d1.hcs.cl6.05 d1.hsm.cl5.06 d2.trm.cl9.02 slide 1

DEVELOP AND IMPLEMENT A BUSINESS PLAN

D1.HCS.CL6.05D1.HSM.CL5.06

D2.TRM.CL9.02

Slide 1

Subject elements

This unit comprises four Elements:

1. Analyse the internal and external business environment

2. Formulate business plans and strategies

3. Implement the business plan

4. Monitor the business plan

Slide 2

Assessment

Assessment for this unit may include:

Oral questions

Written questions

Work projects

Workplace observation of practical skills

Practical exercises

Formal report from supervisor

Slide 3

Element 1:Analyse the internal and external business environment

Slide 4

Analyse the internal and external business environmentPerformance Criteria for this Element are:

Determine information requirements and undertake research to deliver relevant information

Consult with all internal and external stakeholders in the research process

Use research to assist in the prediction of social, political, economic and technological trends and developments

Identify and seek assistance and advice from appropriate experts when necessary

Slide 5

Analyse the internal and external business environmentPerformance Criteria for this Element are:

Review and analyse the existing internal resources and capabilities

Document and analyse business opportunities and obstacles based on valid and reliable comparative market information

Review and analyse current and emerging competitors for their potential impact

Slide 6

Business planning

A business plan

A business plan is a written document that presents detailed information about:

The business

Its projected plans and projections for the future

Slide 7

Business planning

Importance of a business plan

A business plan is the key formal document that sets out a total picture of how a business will operate

It helps to establish standards for measuring the success of all aspects of a business

Slide 8

Business planning

Basis of a business plan

The plan is based on:

An analysis of the business’ current situation

Forecasts of future trends within the relevant industry and economy

Includes results from research into all aspects of the business operation

Is a logical and structured document

Slide 9

Business planning

Purpose of a business plan

Preparation of a business plan:

Gives a sense of ownership and involvement in the future of the business

Ensures that the commercial directions planned have been tested for their viability in the marketplace

Slide 10

Business planning process


The planning consists of three activities:

Core business concept

Feasibility study

Business plan

Slide 11


Core business concept

Defines the essence of a new business idea:

What are the products and/or services your business will market?

What markets will you target with your products and/or services?

Slide 12


Feasibility study

In three steps, the feasibility study determines the initial viability of the core business concept:

Technical feasibility

Market feasibility

Commercial feasibility

Slide 13


Business plan

If the feasibility study indicates that the business concept is a viable proposition, a detailed business plan must be prepared

Slide 14

Research process

The Research Process

You need to undertake initial research to determine your idea is viable before progressing on to a detailed business plan

Slide 15

Research process

Five steps in the research process

Define the problem

Analyse the situation

Collect information and data

Interpret the information

Decide on a plan of action

Slide 16

Research process

Types of research

Research may include:

Interviewing colleagues and clients

Focus groups

Data analysis

Product sampling

Documentation reviews

Slide 17

Research process

Types of relevant information

Common types of relevant information may include:

Current performance data

Sales and contracts

Forecasted trends and opportunities

Available resource commitments and capacity

Slide 18

Research processSources of research information

Trade associations

Unions

Trade journals

Daily newspapers

Internet

Government departments

Local council

Friends, colleagues, business associates

Other associated businesses in the field

Slide 19

Consult with stakeholders

Importance of consulting with stakeholders

Who are possible stakeholders?

Why is it important to consult with them?

What do you require from them?

Slide 20

Key stakeholders

Types of stakeholders

Stakeholders may include:

Customers

Employees

Government agencies

Owners

Suppliers

Strategic alliance partners

Slide 21

Involving stakeholders

Importance of involving stakeholders

Communication throughout the planning, preparation and delivery of new concepts is vital to ensure that all stakeholders:

Are involved

Had the chance to contribute ideas

Provide feedback on initial concepts

Understand how concepts will affect them

How concepts interrelate or impacts other stakeholders

Slide 22

Conducting research

When researching information to help facilitate the business planning process, it is essential to collecting and analysing information in a wide variety of 'environmental areas' that may impact on an organisation in the future.

Information must ensure it not only explores:

External environment - what is provided or needed by competitors and the industry as a whole

Internal environment - what the organisation provides

Slide 23

Analysing the environment

Importance of analysing the environment

What do you want to analyse?

