DEVELOP AND IMPLEMENT A BUSINESS PLAN FACILITATOR MANUAL WITH SIMULATED ONLINE BUSINESS ASSESSMENT BSBMGT617A

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1 DEVELOP AND IMPLEMENT A BUSINESS PLAN FACILITATOR MANUAL WITH SIMULATED ONLINE BUSINESS ASSESSMENT BSBMGT617A

2 Precision Group (Australia) Pty Ltd 9 Koppen Tce, Cairns, QLD, info@precisiongroup.com.au Website: BSBMGT617A Develop and Implement a Business Plan ISBN: Copyright Notice No part of this book may be reproduced in any form or by any means, electronic or mechanical, including photocopying or recording, or by an information retrieval system without written permission from Precision Group (Australia) Pty Ltd. Legal action may be taken against any person who infringes their copyright through unauthorised copying. These terms are subject to the conditions prescribed under the Australian Copyright Act Copying for Educational Purposes The Australian Copyright Act 1968 allows 10% of this book to be copied by any educational institute for educational purposes, provided that the institute (or the body that administers it) has given a remuneration notice to the Copyright Agency Limited (CAL) under the Act. For more information, info@copyright. com.au or visit for other contact details. Disclaimer Precision Group has made a great effort to ensure that this material is free from error or omissions. However, you should conduct your own enquiries and seek professional advice before relying on any fact, statement or matter contained in this book. Precision Group (Australia) Pty Ltd is not responsible for any injury, loss or damage as a result of material included or omitted from this material. Information in this course material is current at the time of publication.

3 Table of Contents 2 Legend 3 Qualification Pathways 4 Qualification Rules 5 Introduction 7 BSBMGT617A/01 Develop Business Plan Key Points Review and evaluate pre-existing strategic, business and operational plan, if available Analyse and interpret business vision, mission, values and objectives Consult with key stakeholders Review market requirements for the product or service, profile customer needs and research pricing options Develop performance objectives and measures through consultation with key stakeholders Identify financial, human and physical resource requirements for the business Consider any permits or licences that may be required for new activity Write business plan 23 True or False Quiz 25 BSBMGT617A /02 Monitor Performance Key Points Communicate business plan to all relevant parties and ensure understanding of performance requirements and timeframes Ensure skilled labour is available to implement plan Test performance measurement systems and refine, if necessary Ensure timely reports on all key aspects of the business are available, user-friendly and balanced in terms of financial and non-financial performance Report system failures, product failures and variances to the business plan as they occur 35 True or False Quiz 37 BSBMGT617A /03 Respond to Performance Data Key Points Analyse performance reports against planned objectives Review performance indicators and refine if necessary Ensure groups and individuals contributing to under-performance are coached, and provide training where appropriate Review system processes and work methods regularly as part of continuous improvement 45 True or False Quiz 46 Summary 47 Bibliography 49 Assessment Pack 1

4 Use considered risk taking in your grey area...and others will follow you! Legend This symbol indicates the beginning of new content. The bold title matches the content of the competency and they will help you to find the section to reference for your assessment activities. Activity: Whenever you see this symbol, there is an activity to carry out which has been designed to help reinforce the learning about the topic and take some action. This symbol is used at the end of a section to indicate the summary key points of the previous section. This symbol is used to indicate an answer to the Candidate s questions or notes to assist the Facilitator. 2

5 Qualification Pathways There are always two choices. Two paths to take. One is easy. And its only reward is that it s easy. Source Unknown This unit of competency is provided to meet the requirements of BSB07 Business Services Training Package although it can be used in a range of different qualifications. The BSB07 Business Services Training Package does not state how a qualification is to be achieved. Rather, Registered Training Organisations are required to use the qualification rules to ensure the needs of the learner and business customer are met. This is to be achieved through the development of effective learning programs delivered in an order that meets the stated needs of nominated Candidates and business customers. 3

6 Qualification Rules You re either part of the solution or part of the problem. Eldridge Cleaver Qualification requirements include core and elective units. The unit mix is determined by specific unit of competency requirements which are stated in the qualification description. Registered Training Organisations then work with learners and business customers to select elective units relevant to the work outcome, local industry requirements and the qualification level. All vocational education qualifications must lead to a work outcome. BSB07 Business Services Training Package qualifications allow for Registered Training Organisations (RTOs) to vary programs to meet: Specific needs of a business or group of businesses. Skill needs of a locality or a particular industry application of business skills. Maximum employability of a group of students or an individual. When packaging a qualification elective units are to be selected from an equivalent level qualification unless otherwise stated. 4

