Business Plan Development and Financial Management

The provided assignment details the process of developing a business plan, which is crucial for start-up businesses. It involves creating value through different approaches such as defining a balance sheet, network, and past success. The document also highlights financial management strategies, including agency problems and debt financing, leadership structure effects, sales force management, and participative management. Furthermore, it touches upon governance in the South African public service and provides references to books, journals, and online resources for further study.

Finance in management and Leadership

Table of Contents
INTRODUCTION ..........................................................................................................................3
MAIN BODY .................................................................................................................................3
1 Produce a business plan demonstrating the commercial viability of a proposed small
business start-up .........................................................................................................................3
2 Create value for investors .......................................................................................................5
3 Analyse the factors which consider into entrepreneurship and make moves a person
towards entrepreneur ..................................................................................................................6
4 Locate, analyse and evaluate sources of information related to funding for small scale
businesses ...................................................................................................................................7
5 Practical and functional skills appropriate for the management of successful SME...............9
CONCLUSION ..............................................................................................................................9
REFERENCES..............................................................................................................................10

Illustration Index
Illustration 1: Business plan............................................................................................................5
Illustration 2: Financial management............................................................................................10

INTRODUCTION
In order to define the finance in management and leadership, it is necessary to understand
the investors and capabilities of resources which can affect the business. Furthermore, it required
a business plan for an angel investor who is interesting in funding in the business. In addition to
this, there are different sources of funding by which company can fulfil their financial liabilities
such as Bootstrapping the start up business, Crowdfunding as a funding option, Get angel
investment in start-up, Get ventures capital for the business, Get funding from accelerators,
Increase fund by winning contests, Increase money through bank loan, Acquire business loans
from micro finance providers, Through government programs, Other quick ways. These all
resources are helpful in maintaining the financial stability. Furthermore, to develop a business
plan, company should follow some stages to get success of its business such as Indite an
Enterprise Plan, Acquire Help and Training, Determine Your Business Location, Realize your
Financing Alternatives, Determine on an Enterprise Structure, Register Your Business Name,
Refer for Permits and Licenses. Creating a business plan is required to attract more investors to
invest fund and capital in their business only. They can create business plan and advertise it into
magazine and other documents by which investors can get the information of relevant company
and can take keen interest to invest,
MAIN BODY
1 Produce a business plan demonstrating the commercial viability of a proposed small business
start-up
Developing a business plan for starting a new venture is very complex function in an
organisation. There are different steps and stages exist to create business plan such as first it has
to write a business plan then get help and training, after both of these steps choose the business
location, next is to understand the financing options, decide a structure of the business, register
the business name and apply for license.
Step 1 – Indite an Enterprise Plan
First step in developing a business plan is to write the plan of enterprise. Plan always be well
prepared and revisited often. Business plan does not have to be encyclopedic. It has to be living
and breathing project(Cubillo and Brown, 2016). The best method for success the business plan

is to divide the plan into mini plans and consider all the factors as individual and different factor
as one for operation and other one for marketing and so on.
Step 2 – Acquire Help and Training : Before starting a business, it is necessary to get different
information and content relating to the business. There are different sources and training
resources which helps a company before get started.
Step 3 – Determine Your Business Location : Then next is to determine the location for the
business. It is essential to evaluate where entrepreneur want to operate their business. Because
the environment and cultural diversity can affect the business and work performance level of
employees. Business location is an essential factor in developing a business plan because the
success of the business is depends on the environment. Before get to started, entrepreneur have
to make sure about the features of operating location(Johnston and Marshall, 2016). These
factors can be analysed through pestle analysis. Mostly locations are varied according to the
cultural diversity. Different taste, interest, fashion and cultural may affect the business plan.
Step 4 - Realize your Financing Alternatives : If entrepreneur wants to run their business
smoothly then financing factor is most concerning factor in business plan. Before get to start
entrepreneur have to decide that by which sources they will get the fund(Kavanagh and
Ashkanasy, 2016). As there are different funds to collect and get financial needs as bank loan,
ventures, angel investors and so on. It is an essential part on developing business plan because
without financing company can not get the things done and accomplished in desired manner.
Illustration 1: Business plan
Source : Business plan, 2016

