Learn about the best business planning framework to help a company grow by offering benchmarks for evaluating performance.
Startups need a good business plan to get funding. Furthermore, a business plan might point the way toward rapid growth. But what makes a good business plan?
ISO Management System Standards (e.g., ISO 9001 for Quality Management, ISO 45001 for Safety Management, ISO 14001 for Environmental Management) provide an excellent Business Planning Framework. They offer standardised procedures that you can repeatedly follow to achieve desired results and increase efficiency. These benchmarks aid in improving both employee and management levels of awareness, leadership, and dedication. The result is a company culture that constantly analyses its practices and adjusts to enhance them.
These primary ISO MSS have overlapping requirements and follow some common structures, including risk-based thinking.
By adopting risk-based thinking, you can prevent losses, seize opportunities, and communicate better with your team. You can use it in any phase of business, from day-to-day operations to creating new products and services to refining existing ones.
Implementing the risk-based thinking methodology includes the following steps:
Identifying Risks and Opportunities
A proper business plan, let alone an appropriate quality strategy, requires an understanding of the context of the organisation.
When considering the context of your business, it is vital to evaluate the internal and external factors affecting the organisation. Some external types of business risk are financial, operational, competitive, market, regulatory, and reputational. The internal types include the values and culture of the business.
The goal is to decide which risks you can mitigate and which your management team will accept. Opportunities are just as crucial. They help grow a company’s market share or position in the industry while simultaneously minimising risk.
Needs and requirements of interested parties
Finding out who the interested parties are and what they anticipate is the next step after understanding the context of the organisation. An interested party is anyone affected by the organisation’s ability to deliver a product as promised.
The business should consider the needs and requirements of the interested parties. It’s the first step in identifying appropriate quality goals and plans for achieving them. By anticipating and meeting their expectations, the organisation will be able to realise its goals and thrive in the long run.
An example may include technical requirements for specific types of work or requirements around corporate social responsibility or carbon neutrality and modern slavery are all examples of current provisions in contracts and customer terms of engagement.
Identifying plans and objectives
The plan outlines the direction of the business. The objectives define the goal and the timeline for its completion. One of the fundamental acronyms used for many years for identifying objectives is SMART. Specific, Measurable, Achievable, Realistic and Timely.
These are some guidelines to keep in mind as you set the objectives:
- The objectives must support decisions. The implementation of the objectives should generate and gather data that the management can use to make decisions.
- The objectives must be suitable to the organisation. The objectives communicate the company’s business and operational performance targets.
- The objectives must be attainable. Objectives that sound impressive on paper and might pass muster in an audit but are impossible to achieve are useless.
- The objectives must not be excessive. It’s not a good idea to define too many goals, as that could lead to employee frustration and discontent rather than productive work.
At this point, you should know what potential risks and opportunities can affect the goal’s realisation. The next step is to make plans to handle and manage them.
Reducing the likelihood of errors in the processes and their impact requires taking action to eliminate, avoid, or control the risks. You must address the gaps to facilitate improvements.
The planning actions are the specific actions required to achieve the goals. Each action should identify who is responsible and an expected completion date. They are vital to achieving the milestones.
With FocusIMS your actions will appear in alerts with reminders to help you keep your actions on track.
The evaluation process is not a one-time event. You should perform evaluations consistently and regularly. A good evaluation process will help businesses stay on track by getting objective feedback from the people involved, including the executive team.
The purpose is to aid decision-makers by giving them the information they need to know the process’s current standing concerning its goals. It will be essential to draw measures for making adjustments or enhancing the methods based on the findings.
It then starts the next cycle of identifying opportunities and risks.
Business Planning and FocusIMS
FocusIMS provides a structured process for business planning, including identifying opportunities and risks, considering their importance to the business then deciding on plans, objectives and the planning actions to achieve objectives. The planning menu on FocusIMS covers all these.