7 Introduction Whether as an individual, or as part of a group, real progress depends on entering whole-heartedly into the process and being motivated to make you a more deeply satisfied human being. Source Unknown This unit of competency is about being able to run a business operation and covers the steps required to develop and implement a business plan. It will help you with the skills you need to demonstrate competency for the unit BSBMGT617A Develop and Implement a Business Plan. This is one of the units that make up Certificates in Business. This manual is broken up into three distinct sections. They are: 1. Develop Business Plan 2. Monitor Performance 3. Respond to Performance Data At the conclusion of this training you will be asked to complete an assessment pack for this unit of competency. The information contained in this resource will assist you to complete this task. On competent completion of the assessment, you will have demonstrated your ability to develop a business plan and manage a business to implement it. 5

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9 PART 1: Develop Business Plan Key Points Section 1 Planning is executed at two distinct levels in an organisation - strategic and operational. When developing plans it is crucial to examine your current plans to look for areas where there are problems, or where improvements could be made. Strategic plans are the basis for operational plans. The operational plans will determine how the organisation achieves its strategic plans. Plans are most effective when they are concise, logical and in line with organisational policy. 7

10 Key Points Section 1 continued Your organisation should have a set of protocols in place used for planning and project management. Consultation is an important part of any plan as it ensures that you take into account the views of others in the organisation. All plans and goals should be developed in consultation with others in the organisation. Customers are important. Look at what they need, and be sure to have protocols in place for measuring customer satisfaction. 8

11 Planning In this manual, we will be examining the processes associated with introducing new ideas or plans into a business to improve overall efficiency. These plans can come in many forms and from many locations. Managers must be aware of what is occurring around them and look for new opportunities that may exist to improve the performance of the organisation that they work for. This is particularly important for those individuals managing small businesses. When you have an idea to improve your business it is critical that you spend the time planning that process out to ensure that any changes that you make to your plans are able to make a positive change. For the most part, it is important to recognise that having a plan is the key to effective ideas being implemented. A plan allows you to ensure that you are managing and implementing what actually needs to be implemented, rather that just being in the dark and doing things that you think are going to be useful. A plan should break down your idea into small bite sized pieces, that allow you to look at the overall job and think, OK where do I start And just take things step by step until the overall plan is implemented and working. So, how does planning actually work? Consider your idea in detail and look at exactly what you are trying to achieve in your program or process improvement. Look at the steps you need to take in order to have the program or process implemented. Take each of these steps and break it down into smaller steps. Have your staff look at each step and determine whether they are critical to the success of the organisation s plan. Align each of the steps that you have mentioned with the overall plan and your organisational requirements. Without such planning, many good ideas simply fail to get implemented. If there is a lack of understanding with regards to what needs to get done, then the project is simply doomed to failure. The breaking down of the project into small bite-sized chunks also assists you in determining the level of resourcing that is required at each stage of the implementation. Planning may seem like a boring process. It often is derided by managers simply because they see it as boring and not actually contributing to the way that the project is going to operate in the long term. However, it is extremely important to involve senior staff in the planning process as much as possible. Involving the senior staff in the planning stage of any project will ensure that those involved will be motivated to keep the process happening. People are generally motivated to work on any project that they are directly involved in, so this process can help significantly. An effective plan needs to encompass ideas from a range of people within an organisation not just middle management, not just senior management but contributions from everyone in the organisation. The low level worker who may be dealing with a client on an everyday basis will have much to contribute as they understand what is needed so well. 9

