MNE3701 ASSIGNMENT 1 2026
DUE 20 AUGUST 2026
QUESTION 1
Drawing on the arguments and evidence presented in Article 1 (Becherer &
Helms, 2009), critically examine five distinct value-creating functions of a
business plan in the context of new venture formation and early-stage
development.
The business plan is frequently viewed as the foundational document for any new
venture, often serving as the initial step for an entrepreneur in transforming an idea into
a tangible business entity (Longenecker et al., 2017, p. 146). Although some critics
argue that a business plan's value is overstated or that its usefulness diminishes over
time, Article 1 by Becherer and Helms (2009) provides compelling empirical evidence of
its significant value-creating functions. This discussion will critically examine five
distinct functions, supported by theoretical perspectives and empirical findings from the
article.
1. Creating a Framework for Financial Success and Profitability
One of the primary value-creating functions of a business plan is its role in establishing
a clear path to financial viability and profitability. According to Article 1, the purpose of a
business plan includes outlining a strategic approach to pursue an opportunity, including
cost estimates and profitability projections (Becherer & Helms, 2009, p. 1).
The study's empirical findings powerfully support this function. The researchers found a
significant relationship between the use of a business plan at start-up and both the
firm's financial success and the achievement of satisfactory financial return goals
(Becherer & Helms, 2009, p. 10, p. 12). Specifically, firms with a business plan reported
, higher scores on the "Financial Success" dimension and were more satisfied with their
company's achievement of financial returns compared to firms without a plan. This
finding is significant because it moves beyond mere anecdotal advice and provides
statistical evidence that the process of planning - thinking through costs, revenues, and
profit margins - directly contributes to a venture's financial health. As the article notes,
the business plan helps founders make decisions, balance resource supply and
demand, and turn goals into operational steps (Becherer & Helms, 2009, p. 4), all of
which are critical for profitability.
2. Enhancing Strategic Focus and Building a Strong Company Culture
The business plan acts as a blueprint for the venture's strategic direction, helping
entrepreneurs focus on the critical success factors and long-term objectives. Article 1
highlights that proponents of business plans suggest their use as a first step in building
a firm that would be considered an "excellent" organization (Becherer & Helms, 2009, p.
6). This vision goes beyond just financial gain and focuses on creating a sustainable
and high-performing business.
The empirical evidence from the study confirms that a business plan plays a direct role
in this area. The research found a significant relationship between having a business
plan at start-up and the achievement of an "excellent" overall organization, as
measured by the EXCELL scale (Becherer & Helms, 2009, p. 10). The article explains
that this measure is focused on employee development and corporate culture, which
are the hallmarks of a strong, sustainable organization (Becherer & Helms, 2009, p. 12).
As forcing the entrepreneur to articulate a vision and the means to achieve it, the plan
fosters a sense of purpose and direction that permeates the company's culture, laying
the foundation for long-term success and resilience.
DUE 20 AUGUST 2026
QUESTION 1
Drawing on the arguments and evidence presented in Article 1 (Becherer &
Helms, 2009), critically examine five distinct value-creating functions of a
business plan in the context of new venture formation and early-stage
development.
The business plan is frequently viewed as the foundational document for any new
venture, often serving as the initial step for an entrepreneur in transforming an idea into
a tangible business entity (Longenecker et al., 2017, p. 146). Although some critics
argue that a business plan's value is overstated or that its usefulness diminishes over
time, Article 1 by Becherer and Helms (2009) provides compelling empirical evidence of
its significant value-creating functions. This discussion will critically examine five
distinct functions, supported by theoretical perspectives and empirical findings from the
article.
1. Creating a Framework for Financial Success and Profitability
One of the primary value-creating functions of a business plan is its role in establishing
a clear path to financial viability and profitability. According to Article 1, the purpose of a
business plan includes outlining a strategic approach to pursue an opportunity, including
cost estimates and profitability projections (Becherer & Helms, 2009, p. 1).
The study's empirical findings powerfully support this function. The researchers found a
significant relationship between the use of a business plan at start-up and both the
firm's financial success and the achievement of satisfactory financial return goals
(Becherer & Helms, 2009, p. 10, p. 12). Specifically, firms with a business plan reported
, higher scores on the "Financial Success" dimension and were more satisfied with their
company's achievement of financial returns compared to firms without a plan. This
finding is significant because it moves beyond mere anecdotal advice and provides
statistical evidence that the process of planning - thinking through costs, revenues, and
profit margins - directly contributes to a venture's financial health. As the article notes,
the business plan helps founders make decisions, balance resource supply and
demand, and turn goals into operational steps (Becherer & Helms, 2009, p. 4), all of
which are critical for profitability.
2. Enhancing Strategic Focus and Building a Strong Company Culture
The business plan acts as a blueprint for the venture's strategic direction, helping
entrepreneurs focus on the critical success factors and long-term objectives. Article 1
highlights that proponents of business plans suggest their use as a first step in building
a firm that would be considered an "excellent" organization (Becherer & Helms, 2009, p.
6). This vision goes beyond just financial gain and focuses on creating a sustainable
and high-performing business.
The empirical evidence from the study confirms that a business plan plays a direct role
in this area. The research found a significant relationship between having a business
plan at start-up and the achievement of an "excellent" overall organization, as
measured by the EXCELL scale (Becherer & Helms, 2009, p. 10). The article explains
that this measure is focused on employee development and corporate culture, which
are the hallmarks of a strong, sustainable organization (Becherer & Helms, 2009, p. 12).
As forcing the entrepreneur to articulate a vision and the means to achieve it, the plan
fosters a sense of purpose and direction that permeates the company's culture, laying
the foundation for long-term success and resilience.
