| Traditionally, business planning has been carried out for | | | | plan is to request objectives from various key people |
| periods of one year or more. But in the past, the | | | | within the organisation. Explain that you are about to |
| commercial environment was not changing as quickly | | | | write a 90 day business plan and ask them for three |
| and a 12 or 24 month plan was appropriate. Today the | | | | or more suggestions to improve each area of |
| situation is different. The plan must reflect the changing | | | | operation. These areas can include products, services, |
| commercial, financial and industrial environment. | | | | marketing, selling, administration, and finance. Not only is |
| Changes are taking place at an ever-increasing rate. | | | | the input from these people valuable but also it can |
| This means that businesses today have to be much | | | | increase their commitment to the plan. |
| more nimble and responsive to the changes in the | | | | You might want to set a number of objectives such |
| marketplace and the needs of the customers. | | | | as |
| Furthermore, changes in technology can mean that | | | | - the desired rate of growth |
| today's equipment is obsolete tomorrow. We | | | | - the desired rate of profitability |
| recommend that businesses write their plan in 90 day | | | | - the desired position in a marketplace |
| cycles. This is a reflection of the current environment. | | | | - the desired public image |
| Annual plans are normally written and filed. They are | | | | - new markets |
| dusted off and rewritten for the next financial year. | | | | - new products |
| We suggest that a business plan is a dynamic | | | | - new services |
| document that is an integral part of the enterprise not | | | | - new staff |
| a vague hope for the future. A good plan is not only a | | | | - improved skills for existing staff |
| management tool and a sales tool but a plan for the | | | | - improved gross profit |
| direction of the organisation. It is a valuable | | | | - reduced expenses of leading to greater net profit |
| management tool for development, expansion and | | | | - increased market share |
| on-going operation of your company. It is also essential | | | | - increased territory |
| when you are promoting your organization to investors | | | | - strategic alliances |
| and lenders. | | | | Remember that all the objectives you set should be |
| Writing down the direction of the company through the | | | | achievable within the time frame. Having set these |
| plan for the next 90 days allows the leader to explain | | | | objectives, the next task is to work out how you are |
| to his or her team the reasons for decisions about the | | | | going to achieve them. The "how" is your business |
| future. This means that the whole organisation can be | | | | plan. The business plan should describe what is going |
| aligned in the same direction. The failure to do this will | | | | to be done, who is going to do it, how they are going |
| create a situation similar to a tug-of-war team with five | | | | to achieve it, how is it going to be measured and the |
| or more ropes. Everybody will be pulling in different | | | | time frame. In making your financial forecasts, you may |
| directions and not focusing on the main goal. | | | | include: |
| Some questions that need to be explored are similar | | | | - projected revenue |
| for all types of businesses. How big should our | | | | - projected taxes |
| inventory be? What sort of products should we have | | | | - projected operating expenses |
| in stock? How much money should we invest in | | | | - projected capital expenditure |
| inventory? What is the demand likely to be? Is that | | | | - projected economic conditions |
| demand seasonal? Will this affect our stock? What is | | | | - projected cash flow |
| our target market? What is the growth likely to be for | | | | - projected gross profit |
| our target market? Do we have sufficient resources | | | | This is only an outline but by the time you have done |
| for the period of the plan? If not, how can we cope? | | | | this a couple of times you will have modified your |
| And so on. | | | | approach to suit your company and made sure that |
| If you don't have a business plan, then you cannot | | | | this 90 day business plan is a valuable tool. When |
| change it when the unforeseen happens. This means | | | | everyone in the organisation is working in the same |
| that re-prioritizing is almost impossible when faced with | | | | direction, the cohesion and profitability will increase. |
| a crisis. One of the first things to do before writing a | | | | |