About business plans

There isn't a fixed format that all business plans must take. For example, the format will vary greatly according the size and complexity of the organization, and the industry. The golden rule is that the layout must be appropriate for the particular purpose of the plan.

Consequently, the place to start is by defining the purpose of the particular business plan. In most cases, it is to gain board approval for a implementing a strategic positioning of the organization over a specified period, often three to five years. It is not the only possible purpose of a business plan. Other purposes can be to gain support from a group of stakeholders, to gain a loan, or to recruit investors. These other kinds of plans have more introductory material about the organization, more glossy photos, and only a summarized version of most content.

A longer term plan also generally needs operational plans for smaller periods (usually each quarter, half-year, or year), and you probably need to include an operational plan for at least the first period. You need to show people how it can be implemented.

In other words, the shape of the strategic plan will depend on:

• the purpose of the document
• the size the organization and its scale of operations
• the client focus and needs
• the level of available funding and the need to raise finance
• the level of risk involved
• the organization's philosophy
• the community within which it operates.

Your presentation needs a style that will get it approved. In other words, you need to present a clear convincing case for the strategic direction you are proposing, enough data to support it, and some way of showing that it is feasible and practical.

Strictly speaking, a business plan is only about what you will do in the future and how you will do it. However, you will also need to explain your business model, which is the way in which your business processes with generate a profit. Business models should be implicit in the budget. Budgets are often like a cross section of a business plan. They interrelate market position, innovation strategies, competitive advantage, services and products, and internal processes. The budget is a also form of your financial plan. (Unfortunately the trend during the last twenty years is that the budget is the plan.)

The plan must be coherent, suit your organization's needs and context, be consistent with your financial plan, and foster improvement. Its size should be appropriate to your organization and should be for a specified time span. There is no specified length in pages, as long as it clearly meets all requirements.

Your plan must meet legislative and legal requirements, as well as the requirements of your insurers and, if you are relying on loans, your financial institution. It may not be just a wish-list, but something that will actually work for your organization. It also includes strategic risk management, including financial risks and risks associated with change.

Expect to be asked to present your plan in three forms:

• A formal full written document according to your organization's format (if it already has an established format).
• An oral presentation to decision-makers and stakeholders.
• A simpler document that explains your position in an easily understood, practical form for staff and shareholders.