Formulating a Business Plan

Nancy Delzer, MBA, MSN, FNP-BC, AOCN, BC-PCM Associate Chief Nurse, Extended Care Tomah Veterans Affairs Medical Center Tomah, WI

What is a Business Plan? • A written statement that describes and analyzes your project and gives detailed projections about its future. • It serves as a guide for you to follow throughout the life of your project. • It serves as a documentation source. • It is the way to conduct business in the marketplace.

I’m a Nurse, Why Do I Need a Business Plan? • To communicate your project plan idea to your supervisor. • To get buy in from participants. • To sell your idea to your local chapter leaders. • To ensure possible investors their money will be well spent.

Components of a Business Plan • • • • •

Executive Summary (Project Summary) Business Section (Project Design) Market Analysis Section (Project Assessment) Financing Section Management Section (Project Evaluation and Impact)

Executive Summary • Concise explanation of project • Size of market/need for project • Discussion on how you are uniquely qualified to fulfill this need • Expected outcome (Elevator Speech)

Business Section • Details of the project – What is your project? – Why is it needed? – What makes it unique? – Timeline – Rollout plan – Marketing

Market Analysis • SWOT Analysis Strengths-Weaknesses-Opportunities-Threats

• Sizes, trends, customers, competition, data sources

Financing Section DESCRIPTION

BUDGET

Equipment Supplies Printing Postage Human Resources

Total

Management Section • Graph, flowchart, or spreadsheet tracking how your project is progressing and being measured for success. • How has your project impacted your situation (unit, local chapter, patient satisfaction, increased efficiency)

• Insert my old project plan

Oncology Nursing Society Steering Council Business Plan Outline 1. Project title 2. Executive summary a. Project description b. What is the outcome of the proposed project c. Target audience d. Significance of project (projected shelf life of project; overall budget cost/revenue) e. How it relates to strategic plan f. Risk/reward 3. Internal/external assessment 4. Project design (1-2 pages) a. Team composition b. Projected impact on corporations c. Resources needed d. Timeline e. Team charge (bullets) 1) What is it we want them to accomplish? 2) Articulation of the vision 3) Prevailing wisdom, things to think about and consider

Oncology Nursing Society Steering Council Business Plan Outline cont’ 5. Budget a. Project costs 1) Initial for project start-up 2) Projected future costs b. Potential funding options c. Projected revenue 6. Executive comments for consideration 7. Evaluation of project a. Expected outcomes 1) How they will be monitored, measured, and communicated 8. Project/product outcome 9. Impact outcome a. Organization 1) Financial 2) Strategic mission/vision b. Professional practice c. Consumer 10. Value added statement

SBAR Approach • • • •

S – Situation B – Background A – Assessment/Analysis R – Recommendation

Situation/Background • S - You want to start performing a new procedure in your outpatient clinic • B – The procedure requires a new piece of equipment you will lease and has a monthly maintenance contract. The procedure requires a full time RN and CNA.

Assessment/Analysis • A - Fixed costs; cost that will not vary based on volume – Variable costs; costs that will fluctuate based on volume – Gross revenue; revenue per unit multiplied by total volume projected – Net revenue; total revenue less insurance deductions – Margin; difference of net revenue and total expenses (sum of fixed and variable expenses)

Assessment/Analysis cont’ •

Fixed costs – – – –

•

$100.00 lights $200.00 maintenance $250.00 lease $550.00 Total fixed costs

•

– – – – – – – –

Variable costs – – –

•

$2,400.00 Salary expense for 1 full time CNA/month $4,800.00 Salary expense for 1 full time RN/month $7,200.00 Total variable costs

Gross revenue – – – – – – –

Net revenue

•

$120.00 cost per visit for procedure A 25 visits per month $3,000.00 Revenue for procedure A $450.00 cost per visit for procedue B 40 visits per month $18,000.00 Revenue for procedure B $21,000.00 Total gross revenue

22% Reimbursement, T19 35% Reimbursement, Medicare 45% Reimbursement, UHC 65% Reimbursement, Humana 70% Reiimbursement, Insurnace 47% Reimbursement, Average $21,000.00 Revenue, Gross $ 9,954.00 Revenue, Net (21,000 x 47%)

Margin – – – –

$9,954.00 Net revenue $7,750.00 Total expenses $2,204.00 Margin/month $26,448.00 Margin/year

Recommendation • Margin – $2,204.00 Margin/month – $26,448.00 Margin/year

• Proceed with adding the new procedure

Start With the End in Sight • • • •

What is your goal? Where are you headed? When do you want to get there? What will your product look like?

Questions