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Business & Strategic Planning

A step by step guide to developing and writing a

business plan

Business & Strategic Planning

What is a Business Plan?

A business plan is
A written statement describing your organisation, why it is needed, what
organisational activities, services, facilities and programmes are
proposed, how these will be managed, what outcomes and
achievements will be made and how these will be financed; in particular
it will show where the money will be sourced from and how and when it
will be spent.
It should also include information about your organisation, its aims,
objectives, history and the organisations ability to delivery the
It is a means of demonstrating that you know what you are doing and
can be trusted with the money you are asking for.
Business & Strategic Planning

Why do we need a Business Plan?

to develop
new ways of
Helps to work
out what your
priorities are

direction to
all staff &

Helps to
reflect on
where you
are now


to identify
problems early &
take appropriate
the seriousness
of your goals to
funders &

Opportunity for
other organisations
to inform the plan

Shows how
you are different
to other similar

part of the
funding process

Business & Strategic Planning


Before you get started

Developing a business plan should be a dynamic and creative
process, give those involved the opportunity to take a step back
and reflect, review the progress made and develop a new sense of
purpose and direction.


It is important to consider the timing of developing your business planensure the organisation undertakes the process at an appropriate time
and schedules it into calendar- as they say if you fail to plan, you plan to

Effective Time Management and Support

Managing the time effectively and supporting individuals and tasks will
help keep things on track during the process reducing the likelihood of
things getting dragged out, people gain a real understanding of what is
involved in its development and tasks are completed.
Business & Strategic Planning

Difference between Strategic

Plan and Business Plan
While a strategic plan is a type of business plan,
there are several important distinctions between
the two types that are worth noting.
A strategic plan is primarily used for implementing
and managing the strategic direction of an
existing organization. A business plan is used to
initially start a business, obtain funding, or direct
The two plans cover different
timeframes as well. A strategic plan generally
covers a period of 3 to 5+ years, whereas a
business plan is normally
no more than one year.
Business & Strategic Planning

A strategic plan is for established businesses,

organizations and business owners that are
serious about growing their organization.
Whereas a business plan could be for new
businesses and entrepreneurs who are startups.
A strategic plan is used to provide focus,
direction and action in order to move the
organization from where they are now to where
they want to go. Whereas a business plan is
used to provide a structure for ideas in order to
initially define the business.

Business & Strategic Planning

A strategic plan is critical to prioritizing resources

(time, money and people) to grow the revenue
and increase the return on investment. Whereas
a business plan is critical if the business is
seeking funding.
A strategic plan focuses on building a
sustainable competitive advantage and is
futuristic in nature. Whereas a business plan is
used to assess the viability of a business
opportunity, and is more tactical in nature.
A strategic plan is used to communicate the
direction of the organization to the staff and
stakeholders. However, a business plan is used
to present the entrepreneurs
ideas to a bank.
Business & Strategic Planning

Another way to grasp the difference is by

understanding the difference in scale between
a strategic plan and a business plan. Larger
organizations with multiple business units and a
wide variety of products frequently start their
annual planning process with a corporate-driven
strategic plan.
It is often followed by
departmental plans and marketing plans that
work down from the Strategic Plan. Smaller
companies and startup companies typically use
only a business plan to develop all aspects of
the business on paper, obtain funding and then
start the business. Many smaller companies
including startups
never develop a Strategic
Business & Strategic Planning

Before you get started

Clarify consultation areas
It is also important to think about who should be involved in the
process before you embark on developing a business plan for the
organisation. You will need to work out what areas are open for
consultation, those people both within and outside your organisation
who could contribute and communicate the decision making
processes clearly, which aids in managing peoples expectations.

Who to consult with

Consulting with a wide range of staff, volunteers, groups and
organisations, both internal and external to the organisation, can
help with various aspects of the business plan including reviewing
where you are now, ideas for future work and what factors may
impact on the success of proposed ideas.

Business & Strategic Planning

Who can we consult with?

