In the first of an occasional series on basic business skills for GPs, healthcare consultant and GP Dr Junaid Bajwa offers his advice on writing a convincing case for a new service.
Whether bidding for a new service, demonstrating the efficiency of your service to a PCT or planning a more businesslike direction for your practice, writing a good business plan is becoming an essential skill for GPs. At first, this process can be daunting, but all it requires is a bit of disciplined thinking to give it creditability.
Eugene Kleiner, the famous venture capitalist, said ‘an idea may sound great, but when you put down all the details and numbers, it may fall apart’. This article will go through the key information you should include in a business plan and gives some advice about presenting it, to make a convincing business case to a commissioner.
1. Define your target patient group
Business analysts often remark that ‘the key to success is satisfied customers, not a great product’. Although a simple premise, it is important not to lose sight that our patients are our customers.
The point of the business idea is usually about how best to improve patient care. When considering the idea, identify the group your business will be targeted to. Will your model target a specific health need or deliver a service for cheaper than the existing service provider (such as the hospital’s tariff charge)?
2. Be clear, concise and distinctive
A successful business plan should be well structured, consistent and accurate. It should be easy to read, avoiding jargon if possible.
Most importantly, it should be memorable. Don’t forget most of these documents are read by non-clinicians who are used to seeing these in a structured format. If you miss the point it will be the equivalent of a history for acute cardiac chest pain where a page is spent on social history when all you need to do is get them into a specialist unit as an emergency.
3. Include an executive summary
If an idea can’t be explained in a sentence, then it isn’t a good one. The executive summary should be a one- or two-page teaser of your ‘product’ or service, outlining your proposal.
Include a simple explanation of what the proposal is and why it has arisen; what makes your idea unique. What are your unique selling points? Are there national policy drivers, such as polysystems?
4. Source information on current services
Outline the current services available to patients, including any relevant data which may support this. Information may be sourced from primary care organisations (published online), the NHS Information Centre, Health Observatories or similar bodies. Does your proposal address a long-standing capacity problem in the area?
5. Outline your proposed service
Go into some detail on the potential impact of the service on patients, local health economy, other services, other professionals, and if possible health outcomes.
Include forecasts or estimates of the likely levels of activity under the proposed new scheme. As far as possible, it is important to avoid any anecdotal evidence or assumptive data, which could lead to criticism from the reader.
As a summary of the new service, it can be helpful to include a description of the ‘patient journey’. Pictures tell a thousand words here, so break up the text with some pictures or diagrams – for example, what the patient journey currently is and how you are looking to change it.
6. Detail how the service can be evaluated
The plan should include some key performance indicators – both internal and external – that can be employed to evaluate your service.
If you don’t have access to anything at all consider auditing your service. Usually preliminary data collection will be illuminating enough to consider funding.
7. Include details of your team
The people who will ensure the success of your business proposal should also be included in your plan. Include the CVs of your team leaders. Remember to include details of practice managers, nurses or administrative staff, so you appear as a committed team able to make the project work.
Include an organisational structure demonstrating how the management responsibilities will be shared and how that particular team can achieve the business goal. It should also show any plans to reinforce the team in the future – such as taking on a human resources lead – and any strategic partnerships – for example, with voluntary groups.
8. Prepare a marketing plan
Good business plans will detail the specific plans to promote the service, and which external partners will be engaged to deliver this element of the business – such as your practice-based commissioning cluster or GP neighbours.
9. Outline an implementation schedule
If successful, what will be your lead time before the service is implemented? Business plans should consider both the initial phase and five-year implementation plan.
The schedules should include key milestones in setting up the service, with dates. It is useful to include detailed charts showing activities by month and named leads for each activity.
This could become a lengthy document, but try to get it onto one chart with dates against activities, such as a Gantt chart.
10. Include a financial plan
This is perhaps the most daunting section for clinicians. It is often the section where most of the effort in writing the business plan is focused, but evaluators often comment that it carries less weight than the other sections.
Financial planning should encompass the next five years (and at least one year beyond the break-even point). It should include the best- and worst-case scenarios for the five-year financial projections, and what mitigating steps are planned in order to minimise risks. Points to include are:
• Start-up costs: What are the financial requirements for the business?
• Income: What are the revenue sources?
• Funding: How will it be paid for? Will the scheme save money elsewhere?
• Balance sheet: What are the key assumptions in the financial proforma (cost of capital, market share, margin)?
Dr Junaid Bajwa is a GP in Greenwich, south-east London, and healthcare consultant at Prospect Health – www.prospecthealth.co.uk
Writing a good business plan is becoming an essential skill for GPs Common errors in writing business plans Common errors in writing business plans