Components of a Business Plan: Introduction, Vision, Mission, Products/Services (Article 2 of Business Planning Series)

2. Business Planning(This article is part of a series on Business Planning. You can read Article 1 here.) 

A business plan is generally composed of the following sections: Cover, Table of Contents, Introduction, Vision, Mission, Products and/or Services, Market Analysis, Competitive Analysis, Management Team Experience, Organization Chart, Marketing and Sales Strategies, Financial Analysis, Supporting Documents.

This article will focus on the Introduction, Vision, Mission and Products and/or Services sections. The remaining sections will be covered in forthcoming articles as part of the business planning series.

  1. Aside from the cover and the table of contents, the first substantive section of a business plan is the General Introduction to the business.
  • What is the business idea?
  • Where will the business be located?
  • Who will manage the business?
  • What is the value proposition (the value the business will provide its clients)?
  1. The second section of the plan will represent the Vision of the business.

The vision of the business establishes the reason why the business exists and the values representing the business. The vision is a tool to establish the purpose and strategic direction of the company. Some visions are short statements, other are more elaborate. As it is strategic in nature, the vision may change every five years, but it must not change from one year to the next. For example:

  • Microsoft’s vision is “Empowering people through great software—any time, any place and on any device.”
  • Part of Coca-Cola’s vision is “Bringing to the world a portfolio of beverage brands that anticipate and satisfy peoples’ desires and needs.”[1]
  1. The third section of the business plan describes the company’s Mission.

The mission is different from the vision in that the mission is of a tactical nature and establishes how the vision will be attained. The mission may change annually, or as needed. For example:

  • Microsoft’s mission is “To help people reach their potential.” It sets up company values to help implement the vision. For example: “integrity, customer service, responsibility…”
  • Part of Coca-Cola’s mission is “To Refresh the World…in body, mind, and spirit.”

It is somewhat difficult to derive the vision, mission and values of a business. There are actually educational workshops and training seminars to teach and facilitate this exercise.[2] Large and multinational companies may spend hundreds or hours in the development of the strategic intent (vision and mission) of the company. An important aspect of this process is that the business owner must not reach “paralysis by analysis” in trying to come up with a vision and mission. Nevertheless, it is important to invest time in going through this process, as business owners must carefully evaluate the purpose and direction (the vision) of the business so that they can communicate to their clients and employees the manner in which the company will achieve this (the mission.)

Establishing the business focus and action plan will help the organization to differentiate from its competitors in the marketplace. The business owner must practice a careful balance: he or she should not act on impulse or emotion while remaining passionate about the business.

  1. The fourth section of the business plan will describe the Products and/or Services offered by the business.

Sometimes it is easier to describe a “product offering” than a “service offering.” The offering is grouped in a manner such that a prospective client can understand what is being sold. For example, a consumer understands statements like “Shoe Sale,” “Computer Sale” or “Italian Food Sale” much easier than “Sale of strategic consulting services.” Therefore, the business must define its offering in the most precise and effective manner possible to attract purchasers. This task can be approached as if the business were developing a “restaurant menu.” Once the products and/or services of a business are defined, it is easier to then assign them a cost and price and use this information to develop financial projections and client communications.

The next article in the Business Planning series will cover Market Analysis.

Footnotes:

[1] This is just an excerpt of their vision.

[2] Organizations like American Marketing Association and American Management Association (among other organizations) offer relevant workshops and seminars.

___________________

* This article is based on material from the book “Does Your Compass Work? Practical Legal Guide for Florida Businesses,” Copyright © 2008-2015 Yasmin Tirado-Chiodini. All Rights Reserved. This article is provided under a Creative Commons License.

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About tiradochiodini

I am a attorney, entrepreneur and author blogging about business, law, entrepreneurship, writing, books and other subjects.
This entry was posted in Business and Entrepreneurship, Does Your Compass Work? Practical Legal Guide... and tagged , , , , , , , . Bookmark the permalink.

2 Responses to Components of a Business Plan: Introduction, Vision, Mission, Products/Services (Article 2 of Business Planning Series)

  1. Pingback: Components of a Business Plan: Market Analysis (Article 3 of Business Planning Series) | The Tirado-Chiodini Post

  2. Pingback: Components of a Business Plan: Competitive Analysis (Article 4 of Business Planning Series) | The Tirado-Chiodini Post

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