How can you create a business plan that reflects your business's value?

One thing that I learned from teaching is that you always have to keep the language of communication in mind. Using financial and other business-heavy terms sometimes only confuses the audience. Start with setting a common language and the build toward something more subject-specific.

Knowing your audience will help you to address their fears and challenges in mind to support your plans! Make sure you address it clearly ( short to the point)

To create a business plan that reflects your business value, your company's core values, mission, and vission have to align with your strategic goals.

To create a business plan that reflects your business's value you need to focus on defining your unique value proposition, understanding customer needs, conducting a market analysis, setting strategic objectives, outlining efficient operational processes, and detailing a strong marketing and sales strategy. By addressing these key elements concisely, I would like to believe that you can convey how your business delivers value to customers and differentiate yourself from competitors.

Crafting a compelling business plan reflective of a company's value involves a strategic fusion of meticulous market analysis, a precise articulation of unique value propositions, financial projections showcasing growth potential, and a keen focus on demonstrating how the business fulfills market needs while maintaining a competitive edge.

One of the most important things I found is to see if the overall results make business sense. All business plans tend to show a hockey stick figures on the top line. If the 5 year CAGR is above 40%, most probably the business plan is not feasible as it is not considering non linearities like hiring, absorbing new people, churn,... Even different competences needed during growth

Focusing on value proposition is good approach. But, I think its all about mindset. If you have developed some business and now writing its value proposition based on features and attractions then it might be a trap. I strongly feel that identifying value proposition is a journey that starts when we conceptualize product / idea for the very first time. What i say planning is the product and finishing is the process. It means jigsaw puzzle should be very much clear at the time of visioning.

In my experience nailling the value proposition is key to ensure credibility. Audience will be very focused on this and if it don't ressonate with their views it will became very dificult to convince them. There are several "scientific" ways of finding and describing your value proposition, some research will help you. Don't try to come up with completly different ways of communicating the value. Your innovation should be on the solutions for client pains/needs and not on new ways of pitching the value proposition.

Of course choosing an audience is not only good for business plan itself, but also is great for the business that we are writing business plan for. In my opinion choosing an audience here, is something as important as choosing a customer segment which we should be aware of, before we start planning. Buy narrowing a segment you will be precise about the pains that you want relieve and the gains you want to give.

Drawing from my expertise in developing marketing and communications strategies, value propositions, and messaging, I've learned that a customer-centric approach is indispensable. It's less about the product/service itself or its feature and more about identifying a pressing need in the market, then designing a product or service specifically engineered to address that need, hence bringing solutions and benefits. Indeed, an offering should fulfil (or create) a particular function for a distinct segment of consumers facing a common challenge, and it's this utility that generates revenue. This fundamental understanding lays the groundwork for constructing a robust value proposition and viable business models.

When it comes to evaluation metrics, I think that what it is key is to discern between different target audiences and select a handful of representative metrics—both qualitative and quantitative—that resonate distinctly with your primary stakeholders (it is about customization). This targeted selection is crucial for meaningful assessment.

In practice we do valuation by some pricing methods for our product or service we want to launch. By narrowing your customer segment and having clear value proposition (which we may need to review more times) through writing business plan and then doing valuations in cost-based, competitor based and value-based methods, you will have a rational range of value of the product or service that can be varied by features you add or remove. Upper limit of this range will be value that customers perceive and the lower limit will be your cost per each product.

Market Capitalization Comparable Company Analysis (CCA) or Market Comparables: Involves analyzing multiples such as Price-to-Earnings (P/E), Price-to-Sales (P/S), or Enterprise Value-to-EBITDA. Comparable Transaction Analysis (CTA) or -Transaction Comparables Discounted Cash Flow (DCF): Based on the present value of projected future cash flows. Asset-Based Valuation: Calculates the value of a business based on its net assets. Earnings Multiplier (Price-to-Earnings Ratio - P/E): Book Value: Calculates the value of a company based on its balance sheet. Replacement Cost: Estimates the cost to recreate the business from scratch. Income Capitalization: Similar to DCF, but instead of projecting cash flows, it uses a single-year estimate.

There are several methods used for valuation, each of which may produce a different value. Here are some of the most common methods: Market capitalization, Discounted cash flow (DCF), Comparable company analysis (CCA), Asset-based valuation. Remember, the valuation method you choose will depend on your business’s unique characteristics and the purpose of the valuation. It is important to consult with a financial professional to determine the most appropriate method for your business.

These days, with the help of AI, you can create a succinct and clear executive summary using the right prompts. Feed in all the information and highlight potential benefits and features of interest. You will be surprised by the quality of what current large language models can produce. Note: this is a good practice for brainstorming and 'prototyping' your summary, but it still needs a human touch.

Usually supporting details will be missed after writing a business plan (financial analysis is expected). Value proposition of the product or product features which you provide in your marketing plan must be a guide Infront of product manager's eyes that it doesn't occur mostly.

Mission Statement:** Craft a mission statement that aligns with your values. It should capture the purpose and guiding principles of your business. Incorporate Values into Goals:** Integrate your values into your business goals. Ensure that the objectives outlined in your plan align with and support your core values. Operational Strategies:** Develop strategies that reflect your values in day-to-day operations. This might involve ethical sourcing, environmentally friendly practices, or community involvement.

Never underestimate the power of a great hook. If this hook comes with a provable statistic from a credible source - even better. Make sure this hook is on point and ties neatly to what you are to say next. First impression mattes, be it a business plan or a pitch.