This presentation shows that insufficient resources are being used to reduce costs compared to sales. Cost reduction makes as much (if not more) NAV (Net Added Value) to the "bottom line" profits of an organisation
This document provides an overview of how bringing together sales and finance can help a business succeed. It discusses how finance can provide the return on investment for sales tools and teams. Key financial metrics like profit margins, fixed vs variable expenses, and how costs are allocated are examined. The importance of understanding which customers and accounts are most profitable is emphasized. Real-world examples of business metrics and profit margins by industry and company size are presented. The overall message is that an integrated approach to sales and finance can help businesses make better investment decisions and ensure sustainability.
This document provides guidance on building a simple financial model for startups seeking investment. It discusses that investors want to see financial projections that show there is money to be made. It then covers the key components of building a financial model, including determining unit economics, revenue and cost assumptions over time, and constructing profit and loss statements. The document emphasizes translating the startup story into numbers and keeping projections within reasonable ranges compared to benchmarks.
Screen-based communication in stores can help brands achieve their sales promotion objectives like increasing sales and joint promotion income. CatchTheEye has researched how to profitably implement screens in stores. Their research identified optimal screen locations, formats, and product categories. They offer services like identifying objectives, calculating advertising revenue potential, and developing business models to sell advertising space within brand stores. Proper planning of tasks like technical specifications, partners, and content are important for success. Once running, relevant on-screen content like product information can further sales goals.
The document discusses key factors in a profit and loss account that determine the financial performance of a business. It explains that a profit and loss account shows net profit, gross profit, sales revenue, expenses, and income. It states that for a business to be financially successful, its sales revenue should be higher than expenses so there is a net profit. Expenses need to be kept low in order to maximize net profit, while gross profit being too low can result in net losses. The document provides an example analysis of a company's profit and loss account and recommendations for improving performance by reducing expenses, increasing sales revenue, and cutting costs of goods sold.
This document provides advice for scaling a B2B sales organization. It discusses starting with founder-led sales, hiring first salespeople while considering company culture versus relationships, creating compensation plans based on activity and goals, building and training sales teams for different customer segments, and using sales data to inform product development. It also emphasizes the importance of understanding customers, reducing churn, and taking a customer-backwards approach when developing products and services.
CO2@Home 2020 | Dan Gordon | CFO WorkshopCoalmarch
This document summarizes a CFO workshop discussing key performance indicators for profitability and wealth creation in pest control businesses. It identifies gross margin, annual cash flow to ownership, recurring to non-recurring revenue ratio, and annual revenue growth as the most important KPIs. It provides examples and explanations of how to calculate and improve each metric, particularly how increasing prices can raise gross margin and decrease the breakeven point. Maintaining a high percentage of recurring revenue is emphasized as providing business predictability and stability. The importance of revenue growth for profitability, valuation, customer satisfaction, and employee retention is also covered.
The document discusses calculating return on investment (ROI) for training. It notes that U.S. organizations spend over $109 billion annually on training, or around $1,435 per employee. While Australia spends less overall, per employee costs are similar. To get an ROI, organizations need to evaluate if training improved business performance by assessing whether employees learned and applied skills. The document provides an example ROI calculation for a call center training program, finding a 540% ROI. It stresses the importance of evaluating training programs to ensure they contribute to individual and organizational goals.
Churn is Dead, Long Live Net Dollar Retention, SaaStr Annual @ Home, SaaStr 2020Dave Kellogg
My presentation at SaaStr Annual 2020 which focuses on understanding SaaS business from a metrics viewpoint with a particular focus on the health of the installed base as measured by churn rates and net dollar retention rates
This document provides an overview of how bringing together sales and finance can help a business succeed. It discusses how finance can provide the return on investment for sales tools and teams. Key financial metrics like profit margins, fixed vs variable expenses, and how costs are allocated are examined. The importance of understanding which customers and accounts are most profitable is emphasized. Real-world examples of business metrics and profit margins by industry and company size are presented. The overall message is that an integrated approach to sales and finance can help businesses make better investment decisions and ensure sustainability.
