What is it, and why do you need one?
Imagine you’re an aspiring changer. You may have come up with an innovative solution to a social issue. It is a long, complex, and iterative process to transform an idea into a sustainable, viable social enterprise. To get your social enterprise off the ground, you will need to define your goals and create a roadmap or plan to reach them. In this article, we will explore the topic of “business planning” and explain why a business plan for social enterprises is essential to their success.
Be sure to read this before we begin.
For a social enterprise (SE) to succeed, the founders need both a Business Model (BM) and a solid Business Plan. These terms are often used interchangeably even though they refer to two distinct concepts.
As discussed, a business plan describes how a firm intends to deliver and capture value. It is the “skeleton,” the basis, of an entrepreneurial venture. Remember: the chosen business model is outlined and elaborated on in the final business plan.
A BM focuses on the “whys” behind a certain project, while a BP describes its “hows.” The business plan is built on the business model, and they cannot exist apart. The business plan must change whenever the business model does. The two terms aren’t the same.
Social Enterprise Business Plan: what is it?
Business planning is built upon business modeling. It goes into great detail about the implementation of it. What is a social business plan?
A social enterprise plan is a document that describes the social entrepreneurship initiative. The BM is translated into goals, roadmaps, and timelines for activities, operations, and projects. It quantifies the financial/economic implications of the project, as well as its social outcomes/impacts. A SBP contains different sections as it is a reference document to plan and manage all activities related to the business.
- Executive Summary and with a brief introduction to the social enterprise.
- The description of the social issue that the organization is tackling, as well as the mission of social impact.
- Structure and Team refers to the legal system, governance, and key individuals in the Team.
- Business Model, including the target customer and core Value Proposition offered.
- A market analysis includes a review of the industry, its competitors, and trends.
- Sales and Marketing with an explanation of the marketing strategy, sales tactic, distribution channels, and a summary of sales forecasts.
- Operations focus on the ” Hows ” of the business model.
- Evaluation, with a focus on financial goals as well as impact goals.
- Financials with clear projections relating to capital and investment, costs/revenues, as well as expected Cash Flow.
It’s a lot of work. Yes, but it’s a much-needed one. Find out why.
Social Enterprise Business Plan: Why do you need one?
As you can see, creating a social business strategy requires more effort than simply defining a model of business. Why is it important to have a social business plan?
A SBP will help you to stress out, assess, and ultimately redesign your BM. True, Steve Blank said, ” no business plans ever survived the first contact with customers. ” It’s still a good tool to assess the viability and feasibility of your venture early and adjust activities accordingly.
A business plan can also be a great way to prioritize and identify business assumptions that need to be validated. Assumption maps can be used as a starting point for prototyping and experiments that will help to reduce the risk of the project.
Owners, managers, and staff can use an SBP as an internal guide to encourage investors, partners, and other stakeholders to join the venture.
The conclusion of the article is:
This article explains the differences between a business model and a business plan. We also discussed the social business plan and why it’s important to create one early.
We strongly encourage all social entrepreneurs to schedule time for business planning. This is a very useful tool for highlighting your business model and assessing the viability of your venture. It can also be used to identify hidden assumptions and critical pitfalls that could undermine your entire experience.
This brief introduction should have helped you to understand the topic and move on with your business plan.