Self-Understanding for Opportunity Creation

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Chapter 9: Planning for Entrepreneurs

9.1

Examine “planning” from an entrepreneurial perspective.

9.2

Define TRIM and explain its importance to entrepreneurial planning.

Neck, Entrepreneurship. © SAGE Publications, 2018.

Learning Objectives

9.3

Explain the different types of plans used by entrepreneurs.

9.4

Debate the value of writing business plans.

Neck, Entrepreneurship. © SAGE Publications, 2018.

Learning Objectives

9.5

Implement the tips for writing business plans.

Neck, Entrepreneurship. © SAGE Publications, 2018.

Learning Objectives

Notable Quote

“Failed plans should not be interpreted as a failed vision. Visions don't change, they are only refined. Plans rarely stay the same, and are scrapped or adjusted as needed. Be stubborn about the vision, but flexible with your plan.”

John C. Maxwell, American author

Neck, Entrepreneurship. © SAGE Publications, 2018.

9.1 The Importance of Planning to Entrepreneurs

Planning

A description of the future you envision for a business, including what you plan to do and how you plan to do it.

Plans help crystalize your thoughts and help you see your idea for what it really is.

The Importance of Planning to Entrepreneurs

9.2 The TRIM Framework

Neck, Entrepreneurship. © SAGE Publications, 2018.

The TRIM Framework

Team

Resources

Idea

Market

The TRIM (Team, Resources, Idea, Market) framework (Table 9.1) is a planning tool that identifies the types of people needed for the team, the resources available and needed, the details of the idea, and the potential market for the product or service.

It serves as a tool for determining the types of people you would like on your team and how you might go about attracting them to your business, the resources you have available to grow the business and the types of access you may have to other resources, the validity of your idea, and the potential market for your product or service.

Table 9.1: The TRIM Framework

Neck, Entrepreneurship. © SAGE Publications, 2018.

Table 9.1: The TRIM Framework

Neck, Entrepreneurship. © SAGE Publications, 2018.

9.3 Plans Take Many Forms

Neck, Entrepreneurship. © SAGE Publications, 2018.

Forms of Planning

Back of a napkin

Sketches on a page

Business Model Canvas (BMC)

Business brief

Feasibility study

Pitch Deck

Business Plan

Plans Take Many Forms

Neck, Entrepreneurship. © SAGE Publications, 2018.

Back of Napkin

Primary Audience—Friends and prospective team members

Purpose—To gain clarity on the idea

Output—A drawing on napkin

Plans Take Many Forms

Neck, Entrepreneurship. © SAGE Publications, 2018.

Sketches on a Page

Primary audience—Team members and early employees

Purpose—To visualize the future potential

Output—More detailed drawing or informally written

Plans Take Many Forms

Table 9.2: Cameron Herold’s Vivid Vision

Neck, Entrepreneurship. © SAGE Publications, 2018.

Table 9.2: Cameron Herold’s Vivid Vision

Neck, Entrepreneurship. © SAGE Publications, 2018.

Table 9.2: Cameron Herold’s Vivid Vision

Neck, Entrepreneurship. © SAGE Publications, 2018.

Business Model Canvas (BMC)

Primary audience—Team members and advisors

Purpose—To identify gaps and evaluate business integration

Output—Completed and tested business model canvas

Plans Take Many Forms

Figure 9.1: Sample Business Model Canvas

Neck, Entrepreneurship. © SAGE Publications, 2018.

Credit: C BY-SA 3.0. License: https://creativecommons.org/licenses/by-sa/3.0/.

Source material: http://www.businessmodelgeneration.com/canvas/bmc. Created by Strategyzer AG.

Neck, Entrepreneurship. © SAGE Publications, 2018.

The Business Brief

Primary audience—Friends and family investors, advisors, other interested stakeholders

Purpose—To have a concise written document to provide to interested parties

Output—2-3 page-typed professional document

Plans Take Many Forms

Table 9.3: Points to Include in a Business Brief

Neck, Entrepreneurship. © SAGE Publications, 2018.

Plans Take Many Forms

Figure 9.2: Sample Business Brief: India in a Box

Neck, Entrepreneurship. © SAGE Publications, 2018.

Figure 9.2: Sample Business Brief: India in a Box

Neck, Entrepreneurship. © SAGE Publications, 2018.

Figure 9.2: Sample Business Brief: India in a Box

Neck, Entrepreneurship. © SAGE Publications, 2018.

Figure 9.2: Sample Business Brief: India in a Box

Neck, Entrepreneurship. © SAGE Publications, 2018.

Figure 9.2: Sample Business Brief: India in a Box

Neck, Entrepreneurship. © SAGE Publications, 2018.

