Upload
patrickmgeorges
View
618
Download
0
Tags:
Embed Size (px)
DESCRIPTION
An executive summary on the 24 golden rules to follow to build a business that works
Citation preview
Executive Education
The 24 golden rules to organize a business that works
Executive Education
A one-day seminar for managers
Experienced managers apply a limited number of rules to run a business unit
These favorite business rules have costs and benefits
This workshop will permit participants to select the right rules to apply in their particular situation
Executive Education
What’s a business unit
Making and selling things to a market for
a profit
Applicable to • A public or a private
organization• An internal unit or an
external unit
Executive Education
The four categories of rules
Strategy rules to thrive on competition
Marketing rules for customer satisfaction, for volumes and quality
Operations rules for costs and productivity management, for delegation to human or technical resources
Control rules for financial profit and brand building
Executive Education
The rules, step-by-stepProtect the profit from the start• Write the local strategic plan
Place the customer first• Write the local marketing plan
Organize the work for a target quality• Describe the projects and the
processes• Make the personnel aware of
their responsibilities
Increase sales• Write the management
plan
Decrease costs• Simplify the unit• Adapt the unit
Control everything• Create the unit’s
scoreboard• Reorganize the internal
accounts of the unit
Executive Education
The list of rules
•B-rules, rules of thumb, executive automatic intelligence, quick fixes…
A bunch of names
•Business is not that simple
•If you are a genius, forget them and follow your guts
•It’s a starting point, you will outperform them soon
Don’t forget
Executive Education
Debate for each rule
What are the benefits ?
What are the costs and limitations ?
Executive Education
Step 1.
THE STRATEGY RULES
To thrive on competition
Executive Education
Select a clear strategy
Executive Education
The business rule
Make a clear choice on what’s your competitive advantage
• Operational excellence, low cost• Marketing and customer
orientation• Innovation, high tech, luxury
Executive Education
Improve your “Sales From New” performance indicator
Executive Education
The business rule
Set a clear target for sales revenues from
• New customers• New products• New channels• New technology• New suppliers• New partnership, alliances
Executive Education
Follow a strict process to collect ideas for innovation
Executive Education
The business rule
A strict process to ask for ideas to
• Suppliers• Customers• Employees• Competitors
Executive Education
Always compare to the best
Executive Education
The business rules
Organize internal and external
benchmarking
Executive Education
Steal a good idea to a competitor
Executive Education
The business rule
Steal a good idea to a
competitor
Improve the product
Outperform the
competitor
• By investing more cash
• By more marketing
• By more forces in sales
Executive Education
Step 2.
THE MARKETING RULES
For customer satisfaction, for volumes and for quality
Executive Education
Sell first, produce after
Executive Education
The business rule
Demo first, contract second, code line after
• Ask for bigger down payment, for delivery delay
• Build to order• Just-in-time production• Produce only what’s already sold
Executive Education
Producing with customers’ money ?
Executive Education
Producing with the money of the customer
Books Building
Transportation: bigger or smaller plane depending
on booking
Events: cancellation for
low booking
Furniture, computers: build
to order
Executive Education
Frontalize the company, subcontract operations
Executive Education
The business rule
Turn a technicians business into a marketing business
•Delegate, subcontract operations
•All employees should sell
Executive Education
Measure constantly the Customer Satisfaction Index
Executive Education
The business rule
Measure the Customer Satisfaction Index on an on-going basis, per customer segment, on selected product specifications
Executive Education
Organize internal customership
Executive Education
Step 3.
THE OPERATIONS RULES
For costs and productivityFor delegation to human or technical
resources
Executive Education
Give more to the best and less to the worst
Executive Education
The business rule
Regularly: quarterly
Give more: budget,
responsibilities,..
To the best: employees,
activities
And less: budget,
responsibilities,…
To the worst: employees,
activities
Executive Education
Each year abandon 5 % of your less profitable suppliers, customers,
employees or activities
Executive Education
The business rules
Businesses are build case per case and their complexity increases with years. Simplify it
regularly
Analyze the return per customer, employee,..
