Reference no: EM132547851

Task 1 - Operational Plan Development

This assessment task requires development of an operation plan for a business you have access to or for a simulated business.

Prepare the operational plan?

The operational plan details how the organisation will accomplish the goals, objectives and strategies outlined in the strategic plan. It includes the actions to be undertaken in line with the strategic plan objectives, who are responsible for carrying out these actions, and the time frames, costs and key performance indicators associated with these actions.
The operational plan should apply to the life of the strategic plan, but should be reviewed on a regular basis to ensure sufficient progress is being made towards achieving the objectives and so priorities can be revised as necessary.

The operational plan must include each of the elements that are explained below:
• Strategies: How the objectives in your strategic plan will be achieved.
• Actions: Detailed description of the key actions to be undertaken to achieve each strategy.
• Prioritise actions (consultation strategy): The importance of each particular action: low, medium, high. This gives an indication of which actions should be completed earlier or later in the plan.
• Timeframes: Describes the ‘due date' for completion of each action.
• Resources: Resource implications: financial, material and human resources.
• Responsibility: Who is responsible for completing the actions.
• Performance indicators: Indicators of what successful completion of each action looks like.
• Risk management: Assess the potential for elements of the plan to be unsuccessful and plan to manage this.
• Communication plan: How will the plan be communicated to have maximum benefit.
• Review of plan: Develop annual systems to ensure the plan remains current, performance documented and progress is monitored.

Your plan should include strategies with regards to recruiting, inducting and developing personnel, acquiring physical resources and services and protecting intellectual property.

Task 2 - Operational Plan Review

Given the operational plan for Terra Engineering below, develop a system to review performance systems and processes to assess progress in achieving profit and productivity plans and targets. Clearly outline how you will establish if these targets are met.

Likewise, develop systems for:

• Analysis and interpretation of budget and actual financial information to monitor and review profit and productivity performance
• Identification areas of under-performance, and strategies to take prompt action to rectify the situation
• Planning and implementation of systems to ensure that mentoring and coaching are provided to support individuals and teams to effectively, economically and safely use resources
• Identification of variations to operational plans and process gain approval from designated persons/groups for rectification of noted variations
• Documentation of performance

Insurance Requirements

Terra Engineering will have to incur costs for business liability insurance. The estimated cost for this requirement is $4,000 per year.

Operating Capital Requirements

Due to the demands imposed at start up, Terra Engineering will require that the business have sufficient working capital to meet all operational responsibilities of the business for the first three months.

It is estimated that the business will need approximately $20,000 in working capital to sustain and ensure the business meets all opening and on-going financial obligations.

Also, throughout the year there tends to be periods of low activities. Consequently, the company will experience financial pressures during these months. While much of this time will be spent developing proposals and marketing strategies, there will be a need to maintain sufficient working capital to cover these periods.

A long term strategy to maintain a positive cash flow during these periods will be to diversify the company and develop environmental training programs for certain communities. These training programs will be given during these months.

Office Requirements and Asset Acquisitions

Terra Engineering will lease office space on located at:

459 Duncan Avenue, Carlton North, Victoria, 3053.

The office space is leased and will accommodate the necessary office equipment such as computers, fax machine, photo copier, and other engineering equipment. This facility will require an estimated
$5,000 to renovate in a style that is aesthetically pleasing to the clients as well as the owners.

These facilities will be leased at $500 per month. In addition, Terra Engineering will require specialised environmental equipment. These are the estimated costs associated with those investments:

Office Renovations $5,000
Office Equipment and Furniture $6,000 Specialized Field Equipment $27,000 Specialized Software $10,000
Total Capital Costs $48,000

The above noted capital purchases will increase work effectiveness, enhance professionalism and will prepare the business for the forecasted demand for services. Further, the equipment may be leased out to partner associates during times of low activity.

Operational Workflow

As with any consulting firm, the operational workflow for the business is quite uniform and simple to follow. The following is a step by step outline of how contracts are completed on a regular basis:

Step 1 Terra Engineering will respond to a request for proposal (RFP) with a professionally prepared proposal for service;

Step 2 At this point, the potential contract is awarded to either Terra Engineering or other companies which submitted proposals for services. Therefore, communication is made by the contract to the successful consulting firm. If Terra Engineering is successfully selected to perform the work, the contract is then triggered to begin;

Step 3 Terra Engineering will collect a deposit from the client and will begin the project. Deposit values vary depending upon the size and location of the project;

Step 4 Terra Engineering will go ahead and start the project while keeping communication with the client. Once the project reaches 60% - 70% completion, funds will be given to the business by the client to complete the rest of the work;

Step 5 Once the work is completed to the satisfaction of both, Terra Engineering and the client, the final payment for the contract will be made.

The above operational workflow is very standard, easy to understand and within industry's norm.

Terra Engineering will accept cash, cheque and visa payments. These payments are well within industry standards. The business will provide credit to larger account holders. It is estimated that the length and terms of payments are net 30 for all clients. This will allow the business to avoid cash flow problems. Late payment charges are 2% of the projects outstanding balance.

Attachment:- operational plan template.rar