Strategic Business Planning Toolkit Summary

Offices in: Kenya, Uganda and India
Associates in: Benin and Guatemala
www.MicroSave.org
[email protected]
Strategic Business Planning for Market-led Financial Institutions

Overview
Strategic business planning is a disciplined and pragmatic approach that organisations can use to make decisions now
about the future. It enables them to make more informed choices and decisions, set future directions, establish
priorities, allocate limited resources, improve operations and monitor results. A well-executed planning exercise
promotes a common understanding about the financial institution’s overall direction and purpose. Individuals see how
their actions support the institution’s mission. Clarity of purpose enhances the organisation’s ability to recognise and
concentrate on those activities that are fundamentally important. Second, the strategic business planning process trains
staff to think and act strategically. These skills permit the organisation to creatively handle changing circumstances.
Overview of Strategic Business Planning Process

MicroSave uses the approach outlined in the diagram below to conduct Strategic Business Planning.
Mission, values, vision at the KOGMA Analysis

Strategy
core of your strategy Or Business Plan
Development
Development
Implement and monitor KOGMA

Diagnose current strategic analysis
position
Formulate strategy Create Measures/Targets and Activities

analysis
Financial Projections Create Key Objectives and Goals

& Budgets analysis
The institution’s strategy is developed/updated on the basis of a systematic analysis of its market, its competition and
its own strengths and weaknesses, together with an analysis of the opportunities and threats in the sector/marco-
environment. On the basis of this analysis, the institution can develop a succinct statement of its Strategy, which will
(together with its Mission and Vision) be implemented on the basis of the business plan. The Strategy will be the basis
for the first-draft financial planning analysis – the Financial Projections – using whatever projections model the
institution has chosen.
On the basis of the institution’s Mission, Vision and Strategy a business plan is developed through a participatory
process using “KOGMA Analysis” 1. This helps the organisation focus on the issues critical to implementing its
strategy and which drive the Key Objectives. KOGMA Analysis provides an intuitive approach to identifying the Key
Objectives for achieving the Mission/Vision of the organisation and then … identifying the Goals that must be
1
Key Objectives, Goals, Measures and Activities
MicroSave – Market-led solutions for financial services
achieved to meet these Key Objectives as well as … the Measures/Targets and the Activities necessary to achieve the
goals. It thus provides a comprehensive road map for the implementation of the organisation’s strategy.
Tracking systems to monitor progress, compile management information and keep the plan on track are also essential
for successful implementation of the KOGMA Analysis. In addition to tracking progress on Key Objectives, Goals and
Activities, Measures should also be monitored. Data should be collected for each Measure and reported at a regular
interval. Progress reports on Measures could be in the form of data tables or presented in charts or graphs.
Successful KOGMA Analysis

 Describes the organisation’s Mission and Values as well as the Vision for the next 5-10 years
 Gives an overall picture of the strategy and enables communication of Key Objectives, Goals and Targets
 Allows monitoring of progress towards Goals and thus Key Objectives through mix of financial and non-financial
measures
 Shows staff how/where to contribute and focuses them on critical issues, thus creating an environment conducive
to motivating staff
Benefits
 Equity Bank used the strategic business planning framework as the core of its change management process – to
identify its critical success factors and create a commonality of vision and purpose throughout the organisation. As a
result, after an extensive process of reviewing the plan throughout the organisation, all staff members had
understood and internalised the plan – thus facilitating its implementation. This process allowed the bank to manage
and control its exponential growth and to become the most successful and recognised microfinance institution in
Africa. The targets and measures set as part of the process were then used to monitor its implementation and to
identify where the bank was under-achieving and thus required to strengthen its efforts/ capacities.
 The strategic business plan developed at both Spandana and Bandhan allowed the institutions to chart their futures
and identify the critical success factors necessary to achieving their ambitious growth plans. The strategic planning
process, conducted with senior management and Board members helped all see the issues facing the organisations
and to discuss how these might best be addressed. The resulting strategic business plan and financial projections
were used by Bandhan for their transformation into an Non Bank Financial Corporation and as a basis of raising
funds to finance the expansion from a range of banks in India including ICICI Bank, ABN Amro, SIDBI and others.
 Uganda Microfinance Limited used the strategic business planning toolkit to improve internal alignment, to
reformulate the human resource function, to improve key communication, to focus on improving portfolio quality
and to increase deposits. Following the strategic business planning a re-energised management improved
performance and significantly increased profitability.
 The strategic business planning process at the Indian Savings and Credit Association allowed the organisation to
work with its Board and new management team to reorient it and re-invent its approaches to delivering financial
services to the poor in Tamil Nadu.
Who Should Attend the Strategic Business Planning Training
The strategic business planning training takes three days and should be attended by Board members and senior
management. Participants should bring laptops as they will prepare the initial mission, vision, values and strategy
statements as well as KOGMA analysis as an integral part of the training. After the training participants will present
the draft documentation to other staff members for critique and updating. This process allows the institution to develop
its strategic business plan in a participatory manner thus:
• Getting inputs/insights from all levels
• Building buy-in/understanding at all levels
• Optimising implementation
It also allows the institution to describe and communicate its strategic business plan in a succinct manner so that
everyone can see their role in delivering on the plan.
Prepare a strategic business plan to focus your organisation on the issues critical to its success, communicate these
to all staff and then monitor the implementation of the plan in a systematic manner!
MicroSave – Market-led solutions for financial services

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Offices in: Kenya, Uganda and India

Associates in: Benin and Guatemala

Strategic Business Planning for Market-led Financial Institutions

Overview of Strategic Business Planning Process

Mission, values, vision at the KOGMA Analysis

Implement and monitor KOGMA

Formulate strategy Create Measures/Targets and Activities

Financial Projections Create Key Objectives and Goals

Successful KOGMA Analysis

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