Editor’s Note: This is the second part of a series of Business Plan classes from DeAim Innovative Resources Limited. In this part, Bridget Olotu provides a powerful guide to writing an executive summary for a professional business plan.
The Executive Summary is often the most important part of your business plan. As the name suggests, it is the summary of the entire plan. Positioned at the front of the document, it is the first part to be read. However, as a summary, it makes sense to write it last. It may be the only part that will be read. Faced with a large pile of funding requests, venture capitalists, banks and different categories of investors have been known to separate business plans into ‘worth considering’ and ‘discard’ piles based on this section alone.
What is the Executive Summary?
The executive summary is a synopsis of the key points of your entire plan. It should include highlights from each section of the rest of the document – from the key features of the business opportunity through to the elements of the financial forecasts. Its purpose is to explain the basics of your business in a way that both informs and interests the reader. If, after reading the executive summary, an investor or manager understands what the business is about and is keen to know more, the executive summary has done its job. It should also be concise. In some cases, it should be no longer than two pages at most – but should be interesting to read. It’s advisable to write this section of your plan after you have completed the rest.
What is it not?
- The executive summary is not a brief description of the business and its products or a synopsis of the entire plan. It is a summary of the key points of your business plan.
- It is not an extended table of contents because this will make for very dull reading and may put off the reader. You should rather ensure it shows the highlights of the plan, than restating the details the plan contains.
- It is not a hype document for bragging what your business will achieve and how much money you will be making for yourself or for your investors. Agreed, the executive summary should excite the reader enough to read the entire plan. However, an experienced investor or businessperson will recognise hype and this will undermine the plan’s credibility.
The Need for the Executive Summary
- It is time-saving for anyone who wants to understand what your business plan is all about. By reading the executive summary, a reader of your plan understands the direction of your business, what it intends to do, who its markets are, what products it is offering at what price, who its owners and managers are, the compensation plan and all other important details that you find in a well-organised business.
- Investors can easily make up their mind by reading this section of your plan.
- Managers can know the direction of the business and its strategic plans by going through this section.
- It can also help you as the owner of the business to get fast information about the business without necessarily delving into the other more detailed parts of the plan.
However, you may require professional help to put together a plan that will secure external funding for your business or to initiate aggressive marketing campaign or to develop a strategic content for your business. Stay blessed.
Bridget Olotu is theCEO/Lead Consultant, DeAim Innovative Resources Ltd, a management and business consulting and human resource development organisation. You can order for your SME Toolkit manual of 2008. You can reach her on 08033036002 or firstname.lastname@example.org for your business and management concerns.