Figure 9.2: Sample Business Brief: India in a Box

Neck, Entrepreneurship. © SAGE Publications, 2018.

Feasibility Study

Primary audience—Team members and early investors

Purpose—To prove that the venture has market potential

Output—10 page-typed professional document

Plans Take Many Forms

Table 9.4: Critical Elements of Feasibility Study

Neck, Entrepreneurship. © SAGE Publications, 2018.

Plans Take Many Forms

Credit: D. Kelley, B. George, D. Ceru, H. Neck. Babson’s Feasibility Blueprint Assignment for MBA students, Babson College, 2013.

Neck, Entrepreneurship. © SAGE Publications, 2018.

The Pitch Deck

Primary audience—Early investors, incubators, and accelerators

Purpose—To obtain funding and meetings with potential investors

Output—Approximately 10-20 slide professional presentation

Plans Take Many Forms

Table 9.5: Sample Feasibility Study Template

Neck, Entrepreneurship. © SAGE Publications, 2018.

Source: Kelley, D., Ceru, D., George, B., & Neck, H. (2014). Feasibility Blueprint Guidelines. Wellesley, MA: Babson College.

Neck, Entrepreneurship. © SAGE Publications, 2018.

The Business Plan

Primary audience—Banks and investors

Purpose—Obtain funding

Output—Approximately 25+ page formal document and appendices

Plans Take Many Forms

Neck, Entrepreneurship. © SAGE Publications, 2018.

Table 9.6: Components of a Traditional Business Plan

Neck, Entrepreneurship. © SAGE Publications, 2018.

Why Write a Business Plan?

Business plans are complex and time consuming, but they also…

Help to gain clarity

Help organize thoughts

Establish a core message

Create alignment

Plans Take Many Forms

A business plan can be useful at the stage when you have partners or team members on board. It allows everyone to articulate their vision and strategy, and ensures that everyone is aligned with current and future plans for the business. It is also a valuable benchmarking tool as it forces you to be honest about your company’s performance by not only showing areas where your business exceeded expectations, but also those instances when your strategies didn’t work out, and the lessons you learned from this.

Figure 9.3: Path From Idea Generation to Business Plan

Plans Take Many Forms

Table 9.7: Summary of Different Types of Plans

Do you think writing a business plan is a worthwhile exercise for every entrepreneur? Why or why not?

At what stage do you think you might start writing a business plan for your startup?

9.5 Tips for Writing Business Plans

Tips for Writing a Business Plan

Be direct (remove ‘fluff’).

Be realistic (outline challenges and risks).

Be conservative in financial projections.

Avoid errors and inconsistencies.

Use visuals.

Tips for Writing Business Plans

Table 9.8: Business Plan Resources

The Vivid Vision Checklist

Mindshift: The Vivid Vision Checklist

Using the Vivid Vision checklist, try to imagine your business in three years’ time.

When you finish your own Vivid Vision, share it with your friends, family, and anyone else you may feel would be interested in seeing it. The act of publicly sharing your picture makes your vision more real and compels you to take action in order to achieve your goals.

Mindshift: The Vivid Vision Checklist

Besides, as Herold says, “the more people who know with clarity what my company looks and feels like, the better chance there is that people will be able to help me to make it happen.”

Pretend you have traveled in a time machine into the future. The date is December 31, three years from now. You are walking around your company’s offices (the startup you founded three years before) with a clipboard in hand.

Mindshift: The Vivid Vision Checklist

What do you see?

What do you hear?

What are clients saying?

What does the media write about you?

What kind of comments are your employees making at the water cooler?

What is the buzz about you in your community?

Mindshift: The Vivid Vision Checklist

What is your marketing like? Are you marketing your goods/ services globally now? Are you launching new online and TV ads? What is being said on social media?

How is the company running day to day? Is it organized and running like a clock?

What’s in the office space? Are people sitting, standing, talking? When they move from their workspace, where do they go?

Mindshift: The Vivid Vision Checklist

What kind of stuff do you do every day? Are you focused on strategy, team building, customer relationships, and so on?

What do the company’s financials reveal?

How are you funded now?

How are your core values being realized among your employees?

1. Is three years a useful and reasonable time period to look ahead and envision your business? If you think three years is too long or too short, explain why.

MINDSHIFT: CRITICAL THINKING

2. In the Vivid Vision checklist, which questions did you find the most useful? The most challenging? Explain your answers.

MINDSHIFT: CRITICAL THINKING

3. Is there anything in your plans for your business that is not covered in the Vivid Vision checklist? Anything that is not relevant to your business?

MINDSHIFT: CRITICAL THINKING