What should be the relationship between the business plan and information system plan is basically a homework assigned by my professor for me to really work hard on. Honestly, I am not born a business entrepreneur nor an information technology expert yet I have to try to present my views in this regards as possible as I can but by way of quoting some experts' minds and ideas about these issues that I have to deal with. Defining what a plan is, might be of great help to develop my upcoming statements about this matter. What is a Plan therefore? In my own definition and understanding, I simply define "plan" as a product of my thoughts on how to go about with something that I have in my mind. How to make it realized must be considered so I have to definitely write down the steps on how should I do it, what materials do I need, consider the procedure and eventually record some hypothesis and observations gathered from what I have done, try and maybe retry the process until I succeed or get what I expect to get out from what I intend to do. Making suggestions and recommendations might also be helpful in doing so.
Now, what about business? what does it mean? Thanks God for Wikipedia for it defined the term explicitly as
"A business plan is a formal statement of a set of business goals, the reasons why they are believed attainable, and the plan for reaching those goals. It may also contain background information about the organization or team attempting to reach those goals.
The business goals may be defined for for-profit or for non-profit organizations. For-profit business plans typically focus on financial goals, such as profit or creation of wealth. Non-profit and government agency business plans tend to focus on organizational mission which is the basis for their governmental status or their non-profit, tax-exempt status, respectively—although non-profits may also focus on optimizing revenue. In non-profit organizations, creative tensions may develop in the effort to balance mission with "margin" (or revenue). Business plans may also target changes in perception and branding by the customer, client, tax-payer, or larger community. A business plan having changes in perception and branding as its primary goals is called a marketing plan. " Wikipedia also displays the contents of a business plan as follows..
"Business plans may be internally or externally focused. Externally focused plans target goals that are important to external stakeholders, particularly financial stakeholders. They typically have detailed information about the organization or team attempting to reach the goals. With for-profit entities, external stakeholders include investors and customers. External stake-holders of non-profits include donors and the clients of the non-profit's services. For government agencies, external stakeholders include tax-payers, higher-level government agencies, and international lending bodies such as the IMF, the World Bank, various economic agencies of the UN, and development banks.
Internally focused business plans target intermediate goals required to reach the external goals. They may cover the development of a new product, a new service, a new IT system, a restructuring of finance, the refurbishing of a factory or a restructuring of the organization. An internal business plan is often developed in conjunction with a balanced scorecard or a list of critical success factors. This allows success of the plan to be measured using non-financial measures. Business plans that identify and target internal goals, but provide only general guidance on how they will be met are calledstrategic plans.
Operational plans describe the goals of an internal organization, working group or department. Project plans, sometimes known as project frameworks, describe the goals of a particular project. They may also address the project's place within the organization's larger strategic goals.
Business plans are decision-making tools. There is no fixed content for a business plan. Rather the content and format of the business plan is determined by the goals and audience. A business plan should contain whatever information is needed to decide whether or not to pursue a goal.
For example, a business plan for a non-profit might discuss the fit between the business plan and the organization’s mission. Banks are quite concerned about defaults, so a business plan for a bank loan will build a convincing case for the organization’s ability to repay the loan. Venture capitalists are primarily concerned about initial investment, feasibility, and exit valuation. A business plan for a project requiring equity financing will need to explain why current resources, upcoming growth opportunities, and sustainable competitive advantage will lead to a high exit valuation.
Preparing a business plan draws on a wide range of knowledge from many different business disciplines: finance, human resource management,intellectual property management, supply chain management, operations management, and marketing, among others. It can be helpful to view the business plan as a collection of sub-plans, one for each of the main business disciplines.
"... a good business plan can help to make a good business credible, understandable, and attractive to someone who is unfamiliar with the business. Writing a good business plan can’t guarantee success, but it can go a long way toward reducing the odds of failure."
Presentation formats
The format of a business plan depends on its presentation context. It is not uncommon for businesses, especially start-ups to have three or four formats for the same business plan:
• an "elevator pitch" - a three minute summary of the business plan's executive summary. This is often used as a teaser to awaken the interest of potential funders, customers, or strategic partners.
• an oral presentation - a hopefully entertaining slide show and oral narrative that is meant to trigger discussion and interest potential investors in reading the written presentation. The content of the presentation is usually limited to the executive summary and a few key graphs showing financial trends and key decision making benchmarks. If a new product is being proposed and time permits, a demonstration of the product may also be included.
• a written presentation for external stakeholders - a detailed, well written, and pleasingly formatted plan targeted at external stakeholders.
• an internal operational plan - a detailed plan describing planning details that are needed by management but may not be of interest to external stakeholders. Such plans have a somewhat higher degree of candor and informality than the version targeted at external stakeholders.
Typical structure for a business plan for a start up venture
• cover page and table of contents
• executive summary
• business description
• business environment analysis
• industry background
• competitive analysis
• market analysis
• marketing plan
• operations plan
• management summary
• financial plan
• attachments and milestones
Revisiting the business plan
Cost overruns and revenue shortfalls
Cost and revenue estimates are central to any business plan for deciding the viability of the planned venture. But costs are often underestimated and revenues overestimated resulting in later cost overruns, revenue shortfalls, and possibly non-viability. During the dot-com bubble 1997-2001 this was a problem for many technology start-ups. However, the problem is not limited to technology or the private sector; public works projects also routinely suffer from cost overruns and/or revenue shortfalls. The main causes of cost overruns and revenue shortfalls are optimism bias and strategic misrepresentation. Reference class forecasting has been developed to reduce the risks of cost overruns and revenue shortfalls.