Executive Education
Allow no activities outside a project or a process
Executive Education
The business rule
Projects and processes are customer-oriented
Projects and processes are easy to delegate and control with the
project and the process master document
Executive Education
Constantly reduce costs per automation, per delocalization and
per subcontracting
Executive Education
The business rule
For cost leadership on competitors
•Automate•Sub-contract•Delocalize
Executive Education
Different methods
Abandon the less profitable activities
Decrease suppliers bills by
centralization, negotiation,…
Collecting the employees
suggestions to reduce the costs
Subcontract activities
Turn activities into procedures
Sign partnerships for economy of
scale
Executive Education
Measure the sales activities
Executive Education
The business rule
Measure and pay people on sales
activities
Increase the Time Facing Customer
performance indicator
Executive Education
Variabilize and flexibilize all costs and assets
Executive Education
The business rule
Match your flexibility with the market
flexibility
• People flexibility• Machine flexibility• Contracts flexibility• Suppliers flexibility
Increase the versatility of your
pricing policy
Executive Education
Optimize your Resources Occupation Rates
Executive Education
The business rule
Calculate the capacities
• Maximal• Minimal• Optimal
Of all your resources
• Employees• Machines• Floors
Executive Education
Organize a flat structure, downsize middle management
Executive Education
The business rule
Delayer the business to be more reactive
Middle managers are less useful• First line manager are self
managing by clear accountability
• Reporting is automated
Executive Education
Improve your indicator “Gains From Processing”
Executive Education
The business rule
Start an activity as a project to check the feasibility to reach a
quality objective
Turn the project into a process to reduce the costs and delays at stable quality level
Streamline the process regularly
Executive Education
Organize the leadership
Executive Education
The business rule
People need directions, vision,
… select only a few KPIs
Place your scoreboard in their
sight
Executive Education
Measure the Employee Satisfaction Index
Executive Education
The business rule
Satisfied employees are more productive
Measure regularly a critical satisfaction
factors with a selected category of employees.
Executive Education
Step 4.
THE CONTROL RULES
For financial profit and brand building
Executive Education
Measure everything
Executive Education
The business rule
No crime to knowAim for a fully
transparent unit, project…
Modern ERPs provide
information at no additional costs
Executive Education
Finance all investments with the gains from abandoned activities
Executive Education
The business rule
Finance all new activities with the gains from
abandoned old activities, for at least
50 %
Avoid stretching your cash. Its easier to engage
a new activity than to stop an old activity
Executive Education
Improve your indicator Return on Critical Resources
Executive Education
The business rule
What’s your most critical resource, asset
• Equipment ?• People ?• Brand ?• Technology ?
What’s its
• Return ? • Occupation rate? • Productivity ?
Executive Education
The business rule
Calculate the return
• Per project• Per process• Per customer segment• Per distribution channel
Executive Education
Protect your profit from the start, buy low
Executive Education
The business rule
Make your profit when you buy, when you are strong, not when you
sell, when you are weak
Constantly try to reduce all suppliers bills and COGS : work hours,
energy…
Supply with the cheapest way : rent or
make or buy
Executive Education
Stop allocating budgets, ask managers for their business plans
Executive Education
The business rule
Start with zero budgeting
Roll your budgets quarterly
Ask managers if they need more and what return they promise if they get that
Executive Education
Create smaller responsibility centers
Executive Education
The business rule
Each team should produce a valuable, merchandisable, tangible product or service, internally or externally
Turn cost centers into profit centers with the internal customership method
Reduce the size of the profit centers
Executive Education
Conclusions
Executive Education
Take home point
You can do better with a simple
discipline, applying some rules
Executive Education
Do not forget
All those rules are common sense and
business proved, but business is not so
simple
Be selective, some rules do not apply to your current situation
Executive Education
Thanks for your patience with me
See you on LinkedIn