Make sure this book is in your own entrepreneurial library.

This book explains how the good steak can sizzle without leaving you with just an aroma. “Marketing that Works” was written by some of the best minds in startup marketing who have held prominent positions in blockbuster startups, idealab!, Wharton and venture capital: Howard Morgan of First Round Capital, Leonard Lodish of Wharton and Shellye Archambeau, former president of Blockbuster’s e-commerce division.

This book includes practical approaches (not just theoretical!) to developing business ideas, pricing, market validation, distribution and channel strategies, product launches and more.

To buy a paper copy or download a Kindle version from our bookstore partner, Amazon.com, click here.

There are a lot of folks hurting for work and wanting an opportunity to leap out-and-up from their current economic situation. As many big companies sit on the sideline for hiring, a growing number of disenfranchised people aspire to take control of their future and create their own job by starting a business or joining a startup. The trouble is: where do they turn? Where can they acquire the knowledge to be a business owner, a business partner, an entrepreneur?

Entrepreneurship is not a reserved for a “ruling class” or exclusive to the highly-educated. At its core, entrepreneurship is about building something of value that others want to purchase and accepting the risks inherent in the process of moving from “idea to implementation”. This includes butchers and bakers, not just iPhone app makers. Just as ActSeed is dedicated to assisting regular people build exceptional businesses, TEC is committed to training regular people to become business partners.

We interviewed Jack Finkelstein, the co-founder and President of TEC – which is as much a movement for positive change as it is a promising young business. We have provided Jack’s contact information at the end of the interview so you can reach him directly and explore how to get involved.

Q. Describe your “Eureka Moment”. What was the market opportunity that drove your decision to form a company around this product/service?

A. The Eureka Moment came when we realized that every one of our graduates will be guaranteed a job. This is a powerful statement to make in the middle of a recession. We also realized that not only are there millions who need our service, but every year an additional 2 million young adults enter our target market zone.

Q. How did you fund the company to its current state?

My partner and I have self-funded the project till now. We have also formed a 501(c)3 not-for-profit corporation, held seminars with Operation Hope in Harlem to test market our program, acquired an office at 590 Madison Avenue in New York City, and started some of the businesses that our graduates will participate in.

Q. ActSeed champions the need for solid planning and preparation from the very beginning. How important is planning and prep to your company’s success? Can you share an example or two?

A. Planning and preparation is important to the success of any new corporation. The seminars we held at Operation Hope and some of the high schools resulted in the following: Young adults in the inner cities with a high school degree or GED degree desperately want and need the TEC Center Program. Not only will they be guaranteed jobs but they will also become partners in the business that they will work in. Our target market currently has an unemployment rate of close to 20%. The TEC Center Program is a valuable program that can provide them with the type of success they may otherwise only dream about.

Q. How long did it take to get your idea into the market from initial concept to first customer?

A. This has been a 3 year labor of love that not only is about a great business venture – but also a “movement.” From understanding the inner city individual to determining which businesses can be formed and remain successful in the inner city has taken up the majority of our time. The last 6 months have been spent in looking for the right nationally accredited school with the proper accreditation, and Title IV abilities that we require for our program.

Q. What influence have the internet and new media had on the way you are marketing, selling and supporting your products/services?

A. An advantage we have is that we know how to reach our target market. Every high school graduating class, every GED class, and even the colleges represent potential students for our program. It is not a surprise that these individuals all have email addresses and a cell phone. We also utilize the internet as a research tool to teach entrepreneurialism to our students.

Q. Describe the challenges you faced as you built your customer base, including defining the customer target, establishing the right price and pricing strategy and of course, closing the first few deals. Any wisdom to share with other entrepreneurs on this subject?

A. Defining and reaching our customer base is perhaps our easiest task. We decided primarily on young adults in the inner cities because they can utilize our services more than college grads. The cost of tuition is covered through Title IV Federal Student Loan Program. Students pay back the loan after they graduate and begin working. Since all students will be working for one of our company-sponsored startups, we do not anticipate any issues in paying back the loan.

Q. What techniques have you used to establish credibility in the eyes of customers, investors, partners, personnel and the general public?