This document provides guidance on building a simple financial model for startups seeking investment. It discusses that investors want to see financial projections that show there is money to be made. It then covers the key components of building a financial model, including determining unit economics, revenue and cost assumptions over time, and constructing profit and loss statements. The document emphasizes translating the startup story into numbers and keeping projections within reasonable ranges compared to benchmarks.
Screen-based communication in stores can help brands achieve their sales promotion objectives like increasing sales and joint promotion income. CatchTheEye has researched how to profitably implement screens in stores. Their research identified optimal screen locations, formats, and product categories. They offer services like identifying objectives, calculating advertising revenue potential, and developing business models to sell advertising space within brand stores. Proper planning of tasks like technical specifications, partners, and content are important for success. Once running, relevant on-screen content like product information can further sales goals.
The document discusses key factors in a profit and loss account that determine the financial performance of a business. It explains that a profit and loss account shows net profit, gross profit, sales revenue, expenses, and income. It states that for a business to be financially successful, its sales revenue should be higher than expenses so there is a net profit. Expenses need to be kept low in order to maximize net profit, while gross profit being too low can result in net losses. The document provides an example analysis of a company's profit and loss account and recommendations for improving performance by reducing expenses, increasing sales revenue, and cutting costs of goods sold.
This document provides advice for scaling a B2B sales organization. It discusses starting with founder-led sales, hiring first salespeople while considering company culture versus relationships, creating compensation plans based on activity and goals, building and training sales teams for different customer segments, and using sales data to inform product development. It also emphasizes the importance of understanding customers, reducing churn, and taking a customer-backwards approach when developing products and services.
CO2@Home 2020 | Dan Gordon | CFO WorkshopCoalmarch
This document summarizes a CFO workshop discussing key performance indicators for profitability and wealth creation in pest control businesses. It identifies gross margin, annual cash flow to ownership, recurring to non-recurring revenue ratio, and annual revenue growth as the most important KPIs. It provides examples and explanations of how to calculate and improve each metric, particularly how increasing prices can raise gross margin and decrease the breakeven point. Maintaining a high percentage of recurring revenue is emphasized as providing business predictability and stability. The importance of revenue growth for profitability, valuation, customer satisfaction, and employee retention is also covered.
The document discusses calculating return on investment (ROI) for training. It notes that U.S. organizations spend over $109 billion annually on training, or around $1,435 per employee. While Australia spends less overall, per employee costs are similar. To get an ROI, organizations need to evaluate if training improved business performance by assessing whether employees learned and applied skills. The document provides an example ROI calculation for a call center training program, finding a 540% ROI. It stresses the importance of evaluating training programs to ensure they contribute to individual and organizational goals.
Churn is Dead, Long Live Net Dollar Retention, SaaStr Annual @ Home, SaaStr 2020Dave Kellogg
My presentation at SaaStr Annual 2020 which focuses on understanding SaaS business from a metrics viewpoint with a particular focus on the health of the installed base as measured by churn rates and net dollar retention rates
This Presentation Uses Two Case Studies
to Show How Risk Can Be Used as a
Discriminant in Decision Making for Key
Decisions, in:
Key
Areas of a Corporation,
Selecting
Alternatives,
Evaluating
Projects
In the second Case Study, a method that
eliminates the pitfalls of NPV is presented.
CDA / ESM eliminates the pitfalls of NPV, an obsolete
financial concept still used by many.
The evaluation of a project with CDA/ESM includes:
the
annual risks potentially afflicting the project,
construction
risks,
risks
of malfunctioning, and possibly also the
demolition/
reclamation costs.