Legal and liability issues
Disclosure requirements
An externally targeted business plan should list all legal concerns and financial liabilities that might negatively affect investors. Depending on the amount of funds being raised and the audience to whom the plan is presented, failure to do this may have severe legal consequences.
Limitations on content and audience
Non disclosure agreements (NDAs) with third parties, non-compete agreements, conflicts of interest, privacy concerns, and the protection of one'strade secrets may severely limit the audience to which one might show the business plan. Alternatively, they may require each party receiving the business plan to sign a contract accepting special clauses and conditions.
This situation is complicated by the fact that many venture capitalists will refuse to sign an NDA before looking at a business plan, lest it put them in the untenable position of looking at two independently developed look-alike business plans, both claiming originality. In such situations one may need to develop two versions of the business plan: a stripped down plan that can be used to develop a relationship and a detail plan that is only shown when investors have sufficient interest and trust to sign an NDA.
Open business plans
Traditionally business plans have been highly confidential and quite limited in audience. The business plan itself is generally regarded as secret. However the emergence of free software and open source has opened the model and made the notion of an open business plan possible.
An open business plan is a business plan with unlimited audience. The business plan is typically web published and made available to all.
In the free software and open source business model, trade secrets, copyright and patents can no longer be used as effective locking mechanisms to provide sustainable advantages to a particular business and therefore a secret business plan is less relevant in those models.
While the origin of the open business plan model is in the free software and Libre services arena, the concept is likely applicable to other domains.
Uses
Venture capital
• Business plan contests - provides a way for venture capitals to find promising projects
• Venture capital assessment of business plans - focus on qualitative factors such as team.
Public offerings
• In a public offering, potential investors can evaluate perspectives of issuing company
Within corporations
Fundraising
Fundraising is the primary purpose for many business plans, since they are related to the inherent probable success/failure of the company risk.
Total quality management
Total quality management (TQM) is a business management strategy aimed at embedding awareness of quality in all organizational processes. TQM has been widely used in manufacturing, education, call centers, government, and service industries, as well as NASA space and science programs.
Management by objective
Management by objectives (MBO) is a process of agreeing upon objectives within an organization so that management and employees agree to the objectives and understand what they are in the organization.
Strategic planning
Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. Various business analysis techniques can be used in strategic planning, including SWOT analysis (Strengths, Weaknesses, Opportunities, and Threats ) and PEST analysis (Political, Economic, Social, and Technological analysis) or STEER analysis involving Socio-cultural, Technological, Economic, Ecological, and Regulatory factors and EPISTELS (Environment, Political, Informative, Social, Technological, Economic, Legal and Spiritual)
Now, what about the information system? My deep appreciation for Wikipedia is extended to this avenue for helping me make my search and my work so easy to understand, exact and meaningful as I quote.. " Information Systems (or IS) is historically defined as a 'bridge' between the business world and computer science, but this discipline is slowly evolving towards a well-defined science. Typically, Information Systems (or IS) include colleagues, procedures, data, software, and hardware (by degree) that are used to gather and analyze information. Specifically computer-based information systems are complementary networks of hardware/software that people and organizations use to collect, filter, process, create, & distribute data. Today, Computer Information System(s) or CIS is often a minor track within the computer science field pursuing the study of computers and algorithmic processes, including their principles, their software & hardware designs, their applications, and their impact on society. Overall, an IS discipline emphasizes functionality over design.
In a broad sense, the term Information Systems refers to the interaction between algorithmic processes and technology. This interaction can occur within or across organizational boundaries. An information system is not only the technology an organization uses, but also the way in which the organizations interact with the technology and the way in which the technology works with the organization’s business processes. Information systems are distinct from information technology (IT) in that an information system has an information technology component that interacts with the processes components.
An Information System consists of four parts which include: procedures, software, hardware, and information or data, which are essentially the same. There are various types of information systems, for example: transaction processing systems, office systems, decision support systems, knowledge management systems, database management systems, and office information systems. Critical to most information systems are information technologies, which are typically designed to enable humans to perform tasks for which the human brain is not well suited, such as: handling large amounts of information, performing complex calculations, and controlling many simultaneous processes.
Information technologies are a very important and malleable resource available to executives. Many companies have created a position of Chief Information Officer (CIO) that sits on the executive board with the Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Operating Officer (COO) and Chief Technical Officer (CTO).The CTO may also serve as CIO, and vice versa. The Chief Information Security Officer(CISO), who focuses on information security within an organization, normally reports to the CIO.
In this regard, information system professionals and their associates have strong analytical and critical thinking skills to implement large-scale business models within any organization. Although solving problems within an organization is a common practice, IS professionals have the ability to automate these solutions via programmable technologies without violating ethical principles. As an end-result, IS professionals must have a broad business and real world perspective to implement technology solutions that enhance organizational performance.
Now that I have at least presented some facts and ideas about the business plan and information system as quoted from reliable source, it is hoped that a comprehensive grasp between the two concerns could at least be attained. Knowing some basic facts and nature about these two aspects could at least lead us to identify or point out what should be the relationship between them. In my own understanding, I could say that an information system plan is very important in going about the business plan. The way I look at it...the business plan is the body while the information system is the blood of the whole system.
Mood's In ControlTuesday, March 16, 2010
Posted by ♪_TARIZTA_♪ at 5:38 AM
|
0 Comments:
<< back home
Post a Comment