MEI608 Study Guide
| Site: | Saylor University |
| Course: | MEI608: Entrepreneurial Planning |
| Book: | MEI608 Study Guide |
| Printed by: | Guest user |
| Date: | Saturday, 12 September 2026, 9:18 AM |
Navigating this Study Guide
Study Guide Structure
In this study guide, the sections in each unit (1a., 1b., etc.) are the learning outcomes of that unit.
Beneath each learning outcome are:
- questions for you to answer independently;
- a brief summary of the learning outcome topic; and
- and resources related to the learning outcome.
At the end of each unit, there is also a list of suggested vocabulary words.
How to Use this Study Guide
- Review the entire course by reading the learning outcome summaries and suggested resources.
- Test your understanding of the course information by answering questions related to each unit learning outcome and defining and memorizing the vocabulary words at the end of each unit.
By clicking on the gear button on the top right of the screen, you can print the study guide. Then you can make notes, highlight, and underline as you work.
Through reviewing and completing the study guide, you should gain a deeper understanding of each learning outcome in the course and be better prepared for the final exam!
Unit 1: First Steps in Planning Your Business
1a. Outline the steps to take when writing a business plan
- What are the components of a business plan?
- What is the process for writing a business plan?
- Which aspect of the business plan do you think is the most challenging?
A business plan is a formal document used for the long-range planning of a company's operation. A full business plan usually includes an executive summary, business description, market strategies, marketing plan, competitive analysis, operations plan management plan, financial plan, and design and development plan. A business plan is used as an organizational roadmap, which is an internal planning and working tool. There are two main types of business plans. A brief plan is an executive summary that summarizes the key elements of the entire plan. The second is the full business plan.
After a business plan is written, the next step is to obtain financing to start the company. The two forms of business financing are debt, which are borrowed funds that must be repaid, and equity financing, which are funds raised through the sale of stock or ownership in a business. Angel investors are individual investors of people who provide financing for start-up businesses.
To establish credibility for your business plan, we can look at it from four elements: the opportunity, the market, the entrepreneur or the team, and the resources needed.
To review, see:
1b. Apply an appropriate business model to a business
- What types of strategies do you think a small start-up would use?
- How can an entrepreneur use Porter's Five Forces to develop their business plan?
- How do entrepreneurs use the Business Model Canvas before writing their business plan?
One way to begin thinking about a business plan is to use the Business Model Canvas, which is a tool that identifies key partners, key activities, key resources, the value proposition, customer relationship, channels, customer segments, cost structure, and revenue streams.
Understanding the strategy cycle is important to determining an effective business model. The cycle begins with strategic analysis, development of objectives, choosing strategies, implementation of strategies, and measurement and evaluation of the performance of strategies, mission, and vision. A vision statement is usually very broad and expresses what a business wants to accomplish. A mission statement is more specific and broadly describes how the firm will make its vision a reality.
Companies can use various tools to determine their business model and strategic plan. They include PESTEL analysis, which looks at political, economic, social, technological, environmental, and legal issues that impact their business, and also use Porter's Five Forces, which is concerned with industry rivalry, the threat of new entrants, the threat of substitutes, supplier power, and buyer power.
There are several levels of strategies. A business-level strategy is the framework a company uses to organize its activities. Corporate strategy is the broadest level and is mostly concerned with decisions about growing, maintaining, or shrinking a company. Some companies use a growth strategy, where the goal is to increase the company's size. A stability strategy is one where a company wants to maintain its current position in the market. A defensive strategy is used when a company is struggling.
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1c. Analyze ethics as it relates to entrepreneurship
- What is the difference between a stakeholder and a shareholder?
- What elements of ethics are important as an entrepreneur?
- How do entrepreneurs implement corporate social responsibility into business plans?
Stakeholders are a large group of people that includes anyone involved in the interest of the business. Shareholders are a smaller group of owners of the company. To have a successful business, concern with shareholders and stakeholders is important.
Ethics relates to the behavior you expect of yourself, such as always telling the truth. Business ethics guides the conduct by which entrepreneurs and their companies abide. Many legal situations may also be ethical issues in entrepreneurship, including contracts, antitrust, fraud, employment, torts, and intellectual property. A conflict of interest is when an individual has interests in multiple areas, such as financial investments, work obligations, and personal relationships.
Corporate social responsibility is the practice of a business viewing itself in a broader context as a member of society with implicit social obligations. When we look at social responsibility, we can look at four areas of responsibility: legal, financial, ethical, and social/philanthropic. Entrepreneurs can look at excellence, fairness, and trust as cornerstones of being socially responsible.
To review, see:
Unit 1 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- Business Model Canvas
- business plan
- conflict of interest
- corporate social responsibility
- corporate strategy
- debt financing
- defensive strategy
- equity financing
- ethics
- growth strategy
- Porter's Five Forces
- shareholder
- stability strategy
- stakeholder
Unit 2: The Competitive Analysis
2a. Choose appropriate business planning tools such as SWOT or PESTLE for competitive analysis
- Why do entrepreneurs perform a competitive analysis?
