The Business Planning series will posted on Tuesdays, Wednesdays and Thursdays through the month of September 2011.
Perhaps my favorite part of business planning is crunching the numbers and watching one number change another and another as a part of the process. It can be as beautiful as a kaleidoscope in which each turn brings new patterns and color combinations.
I have seen a lot of business plans in which numbers were simply put into the blank labeled as appropriate for that entry. In many cases, the number is basically pulled from the air with little thought as to the impact that will ripple throughout the company or the strategy required for the number to become a reality.
Crunching numbers requires that we think in terms of all of the moving parts that are connected. Crunching the numbers applies force to aspects of the business and creates movement. Consider how Newton’s Laws of Motion (summarized below) really apply to business planning and number crunching as well. Replace the term body with company, unit, or any other quantifiable business unit of activity.
- The velocity of a body remains constant unless the body is acted upon by an external force.
- The acceleration of a body is parallel and directly proportional to the net force and inversely proportional to the mass.
- The mutual forces of action and reaction between two bodies are equal, opposite and collinear.
Each time we put a number in our plans it is not an isolated number. It changes other components of the plan and can be impacted by external and internal forces.
It is these forces that we really need to consider when choosing the numbers we really want to change. Forces are often divided into two categories related by control.
What do or can we control? What don’t we control that can impact our decisions and results? Consider the examples below of three companies wanting to positively impact results.
Example 1: A packaging company, decided to increase the units it made in the packaging for beer products. They thought that since many of the sunk costs of production had been met, this might be the quickest way to increase profits since beer drinking was definitely on the rise and demand from the breweries they supplied should not be a problem. The numbers they did not factor in were the cost of getting the raw product to their factory since petroleum prices were increasing. Adding to the challenge was the cost of petroleum based products in the dyes they used and to maintain their machinery. The number could be met but would not return the same profit they had planned on.
Example 2: A company decided that if it could grow its sales staff by 10% that they should be able to change their bottom line significantly. If people are units, without any conditional influences, that can work, but was far from the case. Their plan called for 70% of the new hires to be experienced and 30% to be new to the business. They calculated a time for hire to production for the new to the business hires to include training time. The experienced hires were given very little time with the expectation of some transitioned or carry over business. They did not factor in the consideration that there would be some training to their products, services, tools and methodologies as well as time for assimilating into the company culture. They also failed to consider the impact to support staff, greater demand on tools and systems and breakage where some of the existing team will leave or new hires not make it. End result, the numbers did not produce the result intended even if they hit the number.
Example 3: A small medical practice in a growth mode decided to add another physician to be able to maximize revenue through capacity to see and treat more patients. The doctor hired was a good doctor but not used to working at the pace needed to drive the numbers. Additionally, no new patients were brought to the practice as a result. Consequently, patient numbers and appointments which are billable revenue did not increase and the revenue was not made in spite of the additional cost.
Each of these companies could have changed the outcome if they had considered the laws of motion as applied to business, seasoned with an understanding of who is in control of what. They could have changed tactics and strategies. Crunching the numbers is not restricted to business planning but should be a part of regular review. All business is like the kaleidoscope with a new view at each turn. We do not have to be surprised.
11 comments:
prada outlet, kate spade outlet online, coach outlet, burberry outlet online, longchamp outlet, longchamp outlet online, nike outlet, jordan shoes, ray ban outlet, oakley vault, tiffany jewelry, louis vuitton outlet, tiffany and co jewelry, ray ban sunglasses, gucci handbags, christian louboutin, michael kors outlet store, longchamp handbags, christian louboutin shoes, polo ralph lauren outlet, nike air max, coach outlet store online, michael kors outlet online, louis vuitton outlet online, prada handbags, louis vuitton handbags, coach outlet, tory burch outlet online, michael kors outlet online, louis vuitton, chanel handbags, true religion, cheap oakley sunglasses, louis vuitton outlet, michael kors outlet online, red bottom shoes, michael kors handbags, nike free, christian louboutin outlet, michael kors outlet, polo ralph lauren, kate spade outlet, coach purses, nike air max, burberry outlet online, true religion outlet, oakley sunglasses
north face jackets, reebok shoes, ugg, nike huarache, uggs on sale, ugg soldes, celine handbags, north face jackets, giuseppe zanotti, marc jacobs outlet, ugg outlet, uggs outlet, replica watches, birkin bag, bottega veneta, ghd, vans outlet, soccer jerseys, babyliss, canada goose outlet, mont blanc pens, asics shoes, insanity workout, canada goose outlet, canada goose outlet, nike trainers, nike roshe, ugg boots, lululemon outlet, canada goose, longchamp, soccer shoes, ferragamo shoes, chi flat iron, mac cosmetics, wedding dresses, ugg boots clearance, valentino shoes, instyler ionic styler, jimmy choo shoes, herve leger, nfl jerseys, beats headphones, abercrombie and fitch, mcm handbags, hollister, new balance outlet, uggs outlet, p90x workout
nike air max, montre femme, vans, hollister clothing, toms outlet, canada goose, swarovski jewelry, moncler, iphone 6 case, pandora charms, canada goose, gucci, uggs canada, ray ban, moncler, timberland shoes, karen millen, thomas sabo uