Internal Business Plan: What it is and How to write it

An internal business plan is a document that keeps your team of staff aligned with the goals, business strategy and budget to help you keep track of your performance and manage your business better. It is to be used internally ensuring that everyone is involved and has a concrete idea of what is happening in the business.

The components of an internal business plan includes a value proposition, the problem and the solution, financial projections, milestones as well as your target market and competition. The purpose of an internal business plan is to define your business strategy, bring everyone to speed with your mission and goals as well as to forecasting on financial forecasts and performance.

An expert business planner can help you write an internal business plan and charges between $ 2000 and $ 25000. However, you need to check the competence of the expert before hiring one. 

What is an internal business plan?

An internal business plan is a type of business plan that is made to be used within an entity and aims at aligning your team with the goals and strategy of the business. It ensures everybody understands their roles and responsibilities in achieving your business’ vision and encourages employee engagement in the decision making process of a company.

An internal business plan defines your business strategy, identifies your ideal customers, outlines a marketing plan, sets your revenue goals and expense budget. It focuses on uncovering the weaknesses of your business to ensure that you run your business in a better way. 

An internal business plan helps you track the performance of your business and can easily be shared through multiple communication channels within your organization. Communication is thus improved as your staff is able to voice their concerns or applause regarding where your business is going.

Internal business plans are often used to put metrics that staff can use to determine how hard they are working. These plans are suited for staff empowerment much as they are suited for better financial management of your business. An internal business plan allows for coordination among different levels of employees and management ensuring that everyone knows what to do in their job performance.

How to write an internal business plan

Writing an internal business plan is a step by step process which involves first identifying the goals and objectives that your business wants to achieve. Avoid long paragraphs and explanations and instead use short sentences. Use tools such as Word and spreadsheets to write your internal business plan and make it simple and bulleted. You will also need to dedicate enough resources for the business plan writing project. Strike the right tone, hitting a few emotional chords and be formal. After making your first draft, ask for feedback so that you review it by making improvements. 

Value proposition

Value proposition is a summary of your business which explains what value your business provides and to whom it provides. Your employees should keep in mind why a customer would choose your business and the benefits customers would get by giving you business.

Use vallue proposition to share your mission statement which serves as a reminder of the overall purpose of your business. Include also your vision which outlines what you aim to achieve in future. Your value proposition should be clear and inspiring and be written in a single sentence.

The problem and your solution

Define the problem that you solve for customers in a clear way to keep you focused as you seek new revenue opportunities. Definition of the problem includes describing how your products and services offer solutions to the problem stated.

Stating your problem starts with mentioning and explaining the current state as well as the people affected by it. Include the time frame over which the problem has been occurring or existing.

Add statistics as references and define how the problem impacts your business. Present the solution that your business provides to improve the current state.

Target market and the competition 

Target market refers to a group of customers that a business aims to serve. They are the likely buyers of the products and services that your  business offers. Identifying your target market ensures that your marketing efforts focus on the target ensuring that your staff understands who your business is trying to reach.

Let your team know who your competitors are so that they help you devise strategies to give your business a competitive edge. Your employees should understand how your competitors are a threat to the business and why your clients may choose your competitors over you.

Financial projections

Financial projections provide an overview of the financial health of your business.They forecast sales and set expenses budget to guide your team. Sales and expenses will help you calculate profit.

Cash Flow projections predict how much cash you will have in hand at a given point in time hence giving you insights if you will consider additional funding. Additional sources of funds come from lenders or investors to help expand your business.

Milestones

Milestones lay out the parameters of your objectives and set expectations on how these will be executed. They define key objectives and goals that your team must meet. Setting milestones is not just about setting daily tasks but also includes critical objectives for the coming months.

By setting milestones, you will keep your team focused on the most important business objectives. You will want to include a description of each goal, their due date as well as who is responsible for each goal.  

Your team

Describe your current team and who you need to hire. As part of your business strategy, you may want to include more team members. Highlight briefly the experiences of each team member.

Identify the growth areas of your team so as to add significant team members. You are free to skip this section if you do not plan on growing your team.

What is the purpose of an internal business plan?

The main purpose of an internal business plan is to keep your team in sync with the goals and strategies of the business. It promotes teamwork giving everyone a clear focus on the mission. An internal business plan provides a compelling vision for the future of your business hence can be used as a powerful tool to convince board members to approve an action plan.

