The Ultimate Guide to Writing an Executive Summary for Business Plans

In this tutorial, we look at how to write an effective executive summary. We’ll explain the difference between an executive summary and an Introduction, then look at how you to improve the tone, narrative, and language.

Your ability to summarize your business plan, report, or proposal affects the likelihood you’ll receive the funding, support, or recommendations to proceed with your business, venture, or research.

Think of the Executive Summary as the Cliff Notes of your main document. It gives you the gist of what’s involved – a  snapshot, the key highlights – without having to read the entire document.

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Purpose

An Executive Summary aims to:

  • Summarize the key points so readers don’t have to read the accompanying document.
  • Help the reader quickly understand the report.
  • Encourage the reader to either read the main document or delegate the reading task to another person for evaluation.
  • Provide sufficient information for the document to be understood in isolation. In other words, if you removed the executive summary from the main document, and read it, you’d be able to grasp the gist of the document.

Definition of an executive summary

An executive summary, as the name suggests, is:

  • For busy individuals in a decision-making position.
  • Written to be understood in one quick reading.
  • Provide enough information for the reader to decide to continue with the main document or not. After scanning it, they should be able to say, Yes, I want to read more, or No, this is not for me.

Why do we need an Executive Summary?

Not every document needs an executive summary. However, if your document is more than fifteen pages, an executive summary is a nice way to orient the reader. It gives them a snapshot of the document and helps them determine if it’s worth their time to read the main document.

There is also a second benefit. It helps you, as a writer, check if you’ve structured the document correctly and that you understand the material. If you struggle to write the executive summary, you should take a step back and see what’s unclear to you.

After all, if it doesn’t work for you, others will struggle too.

So, ask yourself: what’s the purpose of this executive summary?

When you can answer this question for yourself, it becomes easier to write, structure, and format the text.

Here’s how to look at it.

  • Let’s say you have a 200 page proposal. This document is presented to someone in the decision-making process, for example, someone who authorizes grant applications.
  • They don’t have the time to read 200 pages but they need to make a decision. This is where the executive summary comes in. It distils the entire document into a short synopsis.
  • In theory, the reader, should be able to understand the gist of the document from this summary.
  • If the summary is compelling enough, maybe they’ll pass it on to other staff who’ll examine the finer details and evaluate the relative merit of the document.

Difference between an Executive Summary and Introduction

The executive summary boils down the main points in the main document. For example, if you’re responding to an RFP, it might outline the business problem, proposed solution, key personnel, and costs.

  • The introduction is the next step down. It introduces the main chapters, explains their purpose, and explains the proposal in detail.
  • The executive summary is a high-level summary. The introduction starts the main document.

Another difference is that, in general, you write the Introduction at the start, whereas you write the executive summary at the end.

Why?

Because the document itself changes during drafts and reviews. Once it’s completed – and approved for sign-off – you can distil the contents into the summary.

Business Plan: Excel Templates

Some of the Excel spreadsheets include a Balance Sheet, Break-even Analysis, Cash Flow, Competitive Analysis, General Demographic Profile, Personal Financial Statement, Profit and Loss Projections, and Sales Forecast.

[Learn More About These Templates]

Are Executive Summaries only for Executives?

No.

It’s for anyone in a decision-making position. In general, this covers anyone in an executive position, however, you need to consider that the reader could be a scientist, researcher, accountant, or civil servant.

However, your goal is the same.

  • Summarize the document.
  • Generate interest.
  • Encourage them to read the main document.

Who is the audience of Executive Summaries?

In general, your readers are:

  • Busy. So be direct, remove the waffle, get to the point.
  • Experts in their respective fields, so be careful with the tone and phrasing.
  • Hold senior positions or a position of influence.
  • Need to understand the key concepts quickly.

Knowing this, structure your executive summary so it can be understood in one glance, avoid jargon, and encourage the reader to continue reading or delegate the reading to other staff.