What information do you seek?

Where do you get this information?

Slide 24

Understand external environment

What is market analysis?

Market analysis provides us with the information necessary to understand what can cause changes in our operational environment

A prime intent of this activity is to gain a more insightful and detailed view of the organisation and where it sits in the overall business and other settings

Slide 25

Analysis of external environment


Competitors

Economic climate

Customer preferences

E-business

Markets

Slide 26



Environment

Technology

Political issues

Legal issues

Social issues and trends

What other external influences exist?

Slide 27

Evaluating market trends

Types of information sources

Why is it important to understand trends?

Which trends and statistics are important?

How can you collect this information?

Slide 28



Colleagues, supervisors and managers

Representatives

Developing your own industry network

Conferences and seminars

Product launches

Trade magazines

Slide 29



Industry Publications

Newsletters

Brochures

Advertisements

Government bodies

Slide 30


Types of industry statistics and trends

Types of tourism and tourism businesses

Types and demographics of customers

Top destinations

Hotel occupancy percentages

Reasons for stays

Current industry information

Destination countries

Departure months

Slide 31


Types of industry statistics and trends

Length of stay

Type of organisation for the trip

Transport mode

Accommodation type

Expenditure

Popular tourist attractions

Tourism patterns

Technology

Slide 32

Customer demands

Impact of customer demands

What are common customer demands?

What influences customer demand?

Slide 33

Seeking advise from experts

Before you start your business it is advisable to consult as many organisations and persons that you believe can inform and assist you in your planning.

Why is this important?

What types of assistance and advice can be sought?

What are sources of assistance and advice?

Slide 34


Types of assistance and advice

Assistance and advice from appropriate experts may be sought for:

Collection and collation of facts and information

Review or verification of facts

Legal or financial advice

Ensure compliance of regulations and laws

Issuing of permits and licences

Strategic planning

Specialist skill sets Slide 35


Sources of assistance and advice

Local government agencies

Tourism associations

Non-government organisations

Media personnel including journalists

Copy writer

Professional research organisations

Solicitors

Slide 36



Family

Existing employees

Your existing bank

Your accountant

Financial adviser

Your planning consultant

Your architect

Your local council Slide 37



Your potential financier (if not your current bank)

Tourism agencies (local/regional/state)

Tourism operators

Shareholders/business partners

Customers

Suppliers

Neighbours and the local community

Slide 38

Analysis of internal environment

Once management have had a thorough look at the external environment, the focus must be internally focused

The internal environment is the environment within the business

Slide 39


Review internal resources and capabilities

Location including premises

Market share

Turnover

Profitability

Staff

Resources

Future potential

Slide 40


Internal considerations

Products and or services

Skill level of staff and management

Commitment to growth

Current market share

Level of debt

Slide 41


Internal considerations

Profit margins

Capacity to produce goods and/or services

Competition

Skills of the owners

Location of the business

Equipment

Slide 42


Organisational requirements

Access and equity principles and practices

Maintaining ethical standards

Meeting goals, objectives, plans, systems and processes

Legislated obligations

Slide 43


Organisational requirements

Management and accountability channels

Manufacturer’s and operational specifications

OHS policies, procedures and programs

Quality assurance and continuous improvement processes and standards

Slide 44


Types of resources

Resources can encompass:

Physical resources

Human resources

Financial resources

Intellectual property

Slide 45


Common resources

Location/premises

Occupational safety and health (OSH) resources

Plant/machinery

Raw materials – used to produce the products or service

Refurbishment requirements

Staff amenities

Slide 46


Common resources

Stock and supplies

Storage space

Technical equipment and software

Staffing

Training

Training materials

Slide 47

Analyse the environments

Analyse business opportunities and obstacles

How can you do this?