- How can the competitive analysis grid be used to better understand external environments?
The competitive analysis is designed to provide the entrepreneur with information about how competitors market their business. This allows the entrepreneur to identify how best to penetrate the market and identify gaps in the market.
A competitive analysis grid lists key characteristics of the competitive landscape, including competitive strengths and weaknesses. This provides a solid overview of the market.
Another tool used is the SWOT analysis, which addresses strengths, weaknesses, opportunities, and threats. Companies also use a PEST analysis, which is a tool that addresses factors in the external environment. PEST stands for political, economic, societal, and technological factors.
Besides these tools, companies will use market research to find customers and help understand their customers' needs and wants. They will look at factors like demand, market size, economic indicators, location, market saturation, and potential pricing models.
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2b. Select methods to analyze internal and external environments
- When is a mechanistic organizational structure used?
- In what situation is an organic organizational structure used?
- How might an entrepreneur use the McKinsey 7-S model?
When entrepreneurs write their business plan, addressing the external environment and macro forces that could impact their business is important. This includes economic, technological, sociocultural, natural disasters, human-induced problems, and government and political forces.
Entrepreneurs also look at external environments and industries by determining whether or not the industry is stable and the complexity of the industry. As a result of these factors, they may choose a mechanistic organizational structure or an organic one. A mechanistic organizational structure is usually used for stable, low-uncertainty environments. In contrast, organic organizational structures, often used by entrepreneurs as they get started, are used for unstable, highly uncertain environments.
Within these structures are functional, divisional, geographic, and matrix structures. However, many companies use organic, simple structures when they are just starting out.
An open model system model of an organization looks at the environment and considers the inputs, throughputs, and outputs. When considering the internal environment, the McKinsey 7-S model describes the elements a company should have, which include shared values, systems, style, staff, skills, strategy, and structure.
To review, see:
Unit 2 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- competitive analysis
- competitive analysis grid
- mechanistic organizational structure
- open system model
- organic organizational structure
Unit 3: Operations Planning
3a. Evaluate operational methods and operational considerations in a start-up business
- What are the most important aspects of operations planning?
- What are the foundations of operations management?
Operations in entrepreneurship, specifically the operations plan, addresses five areas: money, methods, machines, people, and leadership. Ultimately, this section of the plan focuses on product production processes or workflows when developing services.
To produce a product, operations needs include things like:
- determining a legal structure for a business;
- deciding on a name;
- filing necessary governmental paperwork;
- opening bank accounts;
- obtaining insurance; and
- ordering inventory.
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3b. Explain operational elements, such as legal considerations, technology, and production methods, when creating an operational business plan
- What is the meaning of capital?
- What operations elements should be considered for different types of business?
- How might an entrepreneur use a risk matrix?
Entrepreneurs need capital to start or grow a business. Capital refers to money or cash, which allows purchases of the tools and raw materials needed to produce a product. While sources of capital will normally be addressed in the financial plan of a business, understanding operations costs, such as the cost of equipment that needs to be purchased, will be part of the operations plan.
Understanding risk is also an important part of operations. Many entrepreneurs use a risk matrix to assess the likelihood and severity of different business risks. The matrix consists of the probability of something happening and the impact it would make.
In terms of technology, small businesses need to be concerned about the risks of viruses, spyware, and other malicious code, along with cyber-attacks. The operations plan usually addresses the technology needs, including technology used to avoid cyberattacks. Other forms of technology used might include websites, email lists, systems to manage human resources, and transaction processing systems.
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3c. Choose an appropriate business structure for a business
- How does the span of control impact organizational design?
- What is centralization?
- What elements go into determining organizational structure?
When designing an organizational structure, there are a few important considerations. First, determining the span of control, which is the number of employees a manager directly supervises, can help determine the organizational structure.
Another consideration for organizational structures includes the degree of centralization, that is, the degree to which formal authority is concentrated in one area within levels of the organization. In a highly centralized structure, top management makes most of the decisions.
Most smaller organizations will utilize an organic structure, but as the business grows, the structure will become more mechanistic as departmentalization becomes more rigid and decision-making authority is centralized. Once decisions are made on how work activities are divided, how people will be grouped, and how authority will be managed, a company can determine the best organizational structure.
To review, see:
Unit 3 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- capital
- centralization
- operations plan
- risk matrix
- span of control
Unit 4: Management and Marketing Planning
4a. Analyze marketing plans to sell a product or service
- How do entrepreneurs apply the 7Ps to market their business?
- What are the different types of market research you might engage in?
The marketing mix consists of the 7Ps: product, promotion, price, place, people, physical environment, and process. Each element plays a role in marketing and how the entrepreneur will write the marketing plan. Product refers to the definition of the value of the good or service being provided; promotion involves communication with the customer; price maximizes competitiveness and profits; place involves reaching the market at a reasonable cost; people involves linking companies to customers; the physical environment is what is conveyed through atmospherics; and process involves the ways to build trust through effective processes.