  • Consolidate the major points.
  • Provide enough information for the reader to digest the proposal, plan, or research.
  • Help executives make decisions (technical, financial, scientific) on funding, personnel, policy, etc. based on findings or recommendations in this document.
  • Summarize the main document’s purpose, scope, methods, results, findings, and recommendations.
  • Explain how results were obtained.
  • Explain why the recommendations were made.
  • After skimming the executive summary, the reader should have enough information to decide whether to read the entire document.

How long is an executive summary?

Your goal is to give the reader enough information to decide if they want to invest time in reading the rest of the document.

  • Aim for one to three pages. Two is usually fine. Remember, this is a summary.
  • Don’t be tempted to provide unnecessary details.
  • Keep it as short as possible, but avoid reducing it to an abstract.
  • If you find the word count is climbing, see if you can refine the text, shorten sentences, and swapping long for short words.
  • One suggested approach is to mirror the structure of the main document, creating bullet points for each chapter.
  • Summarize each chapter in a single sentence, if possible. If necessary, sub-divide longer executive summaries into sections.

How can I write an Executive Summary?

To write an executive summary, use the following guidelines:

  1. Active voice. Use active verbs instead of ‘to be’ verbs. For instance, “the project achieved its goals” instead of “project goals were achieved.”
  2. Avoid ambiguity, puns, or clever wording. Say exactly what you intend to say.
  3. Avoid phrases, such as, ‘As it’s well-known…’ or ‘As everyone knows…’ The reader may not agree.
  4. Charts help compare trends, research findings, or information best presented in this format.
  5. Cut the fat. Remove needless words, phrases, and sentences. Purge clichés and overused buzzwords.
  6. Examples help the reader understand the problem and proposed solution. Don’t talk over their head.
  7. In each paragraph, introduces the topic of the paragraph in the first sentence. This is the topic sentence.
  8. In the last sentence summarize what you’ve discussed, the bridge to the next paragraph.
  9. Numbers. Make numbers easy to read at a glance. Round them off if possible ($10.3 million instead of $10,36.556).
  10. One idea or topic per paragraph. Check that each point flows from one to the next.
  11. Parallel construction of sentences
  12. Present tense, if possible. Avoid using the conditional, such as if, shall, will and so on. The exception may be, for example, when you discuss how you market research findings or other activities that occurred in the past.
  13. Proofread – start at the last line and read up to the top. Read it aloud. If you notice you have to slow down, this means the text could be refined.
  14. Remove jargon and acronyms. If a technical word is necessary, explain it to the reader.
  15. Short sentences. Keep to 15-20 words.
  16. Short words, if possible. However, use the correct word each time. If a longer word is more accurate and meaningful, then use this instead. These are guidelines, not rules.
  17. Spell check. Make sure the spell checker is for the correct language, otherwise you color and colour may both appear in the text.
  18. Subject and verb should be as close as possible. One suggestion is to avoid sub-clauses. If possible. Aim for short sentences.
  19. Use a friendly tone, but not too chummy.
  20. Use direct, positive language. Put statements in positive form.
  21. Write in natural, everyday language. Avoid stuffy, halting sentences.

[Learn More About These Templates]

Executive Summary Writing Checklist

Use the following checklist to start shaping the outline of your executive summary:

  1. Define the key points
  2. Outline the main message
  3. Outline the structure
  4. Write the first draft
  5. Revise the draft
  6. Get feedback
  7. Update the text
  8. Check grammar, spelling, punctuation
  9. Design the layout

Give yourself enough time for a peer review, so you can rework the text, and change the order of the main points, if necessary.

Remember, you only get one chance to make a first impression. Make sure the executive summary is immaculate. That there are no typos, errors, or breaks in the narrative.

[Learn More About These Templates]

Structure and Format

In terms of structure, the executive summary should:

  • Summarize the main document, for example, a business plan, white paper, or proposal.
  • Identify the key points only. Not everything needs to be shoe-horned into the summary.
  • Provide a series of recommendations, if appropriate.

The executive summary is not part of the main document.

Instead, see it as an self-contained, stand-alone document. Its purpose it to distil and place the following document in context.

