Part 2: External Management
People reading your business plan will not only be interested in your internal management team, but they also are interested in how you plan on to use External Management Resources. A lot of the time external management resources are overlooked when writing a business plan. However, using External Management Resources can make the difference between success and failure in the management department.

Your External Management Resources give credibility and more expertise as well as acting as a back up to your internal management team. Professional Services and Advisory Board are two sources you should utilize in your External Management Resources.

Professional Services Section
In this section of your business plan’s Management Plan, you should list all the external professional advisors your business plans on using, such as: bankers, lawyers, IT consultantas, accountants, business consultants, etc. These external professionals will be able to provide advice and support your internal management team.

Advisory Board
You should set up an advisory board for your business as soon as possible, because your advisory board will provide information on how to run your business profitably. If you choose your advisory board members carefully they can also provide expertise that your internal management team lacks.

However, when you are selecting people to serve on your Advisory Board, you need to keep in mind that you should pick people that have interest in your business. They also have to want to succeed and provide expertise and good advice. Good choices may include retired executives or managers, successful entrepreneurs, and maybe even vendors would be a good choice. You do not want to include anyone on your Advisory Board that may have conflicting interests such as lawyers, accountants, or a direct competitor. An effective Advisory Board will consist of two or three people that can act as a powerful management tool for a small business.

While writing your business plan you’ll want to list who is on your Advisory Board. You will want to list their names, titles, experience, and expertise while explaining how each of they can contribute to help you make your business successful and profitable.

Conclusion
By having an External Management and an Advisory Board shows those reading your business plan that you are motivated to seek advice from others while making your management team stronger. Most businesses fail because of a poor management structure.

We will be discussing the last part of the management plan section of your business plan is the Human Resources Needs.

Part 1: The Management Plan Section of The Business Plan
Part 2: The Management Plan Section of The Business Plan - External Management Resources
Part 3: The Management Plan Section of The Business Plan - Human Resources Needs

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