves as your firm's resume.  The basic components include a current and pro forma balance sheet, an income statement, and a cash flow analysis.  It helps you allocate resources properly, handle unforeseen complications, and make good business decisions.  Because it provides specific and organized information about your company and how you will repay borrowed money, a good business plan is a crucial part of any loan application.  Additionally, it informs sales personnel, suppliers, and others about your operations and goals.

The importance of a comprehensive, thoughtful business plan cannot be overemphasized.  Much hinges on it: outside funding, credit from suppliers, management of your operation and finances, promotion and marketing of your business, and achievement of your goals and objectives. “The business plan is a necessity.  If the person who wants to start a small business can't put a business plan together, he or she is in trouble”, says Robert Krummer, Jr., chairman of First Business Bank in Los Angeles.  

Despite the critical importance of a business plan, many entrepreneurs drag their feet when it comes to preparing a written document.  They argue that their marketplace changes too fast for a business plan to be useful or that they just don't have enough time.  But just as a builder won't begin construction without a blueprint, eager business owners shouldn't rush into new ventures without a business plan.  Before you begin writing your business plan, consider four core questions:

q       What service or product does your business provide and what needs does it fill?

q       Who are the potential customers for your product or service and why will they purchase it from you?

q       How will you reach your potential customers?

q       Where will you get the financial resources to start your business?

Purposes (continued)  

Consultants and trainers take great pains to give clients and learners ideas, secrets, and understanding in an effort to enable people to work more successfully.  If you are not satisfied with the results you are getting from your work change how you work.  If you want to change how you work change your thinking about work.  Business plans should help people think better so they work smarter and produce more favorable results. 

Plans

As with any kind of a plan, a business plan should have directions and explanations.  A search of current business planning software and publications indicated plans could be classified by how they will be used.  There are basically two types of plans: 

q       Plans to be used by only a few persons, and

q       Plans to be used by many persons within a business entity. 

So the next questions for you are: 

q       Who will be using your plan?

q       What will it be used for by those persons named above? 

Your answers will guide us during the construction of your business plan.

Parts

Plans to be used by only business owners and managers are not as detailed as plans used by all members of a business entity.  A basic format for a business plan includes: 

1. Overall summary of the plan

a.       Mission statement

b.      Strategy

c.       Objectives to be achieved

2.      Description of primary business activities 

3. Market analysis and forecasts
4. Schedule of implementation actions

Plans to be used by all authorized members of a business entity have the following additional segments:

q       Diagrams and descriptions of each business function,

q       Lists of customers’ expectations for the business,

q       Lists of what the business requires from suppliers, and

q       Job descriptions for each employee working for the business.

Parts (continued)

A business plan should have:

q       a situation analysis followed by objectives intended for target audiences with

q       a mission statement, objectives, strategy, and tactics resulting in

q       a plan of execution with budgeting of resources and measurement of results.

Business plans should progress logically from a description of the plan’s purpose through each of the following types of information in this order:

1st.       The purpose or mission of the organization, team, partnership, or person.

2nd.    The strategies to be used to accomplish the mission described above.

3rd.     The tactics to be used to accomplish the strategies described above.

4th.      A calendar or time line listing the actions to be used to accomplish each strategy described above.

5th.      Descriptions of the actions to be taken with details like who is in charge, who will do the work, and how will the work be done. 

6th.      To do lists

All business plans should include the following items:

q       A mission is a brief statement describing what will be accomplished as the plan's goals are reached. 

q       Goals are events and states to be reached in order for the mission to be accomplished. 

q       Strategies are large-scale action plans for interacting with the business environment in order to achieve long-term goals.

q       Tactics are the specific actions required by the organization to implement its strategies.

q       Activities are groups of tasks required by organizational units, departments, or individuals for completing a tactic.

q       Tasks are well-defined limited assignments with target completion dates to be done by individuals and/or groups.

Therefore the mission is accomplished as strategies are implemented; strategies are implemented as tactics are used; tactics are used as activities are completed; activities are completed as tasks are done.

Parts (continued)

Entrepreneur.com explains business plans have three main sections with many components. 

