The business plan and goal setting that you completed as part of the application process will be a critical tool as you begin to build your business.

By on 13-11-2018

ANNUAL BUSINESS PLAN REVIEWS

The business plan and goal setting that you completed as part of the application process will be a critical tool as you begin to build your business. This enables you to gauge your progress and to take corrective action when things don’t go according to plan.

As you approach the end of your first year in the program, it is recommended to have a comprehensive business plan review. Be prepared to invest between one and five hours in your review and planning. At the end of the review you will have refocused, prioritized and planned for success in the coming year.

Some best practice thinking around business reviews are:

Don’t be too concerned about getting it perfect – your plan may need to be revised over time to account for changing conditions. It’s better to have a completed plan with a few flaws than no plan at all.

Identify anticipated obstacles and how you expect to overcome these challenges. Be prepared – foresight can save you time, money and headaches.

Include a monthly one-year cash flow projection – this is the easiest way to measure your actual progress.

Be realistic, not optimistic when estimating sales and costs.

Determine a worst case scenario and how it might impact your business.

Focus primarily on the next year – long term projections serve to provide direction but are rarely accurate.

Prior to writing or revising your business plan for the upcoming year, remember to spend an adequate amount of time reflecting on the progress you made on the previous year’s plan.

Business Plan Review

 SWOT Analysis

 A SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis can help you understand how your business is positioned in relation to the market and your competitors, and thus provides verification of strategic/competitive analysis.

SWOT Analysis is the most renowned tool for audit and analysis of the overall strategic position of the business and its environment. Its key purpose is to identify the strategies that will create a firm specific business model that will best align an organization’s resources and capabilities to the requirements of the environment in which the firm operates.

In other words, it is the foundation for evaluating the internal potential and limitations and the probable/likely opportunities and threats from the external environment. It views all positive and negative factors inside and outside the firm that affect the success. A consistent study of the environment in which the firm operates helps in forecasting/predicting the changing trends and also helps in including them in the decision-making process of the organization.

An overview of the four factors (Strengths, Weaknesses, Opportunities and Threats) is given below-

•  Strengths - Strengths are the qualities that enable us to accomplish the organization’s mission. These are the basis on which continued success can be made and continued/sustained.
  Strengths can be either tangible or intangible. These are what you are well-versed in or what you have expertise in, the traits and qualities your employees possess (individually and as a team) and the distinct features that give your organization its consistency.

Strengths are the beneficial aspects of the organization or the capabilities of an organization, which includes human competencies, process capabilities, financial resources, products and services, customer goodwill and brand loyalty. Examples of organizational strengths are huge financial resources, broad product line, no debt, committed employees, etc.

•  Weaknesses - Weaknesses are the qualities that prevent us from accomplishing our mission and achieving our full potential. These weaknesses deteriorate influences on the organizational success and growth. Weaknesses are the factors which do not meet the standards we feel they should meet.

Weaknesses in an organization may be depreciating machinery, insufficient research and development facilities, narrow product range, poor decision-making, etc. Weaknesses are controllable. They must be minimized and eliminated. For instance - to overcome obsolete machinery, new machinery can be purchased. Other examples of organizational weaknesses are huge debts, high employee turnover, complex decision making process, narrow product range, large wastage of raw materials, etc.

•  Opportunities - Opportunities are presented by the environment within which our organization operates. These arise when an organization can take benefit of conditions in its environment to plan and execute strategies that enable it to become more profitable. Organizations can gain competitive advantage by making use of opportunities.

Organization should be careful and recognize the opportunities and grasp them whenever they arise. Selecting the targets that will best serve the clients while getting desired results is a difficult task. Opportunities may arise from market, competition, industry/government and technology. Increasing demand for telecommunications accompanied by deregulation is a great opportunity for new firms to enter telecom sector and compete with existing firms for revenue.

•  Threats - Threats arise when conditions in external environment jeopardize the reliability and profitability of the organization’s business. They compound the vulnerability when they relate to the weaknesses. Threats are uncontrollable. When a threat comes, the stability and survival can be at stake. Examples of threats are - unrest among employees; ever changing technology; increasing competition leading to excess capacity, price wars and reducing industry profits; etc.