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Bill Gay 770 792 7764 Crowe Horwath Perf Roadmap Brochure


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  • 1. Business Results Road MapPlanning and Implementing Transformative ChangeAudit | Tax | Advisory | Risk | Performance The Unique Alternative to the Big Four ®
  • 2. Businesses often spend considerabletime and effort developing andrefining their corporate strategies,only to discover that turning thosestrategies into effective operatingplans is an even greater challenge.The Business Results Road Map, developed byCrowe Horwath LLP, has proven successful in helpingcompanies meet this challenge. The highly focused,fast-paced road map approach helps executives identifyand prioritize those initiatives that are most promisingfor producing positive results that are directly relatedto the corporate strategy, while at the same timerecognizing the need to operate realistically within theboundaries of the organization’s business assets. Evenmore important, it enables prompt follow-through,successful execution, and measurement of financial andperformance outcomes, while maximizing the effectiveuse of business assets in human, organizational,financial, and informational resources. The result is a trulytransformative change in the organization, which enablesit to make the leap to the next level of performance.2
  • 3. Crowe® Business Results Road MapA High-priority Approach to Achieving Change“Various studies Turning plans into actions is not a new challenge – in fact, it’s a challenge The road map then helps executives prioritize the various initiatives baseddone in the past 25 as old as business itself. Yet in on their individual and collective return today’s competitive environment, on investment (ROI) and their overallyears indicate that 60 the ability to successfully execute strategic impact. The result is a clearpercent to 80 percent strategy is more critical than ever. action plan that leaders can use to Studies show that most business begin implementing an appropriate mixof companies fall strategies consistently fail to achieve of short- and long-term initiatives.short of the success all their stated goals – a shortcoming that just about every executive Even more significant is the transformative change that occurs in thepredicted from their experiences firsthand, often several way the company translates strategy times, throughout his or her strategies.” into action, and the development To overcome such impediments, the of a strong, effective management— Robert S. Kaplan and David P. Norton Crowe Business Results Road Map system that ensures chosen initiatives Harvard Business Review1 helps companies step away from are executed effectively, and that isolated or disconnected improvement projected results are achieved. projects, and instead take a broader view of the organization’s strategy and its implementation. An intensive approach that generally is achieved on a seven-week timetable, the road map process begins with a high-impact review of the existing environment, followed by clarification of improvement targets and performance benchmarks, and the identification of a series of potential initiatives that will provide maximum 3
  • 4. Crowe Horwath LLP Executing Strategy: Where Good Companies Often Struggle The inability to successfully execute Overcoming these common challenges strategy can threaten the very survival requires a management strategy that of a business. This challenge can starts and ends with a business focus, manifest itself in a variety of ways: beginning with clear identification of the desired business outcomes, and „ In some companies, the failure ending with the accurate tracking of to execute strategy results in a the actual business results. The Crowe growth plateau, where the company approach will provide management struggles to reach the next level as with a mechanism to choose the most it wrestles with challenges that limit appropriate alternatives with the highest its size, scope, and sales revenues. potential ROI. In addition, strong „ In addition to an inability to achieve monitoring is essential in order to track growth targets, some companies realization of the targeted results. also encounter an operational wall, To be successful, companies must experiencing unexpected increases establish a “new normal” – that is, a in claims, service complaints, bad new, accepted method of operation“I sat in rooms debt, or other breakdowns. that truly transforms the organizationfor years, looking „ Some companies develop reasonable and promising strategies into a high-performing promising for revenue growth, lower costs, improved service, or other criticalstrategies that never objectives, but key managers aredelivered results.” uncertain where to begin or unable to overcome inertia to get started.— Jack Welch “Jack: Straight From the Gut” 2 „ Still others are able to accurately identify the best initiatives to enact their strategies, but find that execution and long-term adoption are lacking.4