This document contains a grid of numbers from 20 to 0, with each line representing the number of squares of a certain size that can fit within a 20x20 grid. It then lists the number of 1x1, 2x2, 3x3, 4x4, and 5x5 squares that can be in the 20x20 grid, with the totals being 25, 16, 9, 4, and 1 squares respectively.
The document advertises Executive Corporate Residences, a company that provides luxury townhome rentals as an alternative to hotels for business travelers. It offers 22 townhomes near LBJ Freeway and North Dallas Tollway that provide superior accommodations and amenities. The townhomes are designed for guest executives, relocating employees, consultants, clients, and other business uses. They include features like large size, kitchens, home theaters, business centers, and 24/7 concierge services to make business travel more comfortable than hotels.
Este documento repite el título "Tema 5. Bizancio" varias veces y menciona la cúpula de Santa Sofía. Se enfoca en el tema de Bizancio, incluyendo detalles sobre la cúpula de la iglesia de Santa Sofía en dicha ciudad.
We need to be creative and utilize our innovations as a means to build our way out of this global crisis. here is a step by step plan on how to build a creative economy.
If your company’s revenues have been flat to declining over the past eight quarters you are probably ‘Stuck in Neutral.’ There are no magic bullets when it comes to reversing long term flat to declining revenue trends for tech companies. Companies get ‘stuck in neutral’ for a reason. Most of the time it is a market problem versus a ‘people’ problem. Breaking out of the rut, however, takes courage and decisive action. This presentation is an overview of three part strategy for getting your revenue growth back in gear. In the coming weeks we will explore each of the three strategies in depth.
This document provides guidance on compensation plans for various roles in a home improvement business, including marketing, sales, and other departments. It discusses using a volume bonus to incentivize hitting sales and lead generation thresholds, as well as an efficiency bonus to encourage profitability. The roles, their key performance indicators (KPIs), and example compensation structures are outlined. Maintaining the right compensation plans is emphasized as a way to dictate the desired behaviors that translate to business goals and profitability.
CO2 Presentation - The Largest Profit LeversCoalmarch
Take a deep dive with master bookkeeper Dan Gordon, as he explains what tools to use, business organization strategies that include systems, procedures checklists, and more. Learn the tricks of accounting automation that will help you move the profit needle for your company.
The document discusses the CEO's dream of dramatically improving a company's performance by focusing on reducing stagnant revenue, late deliveries, cost overruns, and quality issues through implementing strategies like Lean, Six Sigma, and 5S. It provides an example of a company that achieved 100% on-time delivery for 8 years, low quality issues, zero customer turnover, low employee turnover, new opportunities, and high EBITDA through these strategies. The author, Steven Cummings, presents himself as an executive who can help companies maximize profit and revenue growth by identifying opportunities and leveraging technology, investments, and new strategies.
Gotoclient is a marketing partner that helps technology companies increase sales through innovative promotional techniques and by taking on some of their workload. It is owned by Jordi Marca and based in Barcelona, covering Western Europe. Gotoclient offers a range of plug-and-play promotions, planning services, and implementation services to help companies with marketing, sales, and executing their strategies. Its team is led by Jordi Marca and includes heads of different departments, with support from partners for logistics, recycling facilities, and legal advice.
Stepping into a role which requires business finance knowledge? Here is a short guide offering advice, tools, and expertise that you will need to equip yourself with to be successful. Check out our Diploma in Business Finance for more.
How to spin off the product from the agencyDivante
This document discusses how to successfully spin off a product from an agency. Some key challenges include assembling a dedicated product team separate from the agency with its own P&L, developing a marketing and sales plan to find customers beyond existing agency clients, and giving the product sufficient time and independence to gain traction. It notes that agencies are low-risk cash cows while products require more investment upfront for potentially higher rewards but also higher risk of failure. Setting the right cap table to motivate the product team is important to avoid the new venture still relying too much on the agency.
