For some reason folk are intimidated by "Strategy", one of the most over-rated words in business, whilst getting the business to focus on removal of Value Destruction seems completely overlooked. If we get these two disciplines right, Strategy and Value Management we make things much easier on ourselves. Think of it this way. Consider the effort in generating ZAR 1 of Revenue, which as you will see on your income statement, translates into far less profit once we have accounted for expenses, tax, depreciation etc. But what of the effort that removes ZAR 1 of waste? The impact on your bottom line is ZAR 1 in most cases. OK, this is over simplified and ignores economies of scale, but the fact remains, removing waste in your business and addressing areas of value destruction can have a profound impact on your business. Don't be mistaken, we're not telling you to cut to the bone in your efforts to remove waste, and not every benefit can be measured easily, and every now and then there is nothing better than following your gut instinct. But as businesses grow and direct control is relinquished to your management teams, the business must rely more on good data and tools that allow you to cut through the layers of noise. In so far as Strategy goes, the effective application of the strategy process, will not only provide direction, but it will fortify and consolidate your leadership as the business gains comfort and confidence in you. You will see that Strategy is not a secret to be kept behind closed doors but should ensure that every person in the business knows how they are contributing. This in turn allows them to belong and start to treat the business as their own and from this you will be amazed at how wonderful people can be when they are allowed to be just that!
Unlike other coaching and consulting teams, we start at the cash. Without it what's the point? and the way we tackle Cash, tells us a lot about waste, risk, quality of decision making and the state of the business as a whole.
Our main aim is to have a business that is self-funding, and able to sustain shocks (remain a float for a period of 3 months, even if not a cent of revenue or income is generated!) At the same time everyone understands how the business makes money and where is wastes it, and we need to tie back every activity in the business to the income statement, so that we can align everyone to the strategic goal, the final measure of which must be seen in one of the income statement financial lines.
Our aim is to ensure we have a strategy that translates into coordinated actions across the business, and that everyone in the business can articulate in one or two short sentences. Everyone must be able to demonstrate and measure how their daily activities are aligned to the strategy. The strategy must clearly drive both sustained growth in revenue and margins of a scalable business.
Whether we are conducting a business rescue or preparing for expansion, the basic process is the same, however actions based on what we find may be quite different. Unfortunately, in South Africa currently the formal Business Rescue process is more a legal one than a practical business survival one. This seems to be changing, however we strongly advise you to act before formal business rescue proceedings begin, since: