draft investment club strategic plan by ojijo
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The Draft Investment Club Strategic Plan/Investment Club Manual
(extracted from Making Money Together - Ojijo's Investments Club Manual)
€ What is a Strategic Plan
A strategic plan is a list of activities to be performed in order to achieve certain targets, or goals.
An investment club strategic plan is hence a written plan that indicates where the investment club is today, and where it wants to be in a future time, listing the various steps that have to be taken to achieve the milestones.
According to Kotler, a leading strategist and leader,
‘in the strategic formulation, goals indicate what a business unit wants to achieve, and strategy is a game plan for getting there. Every business must tailor a strategy for achieving its goal.’
The strategy is the ‘what’ activity to be done; how, where, when and to whom.
“the devil is in the details, so is failure and successes.”
-Ojijo
Without a strategic framework I do not know where my going or why my going there. So, then, it does not really matter how I get there!
Strategic planning gives I clarity about what I actually want to achieve and how to go about achieving it, rather than a plan of action for day-to-day operations.
The activities are based on the vision, the final picture of what the organization wants to realize; the activities are based on the final destination of where we want to be within a given time; the activities are it is based on the medium term and short term goals to reach that final destination. The final destination is the dream. But I need strategy to reach my dream.
Strategy is king
Indeed, in the words of the Great philosopher, General and military strategist Sun Tzu,
‘Action without strategy is simply the noise before defeat.’
The strategic plan is compass direction. It answers the great question of Peter F. Drucker,
‘What is our business - and what should it be?’ Strategic planning is setting the direction for my organization in a way that helps me
identify and take advantage of emerging opportunities. Strategic planning is about three variables, RESULTS=ACTIVITIES=RESOURCES. The process of planning typically involves working iteratively through multiple
steps. I will commonly start by identifying results I want to achieve, and work backwards to identify the activities I will need to produce the results. Then, I will need to identify the resources I will need to carry out the activities. At the same time, the planning process generates substantial new knowledge as I proceed, that will cause me to rethink prior conclusions. I will typically need more than one pass to find a match between results, activities, and resources.
To become a successful entrepreneur, I should know the importance of a strategic
plan, and learn to write one up. I should start with a strategic plan. The strategic plan is the document that states what the business is, what it will do,
how it will do it, and the value that it will give to the clients, and to myself as the business owner. Further, once the need to raise finance has been identified, it is necessary to prepare a strategic plan. If I intend to turn around a business or start a new phase of growth, a strategic plan is an important tool to articulate my ideas while convincing investors and other people to support it.
The strategic plan should also be updated regularly to assist in forward planning. The very process of researching and writing the strategic plan should help clarify
ideas and identify gaps in management information about my business, competitors and the market.
The strategic plan indicates who we are, what we want to do, to whom, how, and
when. It then indicates how we will know that we are meeting our goals.
€ Sections of Strategic Plan
There are many contents of a strategic plan, which are divided mainly into seven (7) main sections, namely,
1. Organizational Profile
2. Business Activities/Goals/Objectives
3. Situational Analysis (Feasibility Study)
4. Operational Plan
5. Performance Measurement
6. Financial Plan
7. Growth & Exit Plan
In detail, these areas cover:
1. Organizational Profile
This section is attached to the strategic plan, and shows the current status of the investment club, indicating the philosophy, people, products, partners, processes, profitability, and plans.
a) philosophy, (this includes the name, address, legal nature, and location of the investment club)
b) people, (this includes listing of board members, management, advisors, staff)
c) products (this lists the products we have in the club, which can include loans, savings, insurance, etc)
d) partners, (this lists our service providers, including utility service providers, professionals services providers, etc)
e) processes (this lists our policies and procedures in doing our activities, and includes credit policies, investment policies, recruitment policies, sales plans, marketing plans, customer care plans, and business systems of risk management)
2. Business Activities/Goals/Objectives
This section lists the activities that are to be carried our, based on the goals or objectives or targets of the organisation.