Slide 48

Analyse the environments

SWOT Analysis

Strengths – what the business does well

Weaknesses – what the business can improve upon

Opportunities – where the business can improve or take advantage

Threats – where the business may become disadvantaged, weakened or susceptible

Slide 49

SWOT Analysis

Strengths and Weaknesses

Finance

Production

Resources

Offerings

Marketing

Product life cycle

Business relationships

Relationships with customers

Personnel

Slide 50

SWOT Analysis

Opportunities and threats

Political considerations

Economic considerations

Social considerations

Technological considerations

Legal considerations

Environmental considerations

Slide 51

SWOT Analysis

Opportunities

New markets

New, up-dated or modified products or services

Occasions where new/higher prices may be charged

Problems being experienced by other providers which result in an opening for you

Closure of an opposition business

Fresh markets now available

Slide 52

SWOT Analysis

Threats

Introduction of new or more severe legislation

Opening of a new competitor

Worsening economic conditions

Staff shortages

Difficulty in obtaining physical resources

An unsettled domestic situation which scares off tourists

Negative comparative monetary exchange rates with countries who are major clients

Slide 53

Review current and emerging competitors

Importance of understanding competitive advantage

Why is this important?

How can you see what competitors are doing?

How can you create a competitive advantage?

Slide 54

Review current and emerging competitors

Review and analyse current and emerging competitors

Areas of review may relate to:

Volume

Price

Territory

Customer accounts

Trading terms

Market share

Customer satisfaction Slide 55

Current market situation

Market situation

Total market characteristics - size, growth, trends

Customer needs, perceptions and buying behaviour

Products - service characteristics

Prices

Customer service and distribution

Channels

Communication

Slide 56


Competitive situation

Industry structure

The geographic market in which they compete

Their current marketing performance

Their competitive position

Strengths and weaknesses, and vulnerabilities of each significant competitor

Their objectives and competitive strategies

Industry profitability

Slide 57


Product situation

For each product/service that the organisation offers, sales, profits, contribution margins and growth should be displayed

Product lifecycle and expected demand over the product’s life should be considered

Growth of the product/service should be contrasted to total market growth

Slide 58

Joint ventures and strategic alliances

Explore the potential for joint ventures and strategic alliances.

It may be that there is an opportunity for your business to form a joint venture or strategic alliance with another organisation

Slide 59

Element 2:Formulate business plans and strategies

Slide 60

Formulate business plans and strategiesPerformance Criteria for this Element are:

Create or confirm enterprise mission, vision and purpose as the starting point for the business plan in consultation with stakeholders

Establish realistic, clearly stated and measurable objectives for the business

Develop appropriate strategies and tactics to address objectives across all areas of business operation

Identify and include opportunities for strategic business alliances

Slide 61

Formulate business plans and strategiesPerformance Criteria for this Element are:

Develop all aspects of the business plan to ensure the business meets relevant legal, social, environmental and ethical obligations

Include appropriate action plans and evaluation processes, including key performance indicators

Consult with appropriate staff, management and other stakeholders to encourage support for the planning process so that all perspectives are taken into account in the development of the plan

Slide 62

Formulate business plan

Focus of business plans

The business plan may be for:

A new or existing small business venture

A division or department of a large organisation

A new product development initiative

Slide 63

Formulate business plan

Contents of a business plan

What needs to be included in a Business Plan?

Slide 64

Executive Summary

Business Profile

Your Products and/or Services

The Market

The Business Potential

Mission, Goals and Objectives

Strategies

Business Structure

Finance

Conclusion Slide 65

Business Profile

Business Name

Business Location/s

Business Activity/Activities

Business Objectives

Business History/Entry Strategy

Ownership Structure

Legal Requirements

Slide 66

Market Report

Industry Profile

Review of Existing Operation (if appropriate)

Your Product and/Service

Competition

Environmental Information and Trends

Slide 67

Marketing Plan

Market Segmentation

Your Customers

Target Markets

Strengths, Weaknesses, Opportunities, Threats Analysis

Key Issues

Slide 68

The Marketing Plan

Sales and Marketing Goals and Objectives

Value Proposition (Competitive Advantages)

Marketing Strategies

Pricing

Promotion

Sales and Distribution

Slide 69

Operational Plan

Premises, Plant and Equipment

Floor plan

Production

Purchasing

List of Suppliers

Stock levels

Purchasing Policies and Controls

Purchasing Controls

Break-even Analysis Slide 70

Finance Plan

Current Financial Position

Capital Requirements and Funding Proposal

Financial Budgets

Cash-flow Projection

Projected Statement of Financial Performance (Profit and Loss)

Slide 71

Finance Plan

Projected Statement of Financial Position (Balance Sheet)

Financial Ratios

Financial Controls

Business Insurances

Slide 72

Risk Plan

Risk Identification and Mitigation

What are different types of risks?