There are three primary parts to a business plan:

q    The first is the business concept, where you discuss the industry, your business structure, your particular product or service, and how you plan to make your business a success.

q    The second is the marketplace section, in which you describe and analyze potential customers: who and where they are, what makes them buy and so on. Here, you also describe the competition and how you’ll position yourself to beat it.

q    Finally, the financial section contains your income and cash flow statement, balance sheet and other financial ratios, such as break-even analyses. This part may require help from your accountant and a good spreadsheet software program. 

Breaking these three major sections down even further, a business plan consists of seven key components:

1.       Executive summary

2.       Business description

3.       Market strategies

4.       Competitive analysis

5.       Design and development plan

6.       Operations and management plan

7.       Financial factors

Parts (continued)

Here’s a sample of a business plan outline from www.businessandmarketingplans.com:

Cover Page

Legal Page

Table of Contents

1.0  Executive Summary

1.1  Mission

1.2  Highlights

2.0  Company Summary

2.1  Company Ownership

2.2  Start-up Summary

3.0  Services

4.0  Market Analysis Summary

4.1  Market Segmentation

4.2  Market Analysis

5.0  Strategy and Implementation Summary

5.1  Competitive Edge

5.2  Marketing Strategy

5.3  Sales Strategy

5.4  Sales Forecast

5.5  Monthly Sales

6.0  Management Summary

6.1  Personnel Plan

6.2  Personnel

7.0  Financial Plan

7.1  Break-even Analysis

7.2  Projected Profit and Loss

7.3  Profit Monthly

7.4  Projected Cash Flow

7.5  Projected Balance Sheet

7.6  Business Ratios

8.0  Appendix

9.0  Tables

10.0  Charts

Purchases

There are almost as many individuals and companies writing and critiquing business plans as there are those writing and critiquing resumes.  There are firms who will compose entire business plans (e.g., draft text and illustrations, print all documentation, and bind prints in attractive ways) and there are firms who will critique final drafts giving expert opinion on content and appearance. 

For instance, a Level Two business plan from www.masterplanz.com could be purchased for from $2,500 to $2,900.  Their web advertisement indicates they offer full-color, investor ready business plans.  Their final product is typically used for bank funding and light venture capital needs.  Their plans come complete with financial projections and charts showing cash flows, projected profits and losses, a balance sheet, and more.  Their plans provide considerable scope and analysis of the market, the competition, the products or services offered, and the targeted customer(s) types.  These plans describe the targeted industry and marketplace in detail.  This fee is charged for generally understood businesses such as retail, restaurants, professional services, and wholesale.  Higher fees are charged for non-standard businesses requiring unique documentation. 

Principles

The type and amount of service you should buy should be determined by what you want to accomplish and how much you are willing to invest.  This is an investment that will return significant dividends if you plan your work and work your plan.  

 Principles (continued)

Business plans are financial plans.  Here’s what good financial planning for a business should include: 

q       Current Financial Position – Describe where you currently stand financially by having an audited balance sheet and income statement with explanatory notes.  Describe all cash flows, assets, and liabilities giving special attention to the timing of income and expense items so you know how to best coordinate your cash flows to develop and maintain liquidity.  Establish where you would like to be in the future and how you will get there. 

q       Investment Planning – Treat all business property and employees as valuable investments with varying quality and life spans.  Determine an appropriate asset allocation plan while considering your goals, risk tolerance, expectations, and abilities.  

q       Risk Management – Ensuring that there is sufficient income and capital to cover cash flow needs in the event of death or disability is an essential part of a financial plan. Risk management addresses life insurance, disability insurance, long-term care insurance and other specific types of insurance depending on your unique situation.  

q       Planning Financial Independence – Determine what financial independence should mean to the business and plan to achieve it.  For you it may mean full retirement, for others partial retirement, and for some it may even mean continued full-time employment.  It is important to determine when (at what volumes not at a point in time) you believe the business would achieve financial independence.

q       Employee Development – Determine what the business should do to encourage employees to increase their skills and knowledge.  Determine what the business needs employees to be able to accomplish.  Plan how to get employees to become able to succeed in the future.

q       Succession Planning – Estate planning is the process of developing and implementing a plan that ensures the distribution of your property according to your wishes during your life and after death.  Succession planning is the process of developing and implementing a plan that ensures the distribution of leadership and decision-making power in a business during the owner’s retirement and after the owner’s death.  Preparation of a business plan, establishment of a long-term executive talent development plan, and careful consideration of appropriate power transference strategies are important aspects of a properly designed long-term business plan.

