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My APC > Business Planning - Level 1 > Flashcards

Business Planning - Level 1 Flashcards

1
Q

What are the three levels of business management?

A

Corporate Level
Management Level
Operational Level

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2
Q

What is a business plan?

A

A document that defines the business objectives and suggests steps to be taken to realise the business strategy over the next 3 years.

Components of a Business Plan:
* Division of the business into service type or client segment
* Financial performance targets
* Plan business opportunities and allocate staff resource
* Budgeting and cash forecasting money in vs. money out to understand what you can afford to pay because you estimate what you will earn
* Plan business opportunities, identify the resource required.

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3
Q

What are the business objectives of your company?

A

For sustainable and profitable growth across all services, by strengthening our relationships with existing and new clients, cross-selling pro-actively and by working more efficiently as individuals and teams.
Aim to reach £6m by 2026/27 giving 10% growth and 12% profit each year.

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4
Q

How do you manage your time so that you do not work beyond your fee allowance?

A

Recording my time weekly in timesheets spent against each job allows my workload to be reviewed by senior managers in monthly team meetings.

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5
Q

Does the RICS have a Corporate Strategy?

A
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6
Q

What are RICS strategic goals

A

Lead and influence on sustainability
Attract a diverse next generation
Strengthen trust in the profession
Enhance member value and engagement

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7
Q

What should you do when starting a business?

A

Create a Business Plan, such as a 3 – 5 year business plan.

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8
Q

What is a business plan?

A

A formal statement of the business goals, how they are obtainable and the plan for reaching these goals.

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9
Q

Does the RICS have a business plan?

A
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10
Q

Why would you create a business plan?

A

To help achieve funding.
Set business objectives.
Create a business direction.

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11
Q

What would you expect to be included within this business plan?

A

Method Statement.
Goals and Objectives.
SWOT analysis.
Key Performance Indicators.

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12
Q

What is a Mission Statement?

A

A formal summary of the company aims and values.

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13
Q

What is a SWOT analysis?

A

Internal study undertaken by a business to identify its strengths, weaknesses, opportunities and threats.

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14
Q

What goals and objectives would you likely see?

A

Expected profit margin.
Expected Turnover.
Markets the company are looking to move into.

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15
Q

What is a Key Performance Indicator?

A

A measureable value to determine the success of project/venture.

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16
Q

How is a business plan laid out?

A

Executive summary.
Financial Forecasts.
Management team.
Description of business opportunity.
Market and Sales Strategy.

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17
Q

Why is Market Analysis important?

A

Increase sales through identifying areas of strength, and aligning these with opportunities.

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18
Q

How does an up-to-date business plan help an organisation?

A

Helps achieve funding.
Market previous work to clients.
Bring focus the company priorities.
Allows staff to align their goals with the company’s.
Help set budgets.

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19
Q

In terms of Business Planning, how does your management ensure that you make a profit?

A

Regular reporting.
Forward planning.
Accounting systems to track all costs.

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20
Q

What is a PESTLE Analysis?

A

Political.
Economic.
Social.
Technological.
Legal.
Environmental.

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21
Q

A business plan can help achieve what objectives?

A

Funding
Gain new clients and customers
Help focus on priorities
Help to focus on organisational change
To set targets for staff
Set budgets

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22
Q

How would a public sector business case differ from a private one?

A

A public sector business case would look to maximise net social benefit within its available funds.

A private sector business case is typically focused towards profits for shareholders.

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23
Q

What areas would be included in a public sector business plan?

A

Strategic Case - The case for change
Economic Case - Value for money
Financial Case - Affordability
Commercial Case - Commercial viability
Management Case - Deliverability

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24
Q

What are the essentials elements of a business plan?

A

Executive Summary - The first section should be a concise overview of your business plan
Company Description - This high-level view of your business should explain who you are, how you operate and what your goals are.
Products and Services - Show your industry knowledge, and present conclusions based on thorough market research.
Market analysis - Summarize your sales and marketing strategy, and how you’ll implement them with an operating plan.
Strategy and Implementation - Summarize your sales and marketing strategy, and how you’ll implement them with an operating plan.
Organization and Management Team - Outline your company’s organizational structure. Identify the owners, management team and board of directors
Financial plan and projections - This last section of your business plan should be developed with a professional accountant after you’ve completed a market analysis and set goals for your company.