What needs to be considered?

What are the steps to reduce risks?

Slide 73

Structure and Management Plan

Organisational Chart and Structure

Key Personnel

Labour Requirements and Skills

Staffing Strategies

Professional Advisers

Staffing Controls

Slide 74

Strategic alliances

Identifying possible strategic alliances

Your industry association can provide substantial information, and through trade shows and networking you will meet other similar or allied businesses that lead to new and expanded operations.

How are suitable alliances in the tourism industry?

What makes successful alliances?

Slide 75

Meet legal requirements

Requirements and Obligations

Registration of Business Name

Business Licenses

Taxation Registration

Industrial Awards

Medical Insurance

Intellectual Property Registration

Other insurances

Pollution/environmental controls Slide 76

Action Plans

One of the key requirements of any business plan is to outline how the goals, objectives and strategies will be accomplished.

What actions need to be done

To what standard must it be done

What policies or procedures must be adhered to

Who is responsible for action

What tasks are associated with actions

Timelines for actions

Support mechanisms

Slide 77

Action Plans

Areas requiring action plans

Areas of business operation in the business plan should have action plans include:

Business establishment

Operations

Marketing

Technology

Human resources/labour requirements

Management and organisational structure

Financial plan and projections

Quality management Slide 78

Monitoring and evaluation

Monitoring and evaluation mechanisms

Evaluation processes may include:

Key performance indicators

Gap analysis

Customer feedback

Compliance reports

Employee feedback

Slide 79


Key Performance Indicators (KPI’s)

Total number of customers

Total number of customers per department or market segment

Average dollar spent

Total revenue per capita

Sales per product group

Average sales per day’s trading

Slide 80


Key Performance Indicators (KPI’s)

Average total revenue per client

Marketing expense per customer

Marketing expense and sales revenue per customer from a specific campaign

Total revenue / full time employee

Gross profit margin

Slide 81

Appendices

What documents go into the appendices?

Slide 82

Consult with stakeholders

Importance of stakeholders

What are examples of stakeholders?

Why involve them?

Slide 83

Element 3:Implement the business plan

Slide 84

Implement the business planPerformance Criteria for this Element are:

Communicate the business objectives and content of plans in a timely manner to facilitate a clear understanding of the plan and associated activities and individual responsibilities

Use appropriate leadership techniques to encourage team commitment to the business plan

Encourage staff to provide ongoing input into the business plan

Implement and organise actions detailed in the plan in a cost-efficient manner and in accordance with schedule and contingencies

Slide 85

Communicate business plan

Present final business plan to relevant stakeholders accurately

Once business plans, including objectives have been finalised, it is now time to present the final version to relevant stakeholders

Slide 86


Stakeholder considerations

Get a clear understanding of the business plan

Ensure that all key concerns have been considered

Understand the benefits of the business plan

Understand how the business plan will benefit them

Understand how the business plan will impact on them

Slide 87


Stakeholder considerations

Understand their role in implementing the business plan

Any potential problems identified

Have their concerns addressed

Be excited and reassured about the business plan

Slide 88


Types of stakeholders

Clients

Business partners

Colleagues

Staff

Event organisers

Sponsors from other companies

Superiors

Suppliers / vendors

Team leaders

Team members

Venue operator / leaser Slide 89


Communicate business plan information

Key vision of the plan

Reasoning or purpose behind the business plan

Background information

Business objectives

How the plan will be implemented

Roles and responsibilities of key stakeholders

Timelines

Support mechanisms Slide 90


Communicate information

How can you communicate information to:

Staff

Managers

Clients

Suppliers

Slide 91

Use leadership techniques

Leadership styles

The role of leadership is vital in ensuring that new business plans and the implementation actions associated with them are:

Understood by staff

Staff are motivated and committed to its success

What types of leadership styles are there?