  • 5. Crowe® Business Results Road MapThe Underlying Causes of Failed StrategiesThere are many reasons why companiesfail to accomplish transformative change. „ Limited resources (both financial and human), which prevent the “The vast majorityOne common impediment arises when organization from bringing projects of companies nevercompanies fail to take a broad enough to a successful conclusion;view of the challenges. become great, „ Competing and conflicting prioritiesCompanies in this situation often within the organization; precisely becauselaunch a series of one-off projects,using various skills and disciplines „ Individual executives’ inability to the vast majority recognize the strategic implicationswith which they are already familiar of their initiatives; become quite goodsuch as business intelligence,quality control, lean manufacturing, „ Lack of executive support – and that is their or a powerful championvendor-managed inventory, or within the organization; main problem.”other, similar specialized tools. — Jim Collins „ Lack of a proper managementSome of these initiatives can be valuable “Good to Great” 3 system to sustain performanceand helpful, but only to a limited extent gains and perpetuate the newbecause the chosen initiatives address manner of doing business;only a fraction of the full set of issuesrequired for success. Such well-intentioned „ General resistance to change; andbut inadequately planned efforts can be „ Complacency after partial or limitedcounterproductive, with often disappointing success that fails to lift the companyoutcomes including turnaround from “good” to “great.”expectations that are never realized.In addition to adopting an unnecessarilylimited view of change, companies alsoencounter a number of other commonobstacles 5
  • 6. Crowe Horwath LLPComprehensive, Transformative ChangeDeveloped in response to businesses’ „ Products – including new product „ Customers – including initiatives thatstruggle to achieve transformative development, product profitability, involve relationship management,change, the Crowe Business Results item rationalization, stocking and forecasting, channel partners,Road Map is a rapid, intensive customer service levels, quality, service level agreements, customerapproach that helps companies step and portfolio mix projects; collaboration, early access toaway from isolated or disconnected customer ordering patterns, special „ Organization – including programsimprovement projects, and instead take terms/royalties/rebates, and designed to update personnela broader view of the organization’s customer inventory visibility; and roles, organizational structure,strategy and its implementation. responsibilities, business policies, „ Supply Chain – including projectsDuring the seven-week road map intergroup dynamics, outsourcing, that affect suppliers, supplier-initiative, management is led through shared services, risk management, owned inventory, transportation,a process that helps the company and internal best practices; production, distribution centers,assess the entire suite of potential service level agreements, and „ Process/Systems – includinginitiatives that could be undertaken, contract management. projects focused on businessproducing an accurate evaluation of the processes improvement and system Opportunities in these five categoriesbusiness impact each of those initiatives integration, as well as specific are assessed to identify their impact onwould bring to the organization. technology projects such as the company’s organizational, financial,This initial assessment produces a enterprise resource planning, business operational, and strategic goals. Forportfolio of high-impact prospective intelligence, forecasting, warehouse each potential initiative, Crowe and theimprovement projects that address management, data collection, client organization also collaborate on afive fundamental business domains: and document management; comprehensive list of key dependencies and risks, rating the maturity of current processes, projected business benefits,Pillars for Road Map Initiatives client resources required to implement, and critical success factors. Products In this way, the road map helps to effectively coordinate the delivery of these initiatives and deliver positive results, while also providing management with additional and valuable perspectives they would otherwise not receive. Above all, the process enables the Customers Organization organization to move quickly in actually executing chosen initiatives successfully over a 12- to 18-month period. Supply Chain Process/Systems6
