Guide to Business Planning - Windowsbtckstorage.blob.core.windows.net/site7587/Guides/23_Business_Pla… · Guide to Business Planning ... Table of Contents What is a business plan?

Vo l u n t a r y S e c t o r S u p p o r t

Guide to Business Planning

PROMOTING EXCELLENCE IN VOLUNTARY AND COMMUNITY SERVICES

www.communityimpactbucks.org.uk Community Impact Bucks is a registered charity no:1070267 company no: 3508718

Table of Contents

What is a business plan?..................................3

Why you need a business plan?....................3

How to use this guide ......................................4

Planning ................................................................5

How to develop a Business Plan ...................6

Different Types of Plans ...................................7

Template Business Plan ....................................8

Planning Tools ..................................................14

Balanced Score Card ......................................14

SWOT Analysis..................................................16

Risk Analysis.......................................................17

Cash Flow...........................................................18

Further Information and website links .....19


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What is a business plan?A business plan is a document that describes where yourorganisation is now, where it wants to be in the future, and thestrategy for how it is going to get there.


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National policy and local statutory funders are calling for voluntarygroups to become more business like. You need a business plan tomake your organisation effective, sustainable and organised.

When you have gone through a business planning process you will beable to:

• Lead your organisation confidently into the future• Complete funding applications and tendering exercises more quickly• Convince funders you are worth funding• Convince partners you are worth working with

Why you need a business plan


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This guide contains a template for a business plan and a range ofbusiness planning tools. Not all the headings from the template willapply to your organisation, and you may need to add sections whichapply to your organisation and its work.

No two organisations will have the same plan. Smaller organisationsmay produce a shorter document, while others may write a verydetailed longer plan. It is important that a plan contains enough detailfor it to be a useful tool to the organisation, and have enoughinformation to be a workable document that leads to action.

This guide provides a series of headings that could be usedin a business plan, and demonstrates how to structure your plan.

Suggested headings have been provided in this guide for yourinformation, but you may find it useful to include additional sections inrelation to the specific activities that your organisation delivers.

How to use this guide

Planning The process of planning is more important than the final plan:

“Plans are useless, but planning is indispensable.”– Dwight D Eisenhower

A plan is not meant to be stuck to rigidly, or to be written andthen forgotten, nor should it stop an organisation fromresponding to funding opportunities that come up unexpectedly.Plans should be actively changed as the organisation, and theenvironment it operates in, change.

Planning CycleA planning cycle approach ensures that all your activity is informed by evidenceand evaluated afterwards. As the cycle moves forward, new activity will always beinformed by how well things went last time.

This approach is used by large business and public sector organisations that movethrough a planning cycle through the year. By adopting this approach you canprove that you are always reviewing how you do things to ensure you achieve thebest outcomes. You can also use this approach to ensure that projects aredelivered as efficiently and effectively as possible.

The stages of the planning cycle


AnalyseUse research to provide evidence for

the needs for your services, and provethat there is a market for your services.

PlanPlan services that meet these needs anddesign the method of delivery to best

achieve your desired outcomes.

DoDeliver the services and manage

your performance.

ReviewReview the performance of the service. Didit achieve its outcomes? Did your services

meet the needs of the people who accessedthem? Could your service be improved?

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How to develop a Business PlanUse the planning process to bring your team together and reward goodideas. The best business plans are a joint effort, carried out in consultationwith staff, management and other interested parties. A plan will workbest with the input and support of the people who will be expected tomake it happen.

Some sections of your plan can be written straight away such as thebackground of your organisation. Other sections require planningsessions where the management committee and staff may help withthe contents. We suggest that you set up a working group to lead oncreating the business plan but that you also use whole staff teamsessions to create content for the plan. The working group shouldreflect the composition of your organisation including committeemembers, volunteers, staff, service users and stakeholders. You maywant to set up specific working groups for particular sections of theplan which include the most suitable and capable people.

At the back of this pack we have provided a couple of developmenttools that you may find useful when writing your plans

You may want to start with a visioning exercise where you clarify thepurpose of your organisation, so that you can ensure that the wholeplan is consistent with your vision.