Principles (continued)

How do you want your business to be run?  Your answers to this question and the other questions in this paper should be made as thorough as you want to be successful.  The more you plan smartly the more likely you’ll get the results you want instead of what other people want. 

Remember the five Ps: Proper planning prevents poor performance.  Take actions such as information gathering and consensus building now so a plan is created by your team, for your team.  How detailed should do you want your team plan to be?  Do you want general concepts or a detailed roadmap to your success. 

People

How do you want to work with people in and out of your organization?  Do you want your management team to use a Hire them.  Tire them.  Fire them! management philosophy?  Do you want your management team to partner with their subordinates to develop win/win agreements so employee satisfaction and customer satisfaction are increased as time goes by? 

If you want to use all your resources then plan to use all of your people, not just their hands.  Plan you business so you pay employees fairly, treat employees kindly, encourage employees to be creative problem solvers, and give employees opportunities to serve human needs in principled ways*.  Make sure your plan answers the following questions persuasively:

q       Will reading your plan give your employees a clear understanding of what your organization is trying to achieve and why it does what it does? 

q       Will your employees be enthusiastic about their team’s goals? 

q       Will your employees see how their tasks contribute to achieving your plan’s goals? 

q       Will your employees be able to do their work so well that they will feel satisfied with what they’ve accomplished each week? 

q       Will your plan enable your employees to achieve their professional goals?

q       Will your plan help your employees trust each other? 

q       Will your plan help your leaders foster open communication that is respectful of differing opinions and that results in new and better ideas?

q       Will your plan help your employees hold people accountable for results?

Prospective employees

Should prospective employees be screened by using a test to evaluate their knowledge of medical practice terminology?  Should you require prospective employees to take the Employability Skills Assessment at www.coe.uga.edu as a test of their basic work skills?  Should you require prospective employees who are going to be working with patients and/or their files to take the ACMPE Knowledge Assessment offered by the MGMA? 

The American College of Medical Practice Executives (ACMPE) offers a 175-question assessment to evaluate your knowledge across all eight domains of the Body of Knowledge for Medical Practice Management.

Get instant results to help guide your professional development, including percentage of items correct in each domain, overall percentage correct and a listing of all questions with the correct answers identified.  The ACMPE Knowledge Assessment is accessible online for 30 days, is self-paced and can be taken over multiple sessions. For specific information about the ACMPE Knowledge Assessment, including directions on how to take the assessment over multiple sessions, please read the Knowledge Assessment instructions carefully before beginning.  

Use the ACMPE Knowledge Assessment as a sample test prior to ACMPE exams or as a personal assessment to steer your professional growth.

Purchase the ACMPE Knowledge Assessment.  If you need further information specific to the assessment, call the ACMPE Certification Help Desk toll-free 877.275.6462, ext. 869 or send us an e-mail.

How should the test results of prospective employees be used for planning to develop skills after one of those prospects is hired?

Personnel

Should your management team’s performance appraisals for employees be improved?  If yes, how should your performance appraisal process be improved? 

q       Should performance appraisals be performed more frequently, formally, or friendly? 

q       Should performance appraisals result in formal win/wing agreements between managers and subordinates to work smarter with each other to produce better work for customers? 

q       Should employees be empowered to be more self-directed after performance appraisals have been used to deepen participants’ understanding of what your business needs and what employees should be doing to meet your business’ needs?

q       Should employees be informed only annually or should they be encouraged regularly during the year?

Prospects

Who is most likely to appreciate your business and pay for its services?  What is your market niche?  What do your frontline employees need?

q       What does each of your team need to have accomplished and available to be able to satisfy your customers’ expectations? 

q       What does each of your team need to say to be able to satisfy your customers’ expectations? 

q       What does each of your team need to do before, during, and after engaging customers to be able to satisfy your customers’ expectations? 

Professional Publications & Associations

What do your industry experts say?  What should you be doing for each customer?  What are your industry’s best practices?  What newsletters, professional societies, and continuing education programs can your team benefit from?  What should your plan include, according to the experts you are paying or should be paying attention to? 

