Action Plans, Project Planning, and Planning Tools Study Notes
Business Plan Overview
Definition: A written document giving a comprehensive overview of a proposed business.
Purpose and Functions:
Offers direction for a proposed business.
Explains objectives, operations, finances, and resources.
Used to check performance.
A tool to sell or market the business.
Identifies SWOT: strengths, weaknesses, opportunities, and threats.
Convinces others, such as a bank, of profitability. This is essential when applying for finance.
Action Planning
Meaning: A record of activities showing how they will be organized to reach the goals set out in the business plan.
Nature as a Tool: It is a planning and monitoring tool that defines what must be done, by whom it will be done, when it happens, and what resources are required.
Functionality: Helps focus ideas and determine the specific steps needed to reach a goal.
Importance of Action Plans:
Achieves projects within specified time frames.
Keeps the responsible person organized.
Acts as a control measure to gauge performance.
Prioritizes activities and turns theoretical plans into action.
Identifies possible problems before they occur.
Serves as a monitoring tool to check progress.
Identifies gaps and allows for reflection on what has or has not worked.
Brings together knowledgeable experts.
Clarifies objectives and areas needing change.
Builds consensus as everyone contributes to the process.
Creates ownership and accountability among team members.
Clarifies timescales clearly.
Identifies indicators and measures of success.
Steps to Draw Up an Action Plan
Summarize the vision, mission, and both long-term and short-term goals.
Define the specific steps required to get there.
Start with what must be done first by prioritizing tasks.
Identify the end point for each individual step.
Arrange steps in a logical order.
Think about possible problems that could arise.
Review progress regularly.
Identify indicators that will confirm progress is being made.
Project Planning and Management
Project Planning (Meaning): A tool that turns an idea into an action plan. It is a detailed description of all activities needed to successfully execute a project. A business start-up can be viewed as a project that must be planned.
Project Managers: These individuals develop and monitor the implementation of the plan.
Project Management Skills: Refers to the knowledge, skills, and tools used to plan and implement activities required to meet the goals of a project.
Project Planning Steps:
Define the scope, including the purpose and the first and last activities.
Identify project supporters.
Break the project down into individual activities.
Set time frames for each activity.
Set milestones or targets, which are the main completion points.
Determine accountabilities by deciding who is responsible for what.
Calculate the financial, human, and technical resources needed.
Plot the activity schedule into a Gantt chart.
Execute the project plan.
Monitor progress continuously.
Communicate and review progress as a team.
Keep records of all activities undertaken.
Timelines and Schedules
Meaning: A representation of all tasks that must be completed and the specific times they must be finished. It is also referred to as a schedule.
Function: Helps team members understand what milestones must be achieved and by when.
Requirements: Entries must be accurate and information must be well organized. This process involves making projections.
Importance of Timelines:
Helps planners project specific dates in advance.
Determines the sequence and order of tasks.
Keeps information in the chronological order it must happen.
Helps meet targets and exceed client expectations.
Acts as a project management tool for getting jobs done, often specific to a single company or product.
Work Breakdown Structure (WBS)
Definition and Use: Used to schedule timelines by deciding what tasks happen when and in what order.
Relationship to Business Plan: It is the first step in dividing the business plan into smaller project stages.
Functions:
Organizes the plan into manageable stages that can be carried out individually.
Organizes tasks into a logical sequence.
Can be used as the basis to develop a Gantt chart.
Allocates specific responsibilities to staff members.
WBS Development Steps:
Identify one key activity.
Sub-divide the key task into secondary tasks.
Break down each secondary task into even more detail.
Check the final structure for logic, sequence, and comprehensive detail.
Gantt Charts
Definition: A bar chart illustrating a project schedule. It shows the start and finish dates of the terminal elements as well as summary elements of a project.
Components: The elements consist of the Work Breakdown Structure (WBS) of the project.
Visual Representation: Shows a series of dates across the top with solid bars below representing the duration of each task. Task names are listed in the left vertical column alongside the person or team responsible. Bars differ in length to represent order, timing, and time span.
Steps to Construct a Gantt Chart:
Write down all activities needed to complete the project.
Decide how much time is needed for each individual activity.
Determine which activities depend on others and which can run simultaneously.
Draw a table with a row for each activity and columns representing days or weeks for the timeline.
Write each activity in the correct order down the left-hand column.
Importance of Gantt Charts:
They are easy to prepare and easy to understand.
Events are shown in chronological order.
The time needed for an activity is shown visually.
Managers and teams can see which activities run concurrently.
Team members can see exactly who is responsible for each activity.
Shows progress, which enables managers to monitor it effectively.
Interrelated tasks can be identified at a single glance.
Key Considerations for Starting a Venture
Core Aspects to Outline and Analyze:
Strategy.
Operations.
Productivity.
Size of the business.
Culture of the organization.
Environmental changes.
Customer services.
Business growth.
Cost saving.
Analysis and Funding Requirements:
Analyze these aspects from case studies and provide recommendations.
Explain why businesses need funding.
Outline various funding sources.
Explain factors affecting the choice of funding, including the nature of finance, the amount of capital needed, the risk involved, and the cost of the finance.
Key Terms and Definitions
Strategy: A long-term plan of action; created in the business plan and enforced through the action plan.
Collateral: An asset pledged to a bank in case of default on a loan repayment.
Interest: Money paid as a percentage for the use of borrowed money.
Operations: The different activities a business uses to achieve its goals.
Productivity: The effectiveness of production in terms of the rate of output.
Cost-saving: Plans made by the business to cut costs or expenses.
Business growth: The expansion of the size of the business.
Risk: How safe a credit provider's investment will be, based on factors that could endanger the recovery of funds.
Mortgaged bond: A debt instrument issued for more than one year to raise capital through borrowing.
Incentives: Cash or tax relief provided to encourage investment in specific economic sectors; or a payment made to workers to encourage higher productivity.
Venture capitalists: Financing given in exchange for an ownership share in the business at its start-up phase.
Equity capital: The total money and assets invested in a business by the owner, derived from their own sources.
Grants: Money given by the government or an NGO for a specific purpose, such as funding small businesses.
Bank overdraft: Occurs when a customer withdraws more money than is available in their bank account.
Quick Recall Chain
Sequence: Business Plan Action Plan Project Planning WBS Timeline Gantt Chart.
Conceptual Flow: Start with the Big idea identify who/when/what break the idea into steps break steps into detailed tasks put dates on those tasks visualize the process using bars.