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  • Vision – an organizational dream, should motivate people to think what is beyond the impossible. Microsoft's vision is to empower people through great software - any time, any place and on any device. Mission statements – Feasible, motivating, and distinctive Avoid mission impossible. Those working for the organization should feel that they are working for a worthwhile company. Company should stand out from others. Objectives/Goals Objectives state the broad direction of the organization – We have an objective to increase efficiency in X marketplace, Goals state specific targets for the objectives usually numerical – Goals set the stage for planning - Measurable
  • bplans_1_the_idea.ppt

    1. 1. INLS 210-97 Information Entrepreneurship Module 1: Business Planning
    2. 2. Readings <ul><li>Venturecoach.com </li></ul><ul><ul><li>From Idea to Business http://www.venturecoach.com/resources/howbiz.htm </li></ul></ul><ul><ul><li>Anatomy of a Business Model http://www.venturecoach.com/resources/bizmodel.htm </li></ul></ul><ul><li>Entrepreneur.com: An Introduction to Business Plans http://www.entrepreneur.com/Your_Business/YB_PrintArticle/0,2361,287323----1-,00.html </li></ul>
    3. 3. Readings <ul><li>Planware.org: Business Ideas http:// www.planware.org/ideas.htm </li></ul><ul><li>Center for Entrepreneurial Excellence: Elements of a Business Plan http://www.ceebic.org/elp.htm </li></ul><ul><li>BusinessTown.com: Creating Your Business Plan http://www.businesstown.com/planning/creating-plan.asp </li></ul>
    4. 4. Readings <ul><li>BusinessTown.com: Why Plan Your Business? http://www.businesstown.com/planning/creating-why2.asp </li></ul><ul><li>The Business Planning Institute: Fatal Mistakes to Avoid When Writing a Business Plan http:// www.bpiplans.com/Articles.htm </li></ul>
    5. 5. Sample Business Plans <ul><li>MOOT Court Competition http://www.businessplans.org/mootcorp.html </li></ul><ul><li>Bplans.com: Sample Business Plans http://www.bplans.com/sp/?a= bc </li></ul>
    6. 6. The Idea <ul><li>Develop an idea that maximizes your strengths and minimizes your weaknesses </li></ul><ul><li>Look for strengths by examining your </li></ul><ul><ul><li>Educational background (special expertise or skills) </li></ul></ul><ul><ul><li>Personality (commitment, resolve, independence) </li></ul></ul><ul><ul><li>Personal experience in a business or hobby </li></ul></ul>
    7. 7. Idea Components <ul><li>The idea has four components </li></ul><ul><ul><li>Product/Service </li></ul></ul><ul><ul><li>A Business Model </li></ul></ul><ul><ul><li>A Team </li></ul></ul><ul><ul><li>Money </li></ul></ul>
    8. 8. The Idea: Components <ul><li>When thinking about your product or service </li></ul><ul><ul><li>Remember the better technology rarely wins. But the better idea usually does. </li></ul></ul><ul><ul><li>What real customer need are you meeting? </li></ul></ul><ul><ul><li>How do you market in a way that customers are willing to buy your product or service? </li></ul></ul><ul><ul><li>Who are the competitors? </li></ul></ul>
    9. 9. The Idea: Components <ul><li>A Business Model </li></ul><ul><ul><li>Describes how your business makes money. </li></ul></ul><ul><ul><ul><li>What are you selling? </li></ul></ul></ul><ul><ul><ul><li>How do you get paid? </li></ul></ul></ul><ul><ul><ul><li>Who pays you? </li></ul></ul></ul><ul><ul><ul><li>How much do you get paid? </li></ul></ul></ul><ul><ul><ul><li>How often do you get paid? </li></ul></ul></ul>
    10. 10. The Idea: Components <ul><li>Business Model Fundamentals - What to look for </li></ul><ul><ul><li>markets with a lack of competition </li></ul></ul><ul><ul><li>Recurring revenues </li></ul></ul><ul><ul><li>Low fixed costs </li></ul></ul><ul><ul><li>Low asset requirements </li></ul></ul><ul><ul><li>Compelling reason for customers to stay </li></ul></ul><ul><ul><li>Know why customers stay </li></ul></ul>
    11. 11. The Idea: Components <ul><li>A Team </li></ul><ul><ul><li>Identify business needs – find the best people to fill those needs </li></ul></ul><ul><ul><li>Skill set </li></ul></ul><ul><ul><ul><li>Financial </li></ul></ul></ul><ul><ul><ul><li>Project Management </li></ul></ul></ul><ul><ul><ul><li>Marketing </li></ul></ul></ul><ul><ul><ul><li>Production/Manufacturing/Logistics </li></ul></ul></ul><ul><ul><ul><li>Technological </li></ul></ul></ul><ul><ul><li>Beware choosing friends </li></ul></ul><ul><ul><ul><li>Establish clear roles and accountability </li></ul></ul></ul>
