Three Questions to Assess Your Need for Business Planning
Business plans aren’t just for start-up nonprofits. Any organization faced with a crucial decision, such as whether to launch a new program, enter into a strategic partnership, grow or expand, or make some other major change to its program mix, operations, or economic model, can benefit from business planning.
A business plan tests the proposition that a particular strategy (or set of strategies) is economically and operationally viable. By rigorously examining and elaborating on the core elements of the undertaking — whether a program, partnership, new venture, growth strategy, or the entity as a whole — a business plan describes how and why it is feasible. In other words, business planning is a way to make strategy real.
But organizations don’t always need the deeper dive of a business plan, and (as with anything) timing is key. Before you decide to pursue a business plan, consider the three questions below.
1. Have you identified one or more strategies that will require — or result in — a significant change to your existing business model?
2. Are you considering one of the following:
a) Launch of a new program, partnership, or organizational entity?
b) A growth strategy for your existing organization?
c) Some other major change to your program mix, operations, or economic model?
3. Do you need to develop more information to achieve one of the following:
a) Enable key decision makers (i.e. your board, executive staff) to make a go/no-go decision?
b) Demonstrate to potential funders that your undertaking is both compelling and economically and operationally viable (and thus worthy of their support)?
c) Inform your leadership team in creating a comprehensive implementation plan?
If you answered “yes” to these, it is likely that the time is ripe for business planning.
Read about the differences between strategic planning and business planning to learn more, explore our business planning guide for nonprofit leaders, or contact us to have a conversation about whether business planning can help your organization get to where it needs to go.