This document discusses best practices for communication agencies to effectively partner with clients. It recommends agencies take a consultative approach to understand each client group's needs and perspectives. The agency should conduct workshops to extract valuable information from technicians, marketing, sales and C-level staff. This informs a recommendation covering marketing analysis, communication strategies focused on sales support, and a timeline and implementation plan. Key aspects include building an efficient team, establishing priorities and metrics, and conducting quarterly evaluations to ensure business alignment and improve outcomes through a partnership approach.
The #1 reason businesses fail is that they run out of cash. Not knowing your break-even point is a great way to run out of cash. This deck goes into what exactly is a break-even point and how to calculate, along with many other nuggets.
CO2 2019 | Dan Gordon | Budgeting for GrowthCoalmarch
Budgeting for Growth is a workshop about building a profitable company using budgets. It discusses what a budget is, why businesses create budgets, how to forecast revenues, and how to budget for direct costs, gross margin, sales and marketing expenses, general and administrative costs, and net income. The presentation emphasizes calculating the lifetime value of a customer to determine how much should be spent on marketing to acquire new customers.
The document discusses six critical elements for making turnarounds work: 1) Having a champion to execute the turnaround, 2) Defining the right and ambitious scope that impacts the entire business, 3) Understanding the company's value from the customer's perspective, 4) Addressing cross-influences between different parts of the company, 5) Monitoring the turnaround progress and results, and 6) Thinking outside the box with new scenarios and approaches. It also lists some common pitfalls to avoid, such as having the wrong team or overlooking communication.
This complete deck can be used to present to your team. It has PPT slides on various topics highlighting all the core areas of your business needs. This complete deck focuses on Enterprise Strategy PowerPoint Presentation Slides and has professionally designed templates with suitable visuals and appropriate content. This deck consists of total of fifty one slides. All the slides are completely customizable for your convenience. You can change the colour, text and font size of these templates. You can add or delete the content if needed. Get access to this professionally designed complete presentation by clicking the download button below. http://bit.ly/2OBjyuT
1) The document outlines Mathews Michaels' telecom business advisory services which include reviewing key areas like revenue, costs, productivity, profitability and partnerships.
2) Mathews Michaels aims to uncover organizational strengths and opportunities for improvement through benchmarking sales, operations and finances against typical metrics.
3) Their process involves exercises to analyze current performance, identify gaps, set goals and drive tangible results through improved profitability, new revenue streams and business transformation.
Business Planning And Marketing Strategy PowerPoint Presentation SlidesSlideTeam
This complete deck is oriented to make sure you do not lag in your presentations. Our creatively crafted slides come with apt research and planning. This exclusive deck with fourty eight slides is here to help you to strategize, plan, analyse, or segment the topic with clear understanding and apprehension. Utilize ready to use presentation slides on Business Planning And Marketing Strategy PowerPoint Presentation Slides with all sorts of editable templates, charts and graphs, overviews, analysis templates. It is usable for marking important decisions and covering critical issues. Display and present all possible kinds of underlying nuances, progress factors for an all inclusive presentation for the teams. This presentation deck can be used by all professionals, managers, individuals, internal external teams involved in any company organization. http://bit.ly/2H4rXCH
This Presentation Uses Two Case Studies
to Show How Risk Can Be Used as a
Discriminant in Decision Making for Key
Decisions, in:
Key
Areas of a Corporation,
Selecting
Alternatives,
Evaluating
Projects
In the second Case Study, a method that
eliminates the pitfalls of NPV is presented.
CDA / ESM eliminates the pitfalls of NPV, an obsolete
financial concept still used by many.
The evaluation of a project with CDA/ESM includes:
the
annual risks potentially afflicting the project,
construction
risks,
risks
of malfunctioning, and possibly also the
demolition/
reclamation costs.
This document contains a grid of numbers from 20 to 0, with each line representing the number of squares of a certain size that can fit within a 20x20 grid. It then lists the number of 1x1, 2x2, 3x3, 4x4, and 5x5 squares that can be in the 20x20 grid, with the totals being 25, 16, 9, 4, and 1 squares respectively.