Step 5 – Determine on an Enterprise Structure : What will be the structure of the company
has to be well defined in business plan. There are different structure in which entrepreneur can
run their business as partnership, individually, private and public collaboration, corporation and
incorporation. Entrepreneur has to determine which will be the structure of its business before
get to started(Boin, Stern and Sundelius, 2016).
Step 6 – Register Your Business Name : After accomplished all above stages, in next step
entrepreneur have to register the name of its business. It may be in form of private company or
public company. What is the objective of the business is mostly known from the name of a
company. As private companies have to put Ltd. Word after the name of its company while for
public companies it is not necessary.
Step 7 - Refer for Permits and Licenses : The last stage in business plan is to take permits and
license for the business. It is necessary for fulfil the legal requirements. A company can not run
its business without permit and license.
2 Create value for investors
Companies can create the value for investors and for themselves. Creating and
developing value is not an easy task for any company. Company can create value by evaluating
their strengths and weaknesses. Entrepreneurs can evaluate their strength by following these
steps such as Varied Customer Base, Revenant Income That Is Sustainable and Opposition to
“Commodification”, Great and Rising Cash Flow, Incontestable Permeability, Agonistic
Advantages and Financial Providence and Controls. When an entrepreneur wants to create value
of its business for investors then it is necessary to remember these things such as :
 Define balance sheet : A company can create value in front of investors by defining
their balance sheet. Company has to describe and advertise its balance sheet in magazines
or extra documents(Cubillo and Brown, 2016). Through this, investors can evaluate the
potentiality and reputation of the company in the market. One main thing which need to
be kept in mind is that company always has to show off their contribution in CSR
activities. Because these are the activities which affect the growth of the business.
Businesses are participating in social activities' means it has a huge reputation among
society. Thus, investors can take keen interest to invest their capital in these types of
business.

 Network : If a company have a high range of network than it will also create value for
investors and for themselves. If a business have network connection to international and
global market than it will increase the investment amount of outside investors as well.
High network connectivity means company have enough resources to compete with
international competitors as well. In addition to this, they have strength of resources and
capabilities to maintain its position in the market. With the connection of global market
company can acquire higher range of profitability. Thus, all investors want to invest in
those companies.
 Use past success : When a company is going to advertise its balance sheet into
magazines or other documents than it has to be define the graph of its success in last few
years. By this graphical presentation, company can grab attention of investors. When a
company get continuous success then it will beneficial for its to pull in the investors to
invest fund in their company only. But always keep in mind that if a company is going to
show graphical representation that it will be pure and true. Because in the absence of
these factors, company can lose the loyalty of investors(Siswana, 2017).
3 Analyse the factors which consider into entrepreneurship and make moves a person towards
entrepreneur
Entrepreneurship is a very vital and wide area which consist different aspects such as
skills, attributes, personality and mind set. All entrepreneurs have different tactics which make
them different from others. One model or one approach can not be allied on all the
entrepreneurs. There are different motivational factors which make a person moves towards
entrepreneurs such as :
 Passion : It is the most and common feature of entrepreneurs. A person who have a
passion to do something is entrepreneur. Without any passion of ding something, a
person can not achieve anything. Taking risk is usually comes from having faith and faith
comes from having passion. A company can achieve success if they have employees with
the character of hard working with smart working. Force of passion can move a company
to expand their business all over the world(Siswana, 2017).
 Self reliance : This is another key motivational factor which drives people towards
entrepreneurship. Usually this is the sense of independence and freedom. In most of the
businesses, they do not provide authorities to their employees to solve the problem on

their own capabilities. Employees have to take permission from the superior which
allows restriction to do any task(Akintoye and Beck, 2014). But in the entrepreneur, there
is no manager or superior to take permission. They know that all the task and work
should be done through themselves. They have the authorities and responsibilities to
resolve any complexities and issues in an organisation.
 Personal growth : Entrepreneurs are risk bearers. They always take risks because they
pretend risk as an opportunity. They always keep up with the external factors which may
affect the business and its internal structure. Through this, entrepreneurs can acquire
knowledge in wide range which makes him more confident rather than other
businessmen. Through this, they can develop their personal growth and market sense.
 Sense of control : Entrepreneurs know about the external and internal factors. They
analyse all these factors before start up their business. External factors can be analysed
through pestle analysis while internal factors can analysed through swot analysis. After
the acknowledgement of all these factors they knew the ways to control the negative
impacts of these factors. They have the sense of control by analysing all these aspects.
4 Locate, analyse and evaluate sources of information related to funding for small scale
businesses
Small scale businesses can locate and analyse the information through different sources
regarding to advice and funding for business start-ups. According to the current study, many of
the businesses fail in their starting years of operation due to lack of funding. This is one of the
most common reason for fail the business. There are different sources of finance available. This
report include 10 funding options for start-up businesses to raise the capital and funding such as :
 Bootstrapping the start up business : Bootstrapping means self funding. This is the
best an effective way of start-up financing. Entrepreneurs can invest from their own
savings or can get form family and friends. This is the best because it is easy to raise
without any compliance or formalities and interest rates are also flexible according to
their family and friends(Johnston and Marshall, 2016).
 Crowdfunding as a funding option : This is the newer way to raise fund and
investment. In this, entrepreneurs put up a detailed form on a crowdfunding platform. In
this detailed description they provide the information, aims and objectives of the
business. They also give information related to how much funding they need to gain