A. The TEC Center Program speaks for itself. Guaranteed government funding for every one of our students (each student gets pre-qualified for the funding). Guaranteed jobs for all graduates. The government spends approximately $100 Billion dollars every year on education and we anticipate that this will continue for a long time. This is virtually a no-risk, low cost business to enter. A classroom of 32 students can be turned around 3 times a day (each class is 3 ½ hours long). This represents enough revenue to support full operations and the company-initiated small businesses. Direct overhead is approximately 20%. Investors salivate over these statistics.

Q. Have government, University, or other community / economic development programs been useful? If so, how?

A. We believe that educators are good at educating but do not make the best entrepreneurs. Most have never owned or operated a successful business. While high schools mostly concentrate on math and science to prepare students for college, we concentrate on entrepreneurship and prepare our students to become partners in a business – a business that they will enter as a partner, without being required to apply any of their own savings. Most inner city economic development offices attempt to convince large businesses to move into their district in order to create jobs (mostly low level jobs). The TEC Center Program provides the tools, entrepreneurial education, training and a myriad of jobs and businesses that students can choose from.

Q. What is the most important thing people never tell you about joining or founding an early-stage company?

A. Most people do not know enough to give sound advice about founding an early-stage company. Entrepreneurs and optimists tell you to “go for it.” Non-entrepreneurs and pessimists tell you that “most new businesses fail.” The real key to success is to keep your expenses down, understand your target market and product (or service) better than anyone else, don’t hesitate to continually challenge all of your assumptions, and have plenty of contingency plans if things do not go as expected.

Q. Is there anything else you’d like to share that we didn’t ask you in the questions above?

A. In addition to an expected healthy financial return to our investors TEC is a shining example of a social value enterprise: a profitable venture that address a major public need and gives back to the community. The success of the TEC Center Program will also help reduce the dramatic high school drop-out rate, especially in the inner cities. Nationally, the high school drop-out rate is 25% to 50%, over 50% in the inner cities. In addition, 50% of college students drop out of college – 30% the first year alone. This dropout rate is called “The Silent Epidemic” because few people are talking about it. These individuals can now learn how to become entrepreneurs and partners in a business. TEC will be instrumental in training the unemployed, single parent families, returning G.I. veterans, and individuals who have been released from a correctional institution as long as they have a high school or GED degree. Something has to be done now. The TEC Center Program takes a major step forward in solving this very serious situation. Having just 1,000 students in each state represents a major contribution to job creation and the economic growth in each stage. We are not in a high-tech business; we are in a high-value business.

Our thoughts about ActSeed: “ActSeed is very professional and I strongly believe that its CEO, Bill Attinger, truly cares about our program. ActSeed has been involved in every aspect of the processes that are required to present the TEC Center Program as good as possible. You can’t go wrong by giving ActSeed the opportunity of matching your program to possible investors.”

For more information about The TEC Center, please contact Jack Finkelstein, founder and President, at jack@theteccenter.com or visit their web site at http://www.tecmembers.com.
……………………….

Ken Kaufman’s book explains the essentials of small business finance and how to easily apply them through the use of allegory. In other words, he uses “good ol’ fashioned story-telling” to make even the most finance-phobic business owner learn and appreciate the need for quantitative, financial management.

This is not just a story about Steve, a man struggling as a small business owner, a husband and a dad. It is a guide penned in a way we can all identify with.  It goes beyond merely being clever about teaching financials.

For example, in Chapter 23, the protagonist (Steve) starts to see, from his own experiences, how anxiety and clarity are negatively correlated.  This is a non-financial lesson we all must learn and respect.  This book is full of well-articulated insights that we all face as business owners.

The first time you read it, Kaufman’s book is an enjoyable story that “hits home”.  Then, it becomes a very useful reference guide for the next hundred times you’ll take it off your bookshelf.

You can get your copy of “Impact Your Business” here.

If this quote resonates with you, or even if you have another motive for becoming an entrepreneur, you should read this book.

