Now I find myself taking a project management course in Canada, and writing a business plan is a requirement for one of my classes.
IWAan interactive, on-line marketing company being formed to sell premium beers made by microbreweries over the Internet. According to the president of the company -- a soon-to-graduate MBA candidate at a well known eastern business school -- a prototype web site had already been developed using the now ubiquitous Java programming language.
Literally thousands were visiting the site each day: Prior to jointly founding IWA, the three had worked in management consulting and investment banking: He quickly averted his stare from the business plans in the corner of his less than tidy office so as not to offend his eager audience.
They looked so young - they were so enthusiastic - their business plan was so meticulously printed on the new color laser printers in the technology lab Sahlman wondered what to say next. Few areas of new venture creation receive as much attention. There are MBA and undergraduate courses on business plan writing.
There are countless books describing how to write a business plan. There is even software that will help create a business plan, complete with integrated financial projections.
All across the U. Yet, in my experience, nothing could be further from the truth: There are many other factors that dominate the business plan, per se. Sahlman prepared this note as the basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation.
To order copies or request permission to reproduce materials, call or write Harvard Business School Publishing, Boston, MA No part of this publication may be reproduced, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electronic, mechanical, photocopying, recording, or otherwise—without the permission of Harvard Business School.
The rest of this note develops a conceptual framework for understanding entrepreneurial venture creation and management, which is based on studying hundreds of successful and unsuccessful companies. The goal is to give the reader insights into sensible entrepreneurial management, and, by implication, into the business plan used to describe a venture.
In my framework, there are four dynamic components of any entrepreneurial process or venture: By people, I mean those individuals or groups who perform services or provide resources for the venture, whether or not they are directly employed by the venture.
This category encompasses managers, employees, lawyers, accountants, capital providers, and parts suppliers, among others. By opportunity, I mean any activity requiring the investment of scarce resources in hopes of future return. By context, I mean all those factors that affect the outcome of the opportunity but that are generally outside the direct control of management.
Examples of contextual factors include the level of interest rates, regulations rules of the gamemacroeconomic activity, and some industry variables like threat of substitutes. Finally, by deal, I mean the complete set of implicit and explicit contractual relationships between the entity and all resource providers.
Examples of deals range from contracts with capital suppliers to the terms of employment for managers. Phrased differently, the degree of fit is the answer to the following questions: These questions focus attention on the fact that excellence in any single dimension is not sufficient: An appropriate analogy might be that of a sports team.
It is not sufficient to have the best individual players at each position; rather, success will be a function of how they play together, how the team is managed, what deals have been struck inside and outside the team, and what else goes on in the league.
A diagram of the basic framework is provided in Appendix 1. Nor is it sufficient to focus on these elements and their relationship from a static perspective.
The people, opportunity, context and deal and the relationship among them are all likely to change over time as a company goes from identification of opportunity to harvest.
To focus attention on the dynamic aspects of the entrepreneurial process, three related questions can be asked to guide the analysis of any business venture: Phrased another way, what decisions can be made to tilt the reward to risk ratio in favor of the venture?
This framework and set of questions are extremely powerful in understanding how ventures evolve over time and how managers can affect outcomes.Some Thoughts on Business Plans Case Solution,Some Thoughts on Business Plans Case Analysis, Some Thoughts on Business Plans Case Study Solution, The basis for the evaluation of new business opportunities and business plans developed to .
How to Write a Business Plan. When how to write a business plan is at the top of the SBA list of the ten steps in how to start a business, it tells you something about how important the experts consider it to be. Article Summary: “How to Write a Great Business Plan” by Sahlman.
March 30, | 1 Comment. This is a summary I have written for Sahlman’s article “How to Write a Great Business Plan”, originally as part of my Harvard Innovation and Business Transformation class assignment. Sahlman, William A. "Some Thoughts on Business Plans." Chap.
9 in The Entrepreneurial Venture. 2nd ed. by William A.
Sahlman, Howard H. Stevenson, Michael J Roberts, and Amar V. Bhide, – Harvard Business School Press, Harvard Business School November 14, Some Thoughts on Business Plans Internet Wicked Ale Bill Sahlman, Dimitri V. D’Arbeloff Professor of Business Administration, smiled as he was handed the business plan for Internet Wicked Ale, Inc.
(IWA), an interactive, on-line marketing company being formed to sell premium beers made by microbreweries over the Internet. Updating a Classic: Writing a Great Business Plan Harvard Business School professor William A.
Sahlman's article on how to write a great business plan is a Harvard Business Review.