The matrix lists the objective, or goal, followed by activities, outputs, and outcomes.
The budget, or cot of activities, can be inserted at this point.
In detail, the sections include:
a) Goal or Objective: This is the ultimate, final destination being sought. Organizations have generally three to five goals, and these can cover
membership recruitment, training and capacity building; investment; sales; branding; networking; and institutional development. The identification and realization of objectives determines the relevance and effectiveness of the organisation, respectively.
b) Activities: These are the specific actions that are taken to fulfil the objective, and they can include training and capacity building; advocacy; purchasing land; research; report writing; etc. They are usually attached to costs element. Activities, and use of resources, determine the efficiency of the organisation to fulfil the resources.
c) Outputs: These are the immediate results of an activity, and they include meetings held; reports published; advocacy campaign carried out; debates; trainings; etc. They determine the effectiveness of the organisation in fulfilling its objectives.
d) Outcomes: The overall result of the activities is the long term, final, wider gain, by the various project stakeholders. This is the main objective, or main, goal, of the project. The realization of outcomes fulfils the sustainability, impact, and reach of the project.
The template for listing the objectives activities, outputs, and outcomes, is also the same template for monitoring and evaluation, with a few minor changes, and the template for Mid Term Review (MTR), annual report (AR) or End Term Review (ETR) of the project.
3. Situational Analysis (Feasibility Study)
This section list the factors that might affect the achievement of the goals, and hence, the feasibility of the project.
The analysis looks at various areas of key import to program success, and they include: Social Economic factors; Technological factors; Economic factors; Ecological/stakeholder factors; Regulatory Issues; internal factors of strengths and weaknesses of the organisation; and Competitor Factors.
The key areas for feasibility study, in summary, are:
a) Social-Economic analysis, including life standards, cultural issues, etc, that affects the operations of the organisation. High population growth, leading to increase in demand for housing, and infrastructure projects. Culture and lifestyle is changing, with preference for steel products for construction, and hence, market. Political stability will lead to ease of doing business.
b) Technological analysis, including systems of development, or delivery or product. Technological factors can lower barriers to entry, reduce minimum efficient production levels, and influence outsourcing decisions.
c) Economic analysis/ Gap Analysis/Demand Analysis/Market Analysis/Supply and Demand Analysis, which indicates the supply and demand of the products, and hence ability to sell or deliver the product. Economic factors affect the purchasing power of potential customers and the firm's cost of capital.
d) Regulatory Issues, including laws, policies, constitutional provisions, as well as regional and international obligations that might affect the organisations work. Regulatory factors include government regulations and legal issues and define both formal and informal rules under which the firm must operate.
e) Ecological Analysis/Stake Holder Analysis (all players in the industry value chain, from production, through distribution, to sales).
f) Internal Environmental Analysis/ Ojijo 4P Analysis of People, Product, Principal and Property. The internal environmental analysis looks at the competencies, structure, resources and culture within the company. The internal environment comprise factors within the control of the organization, and is analysed using the Ojijo 4P Analysis Model, which looks at the people (board, directors, management and staff); product (the quality, price, and delivery); property (fixed and moveable assets); and principal (capital finances for operations as well as machinery).
g) Competitor Analysis. An analysis of the competitors, their product types, production processes, pricing, promotion, distribution, and value proposition.
4. Operational Plan
Operational plan is the step by step process of implementing the program, and includes the methodology, or procedure, or start up of project, through implementation of strategies, delivery of product, and measuring of performance.
The areas of operational plan include:
a) Entry strategy:
b) Production plan (research & development)
c) Marketing plan (4p marketing plan, branding plan)
d) Sales plan (sales forecasts, break even analysis)
e) Customer/member retention plan (stakeholder satisfaction)
f) Business systems (risk management plan, business systems checklist)
5. Performance Measurement
The purpose of any activity is to produce results. The strategic plan has a section that lays out the plan for monitoring and evaluating the results being achieved for comparison with the intended results.
