Using Tabletop Exercises to Test Business Plans

Table Top eXercises (TTX) are simulations of real-world scenarios that test an organization's preparedness and its response capabilities, usually to emergency situations or emergent situations like pandemics. Tabletop exercises can help improve communication, coordination, decision-making and problem-solving skills among team members, no matter what industry such as cybersecurity, industrial control systems (ICS/OT), business continuity, public safety, and healthcare as examples.

To understand TTX, it helps to compare them to other types of exercises. Unlike functional and full-scale exercises that involve real-time scenarios and emergency personnel, tabletop exercises are less intense and played out around a table. Participants respond to prompts from the leader and use their organization's emergency plans to make suggestions.

This article explores the use of tabletop exercises (TTX) in the context of achieving a business plan's stated objective, specifically, the business' mission statement. Instead of focusing on cybersecurity or business continuity use cases, this article delves into establishing a mission statement, the components of a business plan, the role of TTX participants, the objectives of the TTX, and after-action reports as briefings for executing the business plan. Through this exploration, we aim to provide a comprehensive understanding of the TTX usage with business plans.

The Mission Statement

A company's mission statement serves as the overall objective of the business plan, guiding every action towards its achievement. It should be known and understood by all members of the organization, using simple and concise language that can be conveyed in less than 20 seconds. A mission statement answers important questions such as:

1. WHO the clients are.
2. WHAT the company does for them.
3. HOW it does it.
4. WHERE it provides the service.
5. WHEN it does it.
6. WHY it is doing it for the clients.

Achieving clarity in the mission statement can take time, but it pays off in the long run as it guides the company towards its overall objective. A mission statement is more than just a slogan or a catchy phrase - it is a statement of the overall objective of a company, which guides its decisions and actions. A good mission statement can help align the team’s efforts, motivate employees, and communicate with customers.

With a clear mission statement, we can move forward to its execution - the business plan. The mission statement should test the effectiveness of the business plan, which we can use a TTX to simulate and evaluate.

Anatomy of a Business Plan

"Everybody has a plan until they get punched in the face." Mike Tyson said right before his fight with Evander Holyfield in 1996.

A business plan is a document that defines your business’s objectives flowing from its hashtag#missionstatement and how you plan to achieve them. It outlines your goals, strategies, market analysis, financial projections and other aspects of your business. Its general components include:

1. Executive summary: A brief overview of your business’s mission, vision, products or services, target market, competitive advantage, and financial highlights.
2. Business Description: A detailed description of your business’s history, legal structure, ownership, location, and operations.
3. Market Analysis and Strategy: A thorough analysis of your industry, competitors, customers, and market trends. Also includes your marketing and sales strategies to reach and retain customers.
4. Products and services description: A clear explanation of what you offer to your customers and how it differs from other similar products or services in the market.
5. Management and organization description: An outline of your business’s organizational structure, key roles and responsibilities, qualifications and experience of your team members.
6. Financial plan: A projection of your income statement (revenue minus expenses), balance sheet (assets minus liabilities), cash flow statement (cash inflows minus outflows), break-even analysis (the point where revenue equals expenses), and funding requirements (how much money you need to start or grow your business).

Baked into these major components are specific plans that are generally implemented by different departments within large organizations, such as:

• Marketing & Sales Plans
• Operations Plans
• Staffing Plans
• Financial Plans

Although creation of the business plan is outside the scope of this article, it is important to include measurable key performance indicators (KPI) and milestones. Without the ability to measure your actions, progress, and goals, a TTX would not only be impossible, but it wouldn't yield actionable results.