Scott Shane packs this book with statistics and information that really helps you understand the realities of building a business. If you are a true entrepreneur, this book should sober your expectations and then bolster your resolve. If you aren’t quite there yet as an entrepreneur, this book will properly discourage you from burning too much of your own time and money (not to mention the time and money of others) until you are truly ready to “do it the right way.”

In this book, Shane shares statistics and data about where funding comes from for new business creation, what impact VC and angels have on new business creation, which industries receive most of their funds and who may likely be the best source of funds for your own business.  He shares data about how long it usually takes to “turn the corner” with a new business and the demographics of entrepreneurship, too.

The Illusions of Entrepreneurship pulls data from a multitude of resources, including the Federal Reserve Survey of Small business Finance and the Center for Venture Research in New Hampshire.  Essentially, Scott Shane has condensed thousands of pages of research into a single, coherent book.

This book is one of the first ones you should read if you are contemplating the plunge into the world of entrepreneurship.

You can purchase this book from ActSeed’s Amazon store here. 

Enjoy!

Reassessing and recommitting on a constant basis makes them both invaluable towards growth and improvement for us and our businesses.

ActSeed launched and learned in 2010.  We won’t forget what we learned and we won’t stop learning in 2011. 

Our commitment to entrepreneurs, investors, work-seekers and all others who contribute to building successful businesses remains the same:

• Provide valuable tools and resources to help you better prepare and avoid the pitfalls and potholes that lead to business failure, and
• Connect you to those who matter and can help you build your vision into a durable, competitive company

ActSeed’s wish for 2011 is that every entrepreneur reap what they sow, and that they carefully cultivate their business to ensure the greatest chance for success.

Here’s to a great coming year!

If you’ve never drafted a business plan (and need to), “Hit the Deck” is a great investment.

The title of Chapter 1 is “You Need a Business Plan. (Yes, This Means You)”. We absolutely agree, so we read further.

We’re glad we did.  Ronick really “cuts to the chase” about what a business plan of the 21st century should look like and why it’s important not only for pursuing investors, but even more for the entrepreneur to set a solid foundation to enter the marketplace and complete.

Lots of step-by-step guidance and examples.

If you’re new to investing, it’s a great book for you to read as well; here, you can learn what you should be understanding and what you should be seeing from the entrepreneur pitching you an idea.

The days of a business plan looking like a 48 page master’s thesis are gone. David shows you how to craft a solid plan quickly and with both internal and external impact.  Again, it’s a book you should add to your library, a quick read, and won’t set you back more than $15 or so. 

You can buy “Hit the Deck” by clicking here.

………………………………

The Kids Cooking Corner is a woman-owned business located in Vancouver, Washington. Its mission is to teach children, ages 3+, about nutrition and safe, healthy cooking. Heidi’s classroom curriculum includes helping kids apply skills in math, reading, science and etiquette. Heidi’s plans for expansion include extending the food and nutrition experience to gardening classes, so she can cover the experience “from the farm to the table”.

While Heidi has already some fully booked classes and birthday parties, she still wants to secure some working capital to help her promote the business and cover short term operating costs as she builds her customer base and attendance. Impressively, she is one of the many entrepreneurs who invested their own savings and “sweat equity” into launching their dream. She has been incredibly resourceful in partnering with local business to contribute to her startup costs through trade, barter and donation of materials.

Heidi is looking for an investment partner who may share her passion for helping kids establish healthy nutritional awareness in the kitchen and at the table.

If you know of someone who is looking to get involved with a startup like Heidi’s in the area of food services, nutrition or educational services with the possibility of national expansion, please contact Heidi and check out her ActSeed profile at http://www.actseed.com/profile/Kcookingcorner.

Of course, if you don’t have $10k to invest but want to support Heidi, you can simply donate to her cause by clicking here.

Below is a brief Q&A with Heidi about her experience as an entrepreneur and small business owner.

Q. What was your “Eureka Moment” – the market opportunity that drove your decision to form a company around this product/service?

A. My own children! Realizing that they will not have a chance to learn at school like I did. Cooking programs have been eliminated in our schools. I wanted to build a place where every child can learn the art of cooking and gardening! In the future I want to add sewing classes!

