Creating Business Plans Joe Ciccone

Creating Business PlansCreating Business Plans

Joe CicconeCathy Porta

NJ SLAOctober 22, 2002

AgendaAgenda

• Introduction• Uses of Business Plans• Components of a Business Plan• Creating a Business Plan for a Library • Lessons Learned• Questions• Selected Business Plan References

Overview of Business PlansOverview of Business Plans

• A business plan is a detailed overview of where a business is now, how it is positioning itself, where it wants to go, and how it is going to achieve its goals.

• It is a blueprint of an organization’s past, present, and future.

• A business plan is critical to the success of any venture and is an indispensable management tool that can be used in a variety of situations.

Business Plan UsesBusiness Plan Uses

• Test the feasibility of an idea• Establish and evaluate performance benchmarks• Communication

– Prospective investors– Lenders and financial institutions– Employees– Outside advisors– Customers, suppliers, etc.

Business Plan ComponentsBusiness Plan Components

• Executive Summary• Business Description• Market/Industry Analysis & Strategies• Competition & Feasibility Study• Operations• Key Management People & Ownership• Personnel• Funds Required and their Uses• Financial Data

Business Plan ComponentsBusiness Plan Components

• Executive Summary– Objectives– Mission Statement– Key Success Measures

• Business Description– An Overview of the Industry– Description of Company/Department– Products/Services– Positioning– Pricing Strategy

Business Plan ComponentsBusiness Plan Components

• Market/Industry Analysis & Strategies– Customers– Market Size & Trends– Estimated Sales– Future Outlook– Strategic Opportunity

• Competition and Feasibility Study– Who are your competitors– Differentiation– SWOT

Business Plan ComponentsBusiness Plan Components

• Operations– Outline how you will accomplish production or

conduct service operations– Identify firm location– Explore operating procedures– Describe operating facilities and layout– Describe purchasing procedures– Explain inventory management procedures– Explain customer service & quality control

procedures

Business Plan ComponentsBusiness Plan Components

• Key Management & Ownership– This section emphasises the management’s talent &

skills indicating why they contribute to the distinctive competence of the business. Should include:

• Name• Qualifications• Skills/Experience• Primary Role• Track Record

Business Plan Components Business Plan Components

• Key Management & Ownership– Identify weaknesses in the team and devise strategies

to overcome them– Describe how you intend to attract & compensate key

people– List the board of directors– List the current shareholders – Define the legal structure of the business

Business Plan ComponentsBusiness Plan Components

• Personnel– List the staff you will need & their primary duties– Explain the reward and compensation method– Outline the recruiting & training methods– Show sample organizational structure– Provide details of staff turnover such as average

length of employment and staff involvement in management issues

– Provide details of union membership or any enterprise agreements with staff

Business Plan ComponentsBusiness Plan Components

• Funds Required and their Uses– How much money is required?– Any actions taken already to secure financing?– How much will be required in the next 3 years?– Describe funding sources and terms– How will these funds be used?– Outline the overall funding strategy

Business Plan ComponentsBusiness Plan Components

• Financial Data– Important Assumptions– Key Financial Indicators– Break-Even Analysis– Projected Profit and Loss– Projected Cash Flow– Projected Balance Sheet– Projected Income Statement

Creating a Business Plan for a Library

Creating a Business Plan for a Library

Phase I: Establish the Planning ProcessPhase II: Establish the Organizational DirectionPhase III: Conduct the Strategic AssessmentPhase IV: Reassess the Strategic DirectionPhase V: Develop Action PlansPhase VI: Write and Communicate the PlanPhase VII: Implement the Plan and Monitor Its Progress

Planning Process PhasesPlanning Process Phases

Phase I: Establish the Strategic Planning Process

- determine the planning goals- determine the planning milestones & budget- establish the steering committee

Planning Process PhasesPlanning Process Phases

Phase II: Establish the Organizational Direction

- review or draft (if ones do not already exist) vision, mission and values statement(s)

Planning Process PhasesPlanning Process Phases

Phase IIIA: Conduct Strategic Assessment (assess external environment)

- develop survey mechanism- identify & interview other corporate archivists

Planning Process PhasesPlanning Process Phases

Phase IIIB: Conduct Strategic Assessment (assess institutional environment)

- for each stakeholder group determine what method to use to obtain feedback (e.g., in-person interview, survey, etc.) - develop the feedback mechanism(s)- identify & interview or survey representatives of each stakeholder group

Planning Process PhasesPlanning Process Phases

Phase IIIC: Conduct Strategic Assessment (analyze information obtained)

- analyze information obtained to determine strengths, weaknesses, opportunities and threats

Planning Process PhasesPlanning Process Phases

Phase IV: Reassess Strategic Direction

- identify strategic issues and clarify strategic goals- review and update the vision, mission and values statements- develop objectives for each strategic goal

Planning Process PhasesPlanning Process Phases

Phase V: Develop Action Plans

- develop an overarching action plan for each strategic goal- develop work plans for each objective

Planning Process PhasesPlanning Process Phases

Phase VI: Write and Communicate the Plan

- draft the planning document- draft the strategy to communicate the plan to stakeholder groups- begin to inform the stakeholders about the plan

Planning Process PhasesPlanning Process Phases

Phase VII: Implement the Plan and Monitor Progress

- implement the plan- periodically review the plan and report to management on your progress

Planning Process PhasesPlanning Process Phases

Lessons Learned & LearningLessons Learned & Learning

• Gain management buy-in early and often• Involve stakeholder groups in the planning• Don’t underestimate the amount of time the

planning will take

QUESTIONS?QUESTIONS?

Selected Business Plan References

Selected Business Plan References

• American Express Small Business Services• Barron’s, Writing a Convincing Business Plan• Business Plan Software & Sample Plans, www.

bplans.com• Ernst & Young, “How to Prepare a Business Plan”• Small Business Administration, www.sba.gov

• Clement, Richard, ed., Strategic planning in ARL libraries: a SPEC kit. Washington, D.C.: Association of Research Libraries, 1995.

• Corrall, Sheila. Strategic planning for library and information services. London: Aslib, ____.

• Dissmeyer, A., “Developing an intelligence audit to drive strategic planning: a case study,” Trends in Law Library Management & Technology, 12(3) December 2001, pp. 5-8.

• Hannabuss, S., “Scenario planning for libraries,” Library Management, 22 (4/5) 2001, pp. 168-76.

• Higa-Moore, M.L., et al., “Use of focus groups in a library strategic planning process,” Journal of Academic Librarianship, 27(5) September 2001, p. 372-8.

• Johnston, J.L., “Paying for the future: financial planning as part of the strategic plan,” Trends in Law Library Management & Technology, 12(3) December 2001, pp. 1-2.

• McClamroch, J., et al., “Strategic planning: politics, leadership & learning,” Journal of the Medical Library Association, 90(1) January 2002, pp. 86-92.

• Nelson, Sandra. The New planning for results. Chicago: American Library Association, 2001.

• Randolph, Susan E., “The Search conference,” Library Administration & Management, 15(4) Fall 2001, p. 230-9.

• Shoaf, Eric C., “Fifteen months in the planning trenches: strategically positioning the research library for a new century,” Library Administration & Management, 15(1) Winter 2001, pp. 4-13.