The document advertises Executive Corporate Residences, a company that provides luxury townhome rentals as an alternative to hotels for business travelers. It offers 22 townhomes near LBJ Freeway and North Dallas Tollway that provide superior accommodations and amenities. The townhomes are designed for guest executives, relocating employees, consultants, clients, and other business uses. They include features like large size, kitchens, home theaters, business centers, and 24/7 concierge services to make business travel more comfortable than hotels.
Este documento repite el título "Tema 5. Bizancio" varias veces y menciona la cúpula de Santa Sofía. Se enfoca en el tema de Bizancio, incluyendo detalles sobre la cúpula de la iglesia de Santa Sofía en dicha ciudad.
We need to be creative and utilize our innovations as a means to build our way out of this global crisis. here is a step by step plan on how to build a creative economy.
If your company’s revenues have been flat to declining over the past eight quarters you are probably ‘Stuck in Neutral.’ There are no magic bullets when it comes to reversing long term flat to declining revenue trends for tech companies. Companies get ‘stuck in neutral’ for a reason. Most of the time it is a market problem versus a ‘people’ problem. Breaking out of the rut, however, takes courage and decisive action. This presentation is an overview of three part strategy for getting your revenue growth back in gear. In the coming weeks we will explore each of the three strategies in depth.
This document provides guidance on compensation plans for various roles in a home improvement business, including marketing, sales, and other departments. It discusses using a volume bonus to incentivize hitting sales and lead generation thresholds, as well as an efficiency bonus to encourage profitability. The roles, their key performance indicators (KPIs), and example compensation structures are outlined. Maintaining the right compensation plans is emphasized as a way to dictate the desired behaviors that translate to business goals and profitability.
CO2 Presentation - The Largest Profit LeversCoalmarch
Take a deep dive with master bookkeeper Dan Gordon, as he explains what tools to use, business organization strategies that include systems, procedures checklists, and more. Learn the tricks of accounting automation that will help you move the profit needle for your company.
The document discusses the CEO's dream of dramatically improving a company's performance by focusing on reducing stagnant revenue, late deliveries, cost overruns, and quality issues through implementing strategies like Lean, Six Sigma, and 5S. It provides an example of a company that achieved 100% on-time delivery for 8 years, low quality issues, zero customer turnover, low employee turnover, new opportunities, and high EBITDA through these strategies. The author, Steven Cummings, presents himself as an executive who can help companies maximize profit and revenue growth by identifying opportunities and leveraging technology, investments, and new strategies.
Gotoclient is a marketing partner that helps technology companies increase sales through innovative promotional techniques and by taking on some of their workload. It is owned by Jordi Marca and based in Barcelona, covering Western Europe. Gotoclient offers a range of plug-and-play promotions, planning services, and implementation services to help companies with marketing, sales, and executing their strategies. Its team is led by Jordi Marca and includes heads of different departments, with support from partners for logistics, recycling facilities, and legal advice.
Stepping into a role which requires business finance knowledge? Here is a short guide offering advice, tools, and expertise that you will need to equip yourself with to be successful. Check out our Diploma in Business Finance for more.
How to spin off the product from the agencyDivante
This document discusses how to successfully spin off a product from an agency. Some key challenges include assembling a dedicated product team separate from the agency with its own P&L, developing a marketing and sales plan to find customers beyond existing agency clients, and giving the product sufficient time and independence to gain traction. It notes that agencies are low-risk cash cows while products require more investment upfront for potentially higher rewards but also higher risk of failure. Setting the right cap table to motivate the product team is important to avoid the new venture still relying too much on the agency.