Another way of looking at it is this. If you removed the executive summary from the business plan, for example, you should still have enough information to decide whether or not the idea was attractive to you and you wanted to invest in it.

Think of it as an ad for the main document.

Sections

What sections do you need in the executive summary?

In the following sections, we look at how to structure your executive summary. You may not need all of these; it depends on the type of document you’re writing.

However, the following categories are usually used to structure an executive summary:

  • Summary
  • Background
  • Process
  • Findings
  • Recommendations

Summary

In the Summary section, use the following structure, especially for a scientific project:

  • Identify the purpose of the research project
  • Explain why it was conducted
  • Describe the project in 2-3 sentences
  • Outline the problem or issue you addressed
  • Describe the purpose of the research

Overview

For business plans and proposals, describe your product or service as though you were giving a snapshot.

Try to boil everything down into a single paragraph.  Then describes the following:

  • Product you intend to develop – what does it do in one line.
  • Target market – who you plan to sell it to
  • Benefits it provides the target market – if you can quantify it, even better
  • Competitors – investors will raise an eyebrow if you avoid this or state that there are no competitors. Skipping this point suggests that you haven’t done your homework.
  • How the product is different – what’s it most remarkable feature? What’s the one thing that’ll make it sell?

Here’s a sample overview paragraph:

<Product name> is a <type of product> that delivers <identify benefit>. Unlike <specific competitor>, <product name> provides <the following unique selling features>.

[Learn More About These Templates]

Problem

So, what problem does it solve? Isn’t that what makes great products stand out?

Depending on the type of document, you may want to start with an anecdote to put it in context and give some back story, or simply list the different types of problems it solves. Number them if you want to highlight their relative importance.

  • Context – in what situations would this product so useful? What’s the one problem it’s trying to fix?
  • What kind of user would be attracted to it?
  • Stats and Facts – back up your claims with market research, if possible.
  • Example – give a real world example, or a use case, where someone would need this product?
  • Inspiration – What made you think this could be a great product? When did you get this idea?

A lot of great products are created when the inventor sees an everyday problem and finds a way to solve it. Look around your desk. Someone came up with the idea for all those things, even the little ones. Look at the design of your keyboard. There’s probably ten design ideas in there you haven’t even noticed.

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Research Background

If you’re writing a scientific paper which involves research work, include a section about the background and history of the research.

For example, describe or give example of the following:

  • Clarify if this if you partnered with other states, universities, or government agencies, or private organizations.
  • Highlight if this is a “first-of-its-kind” research project.
  • Identify research team members.
  • State if the research is part of a national research program.
  • State if this is a second or third phase to earlier research.
  • The specific event or issue which provided the impetus for the research.

Market Research Process

The next section relates to summarizing the market research process.

  • Describe the process used to conduct the research. Keep this relatively brief, for one or two sentences.
  • Provide some background on the length of the research, for example, the number of months or years.
  • Discuss if the process was designed to be compatible with other research, and if so, what findings you want to highlight.

Data Collections

If data collection was part of the research process, provide some bullet points on:

  • Approach – describe the general approach to how data was collected.
  • Location – identify where the data was collected, the methods used to collect the data, for example, offline, online, or using a hybrid approach.
  • Samples – provide some explanatory information on how they were used.
  • Surveys – describe how information was captured
  • Techniques – describe any unusual collection techniques were equipment used for the research.
  • Testing – describe the type and location.

Findings

For research related proposals, summarize the key finding at the end of the executive summary.

This should encourage the reader to learn more about the research or stimulate interest in the findings and how you arrived at these findings.

  • Describe the major findings or results from the research activities.
  • Provide a brief description of the most significant findings. Keep it to two or three sentences.

Cost/Benefit Analysis

This section applies mostly to business plans, grant applications, and other documents related to investment.

Your aim here is to demonstrate the benefits your research, product or service offers. The second point is to outline the costs (savings or gains) this will generate.

