Writing the Business Plan

Summary:

A well-structured business plan is an essential tool for turning a promising idea into a successful venture.

The business plan describes the opportunity and how to exploit it. This written document outlines our ideas and the way to carry them out. In a certain sense, it can be considered a document that:

Identifies, describes, and analyzes a business opportunity, with a certain amount of detail and concrete enough to use to evaluate the potential of our idea.
Examines its technical and economic viability, turning it into a basic argument that reinforces or discards the business project.
Develops the procedures and strategies to convert that business opportunity into a business project, and includes a market analysis, a competition and risk analysis, a technology development analysis, a strategic analysis, a financial needs analysis, and lastly, a description of the management and founding team that will lead the company.

In other words, a business plan is a guide, a road map, the story that we plan for our idea. Even if it is well thought out, the plan is only a hypothesis; it is not an absolute guarantee of things that are going to happen. It is simply an estimate that uses the best information available. The entrepreneur can, during the writing phase, realize that the idea, although having an immense market potential, is not viable due to a series of insurmountable obstacles: technology problems, regulatory problems, poor effort-benefit ratio, small market, difficulties in bringing together the necessary capital for the project, and so on. The benefits may not be satisfactory or the economic requirements might be so high that it might seem imprudent to continue.

On other occasions, nevertheless, the business plan can make the healthcare entrepreneur see the great potential of the initiative and be convinced that it is worth the effort to carry it out.

WHY IS IT IMPORTANT?

A business plan does not only serve to develop our idea. It is also an instrument of control that allows us to monitor changes when we deviate from the original plan while implementing it. A deviation does not mean necessarily that things are going badly. The plans are “live” documents, dynamic, and should adapt as quickly as possible to each circumstance. A business plan is many other things:

It gives us an objective and critical vision of the business opportunity.
It tempers the entrepreneurs’ initial enthusiasm, allowing them to see it and analyze it in an objective and critical way.
It provides clarity of purpose and a feeling of direction about how the business is going to operate and develop.
It foresees obstacles during the development of our initiative.
It creates different scenarios and different strategies to find the most appropriate ones.
It attracts investors, collaborators, and resources to the project. The business plan is necessary to get external financing, be it public (in the form of subsidies and grants) or private (through venture capital investments, business angels, and so on).
It is a tool to keep the workers on board and motivated in the company.
It helps us to communicate our company’s start-up to others.
It helps to test and correct ideas.

STRUCTURE

There are many methods of structuring a business plan. Entrepreneurs will bring their own style to the plan. It should ultimately be a structured and systematic document that explains in a clear way the story of our project. The structure that seems most appropriate to me for the health sector is the following: