Website design By BotEap.comThis is the second in a series of articles describing how small business owners and managers can drive profitable growth and development of their business through the creation and implementation of a business plan.

Website design By BotEap.comI know the prevailing view among many small business people is that “planning” is for larger, more substantial businesses and that “they’re too busy running their business to have time for planning.” In fact, many small business owners are “too busy” running the business, but ignore, at their peril and survival, that “failing to plan is planning to fail.”

Website design By BotEap.comI am convinced that the small business owner will benefit from participating in this business planning process due to the nature of carefully examining and thinking about how their business competes and operates; -and how that will align with his determination of “what business they want to be in.”

Website design By BotEap.comThis business planning process builds a stronger, more profitable business that delivers real value to your customers and the marketplace.

Website design By BotEap.comThe business planning process described in this article is the most logical, pragmatic, and practical examination of small business possible. This process is far from arcane or mysterious, but it fully focuses on the reality of small business environments (the business, the economy, the competition, the needs, wants, and desires of customers), as well as the determination and allocation of company resources).

Website design By BotEap.comBusiness planning process: eight main steps

Website design By BotEap.comFor the past thirty years, I have successfully used the following strategic marketing and business planning process. The following process consists of eight main steps that are sequential and continuous. I will describe the nature and function of each of these steps.

Website design By BotEap.comThis process applies to all types of organizations; regardless of size, products, services, or industry… I’ve even used this process with a national religious organization.

Website design By BotEap.com1. DEVELOP MISSION STATEMENT AND POSITIONING

2. AUDIT STATUS

has. Internal

b. External

3. WOTSUP ANALYSIS

4. MAKE ASSUMPTIONS

5. DEVELOPMENT OF OBJECTIVES

6. DEVELOPMENT OF STRATEGIES

7. SPECIFY TACTICS AND ACTIONS

8. PREPARE FORECASTS/BUDGETS/FINANCES

Website design By BotEap.com1. MISSION STATEMENT AND POSITIONING

Website design By BotEap.comRegarding the definition of the purpose and mission of your business, there is only one approach, one starting point; is the customer or user of your products/services. The user defines the mission of any function or business. The question “what is our mission or purpose?” “What business do we want to be in?”, therefore, can be answered only by looking at your business from the outside, from the point of view of the customer or potential customer. What the user or client sees, thinks or believes at a given moment must be accepted by the management of your company as an objective fact to be taken seriously.

Website design By BotEap.comBy definition, the customer buys the satisfaction of a need or a want.

Website design By BotEap.comFor example, here is a well-known, real-life example of a company mission that defined how that company conducted business.

Website design By BotEap.comA drill manufacturer defined their mission as determining “what size holes customers need”, their focus was squarely on customer needs and not their product specifications. They were customer focused and very successful.

Website design By BotEap.comOnce the mission statement is complete, develop the positioning statement for competitive advantage and prepare the USP – your unique selling proposition. “Why the company is capable of providing more effective and higher value solutions than its competitors.”

Website design By BotEap.com2. THE SITUATION AUDIT – Internal and External

Website design By BotEap.comThe health audit is a description and analysis of past, present and future data (information) that provides the basis for carrying out the business planning process. It is an organized method for:

• collection of relevant information
• interpret its effect on business environments (market conditions)
• significant trend analysis
• projecting all the relevant factors, which could influence the activities of the company.

Website design By BotEap.com3. WOTSUP ANALYSIS

Website design By BotEap.comThe acronym WOTSUP stands for Underlying Strengths, Opportunities, Weaknesses and Planning. This step flows naturally from the database (situation audit). The Weaknesses and Strengths constitute an internal analysis, that is, “what are we good and bad at?”

Website design By BotEap.comOpportunities and Threats, on the other hand, form an external analysis. From this analysis, objectives can be formulated with specific action plans designed to overcome weaknesses and threats by exploiting the strengths and opportunities of the business.

Website design By BotEap.com4. MAKE ASSUMPTIONS:

Website design By BotEap.comAssumptions make planning possible. Without the use of assumptions, planning would be almost impossible. Since planning deals with the “future of current decision making” and future events are nearly impossible to predict with unerring accuracy; – Assumptions make planning possible.

Website design By BotEap.com5. DEVELOPMENT OF OBJECTIVES

Website design By BotEap.comOverall goals are the real crux of the marketing and business planning process. They deserve every last ounce of time and effort, often frustratingly. The objectives form the umbrella under which the balance of the entire planning structure is built. Due to the key role they play, they must be thought of and expressed in the most specific and concrete way. In simpler terms, a goal is… “what do you want to achieve?” Objectives are developed to overcome the weaknesses and threats developed in the WOTSUP Analysis and to exploit the opportunities and strengths.

Website design By BotEap.com6. STRATEGY DEVELOPMENT:

Website design By BotEap.comOnce goals have been developed, strategizing is the next step in the process. Strategies should explain, in a broad sense, how the objectives will be achieved.

Website design By BotEap.com7. SPECIFIC ACTION PROGRAMS:

Website design By BotEap.comAfter the goals and strategies have been developed, describe the work to be done. Actions must be very specific; what work needs to be done, by whom, how and when.

Website design By BotEap.com8. FORECASTS/BUDGETS/FINANCIAL PREPARED:

Website design By BotEap.comThe action programs, once completed, form the basis for budget preparation. The cost of each action and the income derived from the detailed actions generate the operating budget and the cash flows of the Business Plan.

Website design By BotEap.comMany organizations confuse planning with budgeting. An important purpose of the budget is to ensure that the business has adequate financial resources to function. Budgeting is about not failing, planning is about what is possible.