Business Planning Flashcards
What tools does your company use to ensure you are making a profit?
- Timesheets
- Resource planners
- Fee/cost reconciliation tools
- Project reviews
- Yearly performance reviews
- Team meetings
What is benchmarking on a construction project?
Estimating performance (often cost) by comparing a project to other similar projects - highlights areas of design not offering good value for money or if a contractor’s price is in with market expectations
Issues relating to staff turnover?
- Expensive and time consuming to hire and train new staff
- Turnover can impact team dynamics, productivity and continuity
- Can lead to poor external reputation
- Can lose clients
What is an investment appraisal?
Assesses whether a business or project would be worthwhile investment in terms of:
1. Rate of return
2. Payback period
3. Net present value
How do you contribute to your company’s goals?
- Sharing knowledge within my team
- Keeping up to date with new technologies and systems
- Delivering and exceeding responsibilities
- Understanding personal / project objectives
- Bringing in new business
- Focus on safety
- Upskilling new and junior team members
What is a joint venture?
JV = business arrangement where 2+ parties pool resources to accomplish specific task (.e. new project, business activity)
- Each participant is responsible for profits, losses, costs associated. Venture is own entity separate from participants’ other business interests
What is a working capital?
- Amount available to company for day-to-day use
- Company ability to meet current liabilities
- Current assets - current liabilities
What is a Client Account Planning session?
- Review of current workload, resources and fees
- Involves identification of key client personnel who have influence over job opportunities and identification of who firm should look to build relationships with
- Review of pipeline opportunities with that client also undertaken
Does your firm produce an annual account?
- Yes, statement of turnover, gross profit, net profit
- Submitted to Companies House in accordance with Companies Act
Would you be able to interpret and understand an annual account?
At a high level to determine basic ratios, however I would seek advice from internal accountants if and when necessary
What is a PESTLE analysis?
Political, Economic, Social, Technological, Legal, Environmental factors influencing market conditions
- Way of understanding and reviewing how external forces may impact business
What is a SWOT analysis?
Strengths, weaknesses, opportunities, and threats (related to project / business venture)
- Can be used as basis for business strategy
Objective of Porter’s 5 Forces model?
Identifies competitive forces that shape every industry, determining industry’s strengths and weaknesses and barriers to entry
1. Supplier power
2. Buyer power
3. Threat of substitutes
4. Threat of new entrants
5. Competitive rivalry
Examples of fee earning and non fee earning staff?
- Fee earning i.e. QS, PM, architect
- Non fee earning i.e. business infrastructure, admin, IT technicians
Purpose of an organisation chart?
- Graphical representation of roles, responsibilities and relationship between individuals within organisation
- Depicts organisation structure overall / can be broken down by smaller business units
What is a business plan?
- Document summarising operational and financial objectives of a business
- Roadmap to success - detailed plans and budgets showing how objectives will be achieved
- Timescale likely 3-5 yrs min
- Provides employers common ground to focus upon
What’s included in a business plan?
- Executive summary
- Marketing strategy
- Vision and mission statements
- Products and services
- Management team, personnel, training, resource strategy
- Financial forecasts
- Responsibilities, targets
- SWOT analysis
How do companies write a business plan?
- Undertake analysis of market and industry - identify business opportunities, critical success factors
- Focus resources in developing competences in critical success factors
- This leads to development of goals and objectives with associated strategies and actions
How does business planning ensure profitability?
- Efficient use of resources
- Establishes communal goal for employees
- Increaseed expertise, higher standard of service
- These can motivate better reputation, increased profits
- KPIs (measuring tools) and appraisals can be aligned with business plan - better results and profitability
- Reduce wasted resources
What are SMART targets / objectives?
Smart, Measurable, Achievable, Realistic, Time Related
What is meant by a business strategy?
- Outline of company intentions and plans to meet business objectives
- Defines what a business needs to do to reach its goals, helps guide decision-making process for hiring and resource allocation
What is meant by strategic planning?
Managerial process - developing and maintaining strategic fit between organisation objectives, resources and changing market opportunities
Business strategy vs business planning?
- Strategy = entire organisation - what it produces, where it competes, how it allocates resources. Fundamental choices that affect entire organisation
- Planning = detailed implementation of bigger picture choices, deals with detailed implementation of specific aspects of overall strategy
Business vision statement vs mission statement?
- Vision - focuses on tomorrow - what the organisation wants to ultimately become
- Mission - focuses on today and what an organisation does to achieve it