Business Plan TTX Participants

We have the mission statement for measuring and its implementation in the business plan. So, who participates in a TTX? There are different ways to categorize the major disciplines within companies, however, some common ones are:

• Management: This is not considered a department of a company, but it fulfills a series of jobs within it. It involves planning, organizing, leading and controlling the activities and resources of the business.
• Administration: This department handles the administrative tasks such as record keeping, communication, payroll and office management.
• Finance: This department deals with the financial aspects of the business such as accounting, budgeting, auditing and reporting. It may also include finding investors and external funding opportunities for growing the business.
• Marketing: This department is responsible for creating and implementing strategies to promote and sell the products or services of the business to potential customers. It may involve market research, advertising, public relations and customer service.
• Sales: This department is in charge of generating revenue for the business by selling its products or services to customers. It may involve negotiating contracts, closing deals and maintaining relationships with clients.
• Purchasing: This department is responsible for acquiring the materials, supplies and equipment needed for the production or operation of the business. It may involve sourcing vendors, negotiating prices and managing inventory.
• Logistics: This department is responsible for managing the transportation and distribution of goods or services from suppliers to customers. It may involve scheduling deliveries, tracking shipments and ensuring quality control.
• Production: This department is responsible for transforming raw materials into finished products or services that meet customer expectations. It may involve designing processes, operating machines and ensuring safety standards.
• Research and Development (R&D): This department is responsible for creating new products or services or improving existing ones through innovation and experimentation. It may involve conducting research, testing prototypes and applying patents.
• Information Technology (IT): This department is responsible for managing the information systems and technology infrastructure of the business. It may involve installing hardware, developing software, maintaining networks and providing technical support.

In my opinion, there are three scenarios that would govern who participants:

1. Startup Phase: This phase creates the business idea, develops the initial product or service, and launches the business. During this phase, the focus is on survival and establishing the business in the market. Management, Finance and Sales would be the most important participants for a TTX in most industries.
2. Growth Phase: Once established, the company enters the growth phase, where the emphasis is on expanding the customer base, increasing revenue, and scaling operations. This phase requires a significant investment in resources and careful management to ensure sustainable growth. Management, Finance, Operations, and IT would be key in this phase.
3. Maturity Phase: The company achieved its desired level of growth and market penetration, and now focuses on maintaining and optimizing business operations, improving efficiency, and sustaining profitability. Companies in this phase may also explore new revenue streams or market segments to continue their growth trajectory. Management, Administration, Finance, and Production are most important participants for this phase.

Those are the active participants in the TTX, but since the TTX is designed to elicit constructive discussion as participants examine and resolve the problems based on the business plan, you must have support:

• The exercise planner(s) plan, develop and execute the tabletop exercise. They should have a clear objective statement (based upon the mission statement), establish who participates, develop realistic scenarios, set ground rules, do the hot wash (a debriefing session), write the after-action report and create an implementation plan.
• The facilitator(s) guide the discussion during the tabletop exercise. They should have a good understanding of the objectives, scenarios and expected outcomes of the exercise. They should also be able to keep the participants focused, engaged and respectful.
• The evaluator(s) observe and assess the performance of the participants during the tabletop exercise. They should have a clear set of criteria and metrics to measure how well the participants met their objectives, followed their plans and communicated effectively.

Can these all be the same person? Absolutely, and in fact it would be much more efficient if it was but realistically there are very few people who can do all of the above activities well.

Bringing it all together

We now have the mission statement for measurement, a business plan as implementation guide, and participants to execute the TTX, but what comes next is where the magic really is. In order to make any tabletop exercise effective, you should have these items:

1. Ground rules should be set prior to the beginning of the TTX.
2. Complete a "hot wash" as close to the end of the exercise as possible. A hot wash is a brief discussion to identify the top strengths and areas of improvement of the participants and their plans. The facilitator records the feedback and uses it to write an after-action report and an implementation plan.
3. Create an after-action report. An after-action report analyzes the results and performance of a TTX. It identifies the strengths and weaknesses of the participants and their plans, as well as the lessons learned and recommendations for improvement.
4. Create an implementation plan to integrate the findings of the after-action report into the business plan and its integrated plans (above).

And like every good cliff hanger, each of these deserves its own article, but that's enough for now. Next up will be a review of some scenarios that could be played out within a business plan TTX.