Basic questions

Please think about your primary business functions, what people pay you to do (directly and indirectly).  There should be three to five primary reasons people pay your organization to do what it does. 

Think about the two diagrams on this page.  Here’s the most basic of the two diagrams.  This can be used for individual workers or groups of employees. 

The second diagram is more complex.  It illustrates how groups of employees receive inputs from suppliers and feedback from customers.  It also illustrates how groups of employees give feedback to suppliers and give products/services to customers.

Basic questions (continued)

Each diagram illustrates work by showing employee effort follows receipt of goods and/or services.  The diagrams also show goods and/or services are produced by employee efforts.  Take another step toward communicating and illustrating your vision for the business by answering the following questions:  

q    Which type of diagrams should you use for each of the primary business functions you thought of on the previous page? 

q    Who should work to prepare the illustration for each of the business functions you determined are critical to your business’ success? 

q    How should the illustrations be used in the business plan we create?  Should employees use the illustrations as work aids to self-govern their activities, make suggestions for improvements, and know what to expect from others? 

Advanced Questions

Here’s a list of questions to consider answering.  They may not be relevant now so, if you have not already created a file for business planning, file these away for future reference as your business changes. 

q    Is my idea a breakthrough or just so impractical that no one has ever succeeded doing it or really ever wanted to do it?

q    Who are my customers?  They should be plentiful enough to be profitable but few and accessible enough to be serviced thoroughly.

q    Why would anyone buy my product or service instead of the market leaders' brands or service?

q    Who are my greatest competitors and what made them so great in quality, performance, price, location, etc.?

q    What advantages does my product or service offer a customer over the competition in terms of quality, performance, price, etc.?

q    What advantages does my people, facility, etc. offer a customer over the competition in terms of courtesy, responsiveness, accessibility, location, etc.?

q    Does my plan go from describing the market down to describing how measurements of my efforts will be made and used to grade my effectiveness?

q    What do investors, bankers, etc. think of the product or service and my ability, plan, system, skills, etc.?

q    What do legal experts think of the product or service and my organization, plan, etc.?

Advanced Questions (continued)

q    What do my present mentors think about it?  Who can I find with hands-on experience in relevant fields to advise me?

q    Why do I know that I'm willing to do what it takes to succeed? 

q    What will I do if I fail? 

q    Does my business plan demonstrate a chain of logic like: situation analysis, objectives, target audiences, mission statement, objective, strategy & tactics, execution, and budget followed by methods for measurements? 

q    Does my business plan include the following items:

-    strategies are large-scale action plans for interacting with the business environment in order to achieve long-term goals

-    tactics are the specific actions required by the organization to implement its strategy

-    activities are actions required by organizational units or departments for completing a tactic

-    tasks are defined limited assignments with target completion dates

q    What actions should be planned so everyone in my organization constantly thinks through what information he or she needs to do their job and to make a contribution to the business’ success?

Our Process

Planning is a process.  Creating a business plan should be a process.  Here are the steps we recommend you consider. 

1st.       We will discuss your reactions to this document and get a better feel of what you want to happen next.  We will also learn what your priorities are and what you want to do about your needs.  We will review your goals, consider your options, and describe what you want your business to accomplish.  What do customers require?  What work must be done to meet your most important customer requirements?  Diagram or describe each type of customer requirement. 

2nd.    I will develop a detailed rough draft of a plan for you to critique. 

3rd.     You will read and improve our rough draft, making sure it is going to do what you need it to do.  What benchmarking should be done? Benchmarking is an ongoing investigation and learning experience that ensures that best industry practices are uncovered, analyzed, adopted and implemented.  Does the plan describe how your industry’s best practices are to be used by your team?  Does the plan describe how your team will uncover, analyze, adopt, and implement better practices in the future? 

4th.   You will determine what to do next: 

q    What additional information is needed?  What new questions have you thought of that need to be answered?  What information sources should be consulted? 

q    Who can critique the plan when you and I have made it the best we can do?  Do you have a formal or informal mentor to turn to next?  Should a professional business planner be paid to review it?  Should a banker be asked to critique it from a lender’s point of view?  Should one of your secondary vendors or a not too important client be asked to critique it from their perspective?  Is there an industry consultant (e.g., Press Ganey) or a professional association (e.g., Medical Group Management Association “MGMA”) you should send your plan to? 

