A business is as efficient as its team and its management. Therefore, it becomes important for business owners to build a structured management team that achieves the objectives and goals set by the organization.
Andrew Carnegie, an American steel magnate, beautifully summarized it –
“Teamwork is the ability to work together toward a common vision. The ability to direct individual accomplishments toward organizational objectives.”
A business management plan helps build an efficient team and formalizes business operations. This helps businesses streamline strategies to achieve their goals.
So, if you are a business owner who is looking to formalize their business structure and write the management team section in their business plans, this guide is for you.
Here’s a sneak peek into what you’ll learn:
Sounds good? Let’s dive in.
What is the Management Section of a Business Plan?
The management section of a business plan is an in-depth description of a business’s team, its structure, and the owners of a business.
The section discusses who is on the management team—internal and external, their skill sets, experiences, and how meaningfully they would contribute to an organization’s mission statement and goals.
Now that we have defined what the management section of a business plan is, let’s understand why it is so important.
Importance of a Business Plan Management Section
The management section helps you to
- Showcase leadership: The management team section helps you showcase how qualified and experienced team you have.
- Clarify team roles: It outlines who does what in your team, ensuring everyone knows their key performance areas and works together towards the same goals.
- Attract investors: Present your team in the best possible way, as it is one of the key factors in making the final investment decision.
What to include in the Management Section of a Business Plan?
Now that you know why exactly a management section in the business plan is necessary, let’s move ahead with what to include in it:
1. The Management Team
An organization’s entire management team can be divided into parts — the internal team and the external team. Let us see those in detail:
The Internal Management Team
A business team consists of several departments. The most common departments are—marketing, sales, IT, customer service, operations, finance, and HR.
These departments depend on the nature and functioning of your business. For example, a dental clinic may not require a sales department per se.
The entire management team is distinguished according to their responsibility. This helps the business owners and investors be aware of the roles, benefits, ESOPs (if applicable), profit sharing (for sales), work contracts, NDAs (Non-Disclosure Agreements), and Non-Competition Agreements of the entire team.
It is recommended that business owners collect and document the following information about their team:
- Educational Background
- Work Experience
- Accomplishments
The External Management Team
The external management team is usually composed of—advisory board members and professional services.
Advisory board members help by:
- Bringing their industry expertise, experience, and knowledge to the table.
- Offering strategic advice and helping the business develop long-term goals with future considerations in mind.
- Having a lot more contacts than any other individual can help businesses grow.
Credible advisory board members show great commitment to a company’s growth. Therefore, it becomes important to mention their experience and specialization in the business management plan.
The advisory board members can help give valuable advice that internal team members need or lack.
Usually, board members meet quarterly or monthly to provide strategic guidance in place of stock options in your company. This helps attract the best advisors and motivates them to invest in your business.
On the other hand, professional service helps by
- Offering highly specialized advice and sharing knowledge.
- Helping through the implementation process of strategies.
Such services help businesses leverage skills that would be difficult to build and acquire over a short period.
Examples of such professional services are:
- Accounting
- Banking
- Legal
- IT Consultants
- Marketing
- Business coaches and consultants
After a brief overview of the management team, let’s move forward.
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2. The Management Team Gaps
The management team gap is an important part of the management section. Primarily because it helps document if your management team currently has gaps or missing skills.
Your team may lack a few required skills while starting. The management team gaps help you to be aware and make efforts to close this gap.
As a business owner, you must document what positions are missing and who ought to fill those positions or take responsibility.
For example, if you need a VP of Sales, clearly document this in the section.
Also, write down the job description and key responsibilities to be undertaken. For example—you might mention that the role requires 10 years of experience in the sales domain. The applicant must have experience handling a sales team, closing new accounts, and working in tandem with the marketing team.
Be as detailed as possible. This will help you build a checklist while interviewing the right candidate and also win investor confidence in your managerial skills.
Here are a few key positions you would want to include in your management team business plan:
- Founder and/or CEO
- Chief Technical Officer (CTO)
- Chief Marketing Officer (CMO)
- Head of Product Management (PM)
- VP of Sales
- VP of Marketing
- Business Development Manager
- Customer Service Manager
- Sales Managers/Sales Staff
- Human Resources Manager
- Advisory Board Members
3. The Management Structure
The management structure defines how a business organizes its management hierarchy. A hierarchy helps determine all team members’ roles, positions, power, and responsibilities.
The management structure also depends upon the type of business ownership. Business ownership can be—a sole proprietorship, partnership, or LLC.
Following is a sample management structure of an organization.
Now that we understand what details we need to document in business management plans, let’s have a look at the example.
Example of a Management Section Plan
[Management Section of a Hotel]
[Management Team]
Internal Team Members
#1
Name: Charles Fargo
Role: Owner
Responsibility: Formulating key strategies, defining budgets, and building a business plan
Experience: 35 years of owning multiple hotels in Las Vegas
Educational Background: B.Sc in Hospitality Management from South Dakota State University.
#2
Name: Michael Clark
Role: General Manager
Responsibility: Overall hotel operations – guest interactions, revenue management, brand ambassador of the hotel, customer satisfaction, and experience, leadership to all departments
Experience: 25 years working with several technology hotels as the general manager.
Educational Background: MBA from Wharton School
#3
Name: George Trump
Role: Department Manager
Responsibility: Manage employees, smooth coordination amongst employees, plan daily affairs of the department, strategize, prepare reports, and deal with complaints and suggestions. Lead team members to function as a team
Experience: 15 years working as a department manager
Educational Background: BSc in Hotel Management from Texas University
Note: There can be multiple Department Managers depending on the nature of your business. In the case of hotels, departments can include – housekeeping, logistics, security, food, and banquets.
#4
Name: Donald Clooney
Role: Marketing and Sales Manager
Responsibility: Increase occupancy and generate revenue. Position the hotel as an option for leisure activities, relaxation, and holidays.
Experience: 11 years working as the marketing and sales manager for hotels
Educational Background: MBA in Tourism and Hospitality from Midway University
#5
Name: Oprah Williams
Role: Human Resources Manager
Responsibility: Recruit and train hotel staff, maintain smooth onboarding process for new recruits, train, counsel, and coach staff, resolve conflicts, and conduct performance reviews
Experience: 9 years working as human resources manager for hotels
Educational Background: MBA in Human Resources Management from California University
External Team Members
Advisory Board Member
#1 Richard Branson
Responsibility: Strategic advisory for sustainable growth and expansion
Experience: Founder of Virgin Group
Professional Services
#1 Digital Marketing Agency – Neil Patel
– Help market and sell our product using digital mediums – blog, website, YouTube, and social media.
[Management Structure]
There is a gap in one key position in our startup.
#1 Chief Finance Officer (CFO)
Responsibilities: Finance, Accounting, Tracking Profit and Loss, and overseeing FP&A (Financial Planning and Analysis)
Conclusion
So, that’s it for today! Now that you know how to write a management team section, make sure you write the best one by mentioning all the necessary details.
If you are still confused about writing the management team sections, then you can visit various sample business plans to know more. You can even use smart business planning software to smooth your business planning process.
