Effective Business Planning and Execution

This is the first course of the Business Planning Series.

There are four main benefits of preparing a business plan. It helps you clarify what developments your business should focus on. It also gives you a framework within which to develop your business strategies.

Planning for the future is crucial for any successful organization, and business plans play an important part in that process. Without a business plan, your organization or department could easily become directionless.

The Science of Better Learning

How do strategic plans and business plans differ? Strategic plans are longer than business plans, the former covering a period of up to ten years with the latter covering one or two years.

Use this follow-on activity to organize your thoughts for your business plan.

Preparation is of great importance when developing a business plan. Prepare for the development by discussing, thinking, researching, and analyzing your business ideas.

When creating a business plan, success largely depends on how much preparation you put in. The vast majority of the work in an effective business plan is typically done in the preparatory stages.

The second step in preparing to develop your business plan is to do research. Initially, you should identify critical issues – for example, potential sources of internal funding and resource allocation.

Having completed the research for your business plan, you then establish your goals. This is the third step in the preparato ry process for developing a business plan.

Identifying the strategies you'll use to fulfill your goals is the fourth step you'll take when preparing to develop your business plan.

Once you've identified the strategies you'll use, you then assess the resources available to you to fulfill your business plan. This is the fifth step in the preparatory process.

Your business plan will vary depending on its purpose. It typically comprises four major parts.

Business plans vary significantly depending on their primary purpose. When you've collected all the information you need to create a plan, you should then tailor the plan to its intended audience.

Use this job aid to help you prepare for developing a business plan.

Use this job aid detailing the different parts of a business plan when you're preparing your own plan.

When a business plan is being presented to an audience, many issues may arise and affect how the audience responds. For example, Matthew, Heidi, and Omar are senior executives at a camping equipment company.

By following certain guidelines, you can create an effective business plan that should capture your target audience's attention and, ultimately, likely get their approval. The first of the guidelines is keep it short.

Use this job aid to guide you as you create an effective business plan.

Congratulations! You just finished the Preparing a Business Plan Course.

This is the second course of the Business Planning Series.

A business plan will typically include an executive summary, information on market opportunities, the implementation details of the plan, and any necessary contingencies due to unexpected changes in market conditions.

People develop business plans for many reasons – it could be to seek funding for a project, evaluate future growth potential, or perhaps establish a new business partnership.

A robust situational analysis will include an internal analysis to identify the strengths and weaknesses of your company. It'll also include an external analysis to identify the external opportunities and threats to your company.

There are four steps you can take when conducting an internal analysis – although the steps don't need to be carried out in any particular order.

Another step in an internal analysis is assessing your company's resources. You need to identify the resources most important to the business, such as research and development employees, or top-of-the-line equipment.

Another key step is to evaluate the organizational and management strategies. During this phase of your analysis, you need to review the organizational structure of your company and its subunits.

Evaluating your organization's financial position is a fundamental step in undertaking any new initiative.

Use the table to help identify the strengths and weakness in your company.

Use the table to identify the strengths and weakness in your company.

An external analysis of a business environment includes careful consideration of political, economic, societal, and technological factors – otherwise known as a PEST analysis.

Organizations don't operate in isolation. Their success or failure can be affected by external factors such as economic downturns.

As part of an external analysis, you may use scenario planning. Scenario planning can help you visualize the future environment for your business.

Use this job aid to consider factors in the external environment.

After scenario planning for the broader political, economic, societal, and technological considerations, you can consider the market relevant to your business.

When conducting business planning, the third area to consider is the competition.

When writing a business plan, you also examine your industry. Industry information is readily available through sources such as government statistics or industry associations.

Use this job aid to consider factors in a market analysis that may impact your business plan.

A SWOT analysis uses information from your internal and external analyses to define strategies to maximize competitive advantage.

An important step in developing a successful business plan is to identify opportunities and threats.

You begin your SWOT analysis by listing important opportunities and threats in the context of your company's strengths and weaknesses.

A SWOT analysis is a glimpse at your company's competitive position and can be used to generate possible strategies for your business plan.

Use this learning aid to review Blazerfire's SWOT.

This is the second course of the Business Planning Series.

This is the third course of the Business Planning Series

You should view the planning, implementation, and control phases of a business plan as part of a continuous strategic process. This should help you implement it successfully and achieve real benefits.

Many managers are involved in creating business plans in their organizations. A business plan outlines a set of business goals and how those goals can be achieved. Once a business plan has been created and communicated, it needs to be implemented. It also needs to be continuously reviewed and controlled to ensure it's being carried out effectively.

