Writing a business plan is a key step when starting your business or nonprofit. Thereafter, it is also a very helpful annual exercise.
Creating a business plan is different than creating a strategic plan, which outlines your programming – what activities you undertake day-to-day to accomplish your wonderful work. In contrast, a business plan focuses on your organization’s operational elements, specifically its organizational structure and financial structure.
Many entrepreneurs and visionaries skip a business plan altogether – or write one when they start their organization and never use it or revisit it. That is a mistake. Naturally, you are eager to invest yourself in the work that excited you to get started in the first place. A business plan is a vital factor in your success.
But what surprises many leaders most is that putting this document together needn’t be a chore. Before you write one word of your business plan, work through these pre-writing steps. If you do, the process of writing a business plan will be infinitely easier.
The first step is to understand why you’re undergoing the process in the first place: you’re writing a business plan in order to articulate on paper your organization’s operational elements and financial elements.
One struggle among nonprofit leaders is an unbalanced view of their work – often a focus on programming while excluding concern about funding, and less often an overwhelming concern for funding with a loss of passion for your cause. By taking the time to write your own business plan, you embrace both sides of the equation.
The process gives you a deeper understanding of how your organization’s structure and funding work hand-in-hand with programming to achieve your mission. Make sure your mind is clear on the value of these practicalities.
Focus your organization’s mission. Know who you are and what
you do. Keep your vision front and center as you put the document together. Don't take this step lightly ... it is key to success. (More tips on writing identity content.)
Gather information, data, and statistics about your cause. Put a procedure in place to collect anecdotal stories about your work. If you have conducted a feasibility study, have that on hand as well. Have all your financial documents and reports together in one place before your begin writing.
As you work through your gathered data, you will discover areas that need clarification. For instance, you may discover that your budget covers daily operating expenses, but a special event is not funded. This discovery will allow you to put a plan into place to identify event sponsors, thereby helping you to avoid a major financial setback and at the same time allow your fundraising event to be successful.
A business plan gives you a punch list. It pushes you to process the different elements you need to work through to set up your organization’s infrastructure and put a funding plan into motion.
If you outsource your business plan or use someone else’s (simply plugging in your numbers), you will lack understanding of how your nonprofit works – and be unable to explain it to investors. By writing your own plan or working with staff to write it, you will be prepared to speak with financial partners.
Create a strategy to follow to write your plan, including who will write it and a timeline for completion. (Business plan writing tips here.)
After you’ve spent time in these pre-writing steps, then move onto putting together the main elements of a business plan. Review the draft with your board and invite their input. Re-write it.
Then use it.
More on Writing Business Plans and Strategic Plans
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