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25
Q

What are the methods for financial benchmarking? (e.g. key financial ratios)

A

Benchmarking is a process of assessing your current performance against a peer group of organisations of comparable scale and complexity. This enables you to build a case for making changes to support wider business strategy.

This can be done internally or externally.

Profitability / Return on investment - Profitability ratios provide information about management’s performance in using the resources of a business.

Liquidity ratios - Liquidity ratios demonstrate a company’s ability to pay its current obligations.

Leverage ratios - Leverage ratios look at the extent to which a company has depended upon borrowing to finance its operations

Efficiency Ratios - By assessing a company’s use of credit, inventory, and assets, efficiency ratios can help business owners and managers conduct business better.

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26
Q

What is short term planning?

A

Short-term planning looks at the characteristics of the company in the present and develops strategies for improving them. Examples are the skills of the employees and their attitudes. The condition of production equipment or product quality problems are also short-term concerns.

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27
Q

What are the types of organisational structure?

A

Hierarchical Structure - In a hierarchical organization structure, employees are grouped with every employee having one clear supervisor.
Matrix Structure - It is a type of organizational management in which people with similar skills are pooled for work assignments
Horizontal/Flat Structure - The most important thing about this structure is that many levels of middle management are eliminated.
Line Organizational Structure - Its authority flows from top to bottom.
Team-based Organizational Structure - Team-based organizational structures are made of teams working towards a common goal while working on their individual tasks.

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28
Q

What forecasting techniques are there?

A

The Delphi Technique - Using this technique, a group of field experts responds to a series of questionnaires. The experts are kept apart and unaware of each other.

The Subjective Forecasting Approach - Subjective forecasting allows forecasters to predict outcomes based on their subjective thoughts and feelings.

Time-Series Forecasting - Time-series forecasting is a quantitative forecasting technique. It measures data gathered over time to identify trends.

29
Q

What is a Key Performance Indicator?

A

A KPI is a measurable value that demonstrates how effectively a company is achieving key business objectives. Organizations use KPIs at multiple levels to track performance measures.

30
Q

What is a PLC?

A

A Public Limited Company - A public company is a corporation whose ownership is open to the public. Anyone can buy shares in the company’s stocks.

31
Q

What is a Royal Charter?

A

If a company or organisation has been created by Royal Charter, it means that it has been granted power or a right by the monarch.

32
Q

What is Long-Term Planning?

A

In the long term, companies want to solve problems permanently and to reach their overall targets. Long-term planning reacts to the competitive situation of the company in its social, economic and political environment and develops strategies for adapting and influencing its position to achieve long-term goals.

33
Q

What is a Private Limited Company (Ltd)

A

In contrast to a public company, a private company cannot be owned by any members of the public. It will instead be owned by an NGO (non-government organisation) or a relatively small number of shareholders, and the sale of company shares is handled privately.

34
Q

What type of company is Vickery Holman?

A

A private limited company

35
Q

What is a sole trader

A

A person who is the exclusive owner of a business, entitled to keep all profits but liable for all losses

36
Q

What is a LLP

A

A limited liability partnership is a flexible legal and tax entity where every partner has a limited personal liability for the debts or claims of the partnership.
Partners will be taxed individually on their share of the profits.

37
Q

Why should you analyse competition?

A

Because analysing who they are and how they perform will help to inform your business planning including:
areas for growth or expansion
or profitability or opportunities where competition maybe be eroding

38
Q

Who could be your company’s debtors?

A

Clients who owe a payment

39
Q

Who could be your company’s creditors?

A

A bank whom they have taken a loan from.

40
Q

Why should companies be aware of debtors and creditors?

A

To recognise any red flags they are not able to pay and help avoid cash flow issues and keep the business running smoothly.

41
Q

What can a business plan help to do?

A
  • Seek funding,
  • To gain new instructions, new clients, new customers
  • To help focus on key priorities
  • To allow the organisation to respond to change
  • For budgeting, and
  • To set targets for staff
42
Q

What will a business plan typically include?

A

An executive summary
A business description
A market analysis and strategy
A marketing and sales plan
An analysis of the competition, including their services
An operating plan
Detail of company structure
Financial analysis
Objectives or goals
Summary of the strategy

43
Q

Are you familiar with Vickery Holman’s business plan?

A

I think so

44
Q

Why is forecasting essential?

A

It allows for consideration of what may happen in the future.

45
Q

What can you do in order to forecast accurately?

A

Use up to date data
For example: work-in-progress schedules or forecast planned billing for instructions you are currently working.

