create a roadmap for your institution

Business planning is the critical process of creating a roadmap for your organization to achieve its long-term objectives. It provides a framework to establish a clear direction for your institution, make decisions, allocate resources appropriately,
improve operational processes and evaluate progress towards objectives. In this article, we ask you three challenging questions about the business planning process and try to give you inspirational answers!

1. Is your business plan up to date?

A business plan serves as a reference point for all your stakeholders, including the board of directors, staff, funders and other partners. It also can facilitate communication and collaboration among all your team members to ensure that everyone is aligned and working toward the same goals. Deploying a business plan is a dynamic, iterative process that must be constantly reviewed. In 2024, every professionally run microfinance institution (MFI) should have a solid business plan that highlights strategic choices, values, outreach targets, client segmentation and resource planning. Such a plan must be accompanied
by financial and social projections. Generating projections is never a simple exercise. Many aspects must be considered to predict the evolution of an organization’s financial picture over time. We also recognize that developing a business plan is time-consuming for each department of an MFI.
It is therefore necessary that you approach the process of creating projections with a logical tool that can be understood easily by everyone and that doesn’t require expansive inputs of historical data and assumptions. The tool should offer your team an efficient process that yields accurate results that can be interpreted and modified easily, according to changes in the strategy and achievements of the MFI over the years. 

2. Which tool best suits your needs?

Microfact has developed an easy-to-use tool that can generate financial and social projections over a five-year period: Microvision 17.0. Microvision is designed for all types of MFIs and their partners. It will help you to analyse and adjust your long-term financial plans to ensure sustainable growth. The tool not only provides a framework and background information for strategic and operational planning; it also simulates the impact that different parameters can have on the MFI’s activities.
The projections generated through Microvision provide essential inputs for your MFI’s business plan, with features such as: a single Excel file output, automated importing of historical MFI Factsheet data, segmentation of up to 15 types of loan products and five types of saving products, building up to 3 projection scenarios, and the creation of comprehensive graphs and final reports. 

3. When the next crisis hits, will you be prepared?

Crises in the financial sector come suddenly and are usually a surprise to many, despite the inevitable early warning signals. No institution is exempt from facing a crisis, as we have seen in recent years. Given these facts, MFIs always need to
have plans for a range of potential scenarios. Stress-testing and scenario planning are methodologies that can help you explore how exogenous dynamics and future unknowns might affect your institution. They are practical ways to prepare management to tackle a crisis and build institutional immunity. They also help the MFIs’ investors, which need confirmation of an institution’s preparedness and sound response to crises. Developing scenarios and stress-testing are important elements of any business planning process, and Microvision is a great tool to help MFIs perform them. At Microfact, we recommend six steps in developing your projections. 

Business planning with projections in microvision

Microfact invites you to learn more about projections, stress-testing and scenario building during our e-learning course, which starts on May 1st in English, French and Spanish. This course, “Business planning with projections in Microvision,” will
help you excel in making projections for your institution. 

Remember: business planning, financial projections and stress-testing are critical to the ongoing success of any financial institution!