  • 7. Crowe® Business Results Road MapA Practical, Phased Approach to Strategic SuccessBy developing the Business Results change that is the overall objective. „ ExecutionRoad Map in a collaborative manner, The final road map identifies Building on the high-level resourceCrowe and the client can identify, define, budgets, projected benefits, timing, map, management can now quicklyand prioritize specific initiatives that will and a plan for implementation, and confidently assign responsibilityyield the maximum impact in critical beginning with some initial “quick for each project and establishperformance areas. The development wins” that create momentum and the project’s priority in the overalland execution processes are generally help engage the organization. improvement effort. Some projectsorganized into a series of phases: These are followed by longer-term are assigned to internal teams, initiatives that, over the course of others may be led by Crowe„ Defining Objectives the execution, move the organization consultants, and still others may The recognized need for change toward the enhanced performance be executed by niche specialists. is expressed as a series of clearly level called for by the strategy. identified and measurable business objectives, with quantifiable and tangible measures of success.„ Identifying Improvement Initiatives Crowe and the client identify potential initiatives that could be undertaken by the organization to realize these results.„ Assessing Impact and ROI The anticipated impact of each potential initiative is compared against the objectives. To identify ROI, Crowe’s assessment includes a detailed business case analysis and payback analysis.„ Prioritizing Projects The objective assessment of the projects’ impact is combined with other critical decision factors – such as timing, potential barriers, resource constraints, risks, and strategic importance – to produce a prioritized list of initiatives.„ Resource Planning and Road Map An agreed-upon action plan creates clarity, aligns people with the mission, and shows how actions will drive toward the broad 7
  • 8. Crowe Horwath LLPHeat Map Controls/Risk Mitigation Repeatable Processes Returns Improvement Inventory Reduction = RECOMMENDED NP Launch Savings Data and Analytics Customer Service COGS Reduction = CRITICAL Scalability Road Map Initiatives and Projects Business Performance Foundation for Growth Products New Product Development H H M H H M H M M Existing Product Management H H M L L L M M M Organization Roles and Organization Alignment H H M H M M M M M Performance Management M H M M H M L M L Systems ERP System Replacement H L L M M H H M M Forecasting/Demand Management System H M M M M H H M M Document Management/Work ow Enabler M M L H M M H L M Reporting/Business Intelligence Framework M M M M L M M H M Systems Architecture, Integration, & Optimization M M L M L H H M H Supply Chain Process Improvement S&OP Process Improvement H M L L L H H M M Inventory Management H H M L M H M M L Sourcing M H L M L H L M M Service Quality L M M L M L M M H Returns L H H L M L M L L Additional Projects (identi ed post-review) New Distribution Center Assessment M H L M H H M M L Transition to 3PL H H L M H H M M L New Brand Introduction M M L M M L L L LAlthough an actual heat map would typically display many more potential projects, this exampleillustrates the clear visibility and prioritization this useful tool provides.8
  • 9. Crowe® Business Results Road MapA Closer Look at KeyRoad Map DeliverablesThe Crowe Business Results Road Map Charter Developmentis designed to help companies overcome The objective assessment of thesignificant challenges in translating initiatives’ impact, as spelled out instrategy into meaningful operational the heat map, is combined with otherimprovements. Several key deliverables critical decision factors to produceare essential to achieving this goal: a prioritized list of initiatives. These decision factors usually include:Heat Map „ Timing (ideally a mix of quickThis objective, intuitive matrix demonstrates wins and longer-term projects);the anticipated impact of each possibleinitiative and compares it against the defined „ Potential barriers to implementation;objectives. The heat map helps prioritize „ Resource constraints (includingprojects, based on their assessed impact. financial and personnel limitations);For example, those in which the impact „ ROI;is assessed as “high” in three or morecategories are classified as “critical,” while „ Risks;others are “recommended” for execution. „ Strategic importance;This prioritization is essential to counteract „ Interdependencies among variousthe tendency to try to implement too many departments and divisions;projects at once, resulting in none ofthem finishing satisfactorily. „ Possible overlaps with other initiatives; andBusiness Justification/ROI „ Key executive sponsorship.Crowe applies its industry, financialmodeling, and operational experience Resource Planto help clients develop a detailed A high-level resource plan identifiesdocumentation and payback analysis that the available resources from thecan be used to justify key investments client, Crowe, and potential third-with top executives and the board party participants. This resourceof directors. In certain situations this plan will drive the next phase of theanalysis may also serve as a key process, which is the production ofinput into incentive-oriented projects the actual road map document.based on actual business 9