Entrepreneurs engage in research to put together a marketing plan. Primary research entails collecting new data to answer a specific set of questions. In secondary research, already-existing data is used to inform the entrepreneur about the target customer and markets.
Brand strategy is the image a company wants to convey to its customers. When entrepreneurs write marketing plans, the goal is to convey the marketing objectives, strategies, and actions they plan to take to attempt to sell their product or service.
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4b. Apply the necessary components of management plans
- What is management?
- Why should skills and abilities be addressed in a management plan?
- What key advisors and service providers should be used?
Management is the process of guiding the development, maintenance, and allocation of resources to attain the company's goals. Management consists of four main activities: organizing, planning, leading, and controlling.
In a management plan, it is important to address the various team members, such as owners and managers, along with their key skills and abilities that make them uniquely qualified for the position. Also, addressing key advisors and service providers is necessary. This can include people like attorneys and insurance agents.
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4c. Adapt human resource management strategies to your business
- What aspects are involved in human resource management?
- How might an entrepreneur apply the team development process to better understand how to manage people?
Human Resource Management is the process of hiring, developing, motivating, and evaluating employees to achieve organizational goals, and is a key skill in entrepreneurship. Human resource planning involves:
- determining goals and strategies;
- performing job analysis;
- recruiting employees;
- selecting employees;
- training the employees;
- evaluating performance; and
- determining appropriate compensation and benefits.
One of the goals of human resource management is to keep retention and turnover low.
As part of human resource management, understanding the role of teams in an entrepreneurial venture is important. Teams develop over time, and depending on the phase of team development, as a manager, you may take a different focus, either task-focused or relationship-focused. The phases include forming, storming, norming, and performing.
To review, see:
Unit 4 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- 7Ps
- human resource management
- management
- primary research
- secondary research
Unit 5: Financial Statements and Entrepreneurial Finance Planning
5a. Categorize the common financial statements of a business plan
- Why do entrepreneurs need to develop financial statements for their business plans?
- What is the difference between assets, liabilities, and owner's equity?
- What funding strategies can start-ups use?
Three main strategies can be used for funding an entrepreneurial venture: seed funding, which comes from personal savings and small investments; early funding, which can consist of private equity, venture capitalists, or angel investors; and mature growth funding, where an IPO and self-sustaining funding may take place.
Entrepreneurs may focus on debt financing, where the lender does not take a stake in the company, or equity financing, where the lender becomes part owner of the company.
As an entrepreneur, it is important to understand some accounting basics, even if you hire a bookkeeper. The basic accounting equation is assets = liabilities + equity. Assets can be things such as cash, whereas liabilities are debt, and equity is the owner's claim on the assets of the business, which is basically the difference between what they have and what they owe. In terms of the business plan, most investors will want to see an income statement, balance sheet, and statement of cash flows to show their ability to sustain the business.
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5b. Create budget forecasts using best practices for a new business
- What are startup costs?
- What are the tools that can be used to forecast sales?
Forecasting is an important aspect of the business plan. Entrepreneurs will want to forecast sales and cash flow to show the potential success of the business. To forecast sales, people can use historical data to look for growth trends and where there might be months showing declines in sales. Of course, the past is not always a predictor of sales, so as customer bases and businesses change, the forecasts must change, too.
Entrepreneurs also use budgets to determine how much they expect to spend, and it also helps them determine what their startup costs might be. Startup costs can include things like equipment, supplies, communications, licenses and permits, inventory, and marketing.
To review, see:
Unit 5 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- accounting equation
- early funding
- mature growth funding
- seed funding
Unit 6: Other Business Planning Elements
6a. Apply best practices in business plan writing, such as brevity and conciseness
- What elements of the business plan should be considered?
- Why is an executive summary written last?
- How should a business plan be formatted?
To be the most useful, business plans must be realistic. For example, sales projections and cash flow in the first draft of a business plan may not coincide with the rest of the plan. This is why it is important to focus on several drafts of the plan. When reviewing the second draft of a plan, the entrepreneur should review and revise sales projections, adjust strategies to make financial statements realistic, and ensure the written and financial parts of the plan are well synchronized.
A business plan should include the essential initial resource, note the business model, have an introduction, operations plan, human resource plan, marketing plan, and financial plans. Goals throughout the plan should be clear. Once this is done, an entrepreneur writes the executive summary, proofreads it, and creates a pitch for the plan.
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6b. Analyze the different elements of a business plan, such as the executive summary
- What is an executive summary?
- What should be included in a business description for a business plan?
- What types of formats and samples of business plans are available?
The executive summary of a business plan is usually written last and outlines all of the key elements of the entire business plan. When writing a business description for the business plan, the business description describes the industry, your product or service, the business itself, and success factors.
When considering what to write in a business plan, reviewing templates and considering its format and how long it will be, such as choosing a traditional business plan or a lean startup plan, are all important decisions to be made.
To review, see:
Unit 6 Vocabulary
This vocabulary list includes terms you will need to know to successfully complete the final exam.
- executive summary