46
Q

What are Vickery Holman’s Vision?

A
  1. To establish and maintain the position of number 1 property consultants in the South West
  2. To focus on creating a sustainable business for the long term
  3. To support our team to reach their full potential
  4. To add value to our clients’ business
  5. To stay focused on our bottom line
  6. To create an inspiring working environment where our people can perform at their best
  7. To make smarter use of technology
  8. To play our part in making our local community stronger
  9. To do all we can to protect our environment
  10. To adapt and thrive
47
Q

Why should businesses plan short, medium and long term horizons?

A

Planning over horizons will help to keep a business on track and ensure that it is not just focusing on short-term gain.

48
Q

What are Vickery Holman’s goals?
Short, medium, long term?

A

Turnover - £4 million
Profit margin (before tax & dividend - 12%
Company net worth - £1.2 million
% of employees holding shares - 75%
Dividend payment - 7.5% pa
Share value growth - 5% pa
Staff retention per annum - 90%
average employee absenteeism per annum - 4 days
Ensure International Standards with ISO Quality Assurance and Environmental Best Practice - Annually
RICS employees to comply with yearly training requirements - 100%
Community contribution (
By time and financial) - 1% T/O
To engage employees with a plan for wellbeing to support their working lives - adopted
To measure client satisfaction through survey feedback on quality of service - 90%

49
Q

What are Vickery Holman’s values?

A
  1. Integrity - honest open and straight forward in all business dealings
  2. Reliability - when making a commitment, clients can count on us to deliver
  3. Dedication - determined to be the best at what we do and to deliver exceptional results for our clients
  4. Initiative - anticipate our clients’ needs and wished so we can always be alert to every opportunity.
50
Q

What type of investment could a business need to grow?

A

Financial - equity finance or loan
Training
Service development
Resourcing - hiring more staff or better equipment

51
Q

Why is joint ownership of a business important?

A

A variety of views and goals

52
Q

Why is it important to measure KPI’s?

A

To help a business track and identify trends
To put plans in place where indicators are not met.
Keep a business focused on the right goals and avoid it becoming side-tracked.

53
Q

How often are KPI’s typically monitored?

A

In a monthly report using a bespoke spreadsheet or database

54
Q

What is liquidity?

A

A measure of how quickly a business can convert assets into cash thus being able to meet short-term financial obligations.

55
Q

Why can lacking liquidity become a problem?

A

When payments are due such as VAT or tax

56
Q

Why is market research essential for a business?

A

To understand the market in which it operates and its trends as well as threats and opportunities

57
Q

Why should market research be a continuous process?

A

Because markets are dynamic,
changes to interest rates, tax or competitors may drastically affect business strategy.
Any research summarised should be summarised in the business plan and kept on file for future reference

58
Q

What is net profit?

A

Its known as the bottom line and gives a good indication of business health and available funds.
Calculated by deducting: operating, interest and tax expenses from growth profit

59
Q

What is a vertical structure?

A

A vertical structure could be functional, with a president at the top and roles e.g head of HR beneath them.
It could also be divisional, with divisions beneath the president then split under various heads.

60
Q

What is a Matrix structure?

A

Matrix structures have dual command, with employees reporting to two managers, one e.g head of HR and another who is head of a division

61
Q

What are open boundary structures?

A

They are varied and flexible with connections where they are most effective between teams.

62
Q

What is Vickery Holman’s organisational structure?

A

Vertical

63
Q

Types of business plans?

A

Corporate plan
Lower level plans for departments , teams or specific services

64
Q

What is a UPS?

A

A unique selling point helps define a business and the way it differentiates itself in the market. It should be included in the business plan, marketing campaigns and in the values set out by the business.

65
Q

Why is variability important?

A

To monitor and update the business plan on an ongoing basis to help a business remain stable and avoid too variable a performance

66
Q

What is working capital?

A

It represents the funds available for a business to meet its current, short term obligations.
Calculated by dividing current assets by current liabilities
Ideal ratio of 1.5 and 2.

67
Q

What does taking an X-ray approach mean?

A

It means exploring all data about a business, speaking with relevant personnel and leaving no stone unturned. It will help to ensure that business plans are relevant and offer the best chance of success

68
Q

Why is knowing a company’s financial year-end important?

A

It can help when business planning, including managing tax payments and staff bonuses.

69
Q

What does Zenith mean?

A

‘the time or period at which something is at its best, most successful [or] most powerful’

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