Wednesday, 5 March 2014

What everyone ought to know about Key Performance Indicators





Everyone seems to want KPIs for their business.As a specialist financial advisor to marketing agencies and professional firms I have come across the most useful and some rather unusual KPIs.

Here are some common errors:

1.Too many KPIs - e.g. more than say 5.

2. KPIs that are not easy to measure accurately - e.g sales figures that include foreign exchange movements.

3.KPIs that you can't entirely influence e.g. see 2 above, you can't (usually) influence forex movements.

4. Selective KPIs - e.g. dropping KPIs that present bad news...doh!
 

5. KPIs that take ages to calculate - e.g. that you can't derive from your standard management accounts.

Finally, a story I heard to illustrate the above (and I don't know whether it is true or not):

When British Airways really was a great airline and Lord King was chairman he had ONE KPI and it was "The incidence of late take-offs". Apparently, so the story goes, he wanted to be told about every late take off when it happened and wanted an explanation.

Think about the simple beauty of this KPI. To take off on time, the engineering had to be right, the crewing, the refuelling, the baggage loading, the check in spot on etc etc...

As a first step, why not pick the phone up and call John or email him and arrange to meet up.

John's website is: http://www.nomizon.co.uk 
 His credentials: http://www.linkedin.com/in/johntoppin

Friday, 15 November 2013

Green shoots of recovery and the three Cs of success for your business



If you have not started thinking properly about the implications of the green shoots of recovery for your business yet, then you had better get on with it because your competitors will be.

Here is a framework to build into your thinking and business planning.

1. Clients and your business culture 
  • What does your ideal client look like? 
  • Which clients are your most valuable? 
  • What do your clients really need and what do they value? 
  • Is your proposition right, does it match what your ideal clients want and need? 
  • Is your delivery quality up to highest standards? 
  • Do your people provide a consistent level of service to clients? 
2. Confidence 
  • Are you and your client facing staff confident in themselves and in what the company does? 
  • Are you always able to justify the true value you add to your clients' businesses?
3. Clarity
  • Do all of your staff know what makes an ideal client and conversely what would make a nightmare client?
  • Do your staff understand where your business makes the greatest difference to its clients? 
James L. Heskett, Professor at Harvard University has found strong links between companies where employees get where your  business stands on these issues and the levels of efficiency and profitability generated.

As a first step, why not pick the phone up and call John or email him and arrange to meet up. 

John's website is: www.nomizon.co.uk

His credentials: http://www.linkedin.com/in/johntoppin

Friday, 20 September 2013

In five, what does a good business plan look like?



 A good business plan drives the business towards its specified goals by addressing activities, accountabilities, resources and timescales – within a framework of explicit assumptions. 
 
1. Focus


The business plan should focus on how the company will maintain and improve the existing business as well as any new initiatives.

More detail does not equate to better budgeting accuracy and the same applies to the business plan. Passing the sense check and covering key elements is more important.

  
2. Strategies and objectives

The best business plans set key short and long term objectives and outline strategies for accomplishing these.

Some hints: 

  • Business plans should link activities and actions to the strategies so that you are able to measure the actions and the results of those actions. 
  • Actions usually involve resource and cost so this will help you to ensure that the budget reflects the plans.
  • Answer questions such as where do we want the business to go, how will we get there and what is the fall back plan if things don’t work out as expected?
  • Use a SWOT analysis to identify the key activities that the plan needs to address.
3. Measurement

The activities and actions included in business plans should be mensurable so that you can monitor the level of success in achieving them.
  • Measurements do not need to be financial only. For example a goal could be improved sales via the activity of investing in customer care and customer feedback can be the measure for customer care. 
  • Time line the activities and actions so that you can budget them by month.
4. Responsibilities

Assign responsibilities and accountabilities to the planned actions so that you can empower people, measure performance and can reward them for success.

Ensure that all staff allocated with responsibilities in the business plan are involved at some level in producing the business plan.

5. Risks and assumptions

Good business plans address risks, including the risk that the underlying assumptions become invalid. 
  • As well as identifying risks plan for activities and responsibilities for mitigating those risks. 
  • Check that the business plan is affordable.
  • Run scenarios so that if results fall below set criteria the business is able to respond. For example, if sales fall below £Y in region A the alternative plan is to consolidate that geography with region B.

What is stopping you?

As a first step, why not pick the phone up and call John or email him and arrange to meet up.

