| Separate from a Business Plan is the Business Model. | | | | presenting a proposal and an agreement between the |
| The Business Model is nothing more then a description | | | | client and the business to provide certain services and |
| of the means and methods the firm will employ to | | | | products for revenues. |
| earn revenues projected by the Business Plan. The | | | | There are multitude of schematics that are used to |
| Business Plan describes what the business wants to | | | | represent the Business Model, but they all include the |
| accomplish and what resources it will use to reach | | | | four components; the Business Infrastructure, Financial |
| those objectives. The model represents the business | | | | Strategies, Clients, and the Offer or Proposition. In |
| as a system of a series of steps (actions) to generate | | | | order to get to the end result, revenues, each of these |
| revenue and make a profit. The model includes the | | | | four components of the Business Model must be |
| components and functions of the business, as well as | | | | operating at the best level of efficiency in order to |
| the revenues it will generate and the expenses it | | | | obtain the most revenues. Failure in any step will either |
| incurs. | | | | reduce the amount of revenue or completely run your |
| The traditional Civil Engineering Business Model is as | | | | business out of business. |
| simple as the engineering company and the customers | | | | It would be difficult to provide services or products to |
| within a key market like Land Development. The | | | | your clients if the resources necessary were |
| engineering company provides the services that the | | | | inadequate. Imagine if your firm was contracted to |
| customer needs and wants, and in return the client | | | | provide a Technical Drainage Study for a 200 acre |
| pays a fess for those services. Once the engineering | | | | site, but you were not capable of analyzing a |
| company has paid all of its expenses including salaries, | | | | proposed open channel using any of the available |
| the company is left with its profit. | | | | commercial software. You then have to sub-contract |
| This model although simplistic works well if there is | | | | this work out, hopefully to one of your partner |
| very little or no competition and there is plenty of | | | | companies, to assist you in this area of expertise. |
| demand for your services. But rarely is this the | | | | Otherwise, you will not be able to provide the service |
| situation especially in a declining market. The model in | | | | you were contacted to perform. |
| most cases needs to be more robust. One needs to | | | | The same is true if your firm has all of the necessary |
| see the "bigger picture." In order to support the | | | | engineering design expertise it requires and has also |
| Business Plan the Model needs to address the four | | | | contracted with other sub-consultants to provide |
| main components of the business; Framework, | | | | surveying services, but you have no marketing |
| Financial, Client, and the Offer. | | | | expertise. Although there are a number of needy |
| Business Framework (Infrastructure): | | | | clients in your local market, you have no way of |
| - Key Resources - What are the company's | | | | contacting them nor do you even know how to |
| capabilities necessary to make the Business Plan | | | | identify your potential clients. The chain is broken |
| possible? | | | | because there is no way for you to contract with |
| - Key Activities - What company activities are | | | | clients to provide the services you have available. Of |
| necessary to implement the Business Plan? | | | | course, we you have no clients you have no revenues, |
| - Key Partners - What company partners are | | | | and when you have no revenues you have no |
| motivated to participate in the Business Plan? | | | | business. |
| Client (Current and Prospective Clients): | | | | Even if you have an excellent infrastructure and |
| - Segment(s) of Clients - What is (are) the targeted | | | | business partners, and you have a huge pipeline of |
| audience for the company's products and services? | | | | clients that you obtained through marketing, all will be |
| - Communication and Distribution Channels (Marketing) | | | | for not if your proposals do not provide your clients |
| - What are the means the company will utilize to reach | | | | with the necessary services they need at a fair price. |
| the customer and offer them those products and | | | | The Engineering Business Model a tool that assists the |
| services? What marketing campaigns will the | | | | company to implement the Business Plan. A properly |
| company utilize to reach its targeted clients? | | | | prepared Business Plan and a well designed Business |
| - Client Relationship - What are the processes the | | | | Model will focus your company on the task at hand, |
| company will establish to maintain its relationship with | | | | which is to obtain contracts and clients and to produce |
| the clients? | | | | profits. If you have not already done so, now is the |
| Business Financial: | | | | time to either put together your first business plan or |
| - Revenue Streams - What are the company's | | | | update an existing one. Once completed, the plan is a |
| sources that will generate funds to support the | | | | resource with a great deal of information. It will make |
| Business Plan? | | | | you well of aware of competition, the market, and your |
| - Cost Structure - What costs will result from engaging | | | | company's capabilities. Updating the plan regularly will |
| in the Business Plan? What will be the company's | | | | keep you well informed on what is happening in your |
| expenses? | | | | business. |
| Value Proposition (The Offer): | | | | Most engineers have excellent technical skills, but not |
| - What are the company's products and services | | | | necessarily the same level of expertise in |
| being offered to the market? | | | | management. It is responsibility of the engineer to |
| To sum up the Business Model - The business | | | | develop these management skills through continuing |
| resources of technical staff and equipment | | | | education. This continuing education can be obtained |
| complemented by business partners are able to offer | | | | through Community Colleges, Universities, Professional |
| a wide range of products and services with a | | | | Training Programs, Professional Organizations, and |
| particular billing rate to potential and existing clients, | | | | online training courses. In most states these continuing |
| which are obtained through on-going marketing efforts | | | | education courses qualify for continuing education units |
| of the company's staff with an ultimate goal of | | | | (CEU) or Professional Development Hours (PDH). |