Business Plan on "Value of a Business Plan"
Business Plan 5 pages (1393 words) Sources: 3 Style: APA
[EXCERPT] . . . .
Business plan is critical for any organization. At its core, the business plan outlines the opportunities in the marketplace that the company intends to seize and the resources that will be marshaled in order for this to happen. For new and young companies, the business plan is essential in helping to obtain financing, but even for established firms it can help management to understand their business and its characteristics more precisely (Concord Business Development, 2001).The business plan allows for the efficient and effective communication of the company's mission and how it intends to achieve that mission. The business plan helps to align priorities and resources such as new employees (Ibid). Ultimately, the business plan is less a document than the process by which that document is created. The value of the business plan derives largely from the research and analysis that contributes to its creation.
The process, then, involves the development of a framework by which the business objectives will be achieved. This includes budgets, timelines and resource allocations. Because the business plan is often used to help obtain bank or venture capital financing, it should also help management to frame the medium-to-long-range development of the business (Cox, 2007). It is not imperative that the details of the plan be met -- indeed, they probably will not be -- but it is important that management demonstrate that they have considered all aspects of the business and developed a plan that works for the immediate future and that can guide the development of the company down the road.
2. Supply and demand impact organizational performance. The company needs
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Once demand is estimated, the firm must get a sense of how it will supply that demand. Organizational performance is driven significantly by the means and costs of procurement, production and logistics. In most industries, a firm is faced with positive elasticity of demand, which means that as the price goes up the potential demand goes down. Therefore, in order to maximize organizational performance, the firm must by able to find a way to provide enough supply to meet demand at a price point that will enable it to not only capture a share of the market demand but also to turn a profit.
Supply and demand considerations can also have a significant short run impact. While over the long run supply, demand and price will trend towards equilibrium, this is not necessarily the case over the short run. As a consequence, the firm can set as its strategy to disrupt the equilibrium in the market in order to build its market share. This could mean overproducing, so as to flood the market with lower-priced good. This could mean reducing production to create scarcity, which for many products (such as fashion or automobiles) can drive demand higher. Short-term disruptions in the supply-demand equilibrium can help a firm to improve its market position, so it is important for management to understand these dynamics in order to build their business and improve organizational performance in the long run, even if the organization's performance is weaker in the short run.
3. Ethics can be important for the long-term success of a business. In general, any economic system functions at its optimal level when the ethical environment is favorable. Corruption, criminality and nepotism are all negative ethical elements that detract from full market efficiency.
This holds true at the firm level as well. When an organization lowers its ethical standards or controls, the result is often an increase in selfish behavior, which ultimately harms the organization. Such behavior may improve organizational performance in the short run, but over the long run it is almost certain that such behavior will detract from total organizational performance.
It is worth noting that ethics alone will not guarantee success. Firms with high levels of integrity but a lack of business ability will fail regardless. Likewise,… READ MORE
Quoted Instructions for "Value of a Business Plan" Assignment:
“Discuss the value of a business plan to an organization.
o Discuss the value of a business plan to an organization.
o Discuss how the economic concepts of supply and demand can have an impact on organizational performance in the short and long run.
o Discuss Business Ethics and its***** importance to the business*****s success.
o Discuss how the following concepts can provide an organization a sustained competitive advantage in the market place:
 Marketing strategy
 Organizational structure
How to Reference "Value of a Business Plan" Business Plan in a Bibliography
“Value of a Business Plan.” A1-TermPaper.com, 2009, https://www.a1-termpaper.com/topics/essay/business-plan-critical/32924. Accessed 5 Jul 2024.
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