Q. How did you fund the company to its current state?

A. I did a lot of bartering. Asking for free rent with me doing all the sweat and labor of love. I asked for as many donations as possible for paint, lighting etc. I am now working on trying to get kitchen appliances. Otherwise I have paid out of our savings!

Q. ActSeed champions the need for solid planning and preparation from the very beginning. How important is planning and prep to your company’s success? Can you share an example or two?

A. I first started with a rock solid business plan. I started contacting everyone I knew and trying to get it in the right hands of people that can help me. Every day I promote myself and my idea, contacting magazines, TV stations, city recreation centers etc. I am trying to find sponsors daily that share the same vision I do.

Q. How long did it take to get your idea into the market from initial concept to first customer?

A. 1 month

Q. What influence have the internet and new media had on the way you are marketing, selling and supporting your products/services?

A. I have met quite a few people on twitter and Facebook that have been influential in helping make this dream come true, getting me in contact with people who might be able to help with donations or investment.

Q. Describe the challenges you faced as you built your customer base, including defining the customer target, establishing the right price and pricing strategy and of course, closing the first few deals.

A. Well this is still coming. I am opening Dec 1. I have contacted just about everyone I could think of that would have the same demographics that I have. I’m also targeting family magazines to advertise in.

Q. What techniques have you used to establish credibility in the eyes of customers, investors, partners, personnel and the general public?

A. I am truthful and full of excitement when I am talking about this project! People get excited when they see what I have been working on and can feel my passion come through. Its exciting to know I will have a business that will effect so many young lives in such a positive way where schools may not offer it. The Kids Cooking Corner will be there to offer classes and have fun with the kids!

Q. Have government, University, or other community / economic development programs been useful? If so, how?

A. Not yet! I am in the process of working with the community officers to see if they have any possible connections to help me.

Q. What is the most important thing people never tell you about joining or founding an early-stage company?

A. It is not easy to get financing!

………………………

You are an important part of our achieving this milestone, and we’ve organized a fun contest to reward you for your help!

ActSeed’s commitment to helping entrepreneurs and small business owners seems to be resonating.

For this, we are grateful.

ActSeed quickly eclipsed 3,000 “Likes” on Facebook and the ActSeed.com community is benefiting as a result. Browse our Facebook Wall to see how together we are collaboratively sharing information and opportunities. Again, thank you for being part of this energy!

It’s an ambitious goal to reach 10,000 “Likes” before the end of 2010 and we’re ready to reward you for helping us.

FUN CONTEST. SIMPLE RULES.

1. ActSeed will send $500 to the person who has the most Facebook Friends who “Like” ActSeed at the end of 2010. The arrow (see image) shows where you click to suggest ActSeed to all of your Facebook Friends. Tell your friends why small business success is critical to all of us. It’s that simple!
2. If ActSeed achieves its goal of 10,000 Likes before 2011, another $500 will be given to a randomly selected follower of ActSeed’s Facebook page, so everyone has another chance for $500!
3. Additionally, five randomly selected followers of ActSeed’s Facebook page will receive a free ActSeed Entrepreneur Group lifetime membership worth $468 per year. 

HOW TO BE CONSIDERED FOR THE “MOST FRIEND LIKES” $500:

1. When you visit the ActSeed Facebook page, you should see a box in the left column titled “[#] Friends Like This” (see image for example).
2. Capture a screen shot (image) that shows how many of your friends like ActSeed and email it to 10k@actseed.com on or before December 31, 2010. Please include your Facebook link (found on your Facebook Info page) so we can contact you to verify the number of your Friend Likes.

Our focus is to help you establish a solid foundation on which to build your business.

No matter what you are building, you need a solid foundation: people, plan and process.

Big things are on the way throughout the ActSeed community and for you in 2011. We are committed to helping spur the greatest year for entrepreneurship and small business success in every corner of the US and globally and we’re glad you are joining us to be a part of this revolution!

…………………………..

In my previous article I provided an approach for creating integrated functional strategies and goals.  This article describes how to use these functional strategies and goals as the input to define operational metrics and create a financial plan.