Some examples

Local Schools
Centre Users
Local groups
Local Parish/Town
Local Churches
Childrens Centre

Local District/Borough
Local businesses
County Council
Health organisations,
local PCT
Housing associations

Business & Strategic Planning

Key Steps to devising your

Business Plan
1. Clarifying the vision and the values of the organisation

2. Review the organisations current position

3. Identify Ideas- explore assumptions, strategic opportunities and
4. Agree the strategic direction
5. Identifying the resources required and the organisations capacity to
6. Produce the Business Plan Document
7. Implement the Business Plan
Business & Strategic Planning

Step 1: What are our Mission,

Vision and Values?
Mission and Vision statements are two different things
although they are closely linked and may overlap.
A mission statement concisely describes the
organisations key purpose and primary objectiveswhat the organisation is in operation to do.
The unifying, localised statement should answer 3
questions from your communities (as your
customers) perspective;
- What you do - How you do it - Who you do it for
Business & Strategic Planning

Tips on developing your Mission

1. Begin with thinking about the role your organisation plays
2. Ensure you take time writing the Mission Statement. Its a
challenging but vital task- it needs to be both positive and
3. On separate lists write down: What you do and how well you do
it, the people involved in and participating with your
organisation, your community- who are they, how you help
people and your organisations values, beliefs and philosophy.
5. Pick out the most important points
6. Gain input from other people
7. Select your most important words and combine in one sentence
or put your most important sentences together in one short
paragraph youll then have a Mission Statement!

Business & Strategic Planning

Vision and Values

A vision statement is the long-term change the organisation
would ideally like to see if its work is successful. It should
set out your ideal destination- where your organisation wants
to be. It should be challenging, innovative and forwardlooking. The vision should be motivating and enable staff,
volunteers and others to see how their effort contributes to
an overall inspirational purpose.
The beliefs of an organisation, the expression of what it
represents and how it will conduct itself. Values are the heart
of an organisation's being. Values underpin policies,
objectives, procedures and strategies as they provide an
anchor and a reference point for all things that take place.
Business & Strategic Planning

Some mission, values and vision

Community Action Hampshires Mission Statement;
To strengthen and promote voluntary and community action
Community Action Hampshires Values;
To remain an independent advocate for the voluntary and
community sector in Hampshire
To conduct ourselves in an open and transparent way
To be responsible to the needs and views of our members
To value the diversity of the voluntary and community sector

Youthnets Vision statement;

"Youthnet's vision is of an inclusive and equitable society that
values children and young people and actively enables and
celebrates their contribution to this."
Business & Strategic Planning

Step 2: Reviewing your

organisations current position
Review and evaluation
areas for your
organisation to consider

facilities &
Project performance

Current & future

Trends both internal
& external


& Governance


Business & Strategic Planning

Where are we now?

In order to develop a realistic and effective business plan that
takes the organisation into the future it is important that a review
of the organisation as it stands now is undertaken. Youll need to
consider where you are now, what you do and how you do it, how
did you get to this point, what has gone well and what hasnt,
who do you serve? These are just some of the questions you will
need to explore and answer.

Reflection & Reviewing Tools

To help you analyse your organisation, recognise trends, identify
what is happening both within and outside the organisation that
impacts on the work that you do and get a true picture of where
you are there are a number of reflection and reviewing tools you
can use, you can use one or all of them, whatever suits your
Business & Strategic Planning

Reflection and Reviewing tools

SWOT Analysis
The SWOT analysis looks at your
organisations Strengths,
Weaknesses, Opportunities and
Think about what these are and
record them down, perhaps in a
table. By doing this you will be able
to pull out what you do well and can
build on, what needs to be improved
and developed. It will also identify
the opportunities the organisation
may be able to capitalise on and
identify obstacles and barriers that
may get in the way of developing the
opportunities. In turn this will aid
you to identify what the organisation
as a whole can do to overcome
these challenges.