    12. 12. The Idea: Components <ul><li>Money </li></ul><ul><ul><li>A solid plan brings money </li></ul></ul><ul><ul><li>Investors are partners and can offer guidance </li></ul></ul><ul><ul><li>Sources </li></ul></ul><ul><ul><ul><li>Banks </li></ul></ul></ul><ul><ul><ul><li>Credit </li></ul></ul></ul><ul><ul><ul><li>Angels </li></ul></ul></ul><ul><ul><ul><li>Target groups </li></ul></ul></ul><ul><ul><ul><li>Venture capital </li></ul></ul></ul>
    13. 13. The Idea: Elevator Speech <ul><li>To be able to talk about your business plan with clarity and passion develop a Two Minute Summary </li></ul><ul><ul><li>Conveys who the market is, what is the problem to be solved, and how it will be done. </li></ul></ul><ul><ul><ul><li>FOR target customers </li></ul></ul></ul><ul><ul><ul><li>WHO ARE DISSATISFIED WITH market alternatives </li></ul></ul></ul><ul><ul><ul><li>OUR PRODUCT IS A new product or service </li></ul></ul></ul><ul><ul><ul><li>THAT PROVIDES key problem-solving capabilities </li></ul></ul></ul><ul><ul><ul><li>UNLIKE product alternative </li></ul></ul></ul><ul><ul><ul><li>WE HAVE ASSEMBLED key product/service features </li></ul></ul></ul>
    14. 14. Refining the Idea: Logic Flow Planning Adapted by Tom Miller, NCSU and Scott Brown, UNC-CH with permission from Jerry Hart, CMC
    15. 15. High level, abstract view Low level, concrete view Why? How? Vision Mission Objectives / Goals Strategy Tactics / Action Plan
    16. 16. Vision Statement <ul><li>A statement of what the world will be like if the business venture is successful. </li></ul>
    17. 17. Mission Statement <ul><li>The basic purpose of an organization. What the organization is trying to accomplish. </li></ul><ul><li>A clear statement of your company’s long-term mission. </li></ul><ul><li>Try to use words that will help direct the growth of your company, but be as concise as possible. </li></ul>
    18. 18. Logic Flow Planning Terms <ul><li>Objectives/Goals </li></ul><ul><ul><li>The major variable that the organization will emphasize </li></ul></ul><ul><li>Strategy </li></ul><ul><ul><li>A plan of action to accomplish a goal </li></ul></ul><ul><li>Tactics </li></ul><ul><ul><li>Specific steps to be taken to implement strategy </li></ul></ul>
    19. 19. Plan Outline <ul><li>Executive Summary </li></ul><ul><li>Table of Contents </li></ul><ul><li>Situation Analysis </li></ul><ul><li>Business Objectives </li></ul><ul><li>Management Capabilities </li></ul><ul><li>Market Analysis </li></ul><ul><li>Business Development Strategy </li></ul><ul><li>Financial Review </li></ul><ul><li>Appendices </li></ul><ul><ul><li>Company background </li></ul></ul><ul><ul><li>Technological Needs </li></ul></ul><ul><ul><li>Literature Citations </li></ul></ul><ul><ul><li>Resumes </li></ul></ul><ul><ul><li>Administrative issues </li></ul></ul>
    20. 20. Executive Summary <ul><li>Executive Summary </li></ul><ul><ul><li>2 pages maximum </li></ul></ul><ul><ul><li>Summary of the plan </li></ul></ul><ul><ul><li>Do not cut and paste from the plan </li></ul></ul><ul><ul><li>This may be your only chance to sell your idea </li></ul></ul><ul><ul><li>Compelling and persuasive wording </li></ul></ul>
    21. 21. Situation Analysis <ul><li>What is the organization is trying to accomplish? </li></ul><ul><li>What distinguishes the company from the competition? </li></ul><ul><li>How does the company add value to its customer’s lives? </li></ul><ul><li>What factors will account for the company’s success? </li></ul><ul><li>What are the key technologies/concepts upon which the company is based? </li></ul><ul><li>Why is the time right for your product/service? </li></ul>
    22. 22. Business Objectives <ul><li>The major variable that the organization will emphasize </li></ul><ul><li>Describe the where, when, why, how, and who of the company’s first year of business. </li></ul><ul><li>How they will be short-term goals (12 to 18 months) and long-term (18+ months) be achieved? </li></ul><ul><ul><li>State specific measurable objectives </li></ul></ul><ul><ul><li>State market share objectives </li></ul></ul><ul><ul><li>State revenue/profitability objectives </li></ul></ul><ul><li>What are the plans for alternative outcomes? </li></ul>
    23. 23. Management <ul><li>List CEO and key management by name </li></ul><ul><li>Describe roles in company </li></ul><ul><li>Include previous accomplishments to show these are people with a record of success </li></ul><ul><li>Summarize number of years of experience in this field </li></ul><ul><li>Outline advisory boards or panels </li></ul>
    24. 24. Management <ul><li>Describe strategies for attracting and keeping key personnel. </li></ul><ul><li>Schedule for adding new personnel </li></ul><ul><li>Sample organizational structure </li></ul>
    25. 25. Market Analysis <ul><li>Industry Analysis </li></ul><ul><li>Competitive Analysis </li></ul><ul><li>Marketing Activities </li></ul><ul><li>Technology </li></ul><ul><li>Business Operations </li></ul>