Spreadsheet software makes it easy for anyone to spin up a financial model and “show” interesting results.  However, your credibility will be challenged unless you can communicate and defend your financial presentation and the  reasonableness of your model’s underlying assumptions.  I recommend that you follow the general approach outlined in the following graphic.

Assign one person with central coordinating responsibility.  It may seem obvious to have your senior finance person take the lead.  However, don’t hesitate getting someone from the outside involved if they have relevant experience, a general understanding of your business model, good spreadsheet modeling skills, and the ability to engage with your functional managers.  Make sure you start off with the proper expectations.  You may not need a full set of financial statements, or that need may be some time in the future.  Think a step at a time and focus first on operational metrics and a cash view of profit and loss.

Key Inputs:  Your coordinator should start with clear expectations for timeline and an understanding of the functional plans. 

Step One:  The coordinator should determine the time increments to be used for planning, for example monthly for 3 years or quarterly for two years, depending on the desired use for the final deliverables.  Then the coordinator should work from functional plans to construct a basic metrics interpretation of the cost drivers and assumptions for each cost driver by major category.  Major categories might include headcount by role, outside service or development costs, contract labor, equipment costs, raw material, purchase of partial or final assembled components, channel partner costs, IT infrastructure and services, commissions, training, etc.   At this point, the coordinator should focus on the operational activities that will drive costs included in Gross Margin.  In situations where functional plans describe alternatives, such as “build it ourselves” or “outsource”, these options should be included in the metrics model.  Organize your model horizontally to display Units (for example headcount by role), Unit Costs (for example the monthly base salary for each Unit), and if the cost is fixed (a one to one basis to Unit increases), variable (relative to a relationship to another Unit such as production), or step variable (relative to Unit breakpoints such as sales thresholds).  A simply conceived spreadsheet will allow you to efficiently engage each functional lead in the interpretation of their functional plan.   

Step Two:  The coordinator should meet with each functional manager responsible for the completed functional plans.  Given top management’s plan for sales and production, the coordinator should engage the functional manager in the build-out of the metrics model for their functional plan.  The discussion should focus on refining the list of cost drivers, estimating the units relative to the sales and production targets over the planning timeline, and expectations for direct costs (but not yet fringe benefit or other corporate overhead) for each cost driver.  The coordinator should challenge the functional manager so that the units and costs are reasonable given the sales and production targets.  Also the challenge whether the model is complete and captures all inputs and costs.  The functional manager needs to understand that this rough metrics model will become a basic budget for their operations and adjustments, and that this is not just an academic exercise.  Finally, the model should include referenced footnotes that describe basic assumptions that drive the metrics model.      

Step Three:  After completing the function-level metric model, the coordinator should create a consolidating spreadsheet tab that portrays a company-level view of the sales and production targets, units, and units costs on a cash basis for the specified time increments.  This spreadsheet tab should also include a quarterly or annual summation of units and costs.  As a second effort, the coordinator should create an additional corporate tab for costs such as management, space, utilities, employee acquisition or fringe benefit costs, insurance, and other overhead.  Some of these overhead items (for example employee fringe benefits) can then be allocated back to the functional models (for example as a percentage of direct labor).  If distinct functional options exist (for example “build it ourselves” or “outsource”) two or more consolidated tabs should be created and marked accordingly.  The summary model(s) and updated functional models will be easier for the coordinator to model the impact of changes in assumptions.

Step Four:  The next step is a review of the rough cut model with management.  This discussion should begin with a review of the functional metrics models, assumptions, and the summary model(s).  The key questions for management should be “Are we capturing all cost drivers?”, “Are our assumptions reasonable?”, and “Does this model accurately represent our business and expectations for operations and expenditures?”  Responses might lead to some refinements in how the model captures and consolidates metrics and costs.

Step Five:  After the model is determined to be workable, the next step is to seek management challenge for key assumptions and impacts on targets and costs.  This is essentially the real “what if” phase of refining the model.  A few examples of challenges here might include “What if we slow down our timeline for market introduction?”, “What if we use more contract labor?”, and “How can we reduce our pre-breakeven cash burn to the funding level we have or anticipate?”.  Each of these macro questions will have impacts on assumptions for each functional model.  This step enables management to refine or model alternatives and challenge the functional managers.

