When writing the business plan, the Management Plan section describes your management team and staff and how your business ownership is structured. People reading your business plan will be looking to see not only who's on your management team but how the skills of your management and staff will contribute to the bottom line.
A convenient way to organize the Management Plan section is to break it into sections detailing your:
- Ownership Structure
- Internal Management Team
- External Management Resources
- Human Resources Needs
The Ownership Structure section describes the legal structure of your business. It may be a single sentence if your business is a sole proprietorship. If your business is a partnership or a corporation, it may be longer; you want to be sure you explain who holds what percentage of ownership in the company.
The Internal Management Team section will describe the main business management categories relevant to your business, identify who's going to have responsibility for that category, and profile that person's skills.
The basic business categories of Sales and Marketing, Administration and Production work for many small businesses. You may find that your company needs additional management categories such as Research and Development and/or Human Resources.
It's not necessary to have a different person in charge of each business management category you decide to use in your company; some key management people may fill more than one role. Identify the key management people in your business and explain what functions each team member will fill.
This is your management team outline. You may wish to present this as an organizational chart in your business plan, although list format is fine.
Along with this outline, the management plan will include complete resumes of each member of your management team (including you), and an explanation of how each person's skills will contribute to your business' success.
Follow this with an explanation of how your management team will be compensated. What salary and benefits will management team members have? Describe any profit-sharing plans that may apply.
If there are any contracts that relate directly to your management team members, such as work contracts or non-competition agreements, you should include them in an Appendix to your business plan.
But what about external management? Continue on to the next page to learn how you can effectively use external management resources and how to describe these resources when writing a business plan.