The execution plan is the “how-to” for your venture. It is a necessary input to your financial plan, slide pitch deck and business plan. It should also be a tool that you use with your team on a regular basis to manage the business, to communicate your critical goals and timing of deliverables, and to celebrate your successes.
What are the elements of an execution plan?
A good execution plan covers milestones and tasks for your business to achieve as well as what resources will be required to make them happen.
Milestones are the goals critical to the success of any new venture. In The Art of the Start, Guy Kawasaki provides this simple list which applies generically to all technology-oriented ventures:
- prove your concept (both technical and business model)
- complete design specifications
- finish a prototype
- raise capital
- ship a testable version to customers
- ship the final version to customers
- achieve break-even
These milestones can vary significantly in time and scope from business to business and will be generally broken down into additional steps for your internal team. For example, in a biopharmaceutical life sciences company, it may take many years to complete the design and testing process for products that will be injected into or ingested by humans, while a mobile software application may only take several months of effort to rapidly prototype an early version of a product to send to friendly customers for testing.
For each milestone, you will need to determine the amount of resources (headcount and other expenses) required, and the approximate timing involved. This information will be used to develop your financing plan for the business and to determine the type of investor you should approach about funding the next investment round, based on your development stage.
A list of tasks helps you appreciate everything that your organization needs to accomplish and is a means to ensuring that nothing slips through the cracks in the early days. Task lists might include:
- incorporating your business
- renting office space
- finding and engaging key vendors
- setting up accounting and payroll systems
- securing employment agreements with key personnel
- filing legal and taxation documents
- purchasing insurance policies
- setting up your website
For each task, you will also need to make sure that the resources required to complete the task are included in your financial plan. The task list is generally an internal tool, although some of the tasks may appear on an investor’s due diligence list. For example, investors tend to review the terms of employment agreements to confirm that the company’s intellectual property rights have been adequately protected, so you’ll need those documents in place. Some tasks may also form part of the conditions under which an investor is willing to proceed with an investment. For example, an investor is unlikely to be willing to serve on your board of directors unless the company provides a minimum level of directors’ and officers’ liability insurance.
Kawasaki, G. (2004).The Art of the Start: The Time-Tested, Battle-Hardened Guide for Anyone Starting Anything. Toronto: Penguin Canada.