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Choosing the right employees is just as important to the success of your business as selecting the right computer equipment. The management plan helps you define your company’s structure and determine the types of workers you need to successfully produce and support your product/service. It also shows potential lenders or investors that you have the right mix of skills, talent and expertise on board.
“The management plan shows the key people who staff your business, listing job descriptions and titles for each,” says Tony Janniere, executive director at the Manhattan/Bronx Minority Business Development Center in New York.
Whether you operate a temporary employment agency, restaurant or candy store, your management plan should list your key players and indicate whether they’re full-time, part-time or consultants. The length of the plan depends on the size of your business. For multimillion-dollar outfits, it can run as long as 14 pages. Janniere says smaller firms generally use two to four pages for this section.
Here is a list of things a management plan should include. . Personnel.
In addition to listing the company principals, managers and other key employees, this section should explain the qualifications (degrees, certifications, etc.) of every individual. Also include a biography or resume. The information can be discussed in narrative form, but for larger firms, Janniere suggests including an organizational chart.
For start-up companies, the management plan is used to determine what the initial staffing needs are, but for existing businesses, it should detail both the current staff and any additional personnel needs.
In this section, discuss hiring policies (physicals, drug testing, background checks, recruitment, aptitude testing, etc.). You can also discuss union representation, on-the-job training, employee evaluation, promotions, equal employment opportunity and affirmative action policies. . Compensation and benefits.
This section should explain your compensation procedures (salary, commission, hourly, etc.) and whether pay will be based on experience level, industry standards or other factors.
Describe the benefits you will offer, such as medical/dental, vacation, sick leave and disability. Other incentives including tuition reimbursement, expense accounts and bonuses should also be indicated. . Outside professional services.
Describe each of the outside experts who will provide critical services to your operation (attorneys, accountants, business consultants, financial planners, subcontractors, etc.). Include names and addresses of each, their duties and how they will be paid. . Advisory board/board of directors.
For sole proprietorships and partnerships, list your advisory board members. For corporations, include members of your board of directors, the role each will play in your business and the benefits/compensation they will receive.
Next month, in Part 6 of our business plan series, we go to the bottom line of virtually all operations–money. We will help business owners prepare the financial plan.
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