Business & Strategic Planning

PESTLE analysis
A PESTLE analysis explores and identifies the external environment
factors that surround your organisation which have an impact on
the business what you do or want to do.



Business & Strategic Planning

7S Model
This tool is frequently adopted to
assess and monitor changes
within the organisations internal
The 7S model is based on the
theory that, for an organisation to
perform effectively, the 7 elements
need to be aligned and mutually
supporting. Use the model to
review the organisation under
each element to see if you can
identify any elements that need to
be realigned to improve
Business & Strategic Planning

Step 3: Identify IdeasExplore assumptions, strategic opportunities & direction

After reviewing and understanding your organisations current
position, activities, services, structure, strengths, weaknesses,
opportunities etc as well as your community needs and external
impacts and trends it is now time to use this information and
think about what, as an organisation, you would like to do in the
Gain ideas from all stakeholders and explore
What areas of work will you continue to deliver and why?
Explore why you deliver the work you do. Should you continue to
deliver this work? Look into the areas of work that the organisation
currently delivers which are important to the community, effective
and are in line with your mission, values and vision for the future.
You may then wish to prioritise areas of work in relation to those
that are significant to achieving your aims, meet community need
and are financially viable.
Business & Strategic Planning

Identifying ideas and strategic

What new areas of work do you need to develop and move into
and why?
Ask and work out, based on your review and need information,
what services, activities, events or programmes should the
organisation establish and deliver. Again you may wish explore
in depth why the organisation should move into the new areas of
work and prioritise them in relation to achieving your agreed
mission, vision and values, organisational capacity and financial
Other ideas can be identified by exploring
What partnerships, networks and forums do you need to
participate in and why?
What do you need to develop internally to improve your
What areas of work are you not going to deliver or move into and
Business & Strategic Planning

What are your assumptions?

A business plan should outline clearly and define its core assumptions
as those stakeholders (including funders) reading it may wish to
understand the assumptions upon which the rest of the plan is based.
Assumptions need to be credible, openly discussed and frequently
reviewed. The danger of delivering services, activities, programmes
and events where an assumption no longer applies is common place.
It may be helpful to identify elements that may challenge or conflict with
the assumption and to test out how secure and concrete the
assumption is.
Examples of assumptions could include;
The numbers of young people attending the youth club will stay the
same over the next three years
Local government grant to our organisation will decrease by 8% a year
Other community centres and halls in the area will continue to charge a
similar fee for their facilities as we do
We will need to recruit more volunteers to help run our services and
Business & Strategic Planning

Step 4: Agree the strategic direction

Having a clear strategic direction with which the trustees and
staff are highly engaged is a critical factor in building a
sustainably successful organisation.
Strategic direction is about establishing your strategic
goals/aims and methods you will use to achieve them. It
implies a definition of intent, (what should the organisation
achieve and why) as well as identification of the key means of
achieving it, the main effort.

Agreeing the strategic direction and aims involves constant

referral to the mission statement, values and vision for the
organisation. The process will encompass a continual
movement between generating opportunities, forming
priorities and working within the resources the organisation
has and will have to utilise.
Business & Strategic Planning

Setting your strategic direction

It is important to set strategic aims that:
specify a clear direction;
focus on intended outcomes;
interlink with other aims;
are realistic and achievable;

In order to have a plan that is fluid, concise, well planned and has a
clear direction it is important to restrict the number of strategic aims
you devise (ideally no more than 6 or 7).
Developing a future strategy usually involves making challenging
decisions. You may have to decide to discontinue an area of work,
reduce resources for a project or not develop a staff members
proposal all of which will most likely cause conflict and anxiety. It is
just as vital you consider the areas of work you will not be delivering
as to those areas you will.
Business & Strategic Planning

ep 5: Identifying resources required &

he organisations capacity to deliver
Before finalising the organisations priorities, areas of work and
programmes of activity you wish to deliver within the business plans
timeframe, it is vital you work out if you can realistically achieve