Slide 92

Leadership styles

Autocratic and democratic leaders

An autocratic leader is one who centralises authority and relies only on legitimate reward and coercive power

A democratic leader delegates authority to others, encourages participation and relies on expert and referent power to influence others

Slide 93

Leadership styles

Charismatic leadership theory

The key characteristics of charismatic leaders are:

Self confidence

Vision

Ability to articulate that vision

Strong convictions about the vision

Behaviour that is out of the ordinary

Appearance as a change agent

Environment sensitivity Slide 94

Leadership styles

Transactional versus transformational leadership

Transactional leaders are leaders who guide or motivate their followers in the direction of already set goals by making them clear and explaining task requirements

Transformational leaders are leaders who inspire people beyond their own goals through individual consideration and charisma. They are capable of having a profound and extraordinary effect on their followers

Slide 95

Leadership styles

Additional leadership techniques

Have clear goals

Develop mutual trust

Encourage good communication

Provide internal and external support

Slide 96

Encourage staff to input into plans

Encourage staff to provide ongoing input into the business plan

How can a manager do this?

Slide 97


Methods to encourage staff input

Asking for ideas

Having an ‘open door’ policy regarding suggestions

Sharing ideas

Being prepared to test new ideas

Seeking information and ideas from non-traditional places

Slide 98


Methods to encourage staff input

Thanking people for their contributions

Taking the time and effort to explain to someone who contributed an idea why their idea was not implemented

Ensuring the person responsible for suggesting an effective new approach receives the credit for doing so

Slide 99

Implement action

Implement business plan actions

Now that business plans have been communicated with stakeholders responsible for its delivery, it is now time to implement any actions

Slide 100

Implement action

Implementation considerations

Compliance requirements

Occupational safety and health (OSH)

Legal liability exposure

Integration with other aspects of the business

Timing issues

Slide 101

Implement action

Implementation considerations

Resources

Changes to policies and procedures

Documentation and record keeping

Service delivery

Impact on organisational culture

Slide 102

Implement action

Implementation planning inclusions

Details of intended actions to be taken

Allocation of responsibilities for action to nominated persons

Determination of accountability for actions taken

Timelines for completion of nominated actions

Details of the budget and resources allocated

Description of monitoring progress

Details and timelines for reviewing progress

Slide 103

Implement action

Defining and assigning roles

It is important that everyone knows what is expected of them.

What do staff need to know?

How can they understand their roles and responsibilities?

Slide 104

Implement action

Identify predictable consequences of change

Disruptions to routine

Problems with timelines

Issues with reporting structure

Extra support required by employees

Slide 105

Implement action

Provide support and resources to support implementation actions

The aim is to enable staff to be able to learn and implement new changes into the workplace.

During this period, you must manage the twin functions of:

Task functions

Maintenance functions

Slide 106

Element 4:Monitor the business plan

Slide 107

Monitor the business plan

Performance Criteria for this Element are:

Review the business plan regularly and adjust in the light of changing circumstances

Monitor activities detailed in the plan on an ongoing basis

Identify and analyse successes and performance gaps on an ongoing basis

Implement agreed changes to plans promptly

Report performance in a transparent manner to all stakeholders

Slide 108

Reviewing business plans

Timing of business plan reviews

They may be based on:

Quarterly reviews

Business plan cycle

Performance reports

Major events triggering a review

Slide 109

Monitor activities

In order for an organisation to be successful in being able to provide the highest quality of service whilst still making an adequate financial return for investors, it is vital that every aspect of the operation is operating to the best of its ability

Therefore management must constantly assess and evaluate the performance of all areas that contribute to the functioning of the business

Slide 110

Monitor activities

In order to do this, activities must be assessed and evaluated to find out:

What is being done correctly

What needs improvement by:

Identifying problems

Understanding causes

Providing and implementing a suitable remedy

Slide 111

Monitoring and evaluation methods

Reports

Obtaining customer feedback

Using a pretend customer

Walking around and observing

Use of checklists

Brainstorming sessions

Staff input and review

Slide 112

Monitoring and evaluation methods

Observation

Statistical and written reports

Surveys

Checklists

Flowcharts

Benchmarking

Slide 113

Identify performance gaps

Compare what is happening against benchmarks

Comparing actual performance against key performance indicators and/or service standards set

Comparing actual performance against benchmark indicators, which can include industry indicators or performance levels of other branches

Slide 114

Comparison against KPI’s

Organisation’s key performance indicators

Organisation’s key performance indicators are a set of metrics which organisations can use to measure the success of business plan actions.

What are examples of KPI’s?