For example:

  • How much per transaction will a bank save if they use your automation product compared to a member of staff performing it manually.
  • How much per transaction will a customer save if they use your service compared to how they currently perform this task.

Describe the following:

  • Benefits – the most useful, or valuable, benefits to customers
  • Comparison – a before and after product comparison
  • Costs – how the research reduce costs
  • Customer service – examples of where customer service was improved.
  • Investment – details of how the product/service would justify the required investment. If necessary, describe how trade-offs would be measured.
  • Operational inefficiencies – describe how inefficient and out-dated processes would be analysed, prioritized, improved.
  • Productivity – describe how the research increases productivity.
  • Quantifying – describe the approach to quantifying the results.

Policy Implications

Describe the following:

  • Impact on existing federal regulations, local government units, regions, municipalities, or states.
  • Describe if the findings can be used as a national model or for best practises.
  • Describe if the findings have identified new issues or trends.

Implementation

Communications – describe how the research results will be communicated, for example, online, in specific publications.

  • Contact – identify the main point of contact for more information
  • Federal – identify if it depends on federal regulatory changes
  • Impact – if a recommended implementation is part of your solution, describe how it affects the current system, employees, and customers.
  • Legals – outline how it depends on legislative or congressional action.
  • Management – confirm if the implementation requires management involvement
  • Partners – describe how the implementation depends on new or existing partnerships.
  • Workshops – discuss if workshop or training are required

Solution

In this section, write a short paragraph or provide bullet points to describe the product and the specific issues it solves.

  • Write it so that the reader will grasp the gist of the solution in one read.
  • Describe the benefits it provides to customers
  • Give real world examples, not technical features.
  • Why would this be better for the customer?
  • What could they achieve that they couldn’t before?

Intellectual Property

If the executive summary is part of a business plan to raise funds for a new product, you probably have to discuss how it works, especially it if includes intellectual property you want to protect.

Of course, you don’t want to give too much away. Look at the following example, and see if this can be applied to your business plan.

Product description

[our ecommerce product] provides a web-based payment service that can be used by any Merchant (such as small business owners) to accept payments over the Internet.

How it works

  • Merchants link their [ecommerce product] account to their bank account
  • Customers use it to pay for goods but don’t have to reveal their credit card or banking information.
  • [our ecommerce product] transfers money between customers and merchants, and protects both parties from fraudulent transactions.

Main benefits:

  • Merchants can sell to any customer with a bank account.
  • Merchants don’t need an expensive merchant accounts.
  • Customers can make risk-free online purchases.

Opportunity

Next, describe the potential business opportunities. The reader understands that these are projected numbers based on market research findings, such as surveys, and polls.

Keep it to one or two short paragraphs, or a list of bullet points.

To define the market opportunity that the product is designed to capture highlight the:

  • Estimated market size
  • Estimated market growth
  • Target customer

For example:

  • Online retail sales in 2010 reached $900m dollars, a growth of 21% over the previous year.
  • By 2015, Gartner estimates that online commerce will comprise $2250m annually, or 35% of all retail sales.
  • Currently, only 12% of the X small merchants making less than $100k annually are currently using the Internet to reach customers online.
  • In a recent poll, 85% of these merchants indicated their inability to secure a merchant account as the major barrier to them selling online.
  • A web-based payment processing system would remove this barrier, and permit an estimated $7250m in additional online transactions to occur annually.

Competitive Advantages

What gives your product or service an edge over rivals?

Next, discuss the relative merits of your product over similar products, alternatives and substitutes that exist in the market. Compare competing products in terms of

  • Market share
  • Quality
  • Price

Then drill-deeper and identify:

  • What makes your product more ‘saleable’?
  • What are its strengths and weaknesses?
  • Why are competitors not meeting customer needs?
  • Why are they vulnerable?
  • What trend, technology, or opportunity have they missed or failed to capitalize on?

For example:

The web payment product’s competitive advantage over competitors is:

Ease of integration: Any merchant can use its tools to add payments to an existing web site, allowing it to address markets not served by traditional merchant accounts.