12 Planning should outline, in detail, exactly what it is that you are hoping to achieve. It should clearly state the type of changes being made, what you expect to see change as a result of the implementation, how the project will be implemented and how you plan to ensure that the project meets the objectives set out for it. So, when structuring your plan ensure it contains: A discussion of the problems that exist within the organisation that you hope that your new ideas will resolve. The overall goals of the plan that you want to implement and a general idea of how long you expect it to take for such results to become obvious. An overall plan for the project what needs to be done, how long each stage is expected to take, who will be responsible for each area and by when it will be completed. A monitoring plan that outlines how you expect to monitor the results of the implementation and how these results will be reported to the rest of the organisation. As we mentioned above, the first stage of the plan is to look at what the problem is and how you plan to overcome it. This is known as the problem statement. A problem statement is essentially an indication of the problem that you are going to address by implementing a specific project or solution. In it, you need to prove that the problem actually exists, so that you can try and secure the funding you need to overcome the problem. You could include information such as: How big the problem is and how it impacts the rest of the organisation in order to determine the scope of the issue? A brief introduction to who will be affected by any change where the change will be implemented and the type of customers who might be affected? An overview of why the problem exists. Are the causes known and if not, can they be determined by the organisation? Whether this problem has been examined in the past, and if so, whether any changes made had any impact on the problem in question? You should then move on to develop a solution to the issue that you have. Essentially you are answering how can I make things better? Here you are examining the design of your project. What is involved in addressing the issue and eliminating the impacts that it is having on the organisation as a whole. In this section, you need to be sure that you discuss: The overall solution that you are planning to adopt and a brief discussion of why you feel that this is the right solution to implement when any number of other ideas might have worked. Whether there are any other areas within the organisation (or anything the competition is doing) that may resolve this issue. The results that you expect to see from the introduction of your new planned process or program. 10

13 How the project you plan on implementing will contribute to your organisation s ability to reach its overall strategic goals. Whether there is likely to be support for the changes and if not, how this can be gained. Whether there is any potential funding for the project already in place. Let s now look at goals and objectives Goals and Specific Objectives Goals Objectives The overall goals should describe, in a broad way, the long-term changes that will result from your work on the problem outlined in the problem statement. Normally one or two general statements describing the proposed long-range benefits to the target population are sufficient to describe the overall project goals. For each overall goal that you develop, there should be several specific, measurable objectives. These objectives relate to the problem statement and describe anticipated results. The objectives should be used to develop corresponding evaluation criteria to ensure that evaluations conducted later in the project will measure the results that the project intends to achieve. Strategic Planning Planning of this type involves the organisation at a day-to-day level as well as at a major strategic level. The project is likely to impact on the organisation as a whole and the achievement of its overall goals, so you must consider these implications. Strategic planning implications may include: Looking at the business plan for the organisation as a whole. This may include evaluating the project against the mission statement, the overall organisational vision, and the goals and objectives of the organisation. Looking at previous action plans that previous managers have used for dealing with the problem or problems similar to it, to gauge how successful previous actions were in achieving results. Checking out the business s goals, so that you can attempt to ascertain exactly how you may be able to facilitate change through the achievement of goals. If you can show that a particular action is going to assist the organisation in reaching its business goals, then it is more likely to be supported by others in the organisation. Environmental Analysis: You do not operate in isolation, your organisation is likely to have competition so understanding the market and your competitors will enable you to see if any changes will affect the way in which you operate in the broader marketplace. Finances: projects cost money, so you need to be sure that you are aware of where any funding can come from and whether you will be able to contribute to the bottom line through the changes that you are making. 11

14 As well as finances, your arrangements for your project will require people power. You need to be sure that you have the right staff in place for the project to work, and you need to be aware of the implications if you are going to be forced to make individuals redundant because of the changes that you are going to make if needed. Marketing is also a consideration: particularly when your changes involve entering new markets, new products or something similar. You need to be aware of the market data that you have and how you are going to need to make any changes based on this data. Be aware of your customers needs and how they make their purchases as well as how any changes you make are going to impact on their perception of your organisation. Related to this is an analysis of your products and services look at what you are offering and what you propose to offer and determine whether these changes will allow the organisation to function better. Each of these elements allows you to gain information into how your new project is going to impact on the organisation. However, for this information to be useful you need to ensure that it is relatively new. Old information may not provide you with the accuracy that you require when making business decisions. Progress has little to do with speed, but much to do with direction. Author Unknown 12

