Business Health Check
A Business Quiz without answers
Or, do we know what we don't know?
Introduction
One always hopes that no individual or group of individuals follow the slogan often found in many offices:
“I used to think that I was conceited, but now I am just perfect.”
Sadly, we know that it is common – or perhaps too common. Though we can take some satisfaction that history offers us that such hubris (insolent pride or security) is nearly always followed (eventually) by nemesis (retributive justice), it is but little comfort to those that are harmed, to a greater or less extent, by such attitudes. The reality should be that provided by the Avis statement:
“We're number two and we try harder”
Every organisation is number 2 in some, or all, areas of their operations. The issue is to define where the organisation can most benefit from investment to build or further enhance competitive advantage.
Flexibility and a willingness to change is obviously vital – summarised by the famous quotation of Keynes, the economist:
“When facts change, I change my mind. What, sir, do you do?”
As is the potential for improvement through knowledge:
“A wise man will make more opportunities than he finds.” - Bacon
But continually changing direction obviously has it own dangers – drifting ships hit the rocks, and knowledge for the sake of knowledge, though attractive to some, does not pay the bills. Fitting such flexibility and need to change within a formal structure is crucial - creating a framework which knows where it is going but can adapt:
“Planning is everything - the plan is nothing” Eisenhower
This is what Ibis continually attempts to do – creating a framework within which best practice and continual improvement can be applied in a systematic fashion.
Within the framework of the plan one can ask questions such as:
What are we currently doing?
Is there a problem or an opportunity?
Is there something that we are doing that we should not?
Is there something that we are not doing that we should?
What is best practice?
How should we modify it for our circumstances – if necessary?
How do we start?
When do we know that we have improved operational performance to achieve competitive advantage?
Is there some point beyond which such a change is counter-productive?
From the answers one can then (hopefully) achieve the necessary change, and build on a gradual basis a more successful and effective enterprise. Above all, one should try to learn from mistakes – both within your own organisation and elsewhere:
"To err is human, to repent divine; to persist devilish." Benjamin Franklin
“Those who forget the past are doomed to repeat it” Santayana
This set of topics does not have any “correct” answers, because these will vary from organisation to organisation, and from month to month. They are there to help the enterprise think about its current position, and whether improvements can be achieved, and how they will be implemented. Implementation is at least as important as analysis – many would think more so. Completing tasks quickly and effectively moves the organisation along in a cascade approach and motivates staff towards further goals and objectives.
“When the army engages in protracted campaigns, the resources of the state will not suffice. When your army is exhausted, your morale sinks and your treasure is spent, rulers of other states will take advantage of your distress and act. Then even though you have wise counsellors, none will be able to make good plans for the future. Thus, though we have heard of excessive haste in war, we have not yet seen a clever operation that was prolonged”. Sun Tzu
Topics obviously over-lap, and are often complementary. Most topics can then be further sub-divided. Listed in alphabetical order, they are not complete, or weighted for importance --- Ibis welcomes suggestions about topics to add
Topics
A
Abacus principle
Absenteeism
Accounting assumptions
Accounting system
Action planning
Activity based costing
Administrative expense ratio (AER)
Administration plan
Administration strategy
Adstock
Advertising decay rates
Advertising effectiveness
Advertising/ price interaction
Advertising threshold
Agents
Alternative dispute resolution (ADR)
Ansoff matrix
Appeals procedure
Appraisal
Articles of Association
Artificial intelligence (AI)
Aspirational marketing
Asset register
Assumptions
Attention, interest, demand, action (AIDA)
Audit
B
Back order policy
Bad debt ratio
Barriers to entry
Balance sheet
Balanced scorecard
Bean counter philosophy
Benchmarking
Bionics
Blame game
Boiling frog syndrome
Bonus systems
Box canyon thinking
Break even value (BEV)
Brainstorming
Brand loyalty
Branding
Break even
Budgeting
Burst vs drip advertising
Business cycle
Business model
Business planning
Business platform
Business process re-engineering (BPR)
Business monitoring
Business start up
Buyers
C
Camel effect
Cannabilisation
Capacity utilisation
Capex ratio
Capital spread ratio
Cascade investment policy
Cash flow
Cash flow return on total investment (CFROI)
Challenge
Change tunnel
Clausewitz dictum
Clustering
Comfort zone
Commoditisation
Competitive advantage
Competitive analysis
Competitive bidding
Complaints policy
