Development of the main sections of the business plan
Imagine that you are the designated Business Planning Team Leader (BPL). We are talking about planning a full-fledged medium-sized investment project. For its implementation, it is necessary to attract additional sources of financing in the form of bank loans and find partners-investors. Your team consists of four people, including an investment economist, a marketer, and a production technology manager. The development of a business plan has passed the introductory-descriptive stage, and you proceed to its main part.
Location of planning sections in the submarine base
If you look at an investment project with a holistic view, not only from the point of view of a document, but in terms of the stages of its implementation, it should be noted that the development of a business plan refers to the initiation processes. It is important not to allow confusion and confusion between the LTP procedures and the planning of the actual implementation of the project task. These are different aspects of a single process. The business plan performs the task of justification, and the master plan of the project displays the sequence of events and results in relation to the timing and responsibilities. In other words, a business plan is created before a decision is made to start a project, and the direct implementation of a business plan is accompanied by calendar and other types of project planning.
Initiation processes begin with the receipt of a proposal for a project by the enterprise management. This can happen on a regular basis, for example, during a strategic planning session, or situationally. Naturally, the first option is preferable. A bottom-up initiative requires a presentation of the project concept and, sometimes, a preliminary feasibility study. When the initiator is the top management of the enterprise, they themselves may well limit themselves to a brief presentation of the investment idea. The result of consideration of the initiative proposal is an order to prepare a business plan and create a business planning group.
The diagram above shows the stages of developing a business plan for an investment project. The presented procedure is not always followed exactly, it depends on the specifics of the investment event and the existing management culture in the company. The business planning process is multi-layered and iterative, especially for the planning sections of the document, created during the development of its main part. In general, the algorithm for developing the document under consideration is divided into four blocks.
- Preparation of the introductory descriptive part and its fine-tuning.
- Development and revision of the main planning sections.
- Analytical and simulation part of planning.
- Decoration part.
In the article dedicated to the beginning of the business plan for an investment project, we examined the introductory and descriptive part of the document. The development of the main planning sections is central to the LPL process. The stages of business planning do not end with the preparation and execution of a business plan.
After that, there are at least two more stages: the stage of presentation and decisions about the start, financing of the project and the actual implementation of the business plan in the investment process. We will devote separate articles to the stages of preparing a resume, presenting a presentation, convincing potential partners and concluding agreements with them. Business plan implementation management and financial analysis are described in the vast majority of materials on our site in the subject area of project management.
Methodology for the development of planning sections
The question of how to develop a business plan is currently not only occupied by those entrepreneurs who are in dire need of funding sources. To a greater extent, this also applies to businessmen striving to strategically competently build the development of their enterprise. The methodologically verified sequence of developing a business plan is not always perfect. After all, an investment project is a multifactorial procedure, in which it is important not only to take into account all the nuances, but also to correctly prioritize, find profitable compromises.
The methodology for developing a business plan takes into account the main limitations of modern planning systems: the uncertainty of the external environment, the costs of planning activities, the scale of the enterprise. Uncertainty and unpredictability of the market situation is the main deterrent to accurate planning. In order to overcome the negative influence of this factor, active and passive methods are used.