The goals of the business plan and its main functions
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1. Goals and objectives of the business plan
In today's rapidly changing economic situation, it is impossible to achieve positive results without planning your actions and without predicting the consequences.
Planning is the definition of the development goal of the managed object, methods and means of achieving it, the development of a program, an action plan of varying degrees of detail for the near and future prospects.
Planning is one of the most important prerequisites for optimal production management. With all the variety of forms of market entrepreneurship, there are key provisions that are applicable in almost all areas of commercial activity, for different enterprises and organizations, which are necessary in order to timely prepare, eliminate potential difficulties, dangers and thereby reduce the risk in achieving the set goals.
Developing a strategy and tactics for the production and economic activities of an organization is the most important task for any business. Planning is a necessity of any business activity. The modern economic situation associated with the transition to market relations dictates to enterprises a new approach to intrafirm planning. They are forced to look for such forms and planning models that would ensure the maximum efficiency of the decisions made.
The main purpose of business planning is to plan activities for the near and distant periods in accordance with the needs of the market and the possibilities of obtaining the necessary resources.
Business planning helps an entrepreneur to solve the following main tasks:
· define specific areas of the firm's activities, target markets and the firm's place in these markets; - formulate long-term and short-term goals of the firm, strategy and tactics for achieving them. Identify persons responsible for the implementation of the strategy;
The article describes the essence of a business plan as a strategic management tool, its goals and objectives. The article also describes the functions of business planning and typical mistakes made in its preparation.
The essence of the business plan
Business plan is a concise, unambiguous and comprehensive description of a new type of business. It is the main basis for choice when analyzing various scenarios for the development of events, and determining the most effective solution and tools for its implementation. The business plan allows you to manage the activities of the company, and therefore it is an essential component of strategic planning, especially in the processes of implementing plans and monitoring results.
The essence of the business plan is a description and disclosure of the mechanism of interaction between the parties in the process of investment activities of capital owners aimed at launching new industries and products in order to ensure initial costs and receive dividends from profits in the future.
- Business plan developers can be:
- top management represented by the directors;
- a team of representatives of several organizations; li >
- specialized consulting agencies.
The scale and scope of planning directly depend on the level of the business, the larger it is, the more meaningful the project will be.
Most planning processes are limited to a period of one. For this period, all actions are described in the most detailed and specific way, and for the future, only enlarged macro indicators and growth trends are prescribed. For corporations and federal companies, it is important to use longer planning periods - at least five years.
In addition to the importance for the business itself, such projects are of great importance for the development of the economy as a whole, since large-scale business plans form a certain knowledge base, information from which is also used in economic regulation procedures on a national scale.
Business plan goals
As described in the previous section, the essence of a business plan is to organize interaction between a businessman and an investor, which is expressed in the creation of new organizations or projects.
If you do not know what parts of a business plan exist and how to develop it, we recommend that you read the previous material.
Business plan objectives: main points
Taking business in the right direction is the very first and foremost goal of this document, but there are other goals as well. In particular, the following can be distinguished:
- Social. These goals include the development of international relations, business contacts, the creation of new cultural and spiritual values, the improvement of the psychological state in the environment, etc.
- Raising and strengthening the economic potential of a company or entrepreneur. This is a guarantee of entrepreneurial activity and increasing the prestige of the entire company.
- Other goals involving business development - foreign travel, creating new contacts, entering various associations, etc.
In addition, this document allows:
- Determine the degree of difficulty and the likelihood of achieving the set results;
- Prove to the manager or a specific circle of persons the logic and expediency of creating a new business or reorganizing an old one;
- Convince employees to achieve the results outlined in the project, etc.
Any plan has its own specific center, and it is always financial resources, or rather their concentration on solving various problems. T. this document is a kind of assistant for an entrepreneur, which allows you to solve the problems of the company's functioning:
- Identify promising areas of activity, define markets and find a place in these markets.
- Calculate the financial costs required to manufacture products. The data obtained is then weighed against the value of the goods being sold, which helps determine the profitability of the business.
- Analyze the financial position of the company and calculate whether the company will be able to achieve the intended goals;
- Foresee the risks that may arise as a result of the company's activities, and come up with means to eliminate them.
This is what a plan is for in theory, and in practice there are five main functions.