This document discusses best practices for communication agencies to effectively partner with clients. It recommends agencies take a consultative approach to understand each client group's needs and perspectives. The agency should conduct workshops to extract valuable information from technicians, marketing, sales and C-level staff. This informs a recommendation covering marketing analysis, communication strategies focused on sales support, and a timeline and implementation plan. Key aspects include building an efficient team, establishing priorities and metrics, and conducting quarterly evaluations to ensure business alignment and improve outcomes through a partnership approach.
The #1 reason businesses fail is that they run out of cash. Not knowing your break-even point is a great way to run out of cash. This deck goes into what exactly is a break-even point and how to calculate, along with many other nuggets.
CO2 2019 | Dan Gordon | Budgeting for GrowthCoalmarch
Budgeting for Growth is a workshop about building a profitable company using budgets. It discusses what a budget is, why businesses create budgets, how to forecast revenues, and how to budget for direct costs, gross margin, sales and marketing expenses, general and administrative costs, and net income. The presentation emphasizes calculating the lifetime value of a customer to determine how much should be spent on marketing to acquire new customers.
The document discusses six critical elements for making turnarounds work: 1) Having a champion to execute the turnaround, 2) Defining the right and ambitious scope that impacts the entire business, 3) Understanding the company's value from the customer's perspective, 4) Addressing cross-influences between different parts of the company, 5) Monitoring the turnaround progress and results, and 6) Thinking outside the box with new scenarios and approaches. It also lists some common pitfalls to avoid, such as having the wrong team or overlooking communication.
This complete deck can be used to present to your team. It has PPT slides on various topics highlighting all the core areas of your business needs. This complete deck focuses on Enterprise Strategy PowerPoint Presentation Slides and has professionally designed templates with suitable visuals and appropriate content. This deck consists of total of fifty one slides. All the slides are completely customizable for your convenience. You can change the colour, text and font size of these templates. You can add or delete the content if needed. Get access to this professionally designed complete presentation by clicking the download button below. http://bit.ly/2OBjyuT
1) The document outlines Mathews Michaels' telecom business advisory services which include reviewing key areas like revenue, costs, productivity, profitability and partnerships.
2) Mathews Michaels aims to uncover organizational strengths and opportunities for improvement through benchmarking sales, operations and finances against typical metrics.
3) Their process involves exercises to analyze current performance, identify gaps, set goals and drive tangible results through improved profitability, new revenue streams and business transformation.
Business Planning And Marketing Strategy PowerPoint Presentation SlidesSlideTeam
This complete deck is oriented to make sure you do not lag in your presentations. Our creatively crafted slides come with apt research and planning. This exclusive deck with fourty eight slides is here to help you to strategize, plan, analyse, or segment the topic with clear understanding and apprehension. Utilize ready to use presentation slides on Business Planning And Marketing Strategy PowerPoint Presentation Slides with all sorts of editable templates, charts and graphs, overviews, analysis templates. It is usable for marking important decisions and covering critical issues. Display and present all possible kinds of underlying nuances, progress factors for an all inclusive presentation for the teams. This presentation deck can be used by all professionals, managers, individuals, internal external teams involved in any company organization. http://bit.ly/2H4rXCH
Financefornon financialpersonnel-part8-150208202930-conversion-gate02Kristi Anderson
Here are a few options to consider:
1. Extend the deadline by 1 week to allow for proper testing before release. This avoids rushing and potential bugs.
2. Prioritize critical features to hit minimum viable product. Remove nice-to-have items to focus on core functionality.
3. Temporarily pull resources from other projects to assist with testing and bug fixing. Additional help can speed things up.
4. Communicate delay to marketing and customers. Manage expectations while working to still release as soon as possible.
5. Review development process for bottlenecks. Consider adopting more agile practices like daily stand-ups and continuous integration to catch issues earlier.
Let's discuss which approach makes
Finance for non financial personnel - part 8Quek Joo Chay
Many non-financial personnel find finance is mystical and somehow cannot comprehend financial information.
