Crossovers: A Catalyst for Effective Business Planning

Crossovers: A Catalyst for Effective Business Planning


Crossovers: A Catalyst
for Effective Business Planning In this video we are going to look
first at what is a business plan? Why is it so important for
starting up a creative enterprise? What are the options
for different parts and the content of the business plan? And then finally we will be looking
at some crossovers between arts, culture
and creative industries and then other sectors and what crossover means and why is it so important. So, to start with, a business
plan is a document, which could be done
for an existing enterprise or for a startup company. Here we are going to concentrate
on the second option, which is a business planning
for an emerging creative enterprise. This document is a kind of a vector
for development and it covers several areas, but before we go into that
let’s see the different viewpoints: who is reading this document and how we should elaborate
it from four different viewpoints. The first viewpoint
is the entrepreneur. The business plan has to be written
in a way that it fits to our own idea and it elaborates very well what are the steps we need
to undertake to make this idea happen and to transform
the idea into innovation and respectively after
that into a business model and then into putting
it on the marketplace. The second viewpoint is the one
of the customer, or the client, because business
planning is a process, which has to be done
from the viewpoint of the potential clients
and customers. Why they would be really motivated to buy the product
or to use the service. The third viewpoint
is the one of the investor, a very important viewpoint because
majority of business plans are done exactly because of the reasons
of finding external financing, either from debt instruments, either from debt financing
or equity financing, but they have to show very clearly what is the motivation of an external
investor to invest in the business or what is the motivation of a bank, why the bank and how the bank
would give us the necessary funding. And then the fourth viewpoint is the one of the potential
partner, stakeholder who would like to be not
just financial stakeholder but to support us in any other way. So when we elaborate business plan we have to consider these
four different viewpoints. There are different
types of business plans, and a business plan
could be just two pages but could be also
20 or 50 pages of a document. It’s important in a business
plan to cover four main parts. The first one is
the introductory part, which usually consists
of the executive summary, as well as elaboration of the main
concept of the new business venture. So we have to be very clear
about what is the uniqueness, what is the competitive advantage, what are the mission, vision, and the main strategic
goals of our new enterprise. The second part of the business plan is mainly related
to the results of analysis. This analysis is external
macro- and microanalysis connected with what are our potential
audiences, clients, customers, also what is the competition,
direct and indirect one, as well as how
the political, economic, social and technological factors
of the external environment could influence our business in the
minimum next three years to come. The third part is mainly
the conceptual part where we have to be very clear
about what is our idea and how this idea
is positioned within a context and to make it clear how
this idea really contributes to the development of the arts and
culture sector in a specific area, and again what is the uniqueness and
what is the innovation point behind. And the final part, which
is also very important, is all the operational angles
of the business plan, how do we really envisage
managing the people, how do we envisage
managing the market and also what are
the financials behind it. A very important part
of the business plan here is to elaborate the three
financial statements: the cash flow, the income statement
and also the balance sheet. We usually do it in business
planning for three years because after three years
it is very hard to predict the statistical and other indicators. So, once when we know
the general structure and content of the business plan, let’s see in the last part
of this video what are the crossovers between
arts, culture and creative industries and other sectors,
and how they might be a potential for the elaboration
of a new innovative idea. So, when we say
the word ‘crossovers’, it has several
different connotations. One of them could be the connection between different branches
of creative industries, for example, connection
between fashion and opera, connection between music
and gaming industry, or others. The beauty of creative
industry branches, which actually is mentioned
very little in the literature, is that they are very much connected. So, that, for example,
Harry Potter starts from a book but then it goes into the videos,
into the film industry, into the fashion industry, into the whole merchandising area
around this specific character. And there’re many examples like that,
that the cross-connections between different branches
of creative industries are the one where actually
the innovation point is and we can start a new
entrepreneurial idea. The second way,
the second angle of crossovers is the connection between culture
and business development, also research, education,
as well as a technological sector. And here we can see
three types of organisations. One are incubators, second – accelerators, and the third – creative clusters. What is the difference between them? Incubators are usually
helping startup companies within an existing
educational institution. They aim at longer development, hatching a product
for three or four years, and they are usually not for profit. While accelerators usually
help startup entrepreneurs with coaching, education,
as well as mentoring, but they are for much shorter period and many of them are also
elaborated as business ventures, so that the entrepreneurs
have help from someone, but these investors are looking
at a stake in the future business. Creative clusters
are usually a connection between several organisations
of different types and they aim at synergy
in their resources and the way how they do things. So, such kind of creative
clusters are a great concept in a way how we can explore
local resources. And finally, I would like
to stress the fact that crossovers have an effect
on the way how we position arts, culture and creative industries
in the contemporary society, especially related
to the city planning, because nowadays we are looking
at an integrated approach towards the municipal
and city planning, where arts and culture
plans are not isolated area, but they are very much
connected with others, with the plans for environment,
plans for education, plans for economic development,
for social services and so on. So, from this prospective,
all these crossovers and what we do as creative
and cultural entrepreneurs contribute definitely to the whole
notion and concept of a creative city
and creative placemaking, which means the way how we would like
to position arts and culture as catalyst
for the local development, and also looking
at all the spillover effects, what is happening if we elaborate
a great business idea in the arts, how this new venture is really going
beyond the arts and culture sector and influence other
sectors like hotel chains, businesses around and so on. For example,
the idea of elaborating… developing a new
creative part of the city, or transforming an abandoned
factory into a new cultural centre or a new creative cluster are the ways
how we can make our cities much happier to live in
and to work in. And this is the whole idea of why do we need to really
motivate and boost creative and cultural
entrepreneurship as city makers, city planners
and city developers. Thanks very much
for listening to this course. I hope active listening. And I do encourage you to look
at all the online resources that are connected with that and, hopefully, at the end of all we are going to successfully
pass through the test, which we have prepared for you. Thanks very much once again and be wonderful creative
entrepreneurs in the future.

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