■ Business plan: a formal written document describing the goals of a business and the methods

of how to achieve those goals.

■ Action plan: a checklist of the steps or tasks you need to complete to achieve the goals you

have set.

■ Gantt chart: a bar chart that provides a visual timeline of how the tasks are scheduled.

■ Timelines: a sequence of related events arranged in chronological order and displayed along a

line to keep track of the activities.

■ Work breakdown structure (WBS): divides the business plan into smaller project stages and

shows exactly what must be done.

Introduction

This chapter will focus on transforming a business plan that you developed in Grade 10 into an

action plan. We also provide a detailed description of planning tools that provide guidelines on

how to transform a business plan into an action plan.

15.1 Understanding the purpose of a business plan

Napoleon Hill stated, ‘Plan your work and work your plan.’ This is applicable when starting a

business. A business plan is a formal written document containing the goals of a business.

The business plan also includes the timeframe for achieving the set goals, and it serves as a

roadmap that provides direction to the business.

15.1.1 The business plan deals with the following aspects of a business:

The purpose of a business plan is to:

● Gain insight in the market and competition

● Obtain funding from investors

● Set realistic goals and objectives

● Identify the right talent for moving the business vision forward

● Make correct decisions and manage the business

● Communicate the business plan to various stakeholders.

15.1.2 The meaning of an action plan

An action plan is a detailed plan that outlines the actions that need to be executed (done) in order

to reach the business goals. An action plan shows the activities that must be completed. We need

an action plan to implement the business plan and show how activities will be organised to

achieve the goals of the business plan.

It outlines what resources are required to achieve objectives and meet the set timeline.

15.1.3 The importance of an action plan

Effective action plans break long-term goals into small, manageable steps so that businesses

continually act towards their goals. Creating an action plan helps to maintain focus.

131

Without an action plan, the business may engage in activities that are not aligned with the goals.

The action plan ensures that the actions and decisions are in line with achieving the business

goals.

An action plan is important because of the following reasons:

● enables projects to be achieved within a specified time

● businesses are able to prioritise activities by their importance

● can help the person responsible to be more organised

● helps employees to focus on their activities

● can be used as a control measure against which standards and performance can be

measured

15.1.4 Steps to follow when drawing up an action plan

1. Strategic planning of the business. Know where you want to go.

2. Create measurable goals.

3. List the tasks to be performed.

4. Divide the big tasks into smaller, more manageable parts. List the tasks.

5. Decide on deadlines for every activity.

6. Create a visual representation of the action plan.

7. Regularly check the progress.

15.1.5 Project planning steps

The following project planning steps will ensure that projects are completed successfully.

● Define the scope of the plan to be done, for example, define what the purpose, first and last

activities will be.

● Identify project supporters.

● Break the project down into activities.

● Set time frames and determine how much time you will need to allocate to each activity.

● Set milestones/targets, for example, determine what the main completion point is.

● Determine accountabilities and the person responsible for the decision/s made.

● Calculate the financial, human, and technical resources that need to be allocated.

● Plot the activity schedule into a Gantt chart.

● Execute the project plan.

● Monitor progress.

● Communicate and review project progress.

● Keep records of all activities.

15.2 Planning tools

15.2.1 Project planning

Planning tools enable entrepreneurs to transform their business plan into an action plan. The

following planning tools will be discussed in detail:

132

● Gantt charts or Work Breakdown Structure (WBS)

● Timelines

● Project planning

A good project manager will (Enrichment):

● analyse each main activity by breaking it down into smaller activities.

● identify the resources, such as the people, budget, and time, that will be needed.

● prepare a schedule showing the main activities of the plan.

● work backward to prepare timeframes.

● decide who will make each activity happen and by when.

● allocate a budget for each part of the action plan.

● create a projected income statement from the business plan to provide financial information.

● develop control methods to highlight problems.

● identify risks and plan for unforeseen events.

● monitor the plan regularly.

15.2.2 Understanding Gantt charts and Work Breakdown Structures (WBS)

15.2.2.1 A Gantt chart

● Is a type of bar chart that visually illustrates the start and finish dates of elements/job tasks in a

project.

● It is used to schedule the timelines for a project, and to list which tasks/elements need to

happen when and in what order.

● It shows what needs to be done by breaking a project down into smaller parts.

● Illustrates the start and finish dates of the tasks/elements of a project, and depicts the activities

against dates.

● Shows the duration of the tasks/elements.

● Show the dependency relationships between tasks/elements.

15.2.2.2 The WBS of a project:

● These elements make up the WBS of the project and can be completed as individual tasks or

as part of a group of tasks.

● shows all the tasks that need to be done.

● is divided into levels, with each level supplying more detail.

● also forms the basis for stages of the action plan. The elements must be linked logically, and

all the key details must be included.

A WBS requires four main steps:

1. Identify the key task.

133

2. Subdivide the task into secondary tasks.

3. Break down each secondary task by providing more details.

4. Check for logic, sequence and detail.

15.2.2.3 Understanding timelines

A timeline arranges both past and expected future events of a project and what needs to be

achieved within a specific time.

Timelines:

● are a visual representation of chronological information. It is a simple tool that lists all the

activities that need to be done and the date order in which they will be completed.

● help team members to know what milestones need to be achieved and by when.

● shows the dates and events labelled on points.

● have a title and use a series of dates on a linear scale to show the due date or date of

completion for each of the short-term objectives and tasks. They normally show projected

dates rather than actual ones.

● do not show the duration of a project, but instead shows a passage of time. It is divided into

equal spaces that are either days, weeks or months, and the entries need to be correct and

well-organised.

● should be visually appealing, clean, and neat.

15.2.2.4 The importance of Gantt charts, WBS and timelines

● These tools help the project staff to project dates and set up plans to achieve set goals in

advance.

● They are vital to project managers as businesses try to meet and exceed client expectations.

● Project managers use them as tools to get their jobs done, many of which are specific to a

single company or product.

● Timelines serve as a planning tool that helps to indicate the due date/date of completion for

each of the short-term objectives and tasks.

● Timelines keep information in a sequential order and dates on which an activity must be done.