Step Six:  Next is a second round of discussions with functional managers to answer questions and focus on how the functional plans can be reasonably refined to meet the modeling objectives of management.  In other words, “Given management’s refined plans and constraints, what is the level of activity and costs that will allow you to achieve these targets?”.  Functional managers need to understand that this step in the process will require them to make commitments for reaching targets and operating within constraints.  In some situations this may result in push-back to management, indicating with supporting justification, that “This is the most efficient plan and use of all resources to achieve company-wide targets”.

Step Seven:  Input from functional managers should be incorporated into the functional and consolidated models.  Care should be taken to maintain version control over all models.  In my fifth and final article I will present some ideas for managing documents, collaboration, editing, and approvals.

Step Eight:  The new iteration of the model should be reviewed with management to demonstrate the impacts of changes and the commitment and input from functional managers.  This may be done in a meeting where functional managers present their refinements and assumptions.  There may be additional iterations, but the end product should be a dynamic model that can be used in budgeting, operational projection, and financial presentation.  Management needs to declare that one version of the model is “official” and that the underlying assumptions will be the standard for budgeting and projection.  And as plans change, this model will be the basis for modeling current and future state for these changes.

Develop Deliverables – Operational and Metrics:  The coordinator can now interpret the final model into performance targets, budgets, and metrics for each function and also for the company.  This deliverable can remain in spreadsheet format or be incorporated into a formal budget and financial management system.  Then each functional manager can be accountable for monthly and annual performance to plan.  And as circumstances change, these changes can readily reflected in the functional and company level models.       

Develop Deliverables – Financial Model:  The coordinator should work with the senior finance officer or outside resources to make the model adjustments required for the desired set of financial projection deliverables.  These adjustments might address cash to accrual basis for accounting, capitalization, depreciation, valuation of intellectual property, estimates of tax liability, or a myriad of other topics that do not directly impact the scope of influence for functional managers.  In many situations, an accurate projection of cash sources and cash uses may be adequate.  In the other extreme, a full set of independently reviewed financial projections (profit and loss, statement of changes in cash, sources and uses, and balance sheet) might be required.  Once again, it is critical that you begin this exercise with a clear definition of the final financial deliverables required.

This structured approach will deliver many benefits to your company.  Even if you do not need a full set of projected financial statements you will have developed a clear and shared company-wide view, commitment among management and functional managers, and mechanism for review and refinement.  Stakeholders outside of your company will appreciate and value this analytic interpretation of your company’s plans.

 In my previous article I highlighted the importance of understanding the needs and interests of your audience targets.  The next step is putting a process in place to develop and iterate your plan, including assessment of your business and operating environment.

Efficiency and integration of ideas should be your major goals in developing a business plan.  Each of your key team members, including yourself, have other responsibilities, so a clear set of deliverables, activities, and timeline will minimize distractions and delays.  There are three primary areas of focus as you organize the process and assess your environment: 

1. The first is definition of the product/service concept, target market, and related technical development. 
2. The second is the specification of an execution and delivery model. 
3. The third is the iteration and integration of functional execution plans for translation into a financial model.

Make an honest assessment of your staff and those directly involved in your enterprise.  Very few early stage companies can claim (or afford) to have strong representation across all aspects of their venture.  Yet, strong functional representation and relevant experience (particularly venture and emerging company experience) is critical in developing a solid, integrated plan.  For this reason, you should begin early to create and manage an informal, yet involved “Advisory Board”.  You can think of it as a “Delphi” group providing input and perhaps even completing deliverables for your plan.  Members can also provide “eyes and ears” on potential competitors and partners, and also facilitate introductions to partners, vendors, and investors.  Members may later serve in a more formal capacity on a Board of Directors.  A workable number of advisors is typically three to seven people, ideally representing expertise in the spectrum of your market, product,/service, funding sources, and execution model.  Advisors are often given a nominal stock position or options, depending on the level of their involvement.  The purpose of this group is to provide coverage where you need it, alternatives, and also honest, objective feedback on the viability of product/service and execution model.

