by Daniel Velasquez email@example.com
The Business Plan is a formal document that contains business objectives, which develops, systematizes and integrates activities, analyzes market situation and other necessary studies for a business idea to become in a profitable venture or a Company to be organized to achieve its objectives.” Daniel Velasquez (*)
According to studies of Professor Roberto Vainrub, from the Venezuelan Institute of Marketing and Management, IESA, there are important reasons to develop a business plan: a) It increases in 50% the probabilities of success. b) It is a sale document for future employees, financers and partners. c) It is a control instrument. d) It is a good planning instrument. e) It demonstrates professionalism.
After having handled 33% of the strategic planning of Graphic Packaging International (http://www.graphicpkg.com/), a worldwide multinational Company with Four Billion Dollars in sales, at PI Consultores Gerenciales y Asociados we achieved to develop a different approach to business plans and strategic management. We have designed our own models and management tools. According to our theories, and those of Bain and Company Consultants, the first step is to define the objectives and strategies of a venture or company, and then to develop the Business Plan.
In our opinion, the business plan helps you to decide whether to carry out your venture or not, or to organize your company in case it is already functioning. A business plan allows you to:
– Structure your idea or organization. Organize your thoughts and how to execute them. See in black and white how to carry out your venture. Understand what resources you need. Prioritize activities and their costs.
Understand when the business model is going to produce money. Analyze your financing needs and in what moment of the venture you will need the financing. Study the economic feasibility of your venture. Get ahead to possible problems arising in the business. Develop contingency plans for changes in the environment. Understand your needs of staff recruiting. Dimension the necessary assets to carry out your venture. Acknowledge your weaknesses and strengths.
According to the theories of McKinsey and Company, management consultants, the success of companies in unstable environments depends on the nature of the uncertainty they are facing. To confront uncertainty it is necessary to imagine different scenarios, to study their impacts on the business, to formulate strategies for each case and to develop a flexible organization that is able to be adapted to changes in the environment.
The new approach for business plans, that we have adopted, is different to the one applied in conventional plans and it allows you to adapt quickly to changes in the environment. It is characterized because:
– There are no static scenarios but experience and imagination are used to create scenarios, to determine its influence in business and to anticipate them developing the necessary strategies and tactics for each case. This helps the involved individuals not to manage based on the crises.
– Flexible organizations are built so they may be adapted to changes in the environment.
– We use management tools that are worldwide accepted. A key for succeeding in an unstable environment is to use managerial tools adapted to the situation of the country, the industry in which you compete, the nature of competition and the consumers’ needs. These management tools allow developing business plans that contribute to successfully navigate the turbulent waters of the Venezuelan environment.
– Constantly monitoring the environment to anticipate changes. For this purpose, we use an inter-departmental, multifunction and system equipment, to timely identify new realities, new opportunities and threats
– Identify customer’s fundamental competences to leverage them in the development of their business and to dedicate themselves to the activities they can perform better than the market.
– Develop a single sale proposal preferred by consumers over the offer of their competitors.
– Develop exceptional customer service systems.
– Develop plans for the human capital, to change the organizational culture and to build high performance teams.
When developing a business plan, the experience obtained in the world market leads us to suggest to the entrepreneurs to focus more on the critical areas that will determine the success of their project so that they do not waste time and money in activities that will cause no impact in their success.
(*) Lecturer, Business Consultant, Entrepreneur Mentor, (IESA), Professor of CIAP-UCAB, MBA (Emory University), Postgraduate Professor (UCAB), Eng. (UCAB)