Risk in work unit business planning: Starting from the business plan

In this article:
What a business plan contains Where business plans come from

Previous article: Risk in work unit business planning: Introduction for unit managers


The process suggested in this series starts from a business plan for your work unit. It ends with all the artefacts to back up the confidence you reported to the boss, and with some specific issues that need to be resolved.

What a business plan contains

The business plan is assumed to cover one year of activity. The work unit is big enough to need its own business plan. It is headed by a middle manager or executive, but probably not by a C-level executive. It may contain smaller units that have their own business plans and risk assessments.

The business plan is assumed to set out some or all of the following aspects of the year’s work:

  • Why the unit exists, and what it does for the organisation’s goals.
  • Intended outcomes from the year of activity.
  • Totals for financial and human resources for the year.
  • A summary of how the human and financial resources will be used to achieve the outcomes, perhaps headed ‘strategies’.
  • Measures for the achievement of the outcomes.
  • A space for ‘risks’, which may already have something in it.

In a large organisation, the unit’s goals might be understood in terms of the contribution to the next higher-level unit or grouping within the organisation. That might be the only reference to the goals of the organisation as a whole.

Within the unit, the job descriptions and performance plans for individuals reflect the unit’s goals.

The business plan finds the line of sight from individual efforts to organisational outcomes, for motivation and for accountability.

Ideally, risk is considered during the development of the business plan. Business planning and risk management for the unit both start with identification of objectives, so that is the ideal starting point. Risk considerations also shape the strategies, budgets, and performance measures. At the same time, strategies, budgets and measures influence risk.

It often happens that risks are considered after the other aspects of planning. If you already have a business plan drafted, the risk analysis can start from that draft. Risk analysis may lead to some changes to the business plan. Whether or not changes are feasible and necessary, risk analysis will lead to a further layer of planning detail.

Where business plans come from

Most often, the new business plan will start from last year’s plan and other formal sources such as mission statements, function charters, and work plans. Formal sources will have been qualified by conversations with the boss. Those conversations will have been less formal, but much more important than written words populating templates. The big questions do not come up during development of the annual business plan. The big questions are answered at the time they need answers. In the real world, ‘business planning’ is mainly a matter of capturing those intentions in the form of words required by the mandated process – populating a template.

Ideally, the business plan will still be in a formative stage when you start the risk process. After the risk process for the business plan, you will probably want to update the plan. The first step in the risk process is to ask again about the objectives of the unit, in a fresh way.

Next article:

Risk in work unit business planning: Where it ends

Artefacts from the risk assessment process But the artefacts are not the end result. The process is not about filling templates. There are two results that matter.

Previous article: Risk in work unit business planning: Introduction for unit managers

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