Business Planning Flashcards
What would you expect to see in a businesses 5 year plan?
A vision / mission Short and long term goals Strategies Reporting mechanisms Growth
Does Arcadis have a business plan and what does it cover?
Vision:
As a business, we want to maximize our impact by harnessing the power of technology and data to develop solutions to today’s global challenges. We are focused on improving the way resources are utilized, protecting our environment, creating transporting solutions, and planning for the places where we can enjoy our work and home lives.
Core values: People first Client success Integrity Sustainability Collaboration
Strategy:
Urbanisation - increased urbanisation means more pressure on the urban infrastructure. Strong voice that calls on us to rethink mobility.
Climate change - global objectives are driving investment by governments and industry to mitigate and adapt to the impacts of climate change.
Digitalisation - we will use data and digital solutions to ensure we protect our planet and communities while rapidly exceeding our clients expectations.
Social expectations - £1trillion of sustainable investment is required in the next decade. Stakeholders are demanding that companies and governments act with integrity to create a sustainable future.
What is the role of marketing in business planning?
Promote the business and it’s values to attract talent.
What would be considered when setting a business strategy?
Vision - a picture of the business in years to come.
Mission - the purpose of the business.
Objectives - what the business wants to achieve.
Values - what the business stands for.
Strategies - how to achieve the objectives.
Types of business plan
Strategic - outlines mission, vision and high level goals for the next 3-5years.
Departmental - developed by department managers and focussed on a specific department within a company. Discusses past metrics and pain points the team has experienced.
Operational - highly detailed outline of what a department will focus on in the coming year. The plan will answer who what when and how much regarding tasks.
Corporate
What are the 3 levels of business management
- Corporate
- Management
- Operational
Forecasting techniques
Straight line - historical figures and trends are used to predict future revenue growth.
Moving average - the underlying patten of a set of data to establish an estimate of future values
Simple linear regression - analyses the relationship between variables for prediction purposes.
Multiple linear regression - forecasts revenue when two or more independent variables are required for a projection.
Definition of; Working capital Stock Debtors Creditors
Working capital - the liquidity levels of companies which is used in its day to day trading. Calculated by current asset - current liabilities.
Stock - known as equity. Used to describe the ownership certificates of a company.
Debtors - a company or individual that has borrowed funds and owe money.
Creditors - individuals /businesses that have lent funds to another company so are owed money.
Methods for financial benchmarking (key financial ratios)
Financial benchmarks are used to assess business profitability, balance sheet structure and overall business performance.
Financial ratios are calculated from:
Profit and loss budget
Balance sheet
Liquidity - cash
- current ratio (current assets/current liabilities: times covered)
- Working capital (current assets - current liabilities: dollars)
Solvency - business stability
- equity / assets ratio (total equity/total assets: % equity)
- debt / assets ratio (total debt / total assets: % debt)
Profitability - enough money?
- return on assets (EBIT/total asset: % of assets)
- return on equity (NPBT/total equity/ % of equity)
- Debt to income (total liabilities/gross revenue: % gross revenue)
Organisational structure’s
Functional - divides work and employees by specialisation. Hierarchical and usually vertical structure.
Divisional - divides work and employees by output, or market or region.
Matrix - combines the above to create a dual command situation. Employee responds to two managers who are jointly responsible. Typically 1 works in administrative function like finance and the other product or service related.
What is a PESTLE analysis
Political Economical Social Technological Legal Environmental
What is a KPI
A measurable value to determine the success of a project / venture.
What is a SWOT analysis?
A review to identify its strengths, weaknesses, opportunities and threats.