Slide 115


Types of key performance indicators

Market share

Sales figures

Customer satisfaction

Growth

Profitability

Turnaround times

Output rates

Slide 116


Types of key performance indicators

Quality rates

Customer feedback

Equipment usage rates

Lead times and down times

Compliments-complaints ratio

Customer Satisfaction Index (CSI)

Slide 117


Types of performance gaps

Product or service failures

Long wait times for service

High volume of customer traffic

Inaccurate or conflicting information provided to customers

Lack of follow-up action by customer care representatives

Slide 118



Aggressive cross-selling or up-selling by customer service representatives or sales persons

Lack of resources required to implement service operations

Conflicts in priorities

Resource constraints

Lack of information

Supplier delays

Differences in opinion

Slide 119



Interpersonal conflict

Hazardous events

Time constraints

Electricity shortages

Bad weather

Shortfalls in expected outcomes

Poor staff performance

Slide 120

Implement agreed changes

Managers need to identify gaps and issues quickly and take appropriate action swiftly.

Failure to identify these can lead to:

Lack of repeat business

Damage to the reputation of the venue

General decline in sales and profit

Slide 121

Corrective action

Types of corrective actions

Quite simply, types of corrective actions taken to improve service operations may include:

Improvements in the design of products or services

Reviewing the allocation of resources for service operations

Tweaking standard operating procedures to improve efficiency

Slide 122

Initiate corrective action

Take appropriate corrective action

This involves making the necessary adjustments to improve the level of service, productivity or customer satisfaction

Depending on what is being monitored, involving staff in all or some stages of the monitoring process is likely to achieve better results

Slide 123

Initiate corrective action

Short and long term corrective action

Corrective actions taken within an operation workplace context can be seen as either:

Short term corrective action

Long term corrective action

Slide 124

Taking corrective action


It is sometimes necessary to take short term action to solve a problem until it can be looked at more closely and the problem dealt with more thoroughly.

Slide 125


Reasons for short-term action

Isn’t time to stop and analyse the problem more carefully and in more detail

To provide the necessary or expected services to the customer

To meet OHS requirements

To deal with a complaint

To get staff working together again

To give you time to analyse and work through the problem at a later date

Slide 126


Considerations for short-term action

Make a definite time to look at it more thoroughly later on

Decide who to involve in further problem solving

Inform staff and management it is a short term solution

Cost the implications of tackling the problem this way

Slide 127


Management changes

New management

Change in orientation to service

Setting of some new directions in relation to several other factors

New management focus

Slide 128


Organisational re-structures

Change of personnel structure

Elimination of positions

New job roles

Changes in job roles

New knowledge or skills

Slide 129


Introduction of new equipment

New equipment means:

Possible interruptions to operations for installation

Training for staff

Requires that staff can explain the new equipment to customers

Changes in job roles

Changes in procedures

Changes to workflow

Slide 130


Recruitment practices

Need to establish comprehensive job descriptions and job specifications

Seeking of new knowledge and skills

Change advertising strategy

Revised interviewing and selection process

Revised selection criteria

Slide 131

Report performance

Report performance in a transparent manner

Periodically, there will be a need for you to provide your team and management with feedback in regard to achievement or non-achievement of business plan initiatives

Slide 132

Report performance

Methods to sharing performance related information

Holding team meetings

Providing hard copy information

Sharing information via the intranet

Disseminating information at staff briefings

Slide 133

Report performance

Explaining performance related information

Explaining if your business plan strategy and effort work

Identifying the reasons why they work or not work.

Significant variations and the factors associated with the changes.

Unusual results and determine their causes

Slide 134

Report performance

Explaining performance related information

Patterns and trends in consumer behaviours, and the factors that resulted in those behaviours

Strengths and marketing opportunities

Weaknesses and potential areas of improvement

Impact / implications of the results and conclusions on performance

Slide 135

Report performance

Present recommendations for variation to business or operational plans

What are possible reasons for recommendations?

What information needs to be included in a recommendation

What are types of recommendations?

Slide 136

d1.hcs.cl6.05 d1.hsm.cl5.06 d2.trm.cl9.02 slide 1

Documents

business slide

business plan slide

business planmonitor

business planningimportance

business opportunities

business planningbasis

supervisor slide

future slide