15 Objectives For you to achieve a task, it is important to know in which direction you are required to head. The overall direction of your organisation can be established through writing objectives. Essentially objectives are a statement of desired performance. They state where you want to head, and what level of performance you wish to achieve. For objectives to be most effective, they must meet criteria that will ensure that they are useable in a particular situation, and allow them to be used to assist in developing work plans, and monitoring. If your objectives do not meet these criteria, you are likely to find that while you have objectives to work towards, you will never actually know for sure if they have been reached or not. The first criterion is that objectives must be clear. Clarity of expression makes the objectives simple for everybody to understand. If you think about it, clarity is one of the most important components of any piece of written communication, after all, if someone can not understand what is being said, how can they possibly be required to follow or reach it? Clarity comes about by ensuring that you use simple language that is unambiguous in its intent. What this means is that you should avoid using jargon, and any term that is complicated or may require further explanation. An important part of being clear is conciseness. If you are being concise it generally means that you are being clear. The less words you use, the less chance there is for confusion, therefore it is important to try and write an objective in as few words as possible (while still retaining meaning). Objectives should also contain a number of pieces of information that make them useful for managers and other staff. These include: Measures of Performance: For any objective to be effective, it must be measurable. If it is not, there is no way that you, as a manager, can attempt to actually measure your performance. Without this form of measurement, it is impossible to know whether or not you have actually met your objectives. So think about the numbers that are required to meet an objective. Don t just say, An improvement in sales say a 25% increase in net sales ; don t say a decrease in production defects say a 15% decrease in production defects. Actions: State the actions that are required, what do you require to happen, and who should do it? By explicitly stating this information, it is easier to develop plans to meet the objectives. Timeframes: Improvements can not just happen over night, but you should set timeframes for their achievement. For example in our example above about reducing defects by 25%, this is a significant decrease in defects and will not be achieved in a matter of days. Therefore it is useful to add a timeframe to state when this type of objective should be met. By doing this you have also set yourself a timeframe for monitoring the situation. Finally, you should ensure that the objectives you write are related to your actual area of responsibility within an organisation. It is not appropriate to write objectives for areas outside of your responsibility. Therefore, go back and check that the objectives you write are appropriate and within you responsibility. If they are not, you should hand the responsibility for writing them on to the appropriate person within the organisation. 13

16 SMART S Specific M Measurable A R T to avoid differing interpretations to allow for monitoring and evaluation Appropriate Realistic to the problems, goals and strategies achievable, challenging and meaningful Time-bound with a specific time period for achieving them Objectives are Not Set in Stone Objectives are unlikely to remain a constant. A team s responsibilities and roles are constantly changing as changes occur in the organisation. This means that it is important to go back, and evaluate the objectives that you have written in the past to ensure that they are still relevant today. Individuals areas of responsibility within an organisation may also change, and so you should go back and attempt to analyse who a given objective will actually apply to. As people move around an organisation this is likely to change. 14

17 Organisational change refers to changes within the organisation that are likely to affect the overall organisation s objectives. This may include changes in strategy, changes to the organisation s product line, and overall direction. Some organisations may expand their operations while others may be forced to retract their operations and form a smaller, more compact organisational structure. In each of these cases, it is likely that the net effect will be changes to company policy and strategy the company will be wanting to head in a new direction. As your company changes direction, your objectives should be changed to allow your programs within the organisation to comply with the overall strategy. The changes required to be made regarding organisational change are likely to result in different measures needing to be applied. For example as an organisation retrenches their operations, performance measures may fall slightly, in order to reflect the smaller operation. As new products are introduced, new performance measures for performance may need to be established. Objectives also need to be kept in line with the overall requirements of both the organisation and teams within it. Think carefully about the purpose of the operation, and the groups you are developing objectives for. If they are not aligned carefully, it is likely that you may find the organisation, and the groups within it, are moving away from each other in terms of their performance. You want both groups to be moving towards the same goals; however you can t get to the same goal if you are heading in different directions. In order to ensure that your objectives are correctly aligned with organisational requirements (or group requirements) you should compare the objectives you have created with the unit s mission statement, and overall strategies. These two documents should clearly state the direction the company is heading, and your objectives should in some form or another work you towards that overall direction. We will discuss this in more detail later in this section. Let s look at an example: If the overall objectives state that production should rise by 25% over the following year, it would be inappropriate for individual group objectives to state that production should only rise by 10%. This would mean that the overall production aim does not meet with the group s production aim, and thus they are not working together towards a specific goal. Action planning typically includes deciding who is going to do what and by when and in what order for the organisation to reach its strategic goals. The design and implementation of the action planning depend on the nature and needs of the organisation. Action planning may seem detailed and tedious compared to earlier phases of strategic planning which often seem creative in nature. Therefore, action planning is too often ignored, leaving the results of earlier stages of planning much as castles in the air useless philosophical statements with no grounding in the day-to-day realities of the organisation. Meaningful stages of earlier planning become utterly useless. The organisation s commitment to strategic planning is only useful to the extent that the organisation completes action plans to reach each strategic goal, and includes numerous methods for verifying and evaluating the actual extent of implementation of the action plan. 15

