Business Planning
A small shift in odds can produce large long-term gains. Assume a business has an annual after-tax income of $100,000. If effective planning raises the growth rate from 1% to 3% and decreases the risk of failure from 3% to 1%, then the expected value of Retained Earnings rises from $1,209,000 to $2,263,000. $1,000,000 more, just by shifting the odds a little!
Although strategic planning is ultimately the responsibility of the Board Of Directors, it is commonly delegated to senior management. Senior management may, in turn, involve middle and junior management in strategic and business planning to develop their thinking to encompass a longer time horizon and a broader appreciation of aspects and disciplines of modern business. (In a family business, involving second generation family members in a vigorous business planning exercise can be especially beneficial.) The completed plan can and should be used as an accountability tool.
A small shift in odds can produce large long-term gains. Assume a business has an annual after-tax income of $100,000. If effective planning raises the growth rate from 1% to 3% and decreases the risk of failure from 3% to 1%, then the expected value of Retained Earnings rises from $1,209,000 to $2,263,000. $1,000,000 more, just by shifting the odds a little!
Although strategic planning is ultimately the responsibility of the Board Of Directors, it is commonly delegated to senior management. Senior management may, in turn, involve middle and junior management in strategic and business planning to develop their thinking to encompass a longer time horizon and a broader appreciation of aspects and disciplines of modern business. (In a family business, involving second generation family members in a vigorous business planning exercise can be especially beneficial.) The completed plan can and should be used as an accountability tool.
Resources
Strategy & Business Planning of Privately Held Companies
Strategy & Business Planning of Privately Held Companies
MCCA - McCann Corporate Consulting Associates
MCCA is a consulting firm established in 1989 to assist companies and not-for-profit organizations under-performing to the expectations of their executives, shareholders, lenders and stakeholders.