An engineering graduate's views of a home made MBA..true trials and tries!
Your First Business Plan:
- write down what you want to deliver to customers..they call it 'objectives, goals, mission, vision, concept, etc'!
- write down what you want to deliver to customers..they call it 'objectives, goals, mission, vision, concept, etc'!
- list down what make you different from existing competitors..they call it USP 'Unique Selling Proposition'!
- study whether somebody will buy or need your product/service..they call it 'Industry Analysis', 'Market -size, -trend, -segment, -positioning, -analysis', 'Purchasing Decision Process', etc.
- what is short-term for you..and long-term? and which all MACRO-factors and MICRO-factors affect you?
MACRO-factors: Laws, taxes, regulations, political-system...purchasing power of people, how Banks treat you, how good/bad your currency value...cultural (attitude, standard of living, quality of life) and social (interest-groups, age groups)...to technology trends.
They call it 'PEST (Political-Economical-Social-Technological) analysis'!
MICRO-factors: talented staff, good brand, easy access or availability of good resources..and the opposite of these!..keep a regular watch of the potential new products or services bring in growth and profit..and the opposite of these if not vice versa!
They call it "SWOT (Strength-Weakness-Opportunities-Threat) analysis"!..that is, be aware of the internal strengths-and-weaknesses of organization as well as the external opportunities-and-threats.
conclusion: Boost the Strength-Opportunity alliance and Reduce the influence of internal-Weaknesses & external-Threats!!
Operations:
- whats your Operation model: delivery model of service or product, customer support, supplier selection, administration and quality assurance, team-and-cost(of development to production).
Marketing:
- how you do your product/service marketing: brochure and pricing models, select best methods of spreading message of product/service, set goals for sales team, design of distribution channels.
- calculate break-even: how long will it take to get back investment?
(Break-even in years) = (Initial Investment) divided by (average annual Profit)
(Break-even unit volume) = (FixedCosts) divided by (sellingPrice minus variableCosts)
Risk Plan:
- how to land safe if something goes wrong!: have a list of issues like “if loose customer or employee or internal resource”, what all alternate solutions possible..they call it 'Contingency Plan'.
Organizational Structure:
- You may put experienced and reputed people/industry-experts on Board of directors, do proper role allocation of staff members, managers and all contributors through the chart.
Funding and cash-flow:
- how to find funds: first of all, check self that if I invest in this, what&when is the Return Of Investment!!?..if a person get a self YES-answer for this, external investors and funding-partners shall as well!
Business Model:
- can I draw or write how my Business Model look!: make a flow chart of how inputs like ideas, innovation, and services in the organization translate to revenue/profits outputs and make economic sense!.
They confuse us with terms like 'Value Chain', 'value network!', 'Value Proposition!!', etc.
Accounting:
- how good your Accounting fundamentals: "how to quantify, record and analyze business!"...
and at least should be able to understand vocabulary of Chartered Accountant and Company Secretaries!
- tables with many rows and columns of items, quantities, cost and benefit, and accounting cycles.
- understand Income statements, balance-sheets, cash-flow statements, etc.
Income = (Revenue - Expenses)!
Assets = Liabilities + Owners' Equity.
(cash + accounts receivable + long term assets + inventory) = (Liabilities + owners'Equity)
And then the Cash Flow analysis puzzle,
Cash = (Liabilities) + (owners'Equity) - (accounts receivable) - (long-term assets) - (Inventory).
That is, if Inventory goes high or buy more long-term assets, Cash goes down..if add-in more Owners' Equity or borrow more from bank, your cash goes up!
Finance:
- how good you in Buying and Selling!: "maximum value at least cost with in affordable risk!:-)"..quantify capital, profit, investment, security, mergers, cash-flows, debts, acquisitions.
Character and culture of Organization!: they call it, "Organizational Behavior".
- how good your Philosophy, Psychology and rest of social science fundamentals!..
Mathematics and Quantitative Analysis:
- how good your mathematics and quantitative analysis skill!: Probability, Statistics, Normal distribution, scaling and charts, and permutation/combinations for resizing quantities.
Legal Systems and Company Laws:
- how good you in faster data mining of Legal Systems (international and local) and business laws..and reach feasible plans and decisions.
Software Tools to automate manual labor:
- how good and fast in learning and using software tools..to make better presentations materials, better analysis and planning for marketing/sales/business development, and market research, project milestone tracking, collecting feedback, and allocating resources.
Capabilities and Skills:
- how good capabilities and skills: communication skill, ability to learn fast, team-work skill, evaluate multiple options and make good decisions, organizing skill, assertiveness, achieve results through persistence and tolerating stress, how good in making partnerships and alliances, behave with good situational sensitivity and emotional intelligence, how good in selecting right people for right job at right time and mentoring and motivating them and positive thinking.
Business Economics:
- how good your Economics fundamentals!: "mapping supply and demand"!..Macro-economics (purchasing power, GDP, price index, unemployment counts!) to Micro-economics (price, demand and supply, measure of industrial-/national- power and their politics of inflation and currency conversion).
Objective: a continuous improving, faster knowledge-sharing and innovation-attempts culture to be cultivated in all department of organization...and in turn giving back good standard of living and quality of life to society and civilization.
Happy Easter,
thanks,
Rajesh Sulabha
www.bkisolutions.com
www.businessknight.com
