The only way to answer the question How do you get to where you want to be? is through a rigorous process of business planning. There is no escape. Without going through the process of business planning, you will not have thought through all the issues involved and, as a result, you will not be able to write a robust business plan. And, without a solid business plan, you will not get outside financing to resource the growth of your business.

Even if you do not need outside financing to grow your business, you still need to go through the process of business planning and to develop a business plan. Unless you do, you will not apply the resources available to you in an efficient manner.

This section deals with the process of business planning. There is a difference. A business plan is the output from the process of business planning, not an end in itself. Too many people write business plans, without thinking about their content before writing. You must think your business plan before you start writing.

The key topics in the process of business planning are:

• External factors, outside the control of your business
• Your management team, you and the other key people in your business who will be responsible for making growth happen
• Internal factors, under your own control.

External analysis

Although all the external factors ? the environment, market, customers, competition and suppliers ? are outside of your control, they impact (sometimes positively, sometimes negatively) on your business.

The environment

Here, you should consider a whole range of issues, starting with the regulatory framework you operate in. Have you considered the impact of EU regulations, the new Health and Safety legislation and the issue of corporate governance to name a few?

Regardless of whether your business follows the normal economic cycle or works anti-cyclically, you need to be aware of the general economic situation and the outlook for the future ? and not just in Ireland, but in all the markets in which you trade or plan to trade. Do you know the demographics and the current social trends in these markets? What are the trends in technology? What will Europe look like in 20 years? time? Where does your business fit in this future?

The market

Consider size, trends, potential, threats and opportunities. And do this not only from a local perspective, but also from a national and international perspective. Where are the markets? When you started your business you might have done some market research. But how well do you know your current (and future) market?

Customers

Ideally, you know who your customers are and why they are buying from you. Have you ever calculated how much more it costs to get new customers than to retain existing customers? Who are your key customers from a sales and strategic perspective?

Spend some time analysing your current customers (their behaviour, buying decision, dependency, profitability to you, etc.). Then talk to some of them to find out how they perceive you. You will learn a lot.

Competition

How competitive is the market in which you operate? How competitive is your business within it? Consider competitiveness both from a product, service and a price perspective. The intensity and strength of the competition you face will give you an indication of your room to manoeuvre (it is probably not a good idea to compete on price with Microsoft).

Suppliers

If you have been in business for a while, you have a network of suppliers in place. Some are critical others are not. You should evaluate your relationships with them, analyse your dependency on particular suppliers and look for opportunities.

Management team

The key element in the success of a business is its management team. It is the most critical determinant of growth.

In reviewing your management team, you need to consider:

Drive:

• The reasons why the promoters management team are in business
• Whether they have a life style or growth focus
• Their objectives.

Relevant education and experience:

• The level of education and experience of the promoters management team in relation to the business
• Whether their skills are one-dimensional or multi-dimensional
• Whether they have good communications skills.

Network:

• The number of useful contacts they have in relation to the business
• The quality and strength of those contacts
• The positions held by those contacts.

Personality:

• Their level of entrepreneurial zest and attitude in general
• Their flexibility
• Their adaptability
• Their ability to handle stress
• Their health.

Commitment:

• Their ability to commit time, given personal and family circumstances
• Their ability to commit finance, given personal and family circumstances
• Their willingness to commit.

Quality:

• Skill levels
• Organisational ability
• Planning ability
• Management style.

When you analyse the skill levels of your management team, you need to do that exercise in the context of where you want to go, rather then where you are right now. Look at the balance. Are all the functional disciplines there?

If there are gaps, the most obvious solution is to consider strengthening your team, by training, buying in outside expertise or using non-executive directors and or mentors, who can give you invaluable assistance in growing your business.

Internal analysis

Internal factors are factors related to growth that your business control. These factors are:

• Strategy
• Marketing
• Sales
• Product, services
• Process
• Product development and innovation
• Human resources
• Financial resources
• Financial management
• Systems and administration.

Strategy

Your strategy is based on six statements, which define your strategic parameters and the area in which your business operates (almost like a looking glass, from which you perceive the environment). These statements are:

• A values statement: This statement explains the values you and your business aspire to in your dealings with customers, staff, suppliers, public, community and shareholders.
• A passion statement: This statement sets out what you and your business are passionate about.
• A vision statement: This statement explains what you and the business will look like in 10 or 15 years time.
• A mission statement: This statement explains the purpose of the business
• A positioning statement: This statement explains how you want your business to be perceived.
• A resource statement: This statement sets out the resources you have available and which resources you need.

Marketing

This is where you need to look carefully at your business? branding and positioning ? they are the same thing, in effect.

Consider not only the market share you hold but also heart share and mind share ? two other key indicators. After a full analysis (What is the gap between your reputation and your positioning statement?), you should define the steps you need to take to achieve the positioning you want.

Sales

No sales, no business. The sole purpose of marketing is to achieve sales. Analyse your business? routes to market (direct and indirect), your sales pipeline and the tactics you are using to achieve sales.

Set targets from a distribution and promotion perspective and try to forecast your future sales.

Product, services

How good is your product, service offering? Consider not only functionality and features but also the extras that lead to customer delight. This is where service, quality and value perception and branding become important. Is your offering interesting enough to make it on the international market?

Process

Your business has four principal functions: Buy, Make, Move and Sell. The more efficiently you can do each of these (or have them done for you), the better your business.

Look at each function in turn and consider how it is organised. Where could you improve? Look at where e-commerce and outsourcing could improve the way things are done. Consider what your competitors are doing. Then redefine your business based on those findings.

Product development and innovation

Ideas are the life-blood of a business. They are part of your competitive edge and your business?s future value.

How many ideas do you have in your portfolio? How much time and money do you spend on developing new ideas? If both answers are nil, you are in trouble ? or will be soon.

Human resources

Your staff are part of the soft assets of your business. How good are your staff and how do they fit into your plans for the future? Who are key people now and in the future? Who needs to upskill? How many people do you need? Make your answers part of your resource statement.

Financial resources

How much money do you have personally? How much money does the business have? How do you need to finance your growth plans? Where will you get the difference?

Financial management

Finance is the language of business. You should do a ratio analysis and compare your ratios with similar businesses. It will tell you a lot about how you are doing from a financial perspective.

Systems and administration

Information is power. How well informed are you and how quickly do you get the information you need?

Conclusion

This process of analysis should have raised issues about the capabilities of your management team. It also should have given you an idea of the resources you need to put in place from a money, time and capacity perspective to achieve your growth plans. It is now time to finalise your strategy:

Write down on a piece of paper:

Your 6 statements:

• A values statement: This statement explains the values you and your business aspire to in your dealings with customers, staff, suppliers, public, community and shareholders.
• A passion statement: This statement sets out what you and your business are passionate about.
• A vision statement: This statement explains what you and the business will look like in 10 or 15 years time.
• A mission statement: This statement explains the purpose of the business
• A positioning statement: This statement explains how you want your business to be perceived.
• A resource statement: This statement sets out the resources you have available and which resources you need.

Your targets for year 1 and year 5.

The resource implication (money, people, time) across:

• External
• Management team
• Internal

The immediate steps you are going to take to improve your business.