It is likely that most of the sector is looking at a period of substantial transition over the coming months. Given the extent of the crisis created by Covid-19 it is also unlikely that the required response will be a case of simply tweaking the current business plan. In most instances it will require a substantial rethinking of the near future, building on what has been learnt through the events of the last few months. Sadly, we also know that there is going to be a mismatch between sector needs and available resources as the predicted recession hits. This means that not only within arts and culture, but across the wider non-profit sector, competition for funding is going to get more intense.
Dawn
This raises three core questions for me:
- What will your future business model be?
- What have you learnt during lockdown about your potential new model?
- How will you make the case for a new strategy to your stakeholders – including your board or governing body, funders, audiences, beneficiaries and partners
We have already shared a range of resources to help us all think about our business models, so we thought it would be helpful to start to focus on building a business case.
What have we learnt from lockdown?
I think this is a precursor to your business case development because there may be changes you have made during lockdown that will inform what comes next and that you should take into account with your future model. It is likely members of your team may have had an opportunity to re-evaluate how they like to work, some people may have gained more responsibility or autonomy, others may have used skills they didn’t utilise before. Equally, you may have seen what is possible with less resources, how your work can be delivered online more effectively, or created partnerships you’d never have dreamt of before. It should help you ask some big questions like will we be building centric, will we continue remote working, what is the right organisational design?
Reviewing your learning needn’t be a complex or lengthy process and should very much be a shared effort. If you don’t have a team talk to friends, family or partners. As you might imagine Susan and I have spent a lot of time mulling things over, sharing ideas and reflecting on what is happening together.
Here’s a few prompts to help you think about your learning:
- How well did we adapt?
- Did we maintain a shared vision for our work?
- What helped us adapt?
- What constrained us?
- What new opportunities have emerged?
What is a business case and how does it differ from a business plan?
Both support decision-making and help you understand opportunities and risks. A business case usually focuses on a particular area of action, strategy or project whereas a business plan is about the future of the whole organisation. The business case places the emphasis on opportunities, costs and benefits whereas the business plan elaborates your business model.
Given how unpredictable the operating context is at the moment you will probably be thinking in terms of phasing and transition. Creating a business case for each phase may be more practical than working on an ever-changing business plan.
A good business case covers:
- The purpose of the work, the opportunity it addresses and its benefits
- The strategic fit with your organisation and other activity
- Risks
- Affordability and value for money
- Benefits
At the core of creating a good business case from my perspective is building a compelling story. I reviewed a lot of business cases as part of the Arts Council’s Thrive Programme some years ago and the ones that really stood out were the ones that gave me a clear story of what the need was and why this was the best way to address it. It showed me what the risks might be but also illustrated the downsides of not taking the risk . It appealed to heart as well as head!
Think in terms of a clear narrative, and setting out contrasts early on:
- What is?
- What could be?
- A call to action
- The rewards
Susan
No business plan survives first contact with the customer.
This widely used quote has never been truer than it is now. As Dawn has written above, thinking about business models and business cases rather than business plans will be for many, if not most, organisations a more appropriate, motivating and successful response to the world we find ourselves in.
The business case framework can be used in many ways.
- Developed as a full document it can act as a formal ask for support from funders and/or social impact investors.
- A business case is a case for investment. Often that investment is financial, but it could also be the basis for seeking non-cash investment from partners by setting out a clear offer.
- An outline business case could form the basis of a range of funding applications, reducing the workload of developing each application separately and ensuring that that they tell a consistent and compelling story.
- An outline business case could also be a good way to develop a case for support to private funders, making sure that your case for support is grounded in a real opportunity or problem.
- Used as a framework for thinking the business case approach can help you to focus down on the key opportunity you want to exploit or the problem you are trying to solve. Naming the opportunity or problem clearly can be both clarifying and galvanising for you and your team.
Later in the week we will share a tool to help you get to grips with the way business cases are put together quickly. We have created a business case canvas inspired the Business Model Canvas developed by Osterwalder and Pigneur. This is a prototype that we are sharing at an early stage in the spirit of living out our design thinking advice so do let us know what you think via the blog, twitter or LinkedIn.
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