The following two graphics together describe an iterative process for business planning.

The purpose of the Initial Definitional and Planning stage is to develop a rough-cut, but integrated outline of your key business dimensions.  In this example, I’ve grouped them into Product/Service/Market, Execution, and Administration.  No effective plan can be static, so I recommend three planning horizons, including Development, Introduction, and Expansion.  You can call them anything you want, as long as you express them as assumed timelines for developing your product/service, initially introducing it to the market, and then expanding your operations.  The key questions posed for each dimension are fundamental. 

In the Development horizon key questions include:  What is the product/service concept, requirements to develop, and target markets?  What market will we bring this to, and how will we sell it?  What basic business and compliance functions do we need, and what are the implications for staffing or professional services?

In the Introduction horizon key questions include:  Are there opportunities to phase the development and introduction of the product/service, both\for financial and time to market reasons?  How we organize and operate distribution and provide the required forms of support, including technical and customer service?  How will we obtain the human resources and infrastructure required to support product/service introduction?

Finally, in the Expansion horizon, key questions include:  Which enhancements or extensions of the product/service will allow us to capitalize on the market and financial opportunity?  How will we expand our market and channel operations to efficiently meet sales and operational goals?  What insight and infrastructure do we need to efficiently manage our enterprise?

You may not have direct team coverage for each of the Planning Leads identified in the graphic.  This is where your Advisory Board can be valuable.  Get their involvement to cover the identified disciplines where you lack coverage or strength.  Your Initial Definition and Planning Iteration should generate an outline view of your business model and plan, identify major issues and risks, key assumptions, and general enterprise requirements as you move through the planning horizons.  The rough-cut initial iteration should provide enough detail to support a subsequent, function-based planning iteration.

The purpose of the Subsequent, Integrated Planning Iterations is to develop more detail in functional sub-plans and integrate these sub-plans with regard to the operational intelligence you’ll need to operate efficiently and effectively.  The graphic shows a typical set of linear operational functions – yours may be somewhat different.  Think of this as breaking your Initial and Definition and Planning function and team into sub-groups focused on relatively discreet functional components.  Using the rough-cut plan as a starting point, these sub-teams should be tasked with developing the next level of plan details.  Avoid having your sub-teams write any lengthy narrative about this next level.  Instead, their efforts will be more efficient and consistent if you provide them with an outline of objectives, topics, and a simplified, consistent reporting format.  Planning Leads should obviously represent your grouping of operational functions.

Sub-teams can begin a new planning cycle by developing the next level of detail for their function.  After assigned tasks are completed, the next step is to integrate the sub-team deliverables across functions.  In the graphic I show this as a non-linear Operational Intelligence process, focused on level-setting the plans and identifying the information needed to operate as an integrated enterprise.  A good approach to integration is a structured, facilitated session represented by each of the Planning Leads.  The session should be lead by a good facilitator who can provide structure on the objectives, structure, and deliverables for the facilitated session.  Without this structure your session may go off on tangents or levels of detail that will keep you from achieving closure of the planning cycle.  There are many ways to organize the session; however, one of the best is to have each Planning Lead present their sub-group deliverables while the other Planning Leads make notes on assumptions, issues, and dependencies.  Then, in a second round of discussion each of the Planning Leads can field questions from each of the other Planning Leads to refine and level-set assumptions and dependencies of each sub-team deliverable.  In a third round, the discussion should address the information and systems needed to operate the integrated enterprise.  A successful integration session should generate the target level of planning detail.  If not, a second cycle may be scheduled to drive to the next level.  It is the responsibility of the top management team to specify the planning horizon, level of target detail, and timeline for each planning cycle. 

The structured, disciplined approach I’ve described may sound a bit onerous, but it can be scaled to any situation.  The benefits you’ll derive from structure and discipline include better and more actionable results, a faster timeline, and a shared level of understanding and buy-in.           

More details on functional-level strategy, goals, and the role of the financial model will be included in my next article.