Ultimately it is the committee, management or trustee board who willformally adopt the plan, and who will monitor the organisation’sprogress against it.


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Different Types of PlansBusiness Development can lead to the development of a rangeof plans. The list of plans is detailed below. The plans you decideto create for your organisation will be dependent on your size,smaller organisations for example may incorporate a few plansinto their business plan.

The types of plans organisations can have, can include:Strategic planThis is the plan that covers yourlong-term mission and the vision of theorganisation including why you exist,and contains information on thechanges you hope to achieve. This planshould contain an analysis of theinternal and external environment,taking into account opportunities andpotential threats, which will help theorganisation plan more effectively forthe future.

Development plans

Development plans are similar to astrategic plan although more oftenused when starting up a neworganisation. Some organisations referto a strategic plan as a developmentplan.

Operational plan

This would outline the activities andtargets, which the organisation willcarry out in order to work towardsachieving the aims and objectives. Itprovides the framework for anorganisation’s day-to-day operations.An operational plan covers a one-yearperiod.

Project plan

A project plan outlines the objectivesand key activities to be achieved withina specified timeframe, often for a

period of 1-3 years. A project is a timelimited piece of work, not to beconfused with an organisation, which isan ongoing entity that carries outprojects (for more details see ourproject planning guide).

Business plan

A business plan can be written for3-5 years, and should show how you willwork towards your organisation’sstrategic aims. It is a formal plan thatwill cover the operation of the entireorganisation, including timetables, andmethods for the organisation’s work.A business plan can also be used topresent the feasibility of a particular newinitiative.

Fundraising strategy

A fundraising strategy is a writtenstatement of how an organisationintends to fund its work. It should beclosely related to the organisation’sbusiness plan. It will support thebusiness plan and enable theorganisation to reach its stated goals. Itcan be a record of what has beensuccessful in the past as well asrecommendations for the future. Eachfundraising strategy is differentaccording to the needs of theorganisation; it can range from twopages to twenty pages long.


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Template Business Plan

Below are the common areas usually covered in a business plan. Addsections that you think are appropriate to the size of your organisation,and make sure it is clearly written.

Think about who needs to complete each section:management committee, staff, volunteers, service users, stakeholders,funders.

Front Page

Which years the plan will cover:

• Image – this should ideally be apositive representation of yourorganisation and the work thatit does.

• Logo – having a clear corporateidentity and consistent imageryhelps people to recognise andidentify your organisation.

Contact details including:

• Name of organisation • Address • Contact telephone number • Website • E-mail • Charity registration number / Limited

Company number (if applicable)

Contents PageA clear list of page numbers andcontents to enable the reader to find thesections they are interested in.

Executive SummaryIntroduction of the plan, and summaryof the main points the documentcovers. You could include yourorganisation’s Mission Statement.

This should also show the viability ofyour organisation for the years yourplan covers

Legal StatusWhat is your legal structure?(for example, are you a registeredcharity, limited company,unincorporated association)


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Background and History ofyour organisationAdd information here on when yourorganisation was set up, your aims andobjectives, how you are run, trackrecord, what services you deliver andhighlight your key achievements.

You may want to include some key factshere including:

• The number of staff you employ • The number of volunteers you involve • Key financial data • Unique factors about your

organisation

Mission StatementEvery organisation has a mission, whichis the purpose and reason you wereestablished.

Aims and objectives This section should describe the aimsand objectives of the organisation asdetailed in its governing document, butin more detail i.e. what you have beenset up to do, and what you aredelivering at the moment.

Aims: The changes or benefits that you aretrying to achieve, and want to make,through your organisation.

Objectives: The practical activities that you planto carry out to bring about changeswithin the community or yourservice users.

The need for the services of yourorganisation

• You have to show how you aremeeting a clear need.

• What services / activities you provideat this time.

• The government and local authoritieshave specific targets and outcomesthat your organisation may bemeeting – this can be included here.

Key local information and statistics can befound on the Knowing Bucks, Bucks CountyCouncil website via the attached link

http://www.buckinghamshirepartnership.co.uk/partnership/BSP/partners/your_buckinghamshire.page?