Fraud detection: Its fraud system allows it to detect and prevent unauthorized payments, reducing the cost and risk of making purchases online versus traditional credit cards

Business Model

Next, describe how the product will make money.

  • How does the customer purchase the product? Online, offline, both?
  • Is the product sold directly to the customer or provided as a subscription-based service?
  • Is there some other way that the business makes money from providing the product?
  • How much money does the company make on each sale?
  • Over the lifetime of a customer?
  • How does this compare to the competitors’ products?
  • How will you generate revenues?
  • Is your model scaleable? If so, explain.
  • What performance metrics will you be evaluated against—customers, licenses, units, revenues, margin?
  • Whatever it is, what impressive levels will you reach within three to five years?

For example:

PayPal derives revenue from each payment transaction it processes. Customers pay nothing to transfer funds to a merchant using the service, but merchants pay between 1.9% and 2.9%, depending on the dollar value of the transaction, to receive funds from a customer. Each transaction is subject to a minimum transaction fee of $0.30. This is a comparable transaction cost to that of a merchant account, without the up-front costs of establishing the merchant account. Based on these charges, PayPal expects to drive between $X and $Y based on an estimated volume of Z million transactions in 2000.

Team

This section consists of a short one or two sentence bullet describing each of the core members of the team. Each bullet should provide the name of the team member, their role in the organization, and highlights of their relevant skill or career experience. In the case where the organization has only a limited number of key personnel, this list may be augment by a list of key advisors to the organization.

For example:

Peter Theil, CEO:Peter’s experience with venture finance began in the 1990s, when he ran Thiel Capital Management, a Menlo Park-based hedge fund that also made private equity investments. Peter’s experience in finance includes managing a successful hedge fund, trading derivatives at CS Financial Products, and practicing securities law at Sullivan & Cromwell. Peter received his BA in Philosophy and his JD from Stanford.

Financials

This section consists of one or two paragraphs or a handful of bullet points that describe the economics of the business. Items to highlight include the fixed and variable costs required to run the business, the projected customer growth, the projected number months to breakeven, the projected of number of months to positive cash flow, and the overall profit potential. Ideally, some elements of this information may be summarized in graph or table form.

 [Learn More About These Business Plan Templates]

Funding

This section details the amount of funding the organization requires, how those funds will be used, and the milestones the organization hopes to achieve using the funds.

For example:

PayPal is currently seeking $5M in Series B funding. These funds will be used to finance the development and acquisition of payment processing infrastructure in 2000Q1, creation of marketing and training collateral to drive merchant and customer adoption in 2000Q2. At the conclusion of these activities, the company expects to in a position to begin processing transactions by 2000Q3.

Recommendations

If recommendations for actions are given in an executive summary, these are presented at the end. Sometimes bold type is used for these recommendations (Seely 2002).

In some cases, dependent on topic or the approach of the author and/or client, definite recommendations are not given but different options with their advantages and disadvantages provided.

What future steps are needed in both the short-term and long-term?

  • Explain how the findings will be transferred into actual policy or program changes.
  • What needs to be done before the research results can be implemented?
  • Is additional study needed?
  • Are additional resources needed?
  • Are there unresolved issues?
  • Do manuals or guidelines need to be changed?
  • Are legislative changes needed?
  • Are changes needed to existing specifications or procedures?
  • Does the research point to the need for new technology investments?

How to review

One way to review the executive summary is to read it from the last sentence back up to the first.

This forces you to pay attention to each sentence, and helps avoid automatically scanning the text, which tends to happen when you read from the top down.

Business Plan: Excel Templates

Some of the Excel spreadsheets include a Balance Sheet, Break-even Analysis, Cash Flow, Competitive Analysis, General Demographic Profile, Personal Financial Statement, Profit and Loss Projections, and Sales Forecast.

[Learn More About These Templates]

[Learn More About These Templates]

[Learn More About These Templates]

[Learn More About These Templates]

Download Now for only $19.99 – Buy Here!

Download Templates Here

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