An internal business plan helps in making better decisions in your organization because business decisions are effective when they align with the business objectives. Considering that an internal business plan contains both long term and short term goals, it acts as a framework for making informed choices.

An internal business plan connects employees to the business ensuring engagement and collaboration. Every team member is then able to be accountable on their part towards ensuring overall business success. Through goal setting, an internal business plan becomes a risk management tool as potential challenges are identified ensuring that you plan ahead to avoid disasters.

Explain your business strategy

Defining your business strategy involves describing the plan that you will implement to achieve your goals as a business. A solid business strategy is therefore essential to business success and helps you maintain focus as your business grows.

As a business owner, you ought to know what your strategy is to determine if opportunities coming up fit with your strategy. In circumstances where you want to change your strategy, a defined business strategy gives you guidance to ensure that you do it thoughtfully and steer your business in the correct direction.

Ensure all stakeholders work for similar goals

It is important that everyone in your business entity works towards the same objectives or goals. An internal business plan keeps your team aligned and encourages consistent employee communication. In an organization, it is easy for people to pull in different directions and have different visions making your business less efficient. 

Through internal business planning, your staff are informed of business objectives and stay connected to your business. As your team grows, it is critical that everyone is on the same page through a clear vision.  Additionally, your internal business plan helps you define your communications strategy as well as improving the culture of your entity. 

Budget and forecast performance

Detail the budget and resources needed to actualize your plan. Budgets ensure that you have resources such as finances, technology and manpower to execute your business plan. On the other hand, forecasting financial performance is an important tool of management.

An internal business plan should always have a forecast that  sets revenue goals and budget for spending. Have a cash flow projection which gives you information on whether you will need additional funding. These budgets and forecasts should be reviewed and refined regularly based on the performance of your business.

What is the purpose of writing a business plan?

The main purpose of writing a business plan is to use it as a roadmap for your business to show you where to go and how to get there. A business plan validates your business idea by helping modify it to fit market needs. It helps you obtain funding from lenders and investors as they would want to know where their money will be channeled to. Investors will want to refer to your plan and track your progress over time.

A business plan allows you to attract employees to your business ensuring you hire the right people. This is because you will share your plan with them and if it’s feasible they will want to jump ship. Through a competitive analysis, a business plan allows you to understand your competitors enabling you to devise strategies that give your business a competitive edge.

How to write a business plan

Writing a business plan is a step by step process. It is important that before you start writing your business plan, that you understand and be clear about the purpose. After identifying the purpose, you must clearly define to whom you are writing to. Explain whether you are writing it for investors, lenders or employees. Ensure that you do good research and use concise language to develop your business plan.

Making a business plan entails steps such as writing the executive summary, describing your company, listing and explaining your products and services as well as conducting a market analysis. It further includes outlining your management structure and employees, performing a competitive analysis, making a marketing plan and a financial plan.

What are the components of a business plan?

Components of a business plan refer to essential parts to include when developing a business plan. They include an executive summary which is written last and highlights what your business plan will cover. The next component is a business description which highlights your business goals and other business essentials such as the name and location.

You must have a description of your products or services detailing their features and how they bring value to your customers. Include a market analysis, an organizational structure as well as a competitive analysis. You will then have a marketing plan, sales plan, financial plan and a request for funding. The final component is the appendix.

Can you hire an expert to help in writing an internal business plan?

Yes, you can hire an expert to help in writing an internal business plan. A business plan expert will save you the time required to write your internal business plan so that you focus on more pressing aspects of your business.The cost of hiring a business plan expert is between $ 2000 and $ 25000.

The cost of a business plan depends on factors such as length of your plan, experience of the business plan writer, time taken to write it as well as the size of your entity. A highly experienced internal business plan writer will charge more than a less experienced one.

What do you check when hiring a business planning expert

When hiring a business planning expert, you have to ask for references and testimonials from past clients. This is to enable you to assess the planner’s reputation, reliability and quality of their work. Check their qualifications in terms of their skills and competence in business planning by obtaining samples of their work from them. Skills to look out for include market research and financial analysis. Consider a consultant who communicates effectively and whose charges lie within your budget.

Internal business plan example

Find samples of internal business plans on company profiles posted on their websites. An example of an internal business plan showcases its structure to give you a snapshot of what it looks like. Search online for free internal business plan templates that are downloadable making it easy for you to come up with one on your own. You will just need to edit some parts and add details that are relevant to your business. Internal business plan templates also entail a set of guidelines and instructions on how to develop one.