Market Assessment

A market assessment should be basedon research, any needs analysis /evidence you have, who your potentialservice users are, and who uses yourservices now.

Information included in this partcan include:

• Ward data

• Census information

• Research of need

• Knowledge of the needs ofyour community / areayou are based in

• Information on otherorganisations that are inyour area.

(for more information on whereto find statistics and datasee page 19)

Social Purpose and ImpactIn this section consider:• What are the issues in your area?

For example unemployment, crime,income deprivation, lack of healthservices.

• Any gaps in services that are notbeing met at this time.

• What impact do the services youprovide have on your community?

• What is the social return of youractivities – for more information seewww.sroi-uk.org

Organisation ChartIt is a good idea to include a diagramof your organisation’s structure.

In your business plan. This will help toclarify the roles of the people within theorganisation and how different parts ofthe organisation relate to each other.

This can include your managementcommittee, any staff you employ(including different staff teams ifapplicable) and volunteers.

Line management arrangements canbe illustrated by connecting linesbetween different individuals.

Example organisation chart


Management committee

Manager

Volunteer Staff member Staff member

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Management Committee It is important to provide a shortoverview of the committee members,and any relevant skills they have thatsupport the organisation.

Staffing Referring to the organisation chart,detail the skills and knowledge of yourstaff team, including any relevantaccreditation or qualifications held bystaff. This is an opportunity to sell yourteam. Including professional CV’s inthe appendix can be useful.

Physical Resources and PersonnelFrom the planning you have nowdone, you are ready to review theresources you have, and whatresources you need in the future.If possible, you should also identifyareas where you need to increasestaffing capacity to meet demandsfrom service users or funders. Resources can include:

• Staff What staff you have, and how manyyou will need to recruit to carry out thework. What key skills / experience dothey have?

• Building - Where you are based - Do you have premises, hold a lease,

or rent space in a building? - Is it accessible?

• Equipment - Any equipment, for example

computers, that you own and use todeliver your services

• Insurances - Types of insurance you hold for

example: Public Liability, EmployersLiability, Professional Indemnity,Building Insurance.

• Policies & Procedures - Which policies and procedures you

have adopted and use.

• Previous Success / Track record - If you have delivered previously,

or are currently delivering goodprojects, or activities, you couldshowcase them here. This canshow funders the types of projectsyou have successfully delivered.Mini case studies on people youhave helped can be included inboxes throughout your plan toadd interest and demonstrateoutcomes.

• Marketing, Promotion & Publicity - How will you promote your

organisation, its activities, andthe services you provide?

- How will you make sure yourorganisation is promoted in thecommunity so that people knowwhat services you provide?

- How will you target the kinds ofpeople you most want to reach?How will you promote yourselfto stakeholders and potentialfunders?

- How will you market yourorganisation? This can includedeveloping a website & leaflets


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Organisations need to show that the delivery of their services isof the highest quality. Here you can show how this will bemeasured.

• How will you measure the success of the organisation or projects?

• How will you make sure you reach the targets you have set?

• How will you collect information about the work that you are doing?

• Who will do this and when?

• How will this information feed into improving the project?

• Who will analyse this information and act on it to make changes?

Monitoring and Evaluation

Project PlansThis will set out what projectsyou hope to deliver in the future.This section can hold informationon various projects you arelooking for funding for, with adetailed budget on how mucheach will cost based on a full costrecovery approach.

Project plans can then be usedonce funding has beenidentified to complete fundingapplications.

For more information see: Guide to ProjectPlanning and Guide to Funding.

Potential funders identified

Following on from your project plansyou could include information here onwho you have identified as possiblefuture funders, with timescales on when

you are looking at applying andmethods of how you are going to getthese funders on board.

Detailed Action Plan

Completing a balanced score cardexercise (which can be found in theplanning tools section of this pack) willinform the organisation of what needs tobe done and help to develop an actionplan with timescales. Your action planshould include:

• Information on Actions or Projectsthe organisation has decided itwants to deliver

• What resources will be needed

• Who will be the lead / responsible

• Timescales for when you are lookingto deliver the projects

• Costs


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SWOT Analysis This will help the organisation review its: • Strengths • Weaknesses • Opportunities • Threats

(see risk analysis template on page 17)

Risk Analysis In this section you would review all therisks and the potential impact they willhave to your organisation, includingwhat steps you would take to minimiserisk.