When it comes to implementing your business plan, you'll want to carry out the process in a smooth, effective way. However, you may encounter difficulties during implementation. It's important to overcome such challenges when they occur and get your plan back on track as quickly as possible.

As a manager, you'll be able to gain real benefits by implementing your business plans successfully. For one thing, you'll be able to introduce your strategies and ideas smoothly, causing a minimum amount of disruption to your employees. Your team can then focus on making the necessary changes and on reconciling new and emerging strategies with existing ones.

To implement a business plan successfully, you need to coordinate and manage all implementation- related activities in an effective way. You also need to promote implementation-centered behavior, decision making, and problem solving among your employees.

Use this job aid to help you coordinate the implementation activities of a business plan. You can follow a number of steps to help you coordinate the implementation phase of a business plan.

When implementing a business plan, the first step is to develop action plans. To create an action plan, first clarify the outcomes you want to achieve. For each outcome, list the activities necessary to achieve it. Then put the activities in order.

Without careful action planning, the strategies you'd like to implement in your organization are unlikely to become reality. So when coordinating the implementation phase of a business plan, the first step is to develop targeted action plans. An action plan is a series of tasks that need to be completed in order to accomplish a particular objective.

Some organizations undertake action planning at the same time as strategic business planning. This is usually a mistake. Business planning involves considering the bigger picture. But with action planning, you're focusing on the detail. So it's usually better to do action planning afterwards.

You can follow seven steps to help you create the main sections of an action plan. First, clarify the outcomes you want to achieve. For each outcome, list the activities necessary to achieve it. Then put the activities in order. The fourth step is to assign responsibilities for completing each activity among your employees. Then determine the resources you need to implement your plan. And determine the likely costs of implementing it. Finally, create a schedule showing the timelines involved.

When creating an action plan, the fourth step is to assign responsibilities for completing each activity among your team members. Unless you specifically assign responsibility for carrying out a task, it probably won't get done. So your action plan should make it clear who has responsibility – and authority – for ensuring that each activity is completed. You should also identify the individuals, groups, or units who are involved in carrying out each activity.

After developing an action plan, it's important to ensure you can actually implement it. To do this, you should ensure the current organizational infrastructure can support the plan.

Use this follow-on activity to help you coordinate the implementation of your own business plan.

It's important to make sure your business plan can be measured and controlled. You can create a management reporting system to help you do this.

After you've developed an action plan – and ensured its implementation can be supported in your organization – you need to determine how your business plan can be measured and controlled. You can create a management reporting system to help you do this. A proper reporting system can help you monitor progress in relation to targets and outcomes. And it can confirm whether or not your business plan is on track.

Effective implementation of your business plan involves more than reporting information in a well- designed format. You also need to put a system in place so you can use your reports for control purposes.

Despite the best planning and preparation, your business plan can go off track. It's important to react quickly and decisively in this situation by modifying your original plans and taking the necessary corrective action.

The environment your organization operates in is likely to evolve over time. This makes developing a business plan an uncertain process. For instance, legislative changes or other external developments might impact your original plans. Internal developments, such as losing a key employee to a competitor, might also have to be factored in. So when implementing a business plan, you need to have clear procedures in place for modifying your action plans and strategies when necessary.

This is the third course of the Business Planning Series.

This is the first course of the Business Execution series.

Execution is a complex business and has various driving factors. High performance companies usually have the skills in place to drive successful strategy execution.

Planning and execution are integrally linked. While planning provides the foundation for strategy and is a time consuming and important task, it doesn't get the job done.

Given that the drivers are so complex, execution of strategy can be a difficult and obstacle-ridden business.

Use this follow-on activity to assess strategy execution issues within your own organization.

Company leaders should display behaviors conducive to execution to ensure active involvement.

There are three cornerstones of effective strategy execution. The first of these is leadership behavior. You need to secure active involvement of company leaders to ensure effective strategy execution.

Use this learning aid to review the characteristics of a leader at a manufacturing plant.

The second cornerstone of strategy execution involves having people in the right roles. Responsibility in any organization is divided among many different levels, such as leaders, middle management, and the workforce.

National Bank Strategy Execution

Whereas leaders are mainly responsible for defining strategy, middle management is responsible for strategy execution. Line managers must understand both the strategy and the workforce assigned to execute it to ensure the right people are in place.

The workforce interacts with customers, suppliers, and each other so employees are in the best position to execute the organization's strategy.

Roles and Responsibilities

The third cornerstone in strategy execution is creating and managing a culture of execution.

It's no good having all tiers of the organizational chart focused on getting things done if the company culture simply doesn't support delivering on plans. The third cornerstone is creating and managing a culture of execution.

