Strategic Business Plan for Large Projects
Planning is one of the most important parts of running a business, whether you operate a small scale or a large scale business.
A Strategic business plan is similar to a business model, the latter is a representation of how an existing business works, while the former shows how a prospective business will work hence its importance.
Also, the business model serves as a mechanism through which the company generates its profit while the business plan on the other hand is a document presenting the company’s strategy and expected future financial performance.
This means that though they may be similar, they’re distinct in terms of what they actually do. However, business plan is the focus here.
As identified earlier, a proper, detailed, and strategic business plan is needed for the success of large projects. The following are reasons why a strategic business plan is required for such projects:
- Clarification of direction: A strategic business plan aids clarifying the purpose and direction of your business allows you to understand what needs to be done for forwarding movement; to identify your potential weakness and how to go about it. This therefore enables you to make sound decisions for your business.
- Attract financing: Because mere description of your business is not enough to attract potential investors or lenders, having a written and detailed strategic business plan demonstrates that the project is a good investment deal. It includes value-enhancing milestones and a realistic valuation that will enable investors to achieve their target return on investment.
- Dealing with Professionals: Strategic business plan can be shared with professionals (attorneys, accountants and consultants).
- Manage projects: It acts as a management tool that can be referred to regularly to ensure the project is on course with meeting goals, targets or operational milestones. It enables you measure and track your project progress and specified goals.
- Setting objectives for managers: Good management requires setting specific objectives and then tracking and following up. This is made possible and easier with business plans.
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Accordingly, before embarking on a major project, a financial plan is also required. A Project Finance Business Plan identifies all of the costs associated with the project. These costs are then tailored to fit within the financial resources available for the project.
The major difference between a Strategic business plan and a project finance business plan is that, while the former focuses on the feasibility of a project, a Project Finance Business Plan focuses on the finance of the project. They are both distinct in relation to the role they in the growth and progress of a project. They are however both required.
What is the appropriate capital structure? Which financing instruments make more sense? What are the pros and cons of public and private sources of capital? How much should the firm depend on the domestic capital market? To select a particular source of finance, it will depend on the policy of the organization as well as government policy.
Why not contact us to make your Project HappenOur advisors and consultants would be able to schedule an online meeting with you to discuss your project with the overall objective of seeking ways to achieve the “bankability” and protection of the long term asset value of your project. Request a Meeting Now