success. Consumer can read all these detailed description and can contribute with the
promise of pre-buying of the product or providing a donation(Kavanagh, and Ashkanasy,
2016). .
 Get angel investment in start-up : Angel investors are the individuals who are keen to
invest in start-up businesses. They have helped to many other start-up businesses like
yahoo or Alibaba. They invest lesser amount than venture capital.
 Get ventures capital for the business : These are professionally managed funds who
divest in businesses which have large potential.
 Get funding from accelerators : Start up businesses can consider accelerator plan of
actions as a funding alternative. Accelerators assist thousands of start up businesses every
year. Accelerators and incubator both programmes assist the start-up businesses in
funding but there are few fundamental variations between both of the terms. Incubators
are plays a role as a parent to a child they assist the business by providing tools and
networks.
 Increase fund by winning contests : Increasing the number of contests has helped the
start up businesses to maximize the opportunities and chances for raise the fund. With the
winning of these competitions, start up businesses can achieve media coverages as well.
Company can develop the project in order to better success in these contests(Kavanagh,
and Ashkanasy, 2016).
 Increase money through bank loan : Start up businesses can increase the funding
through taking bank loans. As banks provide different types of loans to maintain and
increase the profitability to start up businesses. Generally, banks are the primary place
whenever a person is thinking about the funding.
 Acquire business loans from micro finance providers : When entrepreneur can not get
bank loan then there is still an option available which is micro finance providers. These
providers generally helps those who would not have access and qualify to bank loans.
 Through government programs : Government has launched different types of
programs to improve ecosystem and finance system of start up businesses. Government
of India has launched 12000 Crore start-up funds in their budget to assist entrepreneurs.

 Other quick ways : There are many other ways by which start-up businesses can raise
their fund such as product pre-sale, selling assets and credit cards.
5 Practical and functional skills appropriate for the management of successful SME
Mostly management skills are of five sets as the management is depended upon these
basic principles: Planning, Organising, Directing, Staffing and Controlling(PODSC) in some
case Reporting and Budgeting. To succeed in the business there should be identified skills which
needs to be developed for the smooth operation and efficient working of the business(Kavanagh,
and Ashkanasy, 2016). .
Rather than the essential management skills some business require more practical or non-
theatrical skills functional or operative skills which some SMEs may require or lack they are the
following:
Multitasking
The best manager must be able to oversee the employees and their performance and handle the
prioritised projects both at the same time balancing them without losing the productivity.
Marketing Skills
Deeper understanding of the customer needs and changes in the market place or economy is an
effective marketing strategy required for the promotion of goods and services efficiently and
attain market share or growth(Kavanagh, and Ashkanasy, 2016). .
Illustration 2: Financial management
Source : Financial management,
2014

