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Unit 7: Building the Business Plan

and outside the company. Once potentially troublesome areas have been identified, proposed Notes
solutions and contingency plans can be incorporated into the business plan.
Business plans also cover such areas as marketing opportunities and future financing requirements
that require management attention. In some instances – such as scenarios in which an entrepreneur
decides to turn a favorite hobby into a home-based business enterprise – the business plan can
be a simple document of one or two pages. A business proposal of significant complexity and
financial importance, however, should include a far more comprehensive plan.

Example: A tool and die manufacturer looking for investors to expand production
capacity will in all likelihood need to compose a business plan of greater depth and detail than
will a computer enthusiast who decides to launch a desktop publishing business out of his/her
home.
Ideally, everyone in the company will use the information contained in the company’s business
plan, whether to set performance targets, guide decision-making with regard to ongoing
operations, or assess personnel performance in terms of the their ability to meet objectives set
forth in the business plan. In addition, workers who are informed about the business plan can
evaluate and adjust their own performance in terms of company objectives and expectations.
Business plans can also be used in the restructuring or reorganization of a business. In such cases,
business plans describe actions that need to be taken in order to restore profitability or reach
other goals. Necessary operational changes are identified in the plan, along with corresponding
reductions in expenses. Desired performance and operational objectives are delineated, often
with corresponding changes in production equipment, work force, and certain products and/or
services.

Caselet Dhirubhai Ambani

he founder of the great Reliance Empire. He was not born with a silver spoon. His
father was a school teacher in the small village of Chorwad in the western state of
TGujarat. At the tender age of 17 he went to Aden and started working as an attendant
in a petrol pump. No one knew at that time that this teenager boy would over a period of
time, grow an empire which would turn out to be the first Indian company to be listed in
the fortune 500 companies of the world. But Dhirajlal Hirachand Ambani – known as
Dhirubhai had dreams and a vision even then. It was for these dreams that he was able to
spot that there existed a discrepancy between the rial-sterling exchange rate and the intrinsic
value of the silver content in Aden’s coinage, which was an excellent opportunity to make
money.
Using this opportunity, he made money, returned to India and established a trading house
called Reliance Commercial Corporation in Bombay in 1958. He started his business with
a mere ` 15, 000/- as capital. The first business was importing polyester yarn and exporting
spices. Then he began manufacturing cloth from polyester fibre. From the textile industry
he gradually diversified into chemicals, gas, petrochemicals, plastics, power and telecom
services. It was he who introduced the equity culture in India by establishing trust amongst
his shareholders. Dhirubhai Ambani always had big vision and worked hard to achieve
that vision. He believed in the philosophy of Think Big, Think Fast and Think Ahead. He
is being regarded as an icon of enterprise in India. Salute to Dhirubhai.
Source: Lall Madhurima, Sahai Shikha(2008), Entrepreneurship. Excel Books Pvt. Ltd.

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