5th.   In an effort to enable your employees to develop greater loyalty to your business, you will train and mentor a few of your employees so they contribute to segments of the plan, share in its ownership, and increase in responsibility.  Select employees who are now or will become subject matter experts “SMEs”?  Which employees should be trained and made responsible for contributing to the development of your team’s plan?  Which employees should be charged with maintaining segments of the plan?  How will you communicate your performance expectations so your SMEs will be more likely to succeed? 

Our Process (continued)

6th.   You will determine how the plan will be followed.  When will performance be measured against the plan?  How will your team react when it successfully implements the plan?  How will your team react when someone does not follow the plan correctly and generates negative results?  Implementation of the plan should be supported by taking steps to:

q    Define buzz words (e.g., SMEs, business plan),

q    Describe and demonstrate the tools, techniques, and processes you need used when creating and implementing the plan. 

q    Teach, model, and illustrate the concepts to be used in the business.

q    Present how the new program/process will help stake holders so they know “W.I.I.F.M.”?

q    Present how the new programs and processes will work in your business. 

q    Determine how each employee will have to change and work smarter.  What tasks will have to be reassigned?  Will they have to work longer or just differently?  (e.g., overtime, organized)

q    How will your new employees be trained?  A good employee orientation program has four phases:

-      Introduction of what employee orientation should be,

-      Creation of an employee orientation program,

-      Implementation of what is created, and

-      Evaluation of the implementation. 

q    How should employees’ performance be described, evaluated, and rewarded?  Who should contribute to such efforts?  Creating and implementing a performance appraisal system requires the following actions:

-      Review of legal requirements,

-      Conduct job analysis based on a systematic examination of the job, and context in which it is performed,

-      Develop appraisal instrument,

-      Select observers,

-      Train observers,

-      Measure performance,

-      Give employee results in motivating ways,

-      Establish performance goals, and 

-      Reward success or discourage error. 

Our Process (continued)

q    What OJT is needed?  How can OJT be done best?  Don’t make training new employees the responsibility of someone who is already spread too thin or not a SME who has been trained to do training. Measure OJT’s impact before and after it is done.  Determine sales OJT’s impact by graphing measurements such as the ratio of new accounts to old accounts, the call-to-close ratio, the average sale size/amount, monthly sales volume, items per order, and add-on sales.  Determine customer service OJT’s impact by graphing the accuracy of orders taken & information given, the # of escalated complaints, employee adherence to procedures, customer satisfaction survey results, and the # of lost customers.  If you did OJT that was not for sales or customer service, decide how to measure its impact.

q    Here’s a process for improving how a job is performed: 

1st.       Determine who will do the analyzing, who will contribute to the analysis, and who will be analyzed.  

2nd.     Determine where to begin to improve an operation by selecting the job(s) that can be improved and help gain Taylorization credibility.  The toehold has to be solid so you can build on it in  the future. 

3rd.      Analyze work tasks, tearing work down into its components timing each phase/segment. 

4th.       Use analysis to put jobs together in ways that are the one best way. 

5th.       Create instruction cards for each task/process.  Instruction cards should be written in ways to communicate performance expectations visually and with narratives that illustrate and describe processes, timing, rhythm, and attitudes. 

6th.       Evaluate performance by using the cards logically and consistently. 

7th.       Encourage people to do more by offering more money.  Appropriate bonus compensation should be budgeted ASAP. 

q    How will each department’s supervisor follow up any training that is done?  How will each supervisor make sure training has a positive impact on performance? 

Our Process (continued)

8th.   If your people become very efficient and effective, should they take on more work from other companies?  (e.g., If your billing department becomes very good at billing and collecting, should it offer services to other companies for fees or commisions?) 

9th.   You will shoelace this opportunity in to bigger and better work.  Successful implementation of this plan will earn you a severance package that will free you from this job and enable you to do this kind of work for clients who do not compete with your current employer.  Upon completion of this plan, your employer should end your full-time employment and pay you as a consultant when your help is needed in the future.  Reducing overhead by your annual salary less a severance package is an incentive you can offer your employer to encourage commitment and support.  

Next 

Please feel free to modify this process as you see fit.  What should be done differently?  What do you want to do next?  Please consider beginning to draft your business plan now.