18 Developing Action Plans (or Work Plans) Let s now move on to examine the work plan (or as it is often referred to - the action plan). An action plan is aimed at specifying exactly what needs to be done in order to correct a problem or to make any changes that are needed to reach a specific goal or set of goals. So you will be following the action plan that outlines the steps, resources and timeline involved. In order to do this: Begin by creating an overall action plan for the project as a whole. This will be a toplevel approach to the process of making the change. Then break down the project into steps or functions you may have an action plan for marketing, one for finance, one for personnel and one for operations as an example. When combined, these action plans should meld together to create the overall strategic action plan. Take the time to provide each manager who is responsible for some functional changes being introduced by the plan to be briefed on any changes that are going to be made. You should also refer to how the action plans are related to the overall changes within the organisation. When writing your action plans, be sure that you cover each of the major changes that you will be implementing within the organisation. This could include all of the following information. Goals for the action plan How your plan allows you to achieve strategic goals Results you expect to be accomplished by the action plan being completed How you will achieve these results When you expect each of the results outlined to be achieved. Satisfaction As managers, we often think we know everything. We expect to be able to know exactly what our customers want and how we are going to make sure they get that. However, you will often find that managers live in a bubble, they are not as familiar with how the customer is feeling as they think they are. In order to really know whether a customer is feeling satisfied, we need to be able to have some hard and fast data on exactly how our customers are actually feeling. A key aspect of knowing how our customers are feeling is knowing exactly what they want. This is a key aspect of marketing. Know your customers and provide them with a service or product that meets those needs at a cost they can afford. In essence this is the marketing concept. So how can you set about establishing exactly what it is your customers are wanting? There are a range of methods that can be used to determine whether your customers are getting what they desire, and in order to show that a given project is going to be effective, you need to be sure you are aware of them. In reality, you are attempting to gain feedback from your customers about the products and services that you are offering, so some of the methods you can use to achieve this include: 16

19 Ask your employees It may be as simple as going up to your staff and asking them. Are you providing the services that your customers want? Are there any areas where there are more complaints than others? Your staff deal with customers on a day-to-day basis and so are the ones in the best position to give this feedback. Provide comment cards While a very simple method of establishing opinions, comment cards are a useful way of getting complaints in. It is well known that most people who have a complaint simply do not complain They let it fester and simply never go back in to a particular organisation again. Unfortunately, without having a complaint, you are not aware of why your customers are not coming back. By using a good comment card, you can gather both good and bad feedback that you might otherwise have never received. This feedback is continual and allows you to track on a day-today basis exactly what complaints are coming and where issues are occurring most. This may vary from week to week, so knowing this information is vital. Comment cards should be available throughout an organisation, so that whether the individual just pops in, or if they are a regular customer, they are able to provide your staff with comments on their performance and their overall satisfaction with your organisational performance. Competition Take a look at what your competition is doing and compare it to what you are offering. If they are performing significantly better, try to find out why this is the case Focus Groups The focus group is a specific market research method that is used to try and get the opinions of your customers. Generally, they involve bringing together 4 to 8 people and asking them for their opinions of your organisation and what your organisation is offering to them in the way of product offerings and services. This method of customer satisfaction research is very useful in that it allows you to gain solid opinions on what you are doing and any changes that you feel need to be made. Your customers also gain a favourable impression of the organisation, because by holding the focus group, you can provide them with immediate feedback and it shows that your organisation is taking these issues raised seriously. It is also very useful to include some of your staff members in the focus group. By including these staff members into the focus group process, it will allow them to get valuable insights into the way that the customers are feeling and may assist them with gaining more knowledge about customer needs. It is however, important not to include many staff as this may make the customers less willing to be open about their opinions. 17

