Best Practices for Developing a Business Plan

A solid plan can help a city align its resources with priorities, demonstrate progress and make the case for public support.
November 13, 2018
Kansas City, Mo.’s five-year business plan drives budget priorities and identifies initiatives with the largest positive impact on residents and businesses in the city. David Kidd
By Lisa Wong  |  Senior Fellow, Governing Institute
Lisa Wong is a senior fellow with the Governing Institute and former mayor of Fitchburg, Mass.
Smartly Resourced

Financial institutions often require a business plan from companies seeking loans as a way to identify risks and outline a roadmap for success. Business plans are important for established and startup businesses, making a company’s vision more cohesive, consistent and transparent. The same can be said for cities. A business plan can help a city align its resources with priorities, demonstrate progress and make the case for public support.

There are plenty of resources available to companies looking to write a business plan, but not so much for cities. Equipt to Innovate provides a broad framework for cities to think through orchestrating the complexities of governing across seven core elements of high-performance government. It serves as a basis for evidence-based policymaking and provides important context for business planning. While a city can follow a template, the level of public engagement, accountability and service impact is usually a lot higher for the public sector, which usually requires a different tool set to build a plan.

Kansas City, Mo., launched its first five-year business plan after residents amended the city charter in 2014 to require a five-year financial plan. The business plan drives budget priorities and identifies initiatives with the largest positive impact on residents and businesses in the city. In reviewing business plans that are readily available, here are some replicable ideas for cities to establish a plan of their own.

Be clear and concise. Provide a description of city services that connects to staffing and budget resources, and the importance of the services to the public. This process should be easier if all departments are involved and engaged and encouraged to be a part of external messaging. Not many people are going to read through a hundred-plus page document, so executive summaries, flow charts, online dashboards and visual aids can be helpful.

Identify and solve problems. City business plans should include measurable goals and objectives, details on what and how data is tracked, and a feasible strategy to make progress on priority initiatives. Cities should highlight successful initiatives, project completions and the achievement of milestones. They should also have a way to track and understand problems. Having a process to regularly evaluate, modify and even eliminate programs is important to save time and money. Some cities have specific departments of individuals charged with this task such as the Office of Innovation in San Antonio.

Seek input. Being open to and responsive to feedback and ideas is a great way for cities to show a commitment to the public and be open to change. Cities can incorporate feedback into the production and evolution of a business plan through myriad tools such as focus groups, social media and surveys. External resources can help gather input as well. For instance, a nonprofit in New Orleans developed the “Big Easy Budget Game,” which is an interactive tool that lets citizens balance the budget as a way to learn about and prioritize services, and then analyzes the results.

Governments are not businesses but that fact does not excuse them from the disciplines of planning for doing the business of government.