Business Planning Part 3 Introduction: Financial and People Planning
We start a new series on The BAM Review blog this month that will focus on developing your business plan: Financial and People Planning.
In previous series we have covered Business Planning Part 1: Introduction to Business Planning and Business Planning Part 2: Product and Market. In Part 3, a new series that will take us up to the middle of December, we will focus on two essential elements in the business planning process: money and people!
Show Me the Money
Crunching the numbers and working out financial projections during the planning stage is a major part of discovering whether your business model is viable or not. Until you start to work out your costs, price points, sales forecasts, cash flow projections, break even point and so on, your business idea will remain just that, an idea. Even if you don’t need to present your plan to outside investors, you will still need to create a financial plan so that you know whether your business model can ever be profitable and how much working capital you will need to sustain it through launch.
A financial plan can include:
- Sales forecast
- Profit and loss statement (income and expenses)
- Balance sheet (assets and liabilities)
- Cash flow statement
- Break-even analysis
Two good introductory articles on financial planning are:
How to Write the Financial Section of a Business Plan – Inc.com
The Key Elements of the Financial Plan – Bplans.com
Who is on the Bus?
In his classic business book Good to Great, Jim Collins says, “To build a successful organization and team you must get the right people on the bus.” Great companies get the right people and put them in the right seats on the ‘bus’.
Working out essential roles for your company and who will do what is an essential part of your business plan. Who will own the business? Who will take key management roles? Who will you hire and when? Who will answer to who? Are the necessary skills and experience available to the company? Will you need to outsource business functions or hire consultants or contractors? All these need to be considered as part of a human resource plan, management plan or organization plan during business planning stages of a company.
Three good introductory articles on human resource or management planning are:
The People Behind the Plan – Bplans.com
The Management Plan Section of the Business Plan – the balance
Business Plan: Your Organizational And Operating Plan – Investopedia
Check back on The BAM Review this month for even more great resources on business planning!
Jo Plummer is the Co-Chair of the BAM Global Think Tank and co-editor the Lausanne Occasional Paper on Business as Mission. She has been developing resources for BAM since 2001 and currently serves as Editor of the Business as Mission website.
Join us for our Business Planning Part 3 series on The BAM Review Blog, looking at financial planning and people planning. Have your say on social media on this topic by following us on Twitter or Facebook.