The 8 parts of the presentation are designed to help the non-financial personnel to look at finance from their own view point. Instead of learn finance from finance perspective, we learn our own perspective.
This is because your goal is to improve your current work not to become a qualified accountant. Crash courses usually can’t provide sufficient knowledge for you to understand finance.
Designed from business’s viewpoint, different from other approaches found in the market. Hopefully, we can equip non-financial personnel with business driven financial knowledge.
By end of the 8 presentation:
1. You can create your value to increase financial value
2. You can interpret financial reports to make decisions
3. You know how to work on budget
4.You can propose your ideas in terms of dollars & cents
5. You produce the financial numbers that your boss likes
6. You can communicate well with finance department
7. You make collaboration with accountant possible instead of just for the sake of formality
Training centers need to develop a Business plan to succeed. This set of PPTs provides step by step development process for an effective business plan.
A quick guide to the basics of budgeting and the fundamentals of forecasting.
In this presentation focussed on finance for founders, you'll learn about budgets, when to use them, different types of budeting methodologies as well as the process of forecasting and modelling.
Similar to Copp 4 Profit:How to reduce operating costs (20)
1. COPP 4 PROFIT
Cost of Poor Performance 4 Profit
“Life isn't about waiting for the
„perfect‟ storm to pass ....
It's about learning to
dance in the rain”.
By: Nigel W. Dawes
Vice President Copyright protected
Areopa S. E. Asia No unauthorized copy without Authors permission
2. Introducing
Areopa
The firm of the future .... Today!
A virtual global organisation
Est‟d. Belgium 1987
SAM‟s; CAP‟s;
3,000 SME‟s globally
2
3. Why many organisations fail to focus
on cost reductions!
What makes good companies great?
• Having „an eye‟ for detail
• Doing the things ordinary co‟s neglect
• Having the ability to adapt
• Having the willpower to invite change and
embrace the positive changes
3
4. What makes good companies great?
People are not against change ....
But against being changed!
People have to want to be open to new
ideas; new thinking; new strategies.
They have to want to change .... But how?
Only when they have reasons &
understanding for change.
Then they „see‟ the benefits of change ....
4
5. Extraordinary times
Extraordinary measures needed .....
Many focus on sales ......
Even though customer/buyer
numbers may have been depleted
So an alternative focus is req‟d .....
To reduce operating costs
5
6. Reduce operating costs
But where to start?
Most people default into „department mode‟
But departments do not create the problems
Departments do not create re-work
Departments do not create wastage
Departments do not make inefficiencies
People do!!
So it is the „people level‟ we should focus on
(not the department level)
6
7. Level of detail of the business
processes
» Level 1 Conceptual level Process
Owners
» Level 2 Departmental level A
B
»Level 3 Hand off level
C
» Level 4 Task level
D
» Level 5 Programming level
E
This is where inefficiencies, re-work,
down-time, & wastage occurs
5/16/2009 7 7
8. COPP ® & T.A.P.E. Grid ® Measurement Tools
Cost Of Poor Performance
Takes you right to the cause of the problem
“Treat the cause not the symptom”
Where you are losing MOST money
•12% Lost thru’ non-timeliness & inaccuracy !
•25% Lost thru’ non-productivity !
•33% Lost thru’ non-efficiency / rework !
T.A.P.E. Grid Measures
Timeliness; Accuracy, Productivity & Efficiency
Takes you directly to the worst performing
processes
8
9. Let‟s back-track a moment
We mentioned sales previously:
So let‟s compare ..... Ask yourself
Do we pay a bous or commission for sales?
Do we employ sales people?
(or outsource & hire sales consultants?)
Do we invest in advertising and marketing?
Do we provide other sales incentives to key
employees? (Entertainment, lunches etc.)
9
10. So it‟s reasonable to expect ....
Then why not do the same for cost
reduction?