Sales and Customer service
Identifying the genuine or potential customers by knowing their need and purpose and delivering
them the right suggestion to choose the product or service. Providing the after sale services and
taking feedbacks and giving relevant answer to their queries(Cubillo and Brown, 2016).
Financial Management
Ability to manage the finances or funds for the smooth functioning of the business such as
benchmarking business performance, cash flow forecasting, investment decisions etc.
Leadership and Motivation
A manager should be capable of motivating the employees to get best out of them for increased
productivity and lead them by allocating coach to mentor them. Motivating self and teams.
Decision making and Problem solving
Ability to evaluate and decide thereby taking the right decision at the right time quickly. A good
manager must be able to make good decisions even under pressure(Kavanagh, and Ashkanasy,
2016). .
Time management and Delegation
Time management means delegating the responsibility to someone else or outsourcing.
Identifying the better one who can concentrate on the tasks assigned to generate value.
Effective communication and Negotiation or Influencing skills
Managers would be ineffective without communication skills. He will need to communicate and
negotiate with investors, suppliers, Interact with consumers, suppliers and employees efficiently.
Good written and verbal skills(Thomas, 2015).
Interpersonal skills
Ability to communicate with credibility, tact and diplomacy. Managing the emotions in
workplace and responding to conflicts.
Strategic skills
Emotional intelligence, cross functional communications in the organisation hierarchy.
Creativity and Innovation skills
Innovation means turning ideas into opportunities(Werther and Davis, 2014). Entrepreneurs
should develop innovative creative thinking to spot patterns and trends that best targets.
Goal setting skills

Effectiveness of a goal setting comprises the existence of commitment. It is assumed that if there
is no commitment then there will be no goal.
Goal setting must be: Consistent, Attainable and Clear.
Project management and Planning
Starting a business starts with managing a range of projects and developing policies and
procedures. Knowledge of effectively managing resources, time, money and staff(Thomas,
2015).
Conceptual skills
Includes analytical, creative and initiative skills. It helps a manager to identify the causes of a
problem thereby helping him to solve problems of the entire organisation and to fix goals for the
organisation(Werther and Davis, 2014).
CONCLUSION
From the above report, it can be concluded that financial management and leadership
plays an important role in a business. The core principle in this approach is to maintain the
financial stability by which company can get success. Financial stability can be maintain if a
company analyse the resources of fund before start up any business. There are different
resources explained in this report which assist to fund. Entrepreneurs have different skills,
attributes, personality and mindset which can move a person towards the entrepreneurship. They
have a personality to motivate other people as Passion, Self reliance, Feeling of completed,
Personal growth and Sense of control. These all attributes affects the person's behaviour. To
manage economies of small scale businesses it requires practical and functional skills and
tactics. Furthermore, To maintain the financial stability company have to create value in the
context of investors. Business can take different approaches and methods to attract investors top
invest their capital in their business. They can create value through Define balance sheet,
Network, Use past success and many more methods. Development of business plan is most and
important process for start up businesses. There are various stages included in this report which
has to be fulfil by those businesses who are going to start their business in a particular location.

REFERENCES
Books and journals
Akintoye, A. and Beck, M. eds., 2014. Policy, management and finance of public-private
partnerships. John Wiley & Sons.
Boin, A., Stern, E. and Sundelius, B., 2016. The politics of crisis management: Public
leadership under pressure. Cambridge University Press.
Bolden, R., 2016. Leadership, management and organisational development. In Gower
handbook of leadership and management development (pp. 143-158). Routledge.
Bush, T., 2014. Theories of educational leadership and management. Sage.
Bush, T., 2017. Leadership and management development in education. Sage.
Chisholm-Burns, M. A., 2014. Pharmacy management, leadership, marketing, and finance.
Jones & Bartlett Publishers.
Cubillo, L. and Brown, M., 2016. Women into educational leadership and management:
international differences?. Journal of Educational Administration. 41(3). pp.278-291.
Fosberg, R. H., 2014. Agency problems and debt financing: leadership structure
effects. Corporate Governance: The international journal of business in society. 4(1).
pp.31-38.
Johnston, M. W. and Marshall, G. W., 2016. Sales force management: Leadership, innovation,
technology. Routledge.
Kavanagh, M. H. and Ashkanasy, N. M., 2016. The impact of leadership and change
management strategy on organizational culture and individual acceptance of change
during a merger. British Journal of Management. 17(S1).
Kim, S., 2002. Participative management and job satisfaction: Lessons for management
leadership. Public administration review. 62(2). pp.231-241.
Siswana, B., 2017. Leadership and governance in the South African public service: An overview
of the public finance management system (Doctoral dissertation, University of Pretoria).
Thomas, T., 2015. Management and leadership for nurse administrators. Jones & Bartlett
Publishers.
Werther, W. B. and Davis, K., 2014. Human resources and personnel management. Harper San
Francisco.
Online

Business plan, 2016[online]. Available through : <https://www.startupguys.net>
Financial management, 2014[online]. Available through :
<http://slideplayer.com/slide/6906654/>

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