Computer aided design computer aided manufacture (CADCAM)
Computerised maintenance management system (CMMS)
Concept Fan
Consolidation
Contingency plan
Contract of employment
Code of conduct
Communication
Confirmation/ Disconfirmation bias
Core competence
Core/ non core employee ratio (CNCER)
Corporate governance
Corporate vertical marketing system (CVMS)
CORRUPT
Cost leadership
Cost management policy
Cost of finance
Counterfeiting
Country spread ratio
Creativity
Creditor ratio (CR)
Credit management
Current ratio (CR)
Critical path
Critical ratio
Critical success factor (CSF)
Culture
Customer complaints policy
Customer life value (CLV)
Customer investment review (CIR)
Customer panel
Customer relationship management (CRM)
Customer satisfaction survey
Customer spread ratio
Customer support
D
Darwinian strategy
Data mining
Data protection
Data storage
Dator's First Law
Debtor ratio (DR)
Discounted cash flow (DCF)
Decision making
Decision tree
Deming rules
Depreciation
Design for assembly (DFA)
Design for competitive advantage (DCFA)
Design for disassembly (DFD)
Development training
Diffusion analysis
Dilbert principle
Directed strategy
Disciplinary code and grievance procedure
Discipline
Discontinuity
Discrimination
Distortion
Distribution channels
Distributors
Diversification
Dividend policy
Documentary credits
Due diligence
E
Earnings before interest, tax, amortisation (EBITA)
Economic cycle
E-enablement
Eight pillars of productivity
Eighty five percent rule
Electronic data interchange (EDI)
Electronic funds transfer (EFT)
Emotional quotient (EQ)
Emergent strategy
Emperor's clothes syndrome
Employee satisfaction scheme
Employee suggestion scheme
Employment contracts
Empowerment
Enterprise growth/ market growth ratio
Entrants
Environmental mapping
Environmental monitoring
Economic order quantity (EOQ)
EPS (earnings per share)
Equal opportunities
Enterprise resource planning (ERP)
Ethics
Exaggeration
Exit interview
Exit planning
Expectations/ fulfillment gap (EFG)
Experience curve
Expert systems
Exponential smoothing
Extranet
F
Face saving formula (FSF)
Facilities management
First in, first out (FIFO)
Finance plan
Finance strategy
Financial accounting
Financing options
Fixed costs
Flexible manufacturing system (FMS)
Focus
Franchising
Fraud
Free cash flow (FCF)
Fringe benefits
Fund raising strategy
G
Game theory
Gap analysis
Garbage in, garbage out (GIGO)
Gatekeeper
Gearing (or debt equity ratio)
Generally accepted accounting principles (GAAP)
Geofencing
Getty's law
Glass ceiling
Globalisation
Goldbricking
Golden circle
Goodwill
Grants
Greek gifts
Gresham's law
Gross misconduct
Gross profit
H
Haldane's dictum
Harassment
Headless chicken reaction (HCR)
Health and safety
Hedging
Herd instinct
Human resource management (HRM)
I
Impact analysis
Industrial cooperation agreement (ICA)
Inflation
Information flow map
Information technology (IT) plan
Information technology (IT) strategy
Induction training
Industrial relations
Initial public offering (IPO)
Insolvency
Insurance
Integrators
International financial reporting standards (IFRS)
International product control
International product life cycle (IPLC)
Interest cover
Interim management
Internal marketing
Intranet
Intrapreneurship
Inventory management
Investment case summary
Investment appraisal
Intellectual property rights management (IPR)
Internal rate of return (IRR)
ISO 9000
ISO 14000
J
James' rule
Job content
Job description
Joint venture (JV)
Journey planning
Just in time (JIT)
K
Kaizen
Kanban
Kinesics
Keep it short, simple (KISS)
Knowledge centre
Knowledge management
KPI (key performance indicators)
L
Labour turnover
Law of first price
Law of unintended consequences
Leadership
Lean manufacturing
Learning curve
Legacy issues
LBO (leveraged buy out)
Licensing
Life cycle analysis
Life style business
Logistics policy
M
Machiavelli's maxim
Maintenance training
MAN (money, authority, need)
Management accounting
Management accounts
MBM (management by memo)
Management by exception (MBE)
MBWA (management by walking about)
MBI (management buy in)
MBO (management buy out)
MBO (management by objectives)
Manpower planning
Manpower strategy
MRP (materials requirement planning)
Marginal profitability
Market drivers
Market entry methodology
Market penetration
Market research policy
Market share
Market size assessment – TAM, PAM, RAM
Marketing plan
Market skimming
Marketing strategy
Maslow's hierarchy
Mathematical modelling
Matrix management
Mean reversion
Media options
Media plan
Meeting management
Meme
Mentoring
Mergers and acquisitions policy
Mind map
MIS (management information system)
Monte Carlo analysis
Moonlighting
Mosaic management
Motivation
MRP (materials requirement planning)
Murphy's law
Mushroom principle
Mystery shopper
N
Negotiation
Nepotism
NPV (net present value)
Net profit
Networking
Noah's rule
NDA (non-disclosure agreement)
NIH (not invented here)
O
Objectives
Obsolescent stock policy
Occam's Razor
OFR (operating, financial review)
Operating leverage
Operations research
Opportunity cost
Order processing
Organisational buying behaviour
Organisational dynamics
Organogram
Outsourcing
Outward thinking
Overhead allocation
P
Packaging assessment
