Steps in the planning process

The planning process is directly related to organizational considerations, management style, maturity of the organization, and employee professionalism. These factors vary among industries and even among similar companies. Yet all management, when applying a scientific method to planning, perform similar steps. The time spent on each step will vary by company. Completion of each step, however, is prerequisite to successful planning. The main steps in the planning process are:

1) Conducting a self-audit to determine capabilities and unique qualities;

2) Evaluating the business environment for possible risks and rewards;

3) Setting objectives that give direction;

4) Establishing goals that quantify objectives and time-frames;

5) Forecasting market conditions that affect goals and objectives;

6) Stating actions and resources needed to accomplish goals;

7) Evaluating proposed actions and selecting the most appropriate ones;

8) Asserting alternative strategic plans;

9) Instituting procedures to control the implementation and execution of the plan          (mainly through the annual budget).

A company’s business plan is one of its most important documents. It can be used by managers and executives for internal planning. It can be used as the basis for loan applications from banks and other lenders. It can be used to persuade investors that a company is a good investment. The process of preparing a business plan serves as a road map to the future by making entrepreneurs and business owners think through their strategies, evaluate their basic business concepts, recognize their business’s limitations, and avoid a variety of mistakes.

 

 

Comprehension Check

1) Refer closely to the article and answer the following questions:

a) What are the reasons for the increase in the use of formal long-term plans over the past few decades? Give comments and your own examples.

b) What is the difference between strategic and tactical plans?

c) Which step in the planning process you consider to be the most important? Give reasons.

 

2) Discuss the following statements from the text, illustrating your arguments with examples:

a) “The planning process is directly related to organizational considerations, management style, maturity of the organization, and employee professionalism.”

b) “Able to clearly identify goals and objectives, managers perform better, are more productive, and their operations are more profitable.”

 

Vocabulary Development

Fill in the table for the words of the key vocabulary and some new words from the text (7- 10 items).

Word	Definition	Equivalent	Synonyms	Antonyms	Derivatives
to assess	to judge the worth, importance, etc. of smth; to estimate the value of smth	оценивать, давать оценку	to evaluate, to judge, to estimate		assessed, assessable, assessor, assessment
1, 2, 3,...

Complete the crossword with the words from the key vocabulary and the text.

		2
	1							9			8
															11
													12
					6			4
					5
							7
											10
3

 

Across

1. An impressive display or collection; an orderly or regular arrangement.

3. A person or group responsible for the administration of a project, activity, or business.

5. A word relating to a goal or aim.

7. To promote the growth or development of smth.

9. Relating to government finances; involving financial matters.

10. A ____ plan is used to guide and control day-to-day activities.

12. A number of objects or people grouped or belonging together, often forming a unit or having certain features or characteristics in common

 

Down

2. Something required as a prior condition.

4. The people employed in an organization.

6. Some property lent, esp. money lent at interest for a period of time.

8. An obligation, promise, etc. that restricts one's freedom of action; a future financial obligation.

11. The process of making practical or worthwhile use of smth.

 

Listed below are the major elements of a business plan. Match them with their brief descriptions.

 

Elements of a business plan

other details market analysis financial plan description of business  contingency plans executive summary   production plan description of management and organization structure

description of products and/or services implementation schedule      sales and marketing plan

1. __________

This is usually a two- to-five page summary of the entire business plan. It is an important part of the plan, in that it is designed to capture the reader’s attention and create an interest in the company. It usually includes the company’s mission statement and summarizes its competitive advantages, sales and profit projections, financial requirements, plans to repay lenders or investors, and the amount of financing requested.

1. __________

This section of a business plan includes not only a profile of the company, but also a picture of the industry in which the company operates. Every business operates within a specific context that affects its growth potential. The data of the section may cover new products and developments in the industry, trends and outlook for the industry, and overall economic trends.

1. __________

The goal of this section is to differentiate a company’s products or services from those of the competition. It describes specific customer needs that are uniquely met by the firm’s products or services. Product features are translated into customer benefits. Product life cycles and their effects on sales and marketing can be described. The company’s plans for a new generation of products or services may also be included in this section.

1. __________

This section presents the strengths of the company’s management team by highlighting relevant experience, achievements, and past performance. Key areas include management’s ability to provide planning, organizational skills, and leadership. The section also contains information about the company’s ownership and work force. It may present an existing or planned organizational structure that will accomplish the goals set forth in the business plan.

1. __________

It serves as the basis for a company’s sales and marketing plans and generally covers the company’s competition, customers, products, and market acceptance, its strengths and weaknesses, providing a basis for discovering market opportunities. This section of the business plan provides a picture of who buys and uses the company’s products or services and highlights how the latter satisfy previously unfulfilled market needs. It also includes evidence of market acceptance of the company’s unique products or services.

1. __________

This section delineates the methods and activities that will be employed to reach the company’s revenue goals. It describes the company’s customer base, products or services, and marketing and sales programmes.

1. __________

It is usually included if the business is involved in manufacturing a product and covers production options that are available to produce a desired mix of products. In non-manufacturing companies, this section would cover new service development.

1. __________

This section covers the financing and cash flow requirements implicit in other areas of the business plan. It contains projections of income, expenses, and cash flow, as well as descriptions of budgeting and financial controls. Financial projections must be supported by verifiable facts, such as sales figures or market research. Monthly figures are generally given for the first two years, followed by annual figures for the next three to eight years. If the business plan is written for investors or lenders, the amount of financing required may be included here or in a separate section.

1. __________

This section provides key dates pertaining to finance, marketing, and production. It indicates when specific financing is needed, when specific aspects of a particular marketing campaign will take place, and delivery dates based on production schedules.

1. __________

This section defines problems and challenges that the company may face and outlines plans for overcoming unforeseen obstacles that might arise. Specific topics that may be explored are competitive responses, areas of weakness or vulnerability, legal constraints, staffing, and continuity of leadership.

1. other details

Most business plans include a table of contents and a cover sheet containing basic information about the company. An appendix may include a variety of documentation that supports different sections of the business plan. Among the items that may be found in an appendix are footnotes from the main plan, biographies, graphs and charts, copies of contracts and agreements, and references.

 

6. Render into English the following passage:

a) Разработке плана предшествует системное осмысление ситуации, более четкая координация усилий фирмы, более точная постановка задач, что должно привести к росту сбыта и прибыли. Основными этапами планирования являются стратегическое и тактическое.

b) Стратегическое планирование состоит из выработки программы фирмы, формирование ее задач и целей, анализа хозяйственного портфеля и перспективного планирования роста организации.

c) Для обеспечения роста фирмы используются следующие стратегии: интенсивного роста, интеграционного роста, диверсификационного роста.

d) На основе стратегических планов фирма разрабатывает тактические планы (планы маркетинга). Основными разделами плана маркетинга являются: сводка контрольных показателей, изложение текущей маркетинговой ситуации, перечень опасностей и возможностей, перечень задач и проблем, изложение стратегий маркетинга, программы действий, бюджеты и порядок контроля.

e) Фирма использует три типа маркетингового контроля: контроль за выполнением годовых планов; контроль прибыльности; стратегический контроль.