BSBMGT617 Develop and implement a business plan Assessment

Task 1 - Assignment Question

1 a) Explain in a paragraph why it is critical to evaluate the organisation’s strategic plan when
developing a business plan.
b) What steps might you take to develop measurable business objectives?
c) List 5 key steps for developing a business plan.
d) Explain in a paragraph why is it important to continually review the market?
e) Describe in a paragraph how you would build a customer profile?
f) List three reasons why it is essential to consult with key stakeholders when developing or revising
a business plan.

Answer:
1 a) It’s critical to evaluate organisation strategic plan and develop business plan in order to know
the purpose strategic, business and operational plans. Thus through those plans, review the
essential components needed for those business plans. Identify business goals and objectives of the
business plan to ensure it goes smoothly according to plan.

b) - Review and evaluate pre-existing strategic, business and operational plan, if available
- Analyse and interpret business vision, mission, values and objectives
- Consult with key stakeholders
- Review market requirements for the product or service, profile customer needs and research
pricing options
- Develop performance objectives and measures through consultation with key stakeholders
- Identify financial, human and physical resource requirements for the business
- Consider any permits or licences that may be required for new activity
- Write business plan

c) – Review and evaluate pre-existing strategic, business and operational plan if available
- Analyse and interpret business mission, vision, values and objectives
- Consult with stakeholders
- Review market requirements for the product or service, profile customer needs, and research
pricing options.
- Develop performance objectives and measure through consultation with key stakeholders.

d) It is important to continually review the market in order to use independent viewers to get an
objective view of continuous improvement and deliver appropriate reports. Present
recommendation to customer and other stakeholders to improve company sales. Last, modify and
improve any systems, processes on services or products as part of improving product/ service.

e) First, identify the customer revenue stream by dividing it into separate group of small, medium or
large then picking revenue as the main criteria to identify your biggest revenue stream based upon
the assumption that the revenue is clearest sign if someone is satisfied with your product/ service.
Within the best revenue stream identify the best customer bring you most value, it will be clear
guideline to find target customer profile. Analyze your best customers, common traits among them
and identify your target company profile. Analyze the actual buyer who will take decision to buy
your product in terms of company positions, demographics, psycho-graphics and behaviour shared
by your best buyer.

f) – It enables us to identify trends and emerging challenges which are currently or will impact the
future on the organisation.
- It helps to improve projects outcomes and help a corporation to identify and control external risks.
- Identify and monitor trends, challenges and perceptions overtime within group of stakeholders.

Question 2
Access the Lifestyle Architects Business Plan from the following web page at:
www.business.qld.gov.au/business/support-tools-grants/tools/business-planing-kit
Write a notes that will assist you with developing a draft business plan, based on the information
and questions raised in this topic. Use the following table to record your notes about the current
business plan. Include: Whether the information is current
 Whether all sections that should be included in a business plan are present, including a
 current analysis of the market, customer profile trends, market trends and possible marketing
options Any strengths and weaknesses of the plan
 Suggested options and areas for improvement.

Checked Item Notes Notes

Description of the business Lifestyle Architects rapidly growing demand for
architecturally designed inner urban apartments to
meet the lifestyle requirements of the working
professional.

Organisation’s purpose (vision, Vision:

mission and value statement) Premier architectural firm in Australia for creating
contemporary urban development communities.

Mission:
design creative and community friendly inner urban
apartments for the home and lifestyle of the
working professional

Value Statement:
- To be one of the leading specialist
architectural firms in Brisbane within the
first two years of operations with a great
reputation for designing inner urban
apartments
- To provide architectural services for high
value small to medium inner urban
development projects for at least 6 major
clients in the first year
- Establish the business in three years as the
premier firm in South East Queensland with
a team up to five people that can provide
clients with the one-stop solution for new
small to medium high density residential
development projects.

Organisational chart - Business Owner

- Administration
- Sales Marketing
- Legal
- Management
Key personnel/ stakeholders
Current target market and
marketing strategy
SMART goals/ objectives and
Key performance Indicators
Finances
Product services (including
market position, unique selling
position/ value to customer,
anticipated demand, market
trends, pricing strategy,
growth potential)
Insurance
Owner/ Architecture ( Peter Drew)
Target Market:
Working professionals who want the convenience
and lifestyle of inner urban living. They are also in a
better financial position to afford the higher price
tags for these types of apartments
- To gain a 10% market share in Brisbane
within the first 18 months for architectural
services in relation to the design of small to
medium inner urban apartment
developments.
- To have two property developers and four
building designer firms as major clients in
the first year of operations
- To position the business as a leading
specialist in the Brisbane market to take
advantage of the strong cyclical upswing in
two to three years time.
- Access to further funds
- Able to manage cashflow, debtors and
cash budgets
- Adequate growth of cashflow
- Management understand the use of
financial accounts on regular basis
- Manage and analyze performance against
financial indicators
Customer profile trends:
next two decades the two main household types
will be ‘Couple without children’ and ‘Lone-person’
households
Market trends:
wealth of experience and talent of the architect
himself in terms of proven design capabilities,
excellent reputation and delivery of service within
agreed costs and timeframes.
Possible marketing options to take:
enable to business to design even better inner
urban developments that command a higher price
tag which in turn delivers greater returns on
investment for the property developers.
- Professional Indemnity
- Loss income insurance
- Property and content insurance
Risk Management - Dependency on small number of large
clients for work
Preventive Actions: Take on a larger number
of small clients to spread the risk and also
build strategic partnerships with building
designer firms
Contingency Plan: Take on work drawing up
designs for houses and renovations. Also
have a contingency fund to manage the
cash flow between jobs