Pandora principle
Paradigm planning
Paranoia
Paternalism
Pareto's law
Parkinson's law
Partnering
Pascal's wager
Payback
Payment systems
Payment terms and conditions
P/E (price earnings ratio)
Pensions management
Period of grace
PDP (personal development plans)
PERT (programme evaluation review technique)
PEST (politics, economics, social factors, technology)
Peter principle
Piggy back
Planning horizon
Ponzi scheme
Portfolio risk analysis
Postponement
Pottery barn rule
Premises certification
Premises layout
Presentation rules
Price elasticity
Pricing policy
Prioritisation
Product certification
Product life cycle (PLC)
Product management
Product portfolio analysis
Product/ service safety
Product spread ratio
Product stretch
Product viability analysis (PVA)
Production efficiency ratio
Production life cycle management (PLM)
Production plan
Production strategy
Product/ service benefit
Product testing policy
Profit and loss
Profit impact of market strategy (PIMS)
Project management system
Protocol for NPD (new product development)
Provocation
Proximal/distal (PD) analysis
Public relations
Purchase portfolio
Purchasing management
Q
Quality circles
Qualitative forecasting
Quantitative analysis
Quantitative forecasting
Queuing theory
Quick ratio
R
Radio frequency identification device (RFID)
Ranke's syndrome
Recent Events Syndrome
Recruitment
Recruitment appraisal
Repetitive strain injury (RSI)
Return on capital employed (ROCE)
Return on plant (ROP)
Revaluation accounting
Reversal
Rice-Davies explanation
Risk assessment and management
Role play
Rule of ten
S
S-curve
Sales contract terms
Sales effectiveness
SER (sales expense ratio)
Sales management
Sales plan
Sales process
Sales promotion plan
SCAMPER
Scenario building
SCORE
Search engine optimisation (SEO)
Seasonal affliction disorder (SAD)
Seasonality
Secrecy
Segmentation
Semi-variable costs
Sensitivity analysis
Seven rules of intervention
Share of voice
Shareholder management
Shareholders
Shareholders agreement
Shared values
Sick building syndrome (SBS)
Simulation
Six Hats
Six “O” of segmentation
Six Sigma
Skills
Social contract
Source and applications of funds
Span of control
Sponsorship
Standard operating procedure (SOP)
Statistical process control (SPC)
Staff
Staff/line ratio
Staff rotation
Stagegate
Stakeholders
Standardisation
Stein's law
Stock turn ratio (STR)
Standard costing
Strategic analysis
Strategic business unit (SBU)
Strategic gap
Strategic options
Strengths, weaknesses, opportunities, threats (SWOT)
Stress
Structure
Style
Substitutes
Succession planning
Suppliers
Supply chain management (SCM)
Support
Survival and recovery planning
Synergy
Systems
Systems analysis
T
Tactical exercise without troops (TEWT)
Tax management policy
Team building
Technology audit
Technology transfer
Telecommunications policy
Territorial imperative
Time based competition (TBC)
There is no alternative (TINA)
Time management
Time series analysis
Time study
TOWS
Total preventative maintenance (TPM)
Total quality control (TQC)
Trade association support
Trade distribution agreement (TDA)
Trading blocs
Training needs analysis
Transfer pricing
Two letters rule
U
Unique selling proposition (USP)
Umbrella marketing
V
Valuation (asset, business)
Value chain
Value reference model (VRM)
Variable costs
Vendor ranking
Venture capital
Vertical integration
Viral marketing
Virtual office
Vision statement
W
Wages ratios
Warranties/ guarantees
Warehouse management
Waste management
Web hosting
Web management
Web strategy
Week activity report (WAR)
Wheel of business
Whistleblower policy
Wishful thinking
Withdrawal
Working capital ratio (WCR)
Working conditions
X
X/Y theory
Z
Z scores
Zelig's Syndrome
Integrating business health check concepts into company operations
A development of the Ibis standard operating procedure SOP programme has been to include “useful concepts” as part of the introduction to the SOP. This has been found to provide quick and effective training and strengthens the SOP in identifying links with other material and the position of the SOP within overall company operations.
An example is the golden circle with links to other topics emphasised in bold:
The golden circle is the graphical description of best practice in strategic implementation. It consists of an inner circle of consolidation or cost cutting, with an outer circle of
market penetration, market development and product/ service
development. The logic is that companies should have a continuing cost cutting programme around which products or services grow volumes in home market(s), which generates investment for international or regional development, which in its term generates revenues for new product/ service development, which are then sold to the home market, and so on around the circle. This focuses the enterprise on its
core competence and levers this expertise into more and more markets and more and more products/ services.
Obviously the balance between the the various strategies will depend on the stage in the
planning horizon, the strategic gap, the set of objectives created (including where relevant the
balanced scorecard), and rates of return through investment appraisal.
23 August 2008 21:18:16