Business Plan Practical Features
The second function involves planning. In turn, planning allows you to control the processes within the company and assess the possibilities and prospects for the development of the company in new directions.
The third function is monetary. It is she who is responsible for attracting funds from various sources - lending, obtaining loans, etc. Today it is very difficult to implement a promising project without credit resources, but it is quite difficult to obtain these resources. In addition, loans require the borrower to meet many conditions, but if this borrower shows the bank a well-developed plan, then in most cases he receives a loan.
Fourth - attracting partners and investors. It is difficult to act alone in today's business environment, so it is imperative to enlist the support of partners. They are ready to invest a lot of money in promising projects, but they can only be convinced of the very prospect by looking at the business plan. Its absence means the absence of any prospects and, as a result, there is no need to invest money.
The goal of any planning is to effectively achieve the desired result. The purpose of business planning is to develop actions for making a profit. Creating a business plan is a laborious process that requires taking into account many nuances and analyzing a large number of factors and indicators. However, this is a mandatory process if you want to develop the company.
The role and meaning of the business plan
A business plan is a document that regulates the activities of an organization, which contains the following information
- Mission, goals and objectives;
- Name, description, field of activity;
- Profit, pricing policy, income and expenses, cash flows, assets and liabilities, insurance and financial risks;
- Description of goods or services, analysis of competitors, strengths and weaknesses, target audience, marketing strategy;
- Production capacity and production process ;
- Organizational structure, partners, responsibilities, human resources;
- Environmental factors, etc.
Thus, it is a complete and accurate description of future activities, serving as a guide for management and control.
Should be viewed as a planning process and outcome. It contains the justification for the need to implement the project under consideration from a financial, marketing, organizational point of view.
Internal goals of creating a business plan
The goals of creating a business plan can be different and can be divided into internal and external.
Internal is expressed in the need to assess one's own knowledge, understand the market and systematize information. Since when implementing a project, the initiator needs to obtain a large amount of information, make calculations and draw conclusions about the advisability of investments.
Internal goals of the business plan include
Every entrepreneur must understand what a business plan is, what functions it performs and what points it consists of. This document will make it possible to determine the economic efficiency of the project, evaluating it from different sides. Banks and future investors, having studied it, will be able to decide for themselves whether it is worth investing in the proposed project and whether it will be able to bring profit. A skillfully drawn up business plan, taking into account the nuances of future production, will help find investors for the development of the enterprise.
You can naturally find many suitable documents, which are abundant on the Internet and use them as a template when composing your own, but we do not recommend using ready-made examples, they will not work. It is better to write everything in the image and likeness yourself, not forgetting about all the subtleties and details of your idea. The basic rule is not to exaggerate or hide the reality, here your ambitions will not help. Calculations and all data must be reliable.
What is a business plan - what does a business plan consist of
It is the program that the company will operate on. It describes not only the company, but also the goods that it will produce, analyzes the sales market, monitors competitors, marketing decisions, provides financial calculations and at the end summarizes the effectiveness of the operations performed.
Remember that each paragraph should be written in an accessible language so that an interested investor in a short and accurate description grasps the perspective of the idea and the opportunity to get a good profit in the process of its implementation. It is recommended to consider several possible situations and the means to achieve them in order to find the most suitable ones that will lead to the desired result. A competent business plan will become an integral part of good business management, therefore it is considered one of the most important elements in the strategy and planning system. It also monitors the performance and progress of work.
The document formulates all the goals of the company, substantiation of the possibilities for their implementation and the paths along which they will have to go to achieve them. You cannot do without calculating the amount of funds on the way to achieving results and final financial indicators. When compiling a business plan, it is calculated for a certain period, most often for 3-5 years, and all the information is presented for each year separately. The process of introducing the idea and the first year of work should be scheduled monthly. If the document is drawn up for an already operating enterprise, then in this case it is recommended to use rolling schedules, which involve drawing up a detailed plan for each year of operation.
Objectives and goals of the business plan
The document can be written for two groups of readers. The first includes initiators and organizers of a business idea, as well as company employees, and the second includes potential creditors, investors and partner organizations.
give answers to questions regarding the profitability of the project and whether it makes sense to invest money in it to earn money;
be informative for the employees of the company and those involved in the implementation of the idea;