- Clients don’t pay

Preventive Actions: Procedure for collection
of outstanding debts. Perform due diligence
on new clients and have formal contracts in
place
Contingency Plan: Engage lawyers for
advice

- Unable to work for extended period of time

Preventive Actions: Take out insurance to
cover for the loss income and have a
disaster recovery plan in place to notify
clients and associates
Contingency Plan: Subcontract work out

- Theft of equipment
Preventive Actions: Take out insurance to
cover for the replacement of equipment as
well as deadlocks on the doors and security
screens
Contingency Plan: Purchase from
alternative suppliers or use suitable
substitute products

- Equipment malfunctions
Preventive Actions: Regular maintenance
and proper storage. Also service agreement
in place with supplier for repairs and/or
replacement of equipment within 24 hours
Contingency Plan: Leasing of equipment
and software

Legal considerations (including - Registered Architecture

Acts, regulations, codes to - Registration of Trust
comply with, permits and - Registration of Business Name
license required) - Australian Business Number (ABN, TFN,
PAYG, and GST)

Strengths and weakness of the plan

 Strengths:
- Targeted on work professional who able to afford higher lifestyle
- Strong purchasing power from customer
- Peter Drew is the designer and owner, which doesn’t rely on external
manpower in terms of designing.
- Spending time on business development with key contracts, building service
firms and property developers.

Weakness:
- Can’t received much project due to short manpower
- High cost on hiring lawyers to conduct new diligence towards new major
clients and set up the contract and payment terms.

Area of improvements
- Too much skilled employees, which affect on working environment
- Firms need to expand at the major cities of Australia
- Improvement in technology used for design purposes.

Question 3
Explain in a paragraph how you would test a performance measurement system
First, understanding the current performance systems and either scrap down the old systems or
introduce the new one as a replacement or redevelop the existing system. Develop performance
indicators to measure your organizations performance and business processes. The purpose is to
develop the performance measurement system with appropriate number of relevant and precise
performance indicators. Decide how to collect the required data and design reporting and
performance data. Test and adjust the performance measurement system if the performance
indicator doesn’t work as intended, undesirable behaviour and problem with data availability.

Question 4:
Imagine you are the general manager for a medium-sized company. You need to communicate the
approved business plan to your staff, which consists of four departmental managers, eight team
leaders and 20 staffs. The business plan reinforces the organisation’s vision and business objectives,
provides a market analysis for their products and services includes a financial plan with projected
profit-and- loss and cash-flow statements, describes performance requirements and responsibilities,
and timeframes for meeting objectives. You prepare to disseminate the information.
a) What method would you use to communicate the business plan to ensure everyone is aware of
performance requirements and timeframes for meeting objectives? Explain why these methods
would be appropriate.
b) Explain in a paragraph how do you prepare for the session in which you communicate the
business plan to staff? For example, what documentation do you prepare?

Answer:
a) Conducting a departmental meetings will to discuss about the organisation vision, objectives
and market analysis is the best method to keep the performance requirements and
responsibilities. Besides departmental meetings, sending emails and verbal communication
through phone among team leaders and staffs to keep project progress updated.
b) Location, meeting agenda & time could be send through email or verbal communication to
ensure all staff are well informed about the meeting conducted. Documentation needed
such as Agenda; meeting plan and topics need to be discussed and tasks need to be
accomplished in given meeting time. Attendance sheets and previous minutes; actions
 points from previous meetings to see if they had been auctioned or not. Presentation papers
and actions sheets from the previous meeting and mention status across each of them.
Lastly, Weekly Progress Report to assess each team member in relations to their assigned
tasks include explanation of their tasks, current tasks being worked on and tasks will be
worked on next week.

Question 5: New customer management database software has just been introduced to your
company to enable more efficient customer service. The software reporting function has made you
aware that some of the customer service staff may need to be trained. You confirm this need with
the customer service manager.
Required: Use dot points to explain what managers should do to ensure staffs have the skills to
implement the business plan and meet performance measures.

- Understand the area where you deriving the qualified labour, for example: developing skills
to match staff skills, experience and capacity.
- Match the supply of the labour force with the actual demand
- Highlight and allow for high priority activities as they may require a drain on your resources
- Set performance measurement systems to establish the basis upon which you see the
measurement producing result and see if the performance measure have meet.
- If the performance result doesn’t meet, take the correct action such as giving training to
customer service staff in order to develop their customer service skills.

