Tag Archive: business model

The Stock Market, The Economy & How They Do Not Align

February 12th, 2019

Key research groups are starting to talk about their predictions for the economy, and everyone is interested. It feels like everyone is waiting for the other shoe to drop. After all, we have been in an expansion mode far longer than is typical and there is plenty of volatility and uncertainty in global trade, the U.S. Shutdown and more. Last week, I heard a research expert from City National Bank and did an informal poll of trusted advisors (CPAs, attorneys, consultants, commercial bankers etc.). The bottom line = continued growth.

The City National Bank expert said that they study about 20 economic indicators, and all are firing on all cylinders. The only one that has consistently shown some potential for hesitation is geopolitical risk –  which isn’t new. As much as the U.S. Shutdown, global trade tensions, Brexit and more has the stock market jittery, it hasn’t impacted the economic forecast. Businesses are growing and the economy is doing well! The hot topics being discussed include asset protection, the talent shortfall, the technology transformation and cyber security risks. There are always lots of details to consider but the common theme is growth. Thus, a key question becomes, are you prepared for scalable, profitable growth?  

One tip to implement this week:

What I’m seeing as a differentiator to success in these strong yet uncertain times is the ability to ‘stay the course’ and be resilient.  With each new emerging news story, I’m seeing the stock market choke and people panic. Unfortunately, this can lead to short-term, erratic changes in executives’ decisions. No one wants to be put into the same position as they were in during the last recession. So, the tendency is to overreact. Yet, the most successful clients provide stability and a platform for scalable growth.

They are willing to make hard decisions, ranging from investing in top talent to systems and technologies (even when their peers are hesitant) to addressing the sacred cow (every business has at least one!) to thinking about how their business model might be evolving and what they might need to change (even when they are currently profitable and seemingly successful).

It might make good sense to take a step back and avoid overreacting to the latest news. Stay aware and on top of trends. Ask questions and consider down-the-line impacts on your business. Instead of getting caught up in the latest drama or fad, put thought into how to build agility into your plans. How can you ensure your navigation system is rock solid and will weather whatever storm occurs next. If there is one constant, it will be continued volatility and uncertainty.

Prepare to be resilient. Check out our new resilient supply chain series and contact us if you’d like to have an assessment of your organization.

Considerations to Evaluate Your Business Model for 2018

January 11th, 2018

Do you Evaluate Your Business Model?
Most of us are so busy on a daily basis we don’t have time to think about our business models.  It is the rare client that questions their business model, let alone continually modifies it for success.  Do you question your business model on a yearly basis?

Why is it Important?
There are many reasons to re-evaluate your business models on a frequent basis.  How many of these impact your company?  

  1.  The global economy – Well, if you don’t see constant movement and change in the global economy – which is impacted by countless numbers of events and triggers, some predictable, some uncontrollable (such as the California fires and related impacts) and some multi-faceted and complex – we can’t imagine what bubble you are living in (and sometimes wish we could join you!).
  2.  Demographics Are you thinking about how the baby boomers are impacting your company?  No matter what you think, they are the largest generation ever and will have a profound impact.  Have you thought about what it means?
  3.  Social mores (customs and manners) – What is society thinking and how will it impact your company and personal career?  Do you think we are going back to dressing up in the work place or wearing jeans in a casual environment?  It was just a few years ago that virtual teams was the hot topic but millennials seem to enjoy engagement.  Speaking of millennials, do you think the environment and sustainability are important?  You bet!
  4.  Technology – Have you thought about the changing nature of technology, the latest trends and what is likely to impact your company?  Technology has the ability to obsolete entire industries if you have your head under a rock.  It also has the potential to provide an enabler to success if you keep your eye out.
  5.  Globalization – Not only are our devices connected (internet of things) but our countries are connected in ways you might never think about or take into consideration.  Certainly, currency differences are relatively easy to understand, although not to predict.  Yet, there are vast numbers of connections between countries, economies, politics, natural resources and much more.  Have you thought about what is changing in the globalization landscape?  For example, ten years ago, no one was fired for outsourcing to China (whether it made any sense or not).  What is going on today?  Near-sourcing is certainly a more relevant trend but only when considered in the global view.

Whatever your business model, it’s important to take time to evaluate and assess so that you are ahead, not behind the curve. Where are you?

What is an Eagle Eye Strategic Focus?

July 1st, 2013

A keen eye for details can uncover big savings.

In my experience, I’ve found that watching trends is vital to success – if you can pick up on a key trends and get better positioned than your competition and/or jump on-board with strategic innovations early, you’ll be guaranteed success. In today’s new normal business environment where sales are no longer easy, talent is in short supply, and innovations are ever-more critical to profitable growth, you must be on the leading edge. Thus, having an eagle eye is paramount to success.
For many years, I underappreciated my eagle eye skill as it hasn’t always been popular – after all, who cares about resolving “unseen” roadblocks to achieving the strategy? Why would you want to create conflict among teams by addressing issues that haven’t yet occurred? However, it turns out that this sometimes cursed skill can provide significant leverage in ensuring success in the new normal. What are the key ingredients of having an eagle eye? 1) Understand strategy. 2) Consider profit drivers. 3) Think of design. 4) Watch for trends.

  1. Understand strategy: Interestingly, it starts with simplicity. What is the foundation of the business? One way to think of the critical importance of the strategic foundation of eagle eye is to consider if you didn’t have it. No matter how great an idea or project seems to be, it will be useless if you are speeding along in the wrong direction. Thus, understanding the strategy and its core components is essential to rapidly selecting just the right priorities.
  2. Consider profit drivers: In order to rapidly assess a situation, a set of priorities or an opportunity, it is essential to evaluate with the key profit drivers in mind. For example, if the core product line has narrow margins with high volume, your operational priorities would likely be quite different from a business focused on luxury product lines. In this case, understanding your break-even point and related volumes will be pivotal to pricing decisionsIn another example, if material cost is a significant proportion of cost, outsourcing will have a much different impact than if labor cost is the driver. In the first case, it’s likely that outsourcing of a peripheral product line could make sense but shouldn’t be a focal point (unless failure is your goal!); however, in the second case, it could be a #1 priority.
  3. Think of design: Design can also be an underappreciated skill. What is the design of your business model? Your ERP system? Your business processes? Your products? Services? Etc.? Why is this skill valuable to a non-engineer or non-architect?
    In my experience across many industries and globally, if you understand the basics of design and can identify where you are in the design, you’ll be able to remain agile and flexible in accommodating for business challenges and changes while keeping the razor-like focus on the required business outcomes. What could be more important?
  4. Watch for trends: Volatility is the new norm. Thus, we must not only become adept at rapidly evolving to ever-changing challenges, but we must also be able to spot key trends ahead of the competition. Train your eyes to watch for trends. Start by taking a step back to see around you. Are your customers ordering differently? Are your suppliers delivering slower? Faster? Should you adjust plans? Being aware of what trends are important to your business is a key component of having an eagle eye.

Developing your eagle eye abilities is paramount to success in the new normal business environment. What will you do to ensure you are not passed by?
Did you like this article? Continue reading on this topic:
Strategy – It doesn’t Fail in Formulation, It Fails in Execution