    26. 26. Market Analysis: SWOT Analysis <ul><li>Informs marketing analysis and planning </li></ul><ul><li>Internal Analysis </li></ul><ul><ul><li>Strengths, Weaknesses, </li></ul></ul><ul><li>External Analysis </li></ul><ul><ul><li>Opportunities </li></ul></ul><ul><ul><li>Threats </li></ul></ul>
    27. 27. Internal SW Analysis <ul><li>Areas to examine within the company </li></ul><ul><ul><li>Profitability </li></ul></ul><ul><ul><li>Sales and marketing </li></ul></ul><ul><ul><li>Quality </li></ul></ul><ul><ul><li>Customer service </li></ul></ul><ul><ul><li>Productivity </li></ul></ul><ul><ul><li>Financial resources </li></ul></ul><ul><ul><li>Financial management </li></ul></ul><ul><ul><li>Operations </li></ul></ul>
    28. 28. External OT Analysis <ul><li>Areas to examine </li></ul><ul><ul><li>Technology </li></ul></ul><ul><ul><li>Government and Regulation </li></ul></ul><ul><ul><li>Legal </li></ul></ul><ul><ul><li>Economic environment </li></ul></ul><ul><li>Opportunities </li></ul><ul><ul><li>Think in terms of consumer problems. </li></ul></ul><ul><ul><li>Define nature of product/service opportunities created by those problems. </li></ul></ul>
    29. 29. Marketing Analysis: Industry Analysis <ul><li>Industry size </li></ul><ul><ul><li>$1 billion or $10 billion </li></ul></ul><ul><li>Target Markets </li></ul><ul><ul><li>Who is most likely to buy from you? </li></ul></ul><ul><ul><li>What wants, needs, and habits do your best customers and prospects share? How many best customers are there? </li></ul></ul><ul><li>Regulatory requirements </li></ul><ul><ul><li>Think about local, state, and federal laws and regulation affecting your business </li></ul></ul><ul><li>Projected changes over the next three to five years </li></ul><ul><ul><li>In industry </li></ul></ul><ul><ul><li>In company’s product/service </li></ul></ul>
    30. 30. Marketing Analysis: Competitive Analysis <ul><li>Who are the competitors? </li></ul><ul><li>What is their market share? </li></ul><ul><li>How do you compare, in the eyes of the consumers, to existing companies? </li></ul><ul><li>Outline your company’s competitive advantage </li></ul>
    31. 31. Marketing Analysis: Marketing Activities <ul><li>Who are the competitors? </li></ul><ul><li>What is their market share? </li></ul><ul><li>How do you compare, in the eyes of the consumers, to existing companies? </li></ul><ul><li>Review those changes in market share, leadership, players, market shifts, costs, pricing, or competition that provide the opportunity for the company’s success. </li></ul>
    32. 32. Business Development Strategy <ul><li>When will the business open? </li></ul><ul><li>What resources are available? </li></ul><ul><li>How will the customer base be built and maintained? </li></ul>
    33. 33. Business Development Strategy <ul><li>Growth Strategy & Tactics </li></ul><ul><ul><li>Market penetration – capture market share from competitors </li></ul></ul><ul><ul><li>Create new markets </li></ul></ul>
    34. 34. Financial Review <ul><li>Detailed financial plan (be conservative) </li></ul><ul><ul><li>Best guess at financial results </li></ul></ul><ul><ul><li>States what assumptions have been made and why </li></ul></ul><ul><ul><li>Outlines funds required and their use </li></ul></ul><ul><ul><li>Reviews yearly expected sales and profits for the next three years </li></ul></ul><ul><ul><li>Discussion of how growth will be managed </li></ul></ul>
    35. 35. Things to Think About <ul><li>Resource Requirements </li></ul><ul><li>Risks and Rewards </li></ul><ul><li>Near-term/Long-term Decisions </li></ul>
    36. 36. Resource Requirements <ul><li>Technology requirements </li></ul><ul><li>Personnel requirements </li></ul><ul><li>Resource requirements </li></ul><ul><ul><li>Financial, distribution, promotion, etc. </li></ul></ul><ul><li>External requirements </li></ul><ul><ul><li>Products/services/technology required to be purchased outside company </li></ul></ul>
    37. 37. Risks & Rewards <ul><li>Risks </li></ul><ul><ul><li>Summarize risks of proposed project </li></ul></ul><ul><ul><li>Addressing risk </li></ul></ul><ul><ul><ul><li>Summarize how risks will be addressed </li></ul></ul></ul><ul><li>Rewards </li></ul><ul><ul><li>Estimate expected pay-off, particularly if seeking funding </li></ul></ul>
    38. 38. Decisions <ul><li>Near term </li></ul><ul><ul><li>Isolate key decisions and issues that need immediate or near-term resolution </li></ul></ul><ul><li>Long term </li></ul><ul><ul><li>Isolate issues needing long-term resolution </li></ul></ul><ul><ul><li>State consequences of decision postponement </li></ul></ul>