(see Risk Analysis template in theirplanning tools section)

Financial AnalysisIn this section you can include thefollowing:

Annual Accounts

This will show the previous year’s incomeand expenditure in a summary table.

Cash flow forecast

Poor cash flow can be a reason for thefailure and ultimately liquidation oforganisations. It is important to planahead and have a good forecast thatshows that you have researched andestimated to predict how much moneyyour organisation needs.

This section should contain cash flowforecasts for each year covered by the plan,which should show the timing of moneyflows in and out of the organisation,based on previous year’s trends.

Appendix

Here we would recommend you addany other relevant information you feelwould help to give a more detailedpicture of your organisation.

• Charts e.g. analysis of servicesdelivered/customer feedback

• References list- list of source documentsfor any quotes or references

Review

Once a year the Business Plan shouldbe reviewed by the committee.

This will monitor the organisationsprogress.

By reviewing the plan you shouldunderstand:

• Where you were aiming to be at theend of the year, and whether you havemanaged to do everything you werehoping to do.

• What went well, what was notachieved, and why.

• What changes need to be made to theplan, considering any changes withinthe organisation, the needs of theservice users, and the community. Alsobe aware of new initiatives coming outof local, regional and nationalstrategies and how any changes mayaffect the work your organisationdoes.

Planning tools can help you think through your strategy and theobstacles you need to overcome. Using planning tools as anexercise for your organisation, the management committee orworking group can help you explore the best way forward foryour organisation.

Detailed below are examples of the most widely used planningtools: the Balanced Scorecard, SWOT and Risk Analysis.

Planning Tools

The balanced score card is aneffective planning tool to showwhere your organisation is nowand where it’s going. It splitsup business development intofour key areas:

• Organisationaldevelopment / Quality

• Projects/Activities • Funding• Resources

There are three time framesfor recording where you arewith each of these areas:now, soon and later.

Balanced Score Card

The now is where you are now, and thetimeframes of ‘soon’, and ‘later’, can bedefined by your organisation. ‘Soon’may be the end of the year or in sixmonth’s time, or a key date when aparticular tender is to be issued – itdepends on the circumstances for yourorganisation. Similarly the ‘later’ maybe anywhere from one to three or fiveyears away.

It is best to do the balanced score card

for your whole organisation. It isrecommended that you complete yourscore card in a planning session withall key parts of your organisationrepresented such as committeemembers, managers, staff andbeneficiaries (service users). Workingtogether the task of completing thescore card will provide manyopportunities to discuss your visionand how you are going to get there.


Later

Soon

Now

Now

Soon

Later

Later

Soon

Now

Now

Soon

Later

Income Generation

Resources

OrganisationalDevelopment & Quality

Projects/Activities

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You should ideally input around 4-8 bullet points in each category.Please see below some ideas of what to include in each section.

What to write in each section

Organisational developmentDescribe your organisation, staff, volunteers, board/committee, partners.Developing your services, training your board, staff development, quality standardsbeing put into place (e.g. PQASSO, Investors in People), reviewing your legalstructure.

Projects/activitiesDescribe your primary activities, services you are delivering and the ones you arehoping to deliver in the future.

ResourcesWhat resources have you got at the moment and which ones will your organisationneed in the future to develop your organisation?

Income generationIncome from grants, fundraising, contracts, trading and loans.


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A strategic analysis of the organisation, and the externalenvironment will enable the organisation to plan more effectivelyfor the future. Taking into account strengths, weaknesses,opportunity, and threats, (organisations may recognise aweakness and turn it into an opportunity).

SWOT Analysis

Strengths

These might include:

• ability to secure resources • effective planning, delivering projects

to hit targets for funders • creating a supportive environment for

staff / volunteers / service users • achieving positive outcomes for

service users • creativity or innovation

Weaknesses• Consider all the areas you could

improve • What areas are you currently

weak in? • Some weaknesses could become

opportunities in the future

Opportunities• Are there areas of your activity or

staffing that you could expand? • Are there central or local government

plans or strategies that you could playa part in delivering?

