efr ch10 busplan_sr2.4

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CHAPTER 10: WRITING A BUSINESS PLAN• Describe the components included in most

business plans, and their purpose• Explain why a special purpose budget is an

essential component of a business plan• Identify at least two types of financial analysis

useful in developing a business plan

1


BUSINESS PLAN & GRANT PROPOSALS BOTH:• Convince the reader there’s a need or problem

that must be addressed• Outline an intervention, purchase, or program

that addresses the concern• Present a budget & review of needed resources• Financial analysis supports feasibility• Provide a convincing rationale to obtain money &

other resources to accomplish specific goals & objectives

2


BUSINESS PLANS VS. GRANT PROPOSALSBusiness plan:• Internal focus to convince

your organization’s decision makers or yourself

• Funding source typically your organization or bank

• Purpose to increase profitability

• Proprietary

Grant proposal:• External focus to convince

outside funders• Funding source typically

private foundation or government agency

• Purpose often to respond to need & develop programs

• Community based

3


PLANS AND PROPOSALS COMPARED TO A LOTTERY TICKET

Amount of work invested up-front:

– Lottery ticket: assume 6 minutes

– Plan or proposal: 600 minutes (10 hours)

– Considerably more work to prepare a plan or proposal• Approaches or reaches

publication quality• Requires planning, thought,

teamwork, coordination

Odds of reward:– Lottery ticket: assume one to

18 million– Plan or proposal:

• Varies and can be targeted or improved

• 1:20 as a guess-timate

– Odds of winning the lottery approach zero

– Odds of getting your plan or proposal funded are uncertain but MUCH greater than zero 4


NURSE ROLES IN BUSINESS PLANS• Entrepreneur• Intrapreneur• Principal proponent• Supportive role• Making a business case for improving patient

care and profitability• Team player and team leader

5


WRITING SKILLS

• Proofreading• Avoid jargon, spell out terms, be clear• Executive summary• Organization and logical flow

6


BUSINESS PLAN COMPONENTS• Problem or need identification• Product definition• Market analysis– Continue or end here. If continued:

• Budget estimates– Continue, revise or end here. If continued:

• Additional financial analysis– Continue, revise or end here. If continued:

• Timeline• Conclusion and feasibility statement– Accept, reject, or revise the business plan

7


PROBLEM OR NEED IDENTIFICATION• First step and first section of business plan• Useful questions:– Is this a problem that can be solved by a new

program or other intervention? – What is the political context of the problem? – How well does the business plan fit with the

organizational mission, values, and goals?– Where does this problem rank compared to other

departmental and organizational priorities? 8


PRODUCT DEFINITION

• Describe the specific product• Explain ways the product can be provided• Identify required resources• Timeline to implement the program• Trends that might affect the program• Provide alternative scenarios for comparison

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MARKET ANALYSIS

• Market share• Identify:– Clients and client mix– Payors and payor mix– Competition, strengths,

and weaknesses– Demand for product or

service• Consider anticipated

change – any or all of above

• Alternative approach– Regulatory requirements– Quality initiatives

• Addressing the regulatory requirements or quality initiatives related to the proposed plan or project can be the basis for the market analysis

10


BUDGET ESTIMATES

• Capital budget: start-up costs• Operating expense budget • Revenue budget (if revenue-generating)• pro forma P&L statement • Include overhead expenses per policy• More in-depth analysis if profitability is

uncertain at this point

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ADDITIONAL FINANCIAL ANALYSIS• Break-even analysis: will the project cover its

costs, make a profit?• CBA: will savings cover or exceed costs?• CEA: is this the best alternative?• Determine cost savings, program feasibility

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TIMELINE, FEASIBILITY STATEMENT, AND CONCLUSION• Specific• Realistic• Gantt chart useful to

visualize the timeline

Feasibility statement:•Bias to ignore infeasibility of project•Will save money if ending infeasible project at this stageConclusion:•Brief summary to wrap up the document

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ELEVATOR SPEECH

• Brief: three to five minutes• Overview of project, including budget and

financial analysis results– How much will the program or project cost?– Will the program or project save money or

generate revenue and profit?

• Convincing

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efr ch10 busplan_sr2.4

Documents

business plan grantproposals

grantproposalsbusiness

plan orproposal

theproposed plan

expense budget revenue

business case

assume6 minutes plan

special purpose budget