The areas of performance measurement include:
a) business performance,
b) staff performance matrix,
c) strategic plan review,
d) implementation matrix
The result of performance measurement is the:
¯ Evaluation Report,
¯ Mid Term Report (MTR),
¯ End Term Report (ETR), or an
¯ Annual Report.
6. Financial Plan
This section of the strategic plan lists the budget of the organisation, that is, the sources, and uses of funds. The budget is based on the implementation plan, and indicates the costs of achieving the said objectives. In some instances, the implementation plan is fused with the budget.
In summary, it lists the following:
a) Cost of project & means of finance (expenses forecast, sources of financing, the offer, claw back strategy/guarantees)
b) Financial Statements (Income Statement, Balance Sheet, Cash Flow Statement)
c) Financial Ratios (Liquidity, Efficiency, Profitability, Leverage/Solvency )
7. Growth & Exit Plan
This part of the plan indicates the procedure, processes and activities that will be carried out by the organisation so as to grow, or to exit the market, after realization of initial objectives.
These include:
a) Increasing Sales/Profitability/Net Cashflow: This involves increasing the money flowing into the organisation by increasing the gross revenue, or profitability, or net cashflow.
b) Investment & Expansion/Expanding To New Markets/Net Products/ Increasing Reach/Impact/Market Share: This involves increasing brand image of the company, or organization, by increasing market share, or program reach, or impact of activities. This involves expansion of the project.
c) Exiting The Program/Market/Management/Product Development. This involves either the project being stopped, or ownership changing, or the management changing.
Appendix: Business Activities/ Attainment of Objectives
OBJECTIVE ONE: To Provide A Sound Saving and Investment Program for Members
Responsibility: Finance Secretary (assisted by members of finance & investments committee)
Goal Timeline Activity /Output
Resources Needed Outcome
Item Cost
Short-Term
Goal
1-2 years
Individual
automatic savings
plan
Saving minimum
USD100 per month
per member
Diversifying
portfolio (debt,
equity, property,
funds & cash)
Professional fees for
acquiring assets
(lawyers, brokers,
advisors, insurance,
document
preparation,
registration, etc)
1% of asset value
=USD 1,000
Automatic savings
/Periodic savings
Cumulative savings
of 1 million after two
years
Diversified portfolio
of USD 1 million
after two years
Mid-Term
Goal
3-5 years
Saving minimum
USD200 per month
Diversifying
portfolio (debt,
equity, property,
funds & cash)
Professional fees for
acquiring assets
1% of asset values
=USD 2,000
Automatic savings/
Periodic savings/
Cumulative savings
of 2 million after two
years
Diversified portfolio
of USD 2 million
after two years
Long-Term
Goal
6-10years
Saving minimum
USD500 per month
Diversifying
portfolio (debt,
equity, property,
funds & cash)
Professional fees for
acquiring assets
1% of asset values
=USD 5,000
Automatic savings
/Periodic savings/
Cumulative savings
of 1 million after two
years
Diversified portfolio
of USD 5 million
after two years
OBJECTIVE TWO: To Provide Education Programs For Members for Personal Branding
Responsibility: Vice President (assisted by members of education committee)
Goal Timeline Activity /Output
Resources Needed Outcome
Item Cost
Short-Term
Goal
1-2 years
Individual reading
assignments &
presentations (book
reviews & summaries),
1 book per month
Guest speaker, market
regulators, investors,
industry players
1 speaker every 3
months
Edutainment, I movie
per month
Field visits, every I field
visit per half year
Facilitation fees
Venue, DVDs, audio-
visual equipment hire,
purchase
Transport to field,
eats, etc
50
100
Member