Now that you have an idea what makes up a strong culture of execution, you have to determine how to achieve it in your own organization.

Use this learning aid to review how the department store created a culture of execution.

The second step when creating and managing a culture of execution is providing employees with adequate education and allowing time for employees to socialize with coworkers.

The third step to create a strong culture of execution is to communicate. Effective communication leads to genuine understanding of strategy execution.

Use this job aid to help you create or manage a culture of execution.

There are three cornerstones of effective strategy execution. The first of these is leadership behavior. You need to secure active involvement of company leaders to ensure effective strategy execution.

It's no good having all tiers of the organizational chart focused on getting things done if the company culture simply doesn't support delivering on plans. The third cornerstone is creating and managing a culture of execution.

Strategy is executed over time by managers in every level of a company as they commit resources, programs, people, and facilities to the business strategy. So business leaders concerned with strategy execution need to know who controls which resources and who has the most influence on strategy execution.

This is the first course of the Business Execution series.

This is the second course of the Business Execution series.

Business strategy involves making decisions about what a company should do and how it should allocate resources.

Without a clear plan of action, most businesses wouldn't be able to operate effectively. Think about it – if managers made decisions without considering their impact, things would fall apart pretty quickly.

The first step in defining the strategy is to clarify the mission, vision, and values. These three items form the basis of the company's purpose, actions, and aspirations.

Once you've clarified the mission, vision, and values, it's time to review your company's current situation – the second step in defining the strategy.

You've clarified your mission, vision, and values. You have a good idea of your company's current situation. Now you can use that information to create strategy direction statements.

Use this job aid to help you perform the three steps in defining your own executable strategy.

Good execution begins with good business strategy. An executable strategy must be planned, integrated, measurable, and supportable.

Without a good business strategy, most companies would find it difficult to reach their goals. Strategy development is an essential aspect of execution.

You've already learned that the first step in creating your business strategy is to define the strategy. Now it's time to move on to the second step in creating strategy that executes: develop the strategy.

Use this job aid to perform the four steps required to develop a business strategy.

When you're developing an executable strategy, you need to take four key steps. You've already learned about the first two – selecting strategic initiatives based on themes and assigning accountability to initiatives.

The final step in developing strategy involves allocating resources to initiatives. This places demands on a company's skills, resources, and capabilities. Resource allocation must align strictly with overall strategy.

Business strategy involves making decisions about what the company should do and how it should allocate resources. These decisions should take into account current competitive conditions and growth opportunities in the industry. Remember, good execution begins with good strategy.

Strategy development is an essential aspect of execution. There are two aspects of the strategy that can have an effect on its execution: the kind of strategy, and how it is translated into plans.

Successful execution depends on how well you translate the initiatives into strategic targets. These targets are the short-term operational metrics that are linked directly to your company's long-term needs. If you want to achieve the long-term goals, you must manage the short-term targets well.

This is the second course of the Business Execution series

This is the third course of the Business Execution series.

Creating an exceptional strategy doesn't guarantee that it'll be executed successfully. To ensure your strategy is implemented effectively, it's important that employees understand how their work fits in with the big picture.

All too often, organizations create well-formulated strategies that appear to take every contingency into account, but fail to get the desired results. On paper, your organization may have a brilliant plan.

Before communicating strategies to employees, you first need to consider your organization's mission, values, and vision. These concepts are central to most companies.

Having developed a strategy based on your mission, values, and vision statements, you then communicate this strategy by applying several important principles.

Purpose: Use this job aid to review principles for communicating your organization's corporate strategy.

As a leader, an effective way of aligning operational processes within your organization is to use a corporate balanced scorecard.

Suppose you've created a strategy based on your company's mission, values, and vision statements. And suppose you've communicated this strategy to your employees so they understand and support the plan.

Your organization's corporate strategy is represented by a high-level balanced scorecard. But to execute this strategy, you need to translate this high-level scorecard into department, team, and individual scorecards.

The next principle of cascading BSCs is that each business unit should examine the high-level scorecard and select the objective that it can execute.

The final principle when cascading BSCs is that all the business unit scorecards combined should cover all the high-level objectives. Just because your organization has created scorecards for each department, unit, or team doesn't necessarily mean they're all aligned to the high-level objectives.

Purpose: Use this job aid to find out how to align your corporate scorecard to other levels within your organization.

When cascading your corporate scorecard, you must link employees' personal objectives with your organization's strategy. Once you've aligned individual scorecards to the high-level scorecard, you need to create a clear picture for your staff of how their tasks can affect the success of the strategy.