Pay a bonus or commission
Employ cost reduction people
Hire expert consultants
(only those who teach you “how to
fish”)
Provide incentives to employees
10
11. Net Added Value (NAV)
The answer is for financial reasons:
Identify the monetary net added value of
your Sales NAV and Cost Reduction NAV
-If we sell $1 worth of product, how much
does that sale impact our profit?
-If we reduce our cost by $1, how much
does that savings impact our profit?
In € Euros
or $ Dollars
or B Thai Baht
Or whatever currency you work with
11
12. The Calculation
Example “A”
ABC Co. there is a 5% net profit.
Each sales $, profit is only 5 cents. (5% X $1 = $.05)
If sales increased by $1,
Then profit increased by 5 cents Net Added Value
If ABC Co. reduces their cost by $1,
Then their profit increases by $1 NAV
Every $ saved moves directly to net profit.
*Examples after all expenses deducted & exclude taxes
12
13. The Calculation (cont ...)
20 Sales $
ABC Co. would have to sell $20.00
worth of product in order to have the
same net effect as reducing cost by $1 !!
In other words a $1 reduction in costs
Is equivalent to a $20.00 sale
13
14. So what next?
• Collaborate:
• The need to inform the whole workforce
of your serious intent to make the
company more efficient by reducing:
Wastage Rework
Inefficiencies Downtime
Create an action plan ....
an Improvement Plan
14
15. Create an 8 C‟s Improvement Plan
1. Create a position/department that has
the specific task of cost reduction.
“The Change Bureau”
2. Consultant: Hire a cost reduction
consulting firm that can provide you
with a fresh perspective.
15
16. The Improvement Plan
3. Cash: Provide employee‟s with cash
incentives to reduce cost.
4. Cost reduction goals: Set and reward
managers for their achievement.
5. Commission: Offer payments to cost
reduction consultants/employees for
implementing savings programs.
16
17. The Improvement Plan
6. Connect with your employees:
Become a cost conscious Role Model.
Eliminate irresponsible spending as a
manager.
7. Communicate the fact that cost
reduction is equally important to sales.
17
18. The Improvement Plan
8. Calculate your spend on sales promotions
Sales commissions Sales Bonuses
Sales discounts Marketing sales
Promoting sales Sales incentive
Sales lunches Customer incentives
Wine, dine & entertainment Others
Total????
Then match this amount into .....
The Change Bureau
18
19. The Result?
The immediate result will demonstrate
just how serious you are in your intent
to bring about change in the
organisation
This sends a clear message to every
employee in the organisation.
Next you will start to see the actual
results in financial improvements
taking place
(within second month of
implementation)
19
20. So what are you waiting for?
GET DANCING IN THE RAIN
And then sing about the results
And Areopa will provide your umbrella
Areopa guarantees a 80% reduction of the negative
customer perception – as measured by the TAPE ® grid
and 50% reduction of the costs of poor performance as
measured by the COPP ® calculation
and reduce the 33% lost thru‟ rework
20
The Net Added Value of Your Savings Dollar (try it with 3% net profit margin)$1 / 3 cents (3%) = 33.3 Sales DollarsABC Co. would have to sell $33.30 worth of product in order to have the same net effect as reducing cost by $1 !!
Having an ‘eye’ for details = seeing things that other pass by.Going that extra mileBeing flexible, thinking “outside the box” not “we’ve always done it that way.Being open to change; new approaches; fresh input; be willing to try new ideas
We are living in extraordinary times...... We need to try extraordinary measures to survive and succeed ....If in Auto biz then new cars 2007 = 800,000 +. This year estimated to fall to 350,000 (=60% drop)If in house sales then people not buying – why? Fear of job losses. How can you sell & promote in this environment?So let’s focus on alternative strategies ...... Reducing our expenditure
But how to reduce costs without reducing productivity and capability?Redundancies? They reduce both productivity and capability.This also destroys all the effort already invested in previous PR; marketing and brand building.Just one lay off and it’s bad news press/media coverage.