Youll need to ask yourself, explore and answer some questions

Do we have the finances to deliver all of our intended work streams?
How much will it cost to deliver our activities, projects, services etc?
Do we have enough members of staff and volunteers to run and
manage the work?
What facilities and equipment will we need?
Do we have the appropriate policies, procedures and systems in
Business & Strategic Planning

Financial Resources

Business & Strategic Planning

Financial information in a business


In an increasingly tough market place a voluntary

organisation needs to demonstrate in a business plan
It is financially viable has considered its financial policy
and expected income and expenditure in an articulate
and realistic manner
Made realistic predictions about the organisations
financial future
Has calculated its services, activities and programmes
costs using accurate figures and taken a full cost
recovery approach with contingency plans attached
Has consistent and reliable financial management
policies and procedures
Business & Strategic Planning

Financial position

A good starting point is to look at reviewing your current

financial positionWhere do you gain income and what do you spend your
money on?
Is this likely to continue in future years?
How much do we rely on particular income streams?
Can we predict what financial trends will occur in the
next 3,5 and 10 years time?
What can we do to secure these income streams?
Where else can we gain income?

Income stream

Current position

Prediction of trend

Business & Strategic Planning

Action required

Where could we gain income from?

Grants from local
Contracts and service
level agreements
Grants from trusts,
other funding bodies
and companies
Hire of facilities and

Income from sale of
Management fees
Profit from trading

Business & Strategic Planning

How much money will we need to

meet our strategic objectives?
It is important for voluntary organisations to
ensure that when calculating the cost of
services, activities and programmes that both
direct and indirect costs are worked out for
effective financial management.
Direct costs: the costs only incurred as a direct
result of delivering a particular service/activity for
example staff, equipment, room hire.
Indirect costs: the shared organisational costs
for example management time, administration
costs etc.
Business & Strategic Planning

Other financial considerations

Develop a budget
Create a cash flow forecast
What % of the organisations turnover would be
reasonable to use as a reserve or contingency?
What financial policies and procedures do you
have in place? how effective is your charging
policy? What type of charging strategy do you
use? Who authorises payments? Who monitors
financial activity of the project/service/
programme and organisation as a whole?
Business & Strategic Planning

Staff and volunteer resources

When developing
services/activities and
projects it is vital for the
organisation to work out
the staff and volunteer
who do we need to meet
our goals and ensure we
have the capacity to
deliver them?
What staffing structure do
we need in place?
Business & Strategic Planning

Step 6: Produce the Business

Plan document
When compiling the document itself it is important to consider the
readers who will usually be those you are requesting support from.
The style, layout and tone of the document will all make an impact on
the reader and it would be wise to think about first impressions- some
readers may only look at the front page or simply flick through the
document briefly.
It would be advisable to identify the key messages the organisation
wishes to get across (no more than about 5), organise the plan around
these, find someone outside of the organisation to review and
feedback on a draft copy, use practical and active language to ensure
the reader understands how you got to this point and how will achieve
your goals. The use of charts and diagrams can be effective in
illustrating information and avoid using abbreviations and jargon.
You will also need to consider different reading audiences and ensure it is
accessible to all people in the community.
Business & Strategic Planning

Business Plan sections

1. Front Cover

Organisation name and logo

2. An executive

An outline summary of the mission, values and

context. It should emphasise the proposed strategic
direction, main benefits and present a case for the
organisation (no more than one page)

3. Introduction
and mission

Explanation of the kind of organisation you are and

what you stand for, complete mission statement and
organisational values and the outcomes you wish to

4. Background

The origins and development of the organisation.

What you have delivered and achieved, what area
you cover, who are the beneficiaries, number of
projects, staff, volunteers and your annual turnover
Business & Strategic Planning

Business Plan sections

5. A

A current overview of the organisation- emphasise the

successes and strengths of the organisation and positive
recognition that the organisation has received externally.
Demonstration of a honest appraisal highlighting areas for
development- SWOT is usually used to illustrate this

6. Future

An overview of the organisations identified future external

and internal environment trends that will impact on its
strategic aims.

