Most organizations don’t spend enough truly productive time attempting to improve the contol of their organization; these steps include oversight, measurement and manipulation of the organization’s processes to fulfill the organization’s sales and profit projections and the expectations of their customers.
In fact, the lack of strategic control creates a good number of the problems in all organizations:
- Not knowing what sales are really going to be
- Not knowing what employees are doing with their time
- Not knowing how many sales leads are required to be profitable
- Not knowing exactly how much time was being spent with face to face sales interviews
- Not knowing exactly what each and every customer wants
- Not knowing what products and services are in demand or will be in the future
- Not knowing how to cut costs while maintaining productivity
- Not knowing the exact price and cost on each job
- Not knowing customer’s true satisfaction and rate of referrals
- Not knowing how to increase profits
- Not knowing where new more profitable opportunities are
In fact, not knowing the answers to their questions is the cause of most of the frustrations organizations experience.
If you solve the strategic control problems, you are well on your way to solving all of your people problems in business.
Most Owners and Managers fail to exercise strategic control for one of two reasons:
- They don’t know how to do it.
- They thought it was unnecessary.
The fact is that it’s not only possible to exercise strategic control but in today’s environment, it is absolutely necessary. The lack of strategic control is costing more profit than they can possibly imagine. The creation of a strategic control system can create, almost immediately, increases in profits, productivity and personnel improvements.
The business plan that never fails is a prototype of your business based on three different but integrated activities through which your business can pursue its natural evolution. They are improvement, knowledge and organization of products, people and processes.
Improvement is to make products and services better, faster, cheaper, easier to use and so forth. This becomes your unique advantage, the true value of your business offering.
Improvement leads nowhere without its own knowledge. Without measuring the results of the improvement you would never know if it really worked better. This is the numbers part of the system, finding the answers to: How many? How much? What changes must be made?
Once you improve a process and measure its impact on the product/service and people; and once you know it works; it is time to organize the total process.
Without organization, nothing is truly predictable by you, your employees or your customers. If people are choosing to do whatever they want and do things differently using their own discretion rather than creating order, then they are creating chaos. What every great entrepreneur and business success founder has said is “if you don’t organize it, you don’t own it.” If you don’t own it you can’t depend on it and if you can’t depend on it, you haven’t got a chance for long term success because you can’t replicate it so you can’t scale it and you have nothing unique so you can’t increase profit.
The First Goal is Profits
The first objective of your strategy is profits. What is your forecast of what your revenues will be? What will your profit be? What will your expenses be? What will your net profit be? How much money does the business need to earn to pay people better, to pay down debt, to arrive at an exciting valuation, not just in income but, more importantly in assets?
Is the idea worth pursuing? Are there enough customers you can identify and service to make it worthwhile? What will you sell and to whom? The idea is to focus on what makes your services/products, processes and people more unique than competitors to capture the underserved markets.
There is no limit on goals but it’s critical to know that objectives must be achieved through a system. A system includes the result it is to achieve, the steps to be done, the standards, measurements and information that interacts with other systems.
It includes structure or what you do and context is how you do it. If you want to create a more profitable and prosperous business, you must analyze your business: as it is now, then plan what you want it to be. That gap between where you want it to be and where you need it to be will lead to what needs to be done. The gap is always created by products/services, processes and people. We help organizations complete a business condition assessment to determine what processes are missing and need to be added. Our BCA will show you how to sustain profits in the challenging months and years ahead.
If you are ready to get your business organized, eliminate problems and increase productivity and profitability, contact Holt Marketing today for your free consultation. You can also subscribe to our blog for more tips and tools to help your business succeed.
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