You should Link Your Business Plans Together For A Substantial Earning Increase. One of the first things you should do when starting a business is to write a business plan. A business plan helps you in your efforts to find investment and also serves as a guidebook that you can refer to whenever you feel like you’ve lost your sense of direction as it relates to your venture.
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Link Your Business Plans Together For A Substantial Earning Increase
When writing a business plan, most people will write one for the company at large. However, there are many ways in which you can write your plan, including writing and linking departmental plans under your overarching company business plan.
How Department Plans Help
Depending on how many departments your business has, you can use these plans to compare departmental effectiveness. Think of it like deciding to compare financial products – once you have a benchmark you can measure them against, comparisons are much easier. Those benchmarks are set out in the departmental plans.
You can compare department actions to the benchmark in their respective plans and then see how successful each section of your business is. If you’re considering cutting back on one department or investing more in another, this will help you determine what course of action to take.
Why Link Departmental Business Plans Together
Each department’s priorities must fit into your plan for the whole organization. You cannot create a plan for the HR department that does not take into account staffing requirements from other parts of your business. Similarly, your plan for the marketing department must take into account timelines coming from the R&D department.
If your departmental business plans are out of sync, you risk damage to your reputation and finances. For example, if your marketing department announces the launch of a new product before your R&D department has finished testing it, you will lose not only the money you spent on marketing, but you’ll also have to refund any pre-orders that you may have received. Additionally, your reputation will take a hit due to disappointment from excited customers.
Ideally, you should use every departmental plan to create a single, overarching strategy document for your business as a whole. This document should be accessible to employees from every department, allowing them to understand how their work plays into the company’s aims.
Creating a single strategy document can be complex, challenging, and time-consuming. However, if you want to get the most out of the process of creating business and departmental plans, doing so is essential.
When creating this document, you will need to coordinate between employees from each department. While you undoubtedly have a vision for your business, your employees understand the needs and capabilities of their respective departments best and will be able to advise you as to whether you’re setting expectations either too low or too high.
How to Write a Departmental Business Plan
Here’s what you’ll need to do to write an effective departmental business plan:
- Review Finances: If you have access to the previous year’s finances, compare the actual results from the department to the forecast. If there are any significant variances, determine the reasons for them, and analyze whether negative variances were a result of unexpected, one-time events or if they are likely to reoccur in the coming year.
- Analyze Overall Performance: Negative variances may not necessarily be the result of poor employee performance. For example, an unexpected weather event may have derailed plans for pop-up stores, which, in turn, affected finances. So, look at how productive each team member and the department as a whole were during the previous year. Set goals to encourage further productivity from your department in the upcoming year, and inform all team members of these goals.
- Write a Mission Statement: Write a statement explaining how the department will help in the business’s growth and explain what value it provides to the larger organization.
- Create a Forecast: Create a financial forecast using the past year’s performance and your goals for the upcoming year. Your forecast should also consider the business’s goals for the upcoming year. You may also want to explore what additional resources and opportunities you may need to create to ensure the business as a whole is able to reach its goals and not just a single department.
You will, of course, also have to ensure that your plan aligns with other parts of the company-wide business plan. For example, if the company is looking to reduce its overall budget, your department will need to reduce its budget accordingly.
Once you have created your business plan, speak to your boss or the business owner to determine if any changes need to be made. Alternatively, you can share the plan with your department’s employees so they know what is expected of them in the upcoming year.
Linking departmental business plans together can help boost company revenues and make it easier to reach business goals. However, you will need to review each department’s plan and ensure that it aligns with your organization’s larger goals for this strategy to be effective and successful.