20 So, how does a focus group operate? Begin by making your customers feel comfortable offer them tea or coffee and allow them to get to know each other. Open the group by introducing yourself, and provide a brief overview about why the focus group is being run and what you hope to achieve. Begin the group proper by asking your customers what they like about the organisation keeping things light and positive before you move into those areas which could be heavier. People will open up by providing you with this information first before you ask about where any problems may exist. Next, ask about areas where products or service could be improved. Remember that you are looking for this information, so never be defensive or argue with those in the focus group. They are there to provide you with their honest opinion, so allow them to give it. Once you have spent time in discussion, end the group on a positive note. Thank everyone that attended, and let them know that you value their contributions. Offer them an opportunity to discuss anything in more detail with you and be sure to let them know that you will provide them with information on the outcome of the focus group. Make they feel like they made a difference, because they certainly will have. Surveys by Mail Surveys by mail are often regarded as something that people hate to do. But many people are very happy to provide feedback using this method, especially if you give some form of incentive if they do. Telephone Surveys Cheaper than a mail survey is the telephone survey. You may be able to get your staff to conduct these on your behalf every few months to check how things are going. The Process of Evaluating Service Like all research processes, customer service research has four broad stages. These are: Define the problem and set objectives Develop a research plan Implement the research plan Interpret and report the findings. 18

21 Monitoring Customer Satisfaction In addition to researching customer satisfaction and making recommendations for improvement, you need a means of continually monitoring the implementation of your service improvement plans and your progress towards your service goals. Monitoring is the partner of planning. Planning establishes what we are going to do, while monitoring determines how well we are doing. There are many monitoring tools that you can use to check the effectiveness of your service improvement plans. There are: Budgets Profit and loss statements Run sheets Pareto charts Histograms. Maintaining Records and Reports For the feedback that you receive from your customers to be useful, you must do more than simply gather. You need to gather the information, analyse it and store it so that it can be used for the purpose of planning customer service improvements in the future. This will involve the use of solid record keeping practices and the development and use of specialised database systems that can allow you to store and retrieve appropriate data quickly and efficiently. More importantly, this electronic storage and retrieval of data will enable you to compare data from different time periods in order to track the progress of your projects in the future. Maintaining records and reports in an efficient and accessible way will help you to support service strategies as: Quickly make adjustments and changes to your plans and strategies. Customers change and so you need to be prepared to adjust your plans accordingly. If you stay still long enough, your customers will change so much that your service is no longer appropriate. In the system, you should have a set of records indicating exactly what it is that you have tried in the past to improve performance. This information can be used to see what may or may not work in a given situation. The more comparisons you are able to make, the better the fit a specific strategy will make in a particular situation. Such systems and procedures will enable you to determine what information you need to obtain and keep so that you can get the most effective information possible for making decisions. You should ensure that you keep the most appropriate information and eliminate any information found not reliable. Finally organisations should have a common base of knowledge that is available throughout the organisation. Systems and processes should be similar to allow for the sharing of knowledge throughout the organisation. 19

22 Activity One 1. What is an operational or business plan? 2. What is a strategic plan? 20

23 Activity One 3. Which plan would a CEO be involved in developing? 4. Which plan would you generally be involved in developing? 21

24 Activity One 5. List what you believe to be the requirements of a good action plan for your team. Facilitator s Notes for Activity One 1. An operational or business plan states how an organisation hopes to achieve its strategic goals. 2. A strategic plan sets the overall direction of an organisation. 3. A CEO would generally be involved in strategic planning. 4. This may vary, depending on the Candidate s status in the organisation. 5. Answers will vary - but should consider: the type of project that you intend to implement, the expected results, the plan of activities for setting up and implementing the project, how progress will be tracked, the reporting system, and the cost of carrying out the project. 22

25 Section 1 - True or False Quiz True False A total plan provides the structure for implementing a program. Plans should never change. Plans should be changed to suit the circumstances of an organisation. A good plan should describe the type of project that you intend to implement. Writing a mission statement is a simple task. Mission statements are difficult to formulate. A problem statement outlines the scope of the problem under investigation. The R in SMART refers to objectives being reminiscent of previous objectives. It refers to objectives being realistic. Action plans attempt to allow an organisation to meet its strategic objectives. Objectives should be as clear as possible. The higher risk a project is, the lower the returns you should expect from it. The opposite is true. Finally organisations should have a common base of knowledge that is available throughout the organisation. 23

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