Checking your business's health

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Business is not just about selling and making money. Successful businesses understand that they need to have a balanced view of their business at any given time. That includes an understanding of their customer base, an assessment of their staff, their processes as well as their sales pipeline and financial state.
However, in many cases, business owners and managers are so busy making sales and meeting orders that they may not have time to sit back and review the state of their business and ask the right questions at the right time.

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Checking your business's health

  1. 1. Business Healthcheck Developing a balanced view of your business
  2. 2. Why a business healthcheck? • Business is not just about selling and making money. • Successful businesses understand the need for a balanced view • This includes your customer base, staff, processes, sales pipeline and financial state. • All are key elements to any business
  3. 3. How to use a healthcheck tool • Most tools are self-diagnostic 1. Read the following slides and answer the questions honestly. Ask people for their views 2. Identify areas of concern 3. Develop action plans to resolve those areas
  4. 4. Strategy & Governance
  5. 5. Strategy & Governance • Understanding the direction you want to take your business is core to making it happen • Creating a clear vision/strategy for your business is the main function of a business owner • Strategy must be communicated well
  6. 6. Strategy • What is the vision for your business? • Where do you want to be in 2 or 3 years’ time? • What values do you hold dear for your business? • What your objectives are for the next year or two?
  7. 7. Governance • How well does your board support you and your management team? • How frequently do you meet and what reporting is provided? • Is reporting to the board onerous? Does it meet their expectations? Is board reporting accurate and timely?
  8. 8. Finances
  9. 9. Finances • Understanding your financial health is paramount to survival for any business. • Often businesses fail to keep a clear track of their bills, invoices or fail to chase payment • Managing cash-flow can be the difference between survival and liquidation
  10. 10. Managing Finances • How successfully are you at forecasting income and expenditure? • How often monitor your cash-flow? Do you know how to manage peaks and troughs? • What loans do you have? When did you last review your liabilities? Do you know what alternatives exist?
  11. 11. Financial Control • How up to date is your book-keeping? • Do you submit tax returns on time? Have you been fined for late returns? • Do you have strong audit trails to track money through your financial systems? • When were you last audited?
  12. 12. Sales & Marketing
  13. 13. Sales & Marketing • Clearly, sales are the driver to growth and that happens when your sales team deliver against an agreed plan. • Linking your marketing and sales plan to your overall business plan is a good place to start.
  14. 14. Marketing • How well do you define your market sectors? • What market research do you undertake? • How well do you understand the drivers and blockers of your target customers? • Do you know what your customers want?
  15. 15. Sales • Do you monitor your sales pipeline? • What is the conversion rate between leads and sales? • Do you have a clear sales process that everyone understands? • Do you know your cost of sale?
  16. 16. Customers
  17. 17. Customers • As a friend of mine says, “if you don’t have customers, you don’t have a business ... you have a hobby” • One thing to remember: it frequently costs much more to attract new clients than it does to retain existing clients
  18. 18. Customers • Do you know the number of clients you have and their demographic split (location, sectors, background, gender)? • How did you attract your clients? • How much is average spend, how frequently do they buy from you, how long have they been clients?
  19. 19. Customer Satisfaction • How frequently do you contact your customers? • When did you last contact ex-customers to find out why they left? • How do you gauge customer satisfaction? • Do you get customer complaints?
  20. 20. Employees
  21. 21. Employees • In many organisations, the highest cost and the most valuable resource are the staff • Understanding the “health” of the staff is a key ways of assessing the stability of a business. • Happy staff = productive staff
  22. 22. Employees • What is the annual rate of staff turn-over? Is it changing? • Do you have on-going grievances and disciplinaries? • What percentage of days sickness do your staff take and what are the reasons and trends?
  23. 23. Staff Skills • What skills do your staff have? Have you undertaken a skills audit? • How many days of training do you provide your staff annually? Do you know how effective the training is? • How many errors are due to lack of knowledge or skill?
  24. 24. Performance Management • Do you have a fit-for-purpose performance management process in place? • Do your staff have frequent 1-2-1’s with their line managers? • Do your staff feel comfortable in raising issues and talking about their own prospects?
  25. 25. Next Steps
  26. 26. Any questions? • If, while reviewing your business, you have any questions, please contact me: www.pkms.co.uk paul.kaerger@pkms.co.uk @paul_pkms 07595 702878

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