John's website is: http://www.nomizon.co.uk


His credentials: http://www.linkedin.com/in/johntoppin

Tuesday, 19 March 2013

Growing your bank balance



It is budget day the day before spring starts. Winter continues for some businesses - one in 8 are facing another year of tight cash. 

Brighter news is that over half of SME's are expecting to grow this year.

Whichever camp you are in it pays to produce regular cash flow forecasts.

How?


  • A cash flow projection is generally divided into periods of weeks (done weekly for 12 weeks in advance) or months (for the next half or whole year).
  • You need to forecast realistically so that you can see any issues which are likely to arise early.
  • Make sure you make regular cash flow projections so you can make any financial arrangements for known expenses before you need the money.

What to include?


  • Opening and closing bank balances
  • Payments - you should be able to plan these very accurately
  • Receipts- always look at these prudently.
As a specialist financial advisor to marketing agencies and professional firms, I know that firms that forecast cash are always able to find the money they need and those who don't always seem to struggle.

Find out more:

Always have plenty of cash

As a first step, why not pick the phone up and call John or email him and arrange to meet up.

Thursday, 3 January 2013

A New Year's resolution for your business?




According to Professor Richard Wiseman of the University of Hertfordshire, most of us will make a New Year's Resolution - maybe to lose weight or quit smoking - but only one in ten will succeed.If you have made a New Year's resolution for yourself or your business, how can you increase your chances of success?

Professor Wiseman maintains that that deciding to revisit a past resolution is likely to set you up for frustration and disappointment. Instead he says, choosing something new or approaching an old problem in a new way works better. Think through exactly what you will do, where you are going to do it and at what time.

For example, instead of promising yourself to go running twice a week, plan to go running at specific times every week.

As a specialist financial advisor to marketing agencies and professional firms I see that businesses often set new goals or seek to change something for the New Year and with next week marking the return to work a resolution might be on your mind right now.So, if you resolve to spend more time on sales, or strategy, or generating profit or cash, be realistic and specific. Resolution: why, who, what, when and where.

As a first step, why not pick the phone up and call John or email him and arrange to meet up.

More on planning: http://www.nomizon.co.uk/planning.htm

His credentials: http://www.linkedin.com/in/johntoppin

Tuesday, 13 November 2012

Clearing out the history



If I had a pound for every time I came across a business owner explaining that such and such - usually something that looks out of place in their business - is there as a historical accident I could probably retire.

Here are some:

1. A new product or service that you are not really geared up for, that you started so as to please a large client.


2. A band of clients that you can't service profitably, but that you stick with because they keep someone in your business busy.

3. A department (or job title, or directorship) created just to keep someone happy.

4. A department that used to do something that earned you money that stays in place long after technology, or the market, passed it by.

You may have one or more historical accidents in your business and if you do, you should be worried.

As a specialist financial advisor to marketing agencies and professional firms, I know that historical accidents make your business inefficient and uncompetitive. They use up cash and destroy your profits.

If you lie awake at night worrying about your business then maybe you should start to deal with these long neglected issues.

As a first step, why not pick the phone up and call John or email him at
johntoppin@nomizon.co.uk and arrange to meet up.

More on planning
http://www.nomizon.co.uk/planning.htm

His credentials: http://www.linkedin.com/in/johntoppin

Friday, 21 September 2012

Lean Thinking for people businesses


 
 
Most Lean Thinking has been developed for and applies to manufacturing businesses. However I have found that marketing, creative and professional services firms can generate extra profits by using Lean Thinking.

Lean Thinking is all about doing things better and/or quicker and therefore taking up less resource (and saving money).

Here are some places to look for waste in your firm:

  1. Over processing - if you don't know what your clients want you could be adding more value than they are willing to pay for. 
  2. Errors - Missing or incorrect information, missed deadlines etc. 
  3. Over producing - Preparing answers for questions that are not being asked - "keeping busy". 
  4. Hanging - Delays at hand off points in a process, in trays (including virtual in trays). 
  5. Switching - Too much reanalysis, swithing between software programs. 
  6. Chasing - Following up for information.
Look out for tasks, steps or spend that don't add value - you know the things...the "we've always done it like that" ones.

I think every business can become 20% more efficient by adopting Lean Thinking ways.

As a first step, why not pick the phone up and call John or email him and arrange to meet up.

John's website is: http://www.nomizon.co.uk

His credentials: http://www.linkedin.com/in/johntoppin