Creating a business plan

A BUSINESS PLAN sounds a very complicated affair and a full plan for a large multi-site and multidiscipline practice is, indeed, a very involved process. It will include financial projections for the various and numerous projects and activities that are due to be implemented in the upcoming 12-month period and beyond.

The level of complexity may appear daunting – and can be enough to dissuade many would-be planners from having a go at any business planning whatsoever. In reality, a complex plan like this is developed from numerous smaller plans, and each one on its own can be very simple and straightforward.

For those unfamiliar with business planning, it is easier to cut your teeth on a simple project to get used to the process and then see the benefits that appear. Once you have had a go at a simple business plan you can tackle the more complex plans with confidence.

Series of steps
The basic approach to business planning is to follow a series of steps, each one of which asks questions about what you are proposing to do. Rudyard Kipling is often quoted for his early business planning advice: “I keep six honest serving men, they taught me all I knew; their names are What and Why and When and How and Where and Who” (from “The Elephant’s Child”, in the Just So Stories). If you address the what, why, when, how, where and who, you will complete the plan.

Many aspects of business planning are common sense, and principals, managers, receptionists, nurses and vets are carrying out business planning on a daily basis in their head. This is fine, but a written plan is different. Once it has been written down, it becomes possible for everyone to contribute and add their constructive criticism! This will improve and amend the plan, helping to accelerate its implementation and compliance.

A written plan crystallises thoughts and ideas and you may discover that your plans and ideas might not be the same vision as your colleagues’ visions! Adaptations and modifications to the plan at this stage will be fruitful later.

The stages are as follows:

• Determine aims and objectives.
• Carry out an external audit.
• Carry out an Internal audit.
• Set the targets.
• Devise the strategies.
• Implement the plan and monitor the outcomes.
• Review the plan.

Case study
Many practices have their own on-site laboratory facilities and I will use this as an example to illustrate the business planning process. I will assume that the clinical team has confirmed the need for the equipment on site and that the practice finance team has assessed the economic viability of the preferred system.

1. Aims and objectives
The aims should be clearly stated and everyone should be aware of what you are trying to achieve. Many plans fail this first step because a consensus is not reached. Often, the project can fail because two or more people are pulling in different directions. The aims and objectives should give clear direction as to what you want to achieve.

For example, these might be “to obtain and install an in-house laboratory facility within three months for routine use within the practice, for biochemistry and haematology analysis for companion animals”.

The aims and objectives are often determined by the owner of the practice or the senior management team and will be developed in consultation with the clinical teams. Ideally, there should be a timescale included. We are all familiar with the builder’s reassurance that “it will be finished by Christmas” and there are far too many people who can testify to the fact they had assumed it was Christmas this year, not next. Numerous public projects have missed deadlines (the new Wembley Stadium comes to mind) where the business planning process has failed to account for various potential hiccups on the way, or has set unrealistic targets.

Business plans to develop a practice may often have financial aims and objectives, such as “to improve gross profit by one per cent by the end of the second financial quarter”. These are specific and most aims that are expressed in numeric terms are relatively easy to measure, for example “to gain 10 new clients every month for 12 months”. Aims such as “to make the practice a happier place” are not really measurable or specific.

For major strategic proposals or commercially-sensitive decisions, such as opening or closing a branch surgery, purchasing a neighbouring practice or extending the premises, the owners will address the plan and hold discussions with the practice teams after these have been approved in principle.

In many instances, the team leaders will meet to discuss and develop business plans and it will be part of their role to collate and coordinate input from all their team members. The team leader should ensure that everyone has a chance to have an input.

2. External audit
This considers the factors outwith the practice – often these are out of your control. In this example, this would assess the various systems and services available to the practice, including the current provider. It would consider the suppliers, the equipment, wet and dry chemistry systems, running costs, leases and finance options. It would also address what else is in the marketplace and what options you had.

Could you offer this service (quality assured) to others? If so, what is the catchment area; local or national? If you were planning to establish an equine referral or surgical referral service, this would assess the marketplace, who the other providers were, where they were located, how easy travel would be and other similar considerations.

3. Internal audit
This considers everything within the practice and within your control. In this section, you will consider the resources already available, the resources needed and how you can obtain them. These will include: what quality control will be needed; how often will it be used; who will process samples; how much time will it take to do this on a daily basis; will everyone use the equipment or just a few skilled and trained individuals; what happens when they are away or at weekends; and what training is required. It will also look at mundane questions such as asking where the equipment will be sited. In effect, this section addresses the logistics of the project.

The number and type of samples tested and analysed under current processes would be assessed and the number that could be tested with two-hour reporting of results using the new system.

Kipling’s questions of What and Why and When and How and Where and Who are the simple way to summarise this element of the planning process. This phase will take some time and should involve as many people as possible to ensure that nothing is overlooked.

4. Targets
SMART targets are still valid.

• Specific.
• Measurable.
• Agreed.
• Realistic.
• Time related.

There is no point in setting unrealistic targets, such as “install the system in the next two weeks and start using it the following day”. Although specific and measurable, it is not realistic and not within a sensible timescale – and I doubt it would be agreed! “Purchase the agreed system we wish to install and have it installed and fully-operational within three months of today” may be more appropriate.

This, by implication, will include training staff to use the equipment, develop and introduce reporting forms and systems that will work in the practice. It also includes promoting the system to the veterinarians and nurses and how it will be promoted and marketed to the customers.

5. Strategies
This addresses how we will make it all happen. It includes some logistics, for example, the training that will be provided, for how many people, who will provide it and when it will be arranged within current workloads.

The internal audit will have identified the resources available, including staff time, and strategies have to be developed to ensure the plan progresses.

It should consider what marketing is needed for the service to become effective as soon as possible. For wide-ranging projects, such as opening a referral service, external marketing will be very important for reaching the customer base. Strategies could include open days, letters to other practices in the catchment area, leaflets, advertising plans and personal approaches.

For laboratory installation, many of the strategies will address internal arrangements to ensure that all staff and clinicians understand the benefits of the system, how it will work on a day-to-day basis, and how to submit samples and report results.

The “internal marketing” is very important in all plans and its importance should never be underestimated. If your own staff know the true benefits of the equipment and service on offer, they will be able to explain this clearly to clients. The converse is also true – if you don’t know the benefits of a system, don’t know what it does or how it works, you are very unlikely to recommend it to others, including clients.

The internal marketing is critical – ignore it at your peril.

6. Implementation
There are many good ideas in practices that have never quite been used, or have perhaps just been partly used, and implementation can often be a stumbling block for
practices. If the planning stages are followed, then implementation is probably the easiest stage!

The main reasons implementation does not occur is because the plan is not clear or
agreed, or there are not enough resources allocated. Resources include people, time and training and these should be resolved before you start implementing plans.

If the planning stages and processes outlined above are followed, the business plan should be a breeze to implement, because you will know what you are doing and will have the time and support to do it.