7. Strategic

The explanation and demonstration of the direction of

travel the organisation wishes to take- the assumptions
that have underpinned the identified direction, what work
will the organisation focus on, what are the main priorities
and what will be changed?
Business & Strategic Planning

Business Plan sections

8. Strategic

The medium term aims are listed in this section and an

outline of the objectives that fall under each aim can be

9. Implications

Identified legal, organisational and other implications of

the work to be included in this section. Clarification
made if services/activities are to be delivered differently
or halted altogether

10. Financial

Clear explanation of how the strategic aims and

objectives will be achieved financially and how these
assumptions were made. Details should include
income and expenditure forecasts for the years the
business plan relates, main financial policies and
evidence of effective financial management systems.
Business & Strategic Planning

Business Plan sections

11. Track record This section gives the opportunity to present the
of the
case for the organisation to the reader highlighting
successes- the strengths, experience, knowledge,
capacity and positive reputation the organisation
possesses. All of which will demonstrate the
capacity of the organisation to effectively implement
the business plan.
12. Immediate

A clear action plan which demonstrates the next

steps within the short term time frame.

Business & Strategic Planning

Step 7: Implementing the Plan

It is important to consider how the business plan will be
implemented across the organisation after it has been created. The
plan should not sit on the shelf collecting dust- it is a active
document that supporters, beneficiaries and other stakeholders will
be interested in particularly if they have provided the organisation
with funding.
If staff, volunteers and stakeholders have been engaged in the
process from the beginning then the implementation of the plan will
usually be effective.
As an organisation you should think about;
How the plan will be communicated to those delivering it
Clarifying the expectations
How the plan and performance will be monitored and evaluated
Business & Strategic Planning

ont forget to consider- Monitoring

& Evaluating
It is important to explore how the business plan will be
monitored and evaluated throughout its life
How will you know if you have achieved your strategic
aims and objectives?
How are you going to measure success?
What monitoring and evaluation tools can be used overall
and within projects/activities and services? Who will be
responsible for this?
How will these be communicated to beneficiaries, funders
and other stakeholders?
See our E bitesize training on Effective Monitoring and Evaluating at:
Business & Strategic Planning

Implementing the plan and

monitoring performance
Using the monitoring
information you can
then measure the
progress you have
4. Evaluating
made and make any
necessary changes. It
is important to feed
this back to
Use monitoring
tools to measure
the progress of the
plan this
information can
then be used to
work out how well
you are doing.

3. Monitoring

1. Defining

2. Ensuring

Business & Strategic Planning

Ensure all those

delivering the plan
understand what they
are doing, when & why
clear expectations.
Goals, objectives &
targets can then be
used to monitor

Ensure the all

resources are in
place and individuals
supported to deliver
tasks, projects &

Traffic light monitoring system

An effective and easy method to use to monitor the
progress of the plan is to adopt a traffic light
Aims, objectives, goals and targets within the plan
are listed against either;
Red: No or minimal progress made
Amber: Progress has been made although not
Green: Target/aim/objective etc has been
completed successfully
objective etc



Business & Strategic Planning

Required action

It is important that all stakeholders are engaged
throughout the process, understand what is
expected so that contributions can be effective in
meeting the needs based aims and objectives of
the business plan. Reviewing, monitoring and
evaluating is vital to success and feeding back
helps keep people up to date and involved.

Over to you and Good luck!!!

Business & Strategic Planning

Useful links and resources

Main resource used to aid this bitesize training course;
Lawrie, A.,2007. The Complete guide to Business and Strategic planning for
voluntary organisations. 3rd ed. London: Directory of Social Change.
Business Link website link
Directory of Social Change Website link
NCVO website link
Charities Evaluation Service Website link
Big Lottery Website link-
Business & Strategic Planning