Tag Archive: profit drivers

5P Accelerator to Fast-Track Growth and Profits

April 26th, 2016
5P Accelerator for growth and profits

Energy spent on focus, speed and relationships can help companies chart a course for growth and increase revenue.

Our most successful clients are constantly thinking about where they are headed. They think about why they are going there — how does it fit with their vision? How does it have meaning for their customers? Employees? Supply chain partners?

They also think about emerging trends — what is most likely to impact their business? What do they have control over? What opportunities can they leverage? Can they turn lemons into lemonade? How?

Our role is to stay ahead of the curve so that I can help my clients achieve dramatic results. Thus, we’ve incorporated the following best practices and thinking into the development of our proprietary processes:

  • Best practices across industries (ranging from aerospace to building products to food & beverage to distribution) and company-sizes (from small, family-owned businesses to facilities and divisions of multi-billion dollar, global enterprises)
  • Expert advice from our collaborations and alliances of clients and colleagues inclusive of top-notch trusted advisors, communities of executives and business owners, and trade association experts and professionals.
  • And, most importantly, we’ve bounced these against “what works” and is immediately pragmatic.

5P Accelerator(SM) is our proprietary process that fast-tracks growth and profits.

Our 5P Accelerator(SM) focuses on the core factors of success:

  • People – success begins and ends with people. Do you consider your people assets or costs? Give me a strong leader with a mediocre strategy any day over a weak leader with a strong strategy!
  • Processes – the foundation of success; similar to a house, if you don’t have a solid foundation, fancy curtains will not be sufficient to withstand a storm.
  • Plan – too many executives jump to action and skip the planning step. A plan is not only a part of your foundation (imagine a football team without a playbook) but it also provides an important collaboration vehicle.
  • Priorities – if I only had a dollar for every executive who wasted time on non-essential priorities, I’d be rich! What seems like a priority because your boss or customer happens to be yelling over the phone or a respected boss, peer or Board member is asking about isn’t necessarily so…..
  • Profit drivers – considering what is essential to your strategy, key customers and potential customers, profitability, cash flow or other critical factors should be of utmost importance.

Unfortunately, getting the 5Ps “right” can be challenging enough; however, it might not be sufficient for success. Add in focus, speed and relationships to tip the scales in your favor to fast-track growth and profits.

Please refer to our webpage to learn more and contact us if you are interested in leveraging 5P Accelerator(SM) at your organization. 

Did you like this article? Continue reading on how to Profit Through People:

The Systems View 

Empower Your People to GROW

 



4 Critical Success Factors Key to ERP Success

March 15th, 2016
erp success

To successfully implement ERP, start by identifying your critical success factors and align these factors with business processes and system functions.

I’ve always focused part of my business on ERP selection projects as these leverage the unique combination of my strengths — understanding the cross-functional and cross-organizational view in combination with the strategic priorities to identify the critical success factors. We then align these factors with the optimal business process design and system functionality to ensure success.

I’m in the final stages of developing a new proprietary process for ERP selection, called ACE (assess and align critical success factors to achieve your desired endgame). The key to success lies with critical success factors. Think about the following when thinking about critical success factors:

  1. Profit drivers – What drives the company’s profit? What is key to success? For example, when I was VP of Operations, I was responsible for cost. Although labor cost was utmost on the Board of Directors’ minds, it wasn’t the most important cost driver. Raw material costs were a much more significant percentage of product cost. Thus, focusing resources on material cost was the smartest way to drive profit.
  2. Alignment with strategy – Strategy can dictate a critical success factor. For example, if customers are core to success, making sure the system can easily address core customer requirements is cornerstone. How flexible is the system to meet those needs in alignment with your strategy?
  3. Differentiators – What does your business do differently from the competition? What are your unique differentiators? Make sure your system supports these.
  4. Unique system functionality – Often-times, there is functionality which is unique to your industry or way of doing business. For example, in metal processing, there can be attributes of metal which have to be considered in understanding items and inventory. Does your system support this without having a separate item for every possible combination of attributes?

Start by identifying your critical success factors. You wouldn’t want to start building a house by picking out curtains when you didn’t have the proper foundations in place. Consider your ERP system in a similar light. Stay tuned for the introduction of my new proprietary ACE process in next month’s newsletter…..

Did you like this article? Continue reading on how to become a Systems Pragmatist:

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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