• Are there new opportunities to growyour revenue through trading or newfunding streams?

Threats• Lack of funding or financial

sustainability • Competition for funding • Changing priorities of funders /

statutory organisations• How might you overcome these

threats


AnalyseUse research to provide evidence for

the needs for your services, and provethat there is a market for your services.

PlanPlan services that meet these needs anddesign the method of delivery to best

achieve your desired outcomes.

DoDeliver the services and manage

your performance.

ReviewReview the performance of the service. Didit achieve its outcomes? Did your services

meet the needs of the people who accessedthem? Could your service be improved?

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Organisations need to assess the risk they might face and thepotential impact it can have and put into place plans formanaging the risk.

We would recommend the management committee look at theareas we have suggested in the risk column and at what levelthey consider the risk. You can also add additional risks specificto your organisation.

Risk Analysis

ExampleRisks can include:

Financial

• Lack of income • Cash flow• Funding not being secured• Reliance on 1 source income -

not diversified

Operational

• Not being able to retain suitable staff

• Building not being accessible for

people with disabilities

• Not meeting targets set by funders

Political

• Change in priorities and strategies

Risk

Financial

Operational

Political

LEVELLow/Medium/High

POTENTIALIMPACT

ACTION TOPREVENT RISK


Page 17

Please see below an example of a cash flow table.

Cash Flow


Cash Flow Forecast – 12 Months Name:

Year:

A cash flow budget will show the total expected outflows (payments) and inflows (receipts) over ayear, on a month-by-month basis.

The difference between the actual outflow and inflow are called the ‘variances’, which will flag uptimes where you may need to monitor costs more closely.

Cash flows are important to make sure that organisations are aware of when you will haveshortages and surpluses of money. If you are aware of any shortages these can be planned for inadvance, and adjustments can be made and short term arrangements can be implemented.

Closing Cash Balance 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Opening Cash Balance 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Cashflow Surplus/Deficit (-) 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Total Payments 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0

Bank charges 0

Training and development 0

Professional fees 0

Office supplies 0

Postage 0

Telephone 0

Travel 0

Insurance 0

Repairs and maintenance 0

Utilities 0

Rent 0

Volunteer Expenses 0

Salaries and wages 0

Payments

Total Receipts 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0

Bank interest 0

Income 0

Grant 0

Receipts

Month: c/fwd Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Totals

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Further Information and website links


Community Impact BucksTel: 0845 389 0389 Fax: 01296 331464 www.communityimpactbucks.org.uk

Information / statistics Nationalwww.neighbourhood.statistics.gov.ukwww.communities.gov.ukhttp://data.ncvo-vol.org.uk/intelligence/

Localhttp://www.buckinghamshirepartnership.co.uk/partnership/BSP/partners/your_buckinghamshire.page?

WorksheetsConducting a SWOT analysisWriting a vision statementWriting a mission statement

These can be found via the attached link: http://www.diycommitteeguide.org

FundingCommunity Impact Bucks provides regular information on funders and funding programmesvia monthly e bulletins. Community Impact Bucks also has a funding blog which can beaccessed via the attached website link. Why not sign up to the funding twitter pagehttp://www.communityimpactbucks.org.uk/pages/funding-information.html

For further information contact [email protected]

Financial ManagementCommunity accountancy website, cash- on line provides financial advice and training forsmall charities and voluntary groups. Further information can be found via the attached linkwww.cash-online.org.uk

Further SupportCommunity Impact Bucks has produced a number of guides on all aspects of running avoluntary or community organisation.

Guides available include:Guide to Project PlanningGuide to FundingGuide to Business PlanningGood Practice Guide to Involving VolunteersGuide to Sustainable Funding and Financing Options

All these guides can be downloaded from the Community Impact Bucks websitewww.communityimpactbucks.org.uk

PROMOTING EXCELLENCE IN VOLUNTARY AND COMMUNITY SERVICES

vicki.parker

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Guide to Business Planning - Windowsbtckstorage.blob.core.windows.net/site7587/Guides/23_Business_Pla… · Guide to Business Planning ... Table of Contents What is a business plan?