  • 10. Crowe Horwath LLPRoad MapThis is an agreed-upon action plan that „ Initial budgets and expenses for various projects’ execution;creates clarity, aligns people with the „ Projected savings, revenue enhancement, or other benefits;mission, and shows how actions will drivetoward the broad, transformative change „ Timing expectations in view of resources, risks, and dependencies;that is the overall objective. The road map „ Expected business impact;will also incorporate many of the company’s „ Expected costs;existing portfolio of projects, and willrationalize any change to existing project „ Action plans and next steps for implementation; andpriorities. The final road map identifies: „ Executive and management responsibility for each initiative.ACME Supply Chain Improvements – All Projects Road Map New Product Development ERP, Forecasting Roles and Organizational Alignment Systems Architecture and Integration Critical Inventory Management (8 projects) Outsource to Third-party Logistics Provider Distribution Strategy Program Management Optimization EU Distribution Introduction Document Management Systems and Work ow Performance Management Recommended (10 projects) Existing Product Management Sourcing S&OP Process Improvement Returns Reporting/BI Service Quality 0 – 6 months 6 – 12 months 12 – 18 months Projects Led by Independent/ Phase II Third Party Company-led Projects Go Live10
  • 11. Crowe® Business Results Road MapExecution That Helps Ensure ResultsThe ultimate measure of the Crowe The road map helps companiesBusiness Results Road Map’s translate broad strategies into aeffectiveness is the successful portfolio of realistic, practical, andimplementation of projects that advance achievable projects – complete withcorporate strategy and deliver real the processes to execute them and thebusiness benefit. Those initiatives tools that are needed to track resultsassigned to Crowe for execution are – while relating each initiative back tomanaged using a rigorous program the company’s defined strategy andmanagement methodology, based objectives. And it does this in a fast-on established best practices in moving, seven-week process thatprogram management. For initiatives establishes a momentum for change.assigned to internal teams or other By identifying the investment required,providers, the road map process helps defining the projected payback,identify milestones, define realistic projecting an achievable timeline,metrics, and establish clear lines of and outlining a specific executionresponsibility for achieving results. strategy, the Crowe Business ResultsFinally, it should be noted that the Road Map can help businessesCrowe Business Results Road Map achieve the transformative changediffers substantially from traditional they are seeking in order to turnassessments, which often serve primarily sound strategy into measurable andto confirm issues that management lasting performance improvement.already suspects are impeding success.Thought leadership from Crowe helps 1 Robert S. Kaplan and David P. Norton,clients identify threats and opportunities “Mastering the Management System,” Harvard Business Review, January 2008,that often are “off their radar.” mastering-the-management-system/ar/1 2 Jack Welch, “Jack: Straight From the Gut,” Warner Business Books, 2001, p. 383 3 Jim Collins, “Good to Great,” HarperBusiness, 2001, p. 11
  • 12. Contact Us About Crowe Horwath LLPFor more information about the Crowe Horwath LLP is one of the largest public accounting and consultingCrowe Business Results Road Map firms in the United States. Under its core purpose of Building Value with Values® ,or any of our other practical, results- Crowe assists public and private company clients in reaching their goals throughoriented business services, contact: audit, tax, advisory, risk, and performance services. With 26 offices and 2,400 personnel, Crowe is recognized by many organizations as one of the country’sVicky Ludema best places to work. Crowe serves clients worldwide as an independent800.599.2304 member of Crowe Horwath International, one of the largest networks in world, consisting of more than 140 independent accounting and management consulting firms with offices in more than 400 cities around the world.www.crowehorwath.comCrowe Horwath LLP is an independent member of Crowe Horwath International, a Swiss verein. Each member firm of Crowe Horwath International is a separate and independent legal entity.Crowe Horwath LLP and its affiliates are not responsible or liable for any acts or omissions of Crowe Horwath International or any other member of Crowe Horwath International and specificallydisclaim any and all responsibility or liability for acts or omissions of Crowe Horwath International or any other Crowe Horwath International member. Accountancy services in Kansas and NorthCarolina are rendered by Crowe Chizek LLP, which is not a member of Crowe Horwath International. © 2010 Crowe Horwath LLP PERF9332B