How developing a business plan differs from building onePosted on April 22, 2012 by Michael Corley, consultant with The Patterson Foundation
Recently, I discussed how Share the Care, a nonprofit in Orlando, FL, is using a financial thrivability model to sustain and expand its mission. This model didn’t just “happen,” in fact, it continues to evolve as circumstances change and more is learned about the market.
At inception, the model for developing and implementing the www.caregivercentral.org product didn’t include a major expansion beyond Orlando. (I am sure the idea was discussed, but first and foremost the product/model had to work in Orlando. Otherwise, Share the Care would have been embarking on a project outside of its mission.)
Because Share the Care was focused on making this product work in Orlando, they were able to target their resources to make it successful. They managed their funding, captured and analyzed the necessary data, communicated, and ultimately created a product that the market adopted. They created value while focusing on mission. They were developing a model.
DEVELOPING A MODEL….
I enjoy that term because it is a comfortable blend of academia and business, yet it comes with a common understanding of “knowledge” and “direction”. (Someone who develops a model must know what they are doing, right?) The term can also be intimidating to a tired executive who wants to expand or improve operations, but because of a lack of operational resources, feels restricted. It insinuates that a lot of sophisticated thinking and work must be done. The term build a model may be relegated to “nice to do” instead of “must do”.
But a business model is nothing more that the result of a business plan. A business plan, properly written, encapsulates the model to be deployed.
Now to developing a business plan that describes your model…how to start? I like the “keep it simple” philosophy.
- Identify goals and objectives.
- Analyze the market to identify the need and potential partners.
- Build a financial model (capital needed, revenues, expenses) with a multi-year pro forma.
- Determine the marketing and communication strategy.
- Create a series of tools (training, evaluation of prospective partners, agreements, organizational structure, etc.). Identify the right personnel. Etc.
As the information above is being captured, incorporate it into your template of choice. There are any number of business plan templates available online, including: About.com; SCORE; Small Business Administration and others.
This may seem like a lot of work, but in reality, if taken a little at a time, it is quite manageable and very productive. Often times, the process of writing a business plan (i.e. creating the model) is more important than the document itself because the process forces you to think, ask, reflect and consider.
The business model and business plan for www.caregivercentral.org are evolving. The Caregiver Central team continues to evaluate the market demand, determine partner needs, evolve the funding opportunities, etc. This is normal and productive. However, the one thing they will not and should not waiver on is the original purpose for the product and its ability to help them drive their mission. Being a nonprofit, their focus must be mission based - any plan must include this.
Learn about these and other concepts used in TPF's approach to philanthropy.
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