contributions
Enhanced reading
culture
Improved financial
literacy
Networking with
industry
professionals
Understanding of
financial
sector/industry
operations
Mid-Term
Goal
3-5 years
2 books per month
1 speaker every 2
months
2 movies per month
I field visit per quarter
Facilitation fees
Venue, DVDs, audio-
visual equipment hire,
purchase
Transport to field,
eats, etc
50*6=300
100*6=600
Member
contributions
Long-Term
Goal
6-10years
4 books per month
1 speaker per month
1 speaker per month
I movie per week
I field visit per 3
months
Facilitation fees
Venue, DVDs, audio-
visual equipment hire,
purchase
Transport to field,
eats, etc
50*12=600
100*12=1,200
Member
contributions
OBJECTIVE THREE: To Provide Networking Programs and Opportunities for Members
Responsibility: Social Secretary (assisted by members of social affairs committee)
Goal Timeline Activity /Output
Resources Needed Outcome
Item Cost
Short-Term
Goal
1-2 years
Movie outs, every 4
months
home visits/family
days, every 4
months
Adventures
(nature walks,
beach picnics,
sports), every 4
months
tickets
food & drinks
group transport,
food & drinks
Members contribute Stronger social
bonds
Networking, meeting
new people
Mid-Term
Goal
3-5 years
Movie outs, every 2
months
home visits/family
days, every 2
months
Adventures
(nature walks,
beach picnics,
sports), every 2
months
tickets
food & drinks
group transport,
food & drinks
Members contribute
Long-Term
Goal
6-10years
Movie outs, every 1
month
home visits/family
days, every 6
month
Adventures
(nature walks,
beach picnics,
sports), every 1
month
tickets
food & drinks
group transport,
food & drinks
Members contribute
2.4 OBJECTIVE FOUR: Corporate Social Responsibility (CSR)
Responsibility: Secretary (assisted by members of organizing committee)
Goal Timeline Activity /Output
Resources Needed Outcome
Item Cost
Promoting
Education
Donating school
fees to two girls
promoting education
Environmental
Protection
Planting trees Venue, meeting, food
& drinks
promoting
environmental
protection
Supporting
Orphans &
Widows
Visit to Kakunglu
Hospice
Venue, meeting, food
& drinks
Promoting stand of
living
2.5 OBJECTIVE FIVE: To Further Institutional Growth through Strategic Partnerships
Responsibility: Secretary (assisted by members of organizing committee)
Goal Timeline Activity /Output
Resources Needed Outcome
Item Cost
Short-Term
Goal
1-2 years
Weekly meetings
Monthly meetings
Annual AGM
meetings
Strategic
partnerships
Institutionalization
(website, legal
documents,
effective
communication
lines)
Annual
performance
review (SWOT,
STEER, BALANCED
SCORECARD)
Venue
Venue
Venue
Transport &
communication
Club registration
(legal entity)
200
500
Re-oriented strategic
plan
Re-aligned mission,
vision, goals, etc
Club is a legal entity,
institutional
Communication
channel, website,
email addresses for
members, online
presence
Mid-Term
Goal
3-5 years
Quarterly
performance
review (SWOT,
STEER, BALANCED
SCORECARD)
Venue, meeting, food
& drinks
Re-oriented strategic
plan
Re-aligned mission,
vision, goals, etc
Long-Term
Goal
6-10years
Quarterly
performance
review (4P,
STEER)
Venue, meeting, food
& drinks
Re-oriented strategic
plan
Re-aligned mission,
vision, goals, etc.
…………………….
The Author, Ojijo, is a public speaker and consultant in financial literacy, collective investment schemes (investment clubs and saccos), and business financial projections; lawyer and guest
lecturer in financial services law, law firm management, and ICT law; author of 36 books; Rotarian, Inua Kijana Fellow; Poet Pianist; and owner, www.luopedia.com, www.lawpronto.com, www.allpublicspeakers.com, www.ajuoga.com, www.bankitgroup.com, www.parara.org, and www.achibela.com.
Email: ojijo@allpublicspeakers.com Mobile:+256776100059
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