Good strategy execution depends on having employees with the right competencies in the right places. Essential competencies involve knowledge or expertise of a particular area, abilities such as interpersonal skills, and personal values such as honesty, creativity, and customer focus.

As a leader, you must nurture a talented workforce to help your organization execute its strategy. Decisions about strategic direction are essentially decisions about talent.

Clearly, competent employees are one of your organization's most valuable resources. Without the right knowledge, skills, and values in place, it can be a costly and time-wasting exercise to implement your organization's strategy.

The first step in assessing employee competencies is to create a detailed list of competencies required for each strategic position in your organization.

The next step in the competency assessment process is to identify gaps in an employee's portfolio of competencies. At this stage, you need to compare the results of your employee assessment to the requirements of the position.

The next step in the process of assessing employee competency is to create a development plan to address gaps in your employees' portfolios of competencies.

Purpose: Use this follow-on activity to analyze what competencies are required for a specific position in your organization, what competencies employees currently have, and how they may be developed.

All too often, organizations create well-formulated strategies that appear to take every contingency into account, but fail to get the desired results. One key reason may be because they don't clearly communicate their strategic goals to employees.

The balanced scorecard, or BSC, is a performance management process that can help you monitor your employees' objectives and ensure their tasks align with your organization's goals.

Organizations are increasingly reliant on having people with the right competencies. Creating an executable strategy means having the desired competency in place.

This is the third course of the Business Execution series.

This is the fourth part of the Business Execution series.

Strategies are only useful when they're implemented effectively. To ensure that a strategy is effective, execution needs to be monitored on an ongoing basis.

Organizations spend a lot of time and resources on developing effective business strategies. However, strategies are only useful when they're implemented effectively.

Executives at the corporate level can integrate and monitor scorecard perspectives using a second method of monitoring – strategic dashboards. These dashboards help to link management reporting to the execution of strategic objectives.

A key use of strategic dashboards is to provide information during quarterly strategy review meetings. Review meetings are the third method you can use to monitor implementation.

Reviewing employee engagement is the fourth method for monitoring implementation. This is a key metric, as engaged employees can increase profitability and customer loyalty.

Use this job aid as a guide when selecting methods for monitoring strategy execution.

A good way to analyze how a project or strategy is progressing is to conduct a variance analysis. This involves assessing the differences between the intended objectives and end results.

Having a strategy that's appropriate and adaptable is critical for success. However, a strategy is useless if it can't be evaluated against results.

Evaluation usually takes place once the implementation process is underway and it's continuous throughout the execution of a strategy. The strategic planning process itself should also be reviewed.

The second step in the evaluation process is to assess priorities for dealing with these variances. You first need to establish which part of the strategy is causing the variances.

The third step in the process is planning what corrective actions to take to address areas that may be associated with the root cause of a variance – the organization's vision, strategy map, achievement targets, or the program itself.

The fourth and final step in the evaluation process is to record lessons learned. Organizations should use this process as an opportunity to continually learn more about their own strategic planning processes.

Use this job aid as a guide to evaluating the results of strategy execution.

When changing strategy to deal with changing circumstances, a new team should be established. The team should follow four steps when altering the strategy.

Strategy comes full circle after it has been evaluated. The organization's vision, strategy map, achievement targets, and a program of execution are all analyzed during strategy development.

Once problems are identified and their root cause investigated, those accountable need to follow through on fixing them. If the results aren't as expected, either the strategy or the tactics you use to implement it need to change.

When altering strategy, there are four steps to help focus on the problem and its solution. The first is to focus on the mission of the organization and its strategic direction. Second, try to coordinate the systems and execution processes already in place.

Organizations spend a lot of time and resources on developing effective business strategies. However, strategies are only useful when they're implemented effectively.

Having a strategy that's appropriate and adaptable is critical for success. However, a strategy is useless if it can't be evaluated against results.

Once evaluation of execution has taken place, these components of strategy then become areas of change. The root causes of variances discovered during evaluation are linked back to one or more of these change categories.

This is the fourth course of the Business Execution series.

You think knowing stuff changes the game? You think sitting in a library, stacking up facts like you’re building a Jenga tower, is gonna make you a winner? Man, that’s cute. But life ain't a trivia night. Information alone? It’s worthless. It’s like having a Lamborghini in your garage but you never learned how to drive. You just sit in it, making engine noises. Vroom vroom. People walk by, they see the car, but they also see you ain't going nowhere. You got all this knowledge, all these textbooks, but when life throws a punch, you’re still looking up the definition of "duck." It’s what you *do* with that information that actually matters. Don't be the person with the shiny car and no keys.