Question 6: The business plan has been implemented and you are regularly analysing business
performance. You have noticed that the performance measures put in place to measure the
business’s environmental impact and uptake of environmental procedures (increase of sales of
sustainable products; number of staff recycling paper; decrease in waste; increased commitment by
staff) have not provided sufficient information to make effective decisions. You collect test samples,
analyse the data, compare variations between actual and forecasted performance. Subsequently you
report the system failure. Then, in consultation with others, you identify refinements that must be
made and include them in the business plan.
Required: Explain in a paragraph what should you do when you notice that a system is not working
well? Provide specific examples.
Answer:
When the system is not working well, capture accurate and relevant date at the time of the failure.
Ensure the failure system and products are part of risk management. Place adequate communication
system than can easily transfer data between department or relevant persons. Link reports to any
existing or corresponding database of the organisation. Lastly, provide suitable reference or tracking
data so that other systems may identify the occurence early. For example: When there’s no
sufficient information to make effective decision, communicate with relevant person regarding the
business environmental impacts and link report to existing database to come out with solutions and
decision to be included in business plan.

Question 7:
a) Explain the value of variance analysing performance against planned objectives.
b) Using your experience or research, list at least three reasons why there may be a favourable
variance and three reasons for an unfavourable variance.
c) Why is it crucial to regularly review objectives and performance indicators?
d) What is the purpose of root cause analysis in analysing the performance against planned
objectives?
e) Explain in a paragraph what is process mapping and why is it a valuable tool?
Answer:
7a) Variance analysis is a great use and importance in business management. It’s a tool applied
to budgeting and management accounting process which helps to make comparisons between
two or more means. It enables the decision makers to estimate results that in turn lead to
improve efficiency and performance of a business entity. If done effectively, variance analysis
leads to attain business objectives and goals in a way as wanted. Having been applied to the
operational and the financial data, variance analysis aims at better efficiency and performance by
computing variances between actual and targeted levels of performance.

7b) Favourable variance:

- The business generated more revenue than the expected or incurred fewer expenses.
- Actual revenue is greater than the budgeted amount.
- Actual manufacturing cost are less than budgeted amount for certain number of period

Unfavourable variance:
- Revenue fall short of the budgeted amount or expenses higher than expected
- Net income is below than management expectation
- Difference between an actual experience and a budgeted experience in any financial category
where the actual outcome is less favourable than the projected outcome.

7c) – Monitor your product, pricing and distribution decision or results against the business plan
- Analyse the effectiveness of your organisational policy and objective of your marketing plan
- Understand how the organisation performing in relation to strategic goals and objective

7d) The purpose is to ensure groups and individuals contributing to under-performance are coached
and provide appropriate training. Review the performance and work methods regularly as part of
continuous improvement.

7e) Process mapping help to define where you want your business to be within certain period of
time (usually 5 years) and plan how you getting there. It is valuable to ensure the company have
reached the milestone being set.

Question 8:
Living outdoors is a furniture manufacturer supplying outdoor furniture products at the premium
end of the market. The company has been in business for over 50 years. It has always relied on
the processes and works methods it has had in place for all those years, and a steady stream of
customers for its expensive products. However, a number of factors are driving down the
success of the company, such as the current poor economic climate, new employees not being as
well trained as in previous years, and a lack of modern technology for production and customer
service staff. These factors mean that production values are slipping and sales are decreasing.
In the last four months, the variance between actual sales and forecasted sales has reached an
unfavourable variance of 15%. Many of the management staffs have been with the firm for 20
years or more. There has never been a rigorous continuous improvement process in place, as the
company has always relies on its reputation for success.
Imagine you have just been hired as a manager at living outdoors. You have been asked to review
system process and work methods to identify opportunities for improvement.
a) Explain in a paragraph how you would utilise process improvement tools and techniques,
in line with Deming’s PDCA cycle, to ensure continuous improvement. Provide possible
examples for each stage of the cycle
b) Describe a range of appropriate coaching of training opportunities to help develop staff
that underperforms, either in your workplace or at Living Outdoors. For each strategy,
explain how this will improve specific staff performance.
Answer:
a) In order to improve, use Deming’s PDCA cycle. First step is to make a plan how to execute
the lack of modern technology for production and customer service staff in Living
Outdoors which cause the production values and sales decreasing as well as poor training
on new employees. Second, take the appropriate action such as training new staff and
providing the latest technology which is environmental friendly and less time
consumptions. Third, check the result after those actions being applied. See if the new
employees have been given a proper training and able to provide good customer service
according to company standard. Check if the production line has been improve
significantly which could be check through the sales performance. Lastly, take action to
standardize and improve the process that is needed to ensure smooth operations.

b) In class training by having HR manager to give customer service training and background
of the company to new employees so that new employees understand the company
better. It gives employees the opportunity to ask questions and empower relationship
building between manager and employees who are learning and growing together.
Interactive training by having small group discussion, role playing and demonstrations
help new employees learning experience and get them ready for 0n the job situation. It’s
highly effective as it empower conversation and group interaction which keep
participants energy high and allow them to learn from each other.