19 Feb 2018, 12:30 — 6 min read
Business planning is a crucial but an often underrated part of running a business. Most businesses would benefit from taking the time out to construct a business plan, the setting of goals and allocation resources to achieve those goals. Within business planning, getting different functions of an organisation to collaborate with each other is essential to achieving success. Being a cricket-loving nation, we thought of using the analogy of the concept of the gentleman’s game that needs great deal of collaboration between players of different competencies.
The need for collaboration
Cricket is one of the most complex games in terms of the rules and number of different competencies required within the team to win the game. Each function is specialised; be it the batsmen, bowlers, keeper, fielding positions, coach, statisticians, physiotherapists, umpire etc. Every one of them plays an equally important part to galvanise the team and win the game. In this sense, it is very similar to a complex business set up with different specialised functions working towards a unified goal.
Similarly, business planning requires co-ordination between different functions like sales, marketing, supply chain, operations, finance etc. Just like cricket, each function is specialised and has a contribution to make in the process. Unfortunately, many planning processes are pseudo and lack a collaborative approach which requires participation and tea work.
Once the team knows the target required to win the game, the captain and the coach work on the plan to achieve it. If they are a batting side then the order of the batsmen to play, pace of scoring, the bowlers to attack etc are planned. If they are a bowling team then the order and type of bowlers, field placements, weakness of batsmen among other things are also discussed and planned.
In business this can be compared to an annual plan once the target has been decided. The monthly plan, product mix, events etc are discussed to achieve that target.
Once the match starts, things obviously do not always work as per the plan. The opposition may do better than expected or vice versa. Depending on the circumstances, the team’s strategy changes to make sure that the win is still at sight. The batsmen may try to take risks and accelerate the pace to bring down the required run rate, a hard-hitting batsman may be sent out to bat out of his turn, bowlers may try to curtail the pace with aggressive field and deliveries. Basically, the team is adapting to the changing conditions in a way that their end goal is still in sight and achievable.
Business planning is also all about being agile and adapting to the changing circumstances in such a way that business objectives are in sight and achievable to the extent possible. The market may not react as we expected or at times it could be external conditions such as competition activity or the government policies. The business function responds to such changes like a team to ensure that the targets are least affected. The marketing team may plan a promotion activity to shape the demand, the sales team may run an aggressive campaign for a certain section of customers or re_evaluate the sales team. Supply chain and operations work towards optimising the material flow to save costs and avoid inventory buildup.
Growing role of business intelligence and analytics
It is important to note the role played by the statisticians and analytics in the modern-day game. With loads of data being captured in every game, the role of big data analytics is immense in strategising the wins of the team. Every move and every situation is analysed and used as an input in the strategy. It is amazing to know that with the help of data one can actually predict the score of an individual player or the way he may get out.
This holds true for business planning as well. The function is slowly but surely moving towards more of a strategic function than just being a spreadsheet-oriented monthly task. The data analytics provide planners with a potent tool to help the business in understanding the customer and strategising better to be ahead in the game. With the help of data analytics, it is possible to accurately predict when the customer is going to buy or even when he will stop buying. Knowing this is of great value to the organisation, as it is possible to change this behaviour by being preemptive and shape your demand better.
While the adoption of the statistical methods and business intelligence tools is still low and slow in business planning across the board, it is only inevitable. Organisations that adopt it earlier shall definitely reap early-mover competitive benefits.
To explore business opportunities, link with me by clicking on the 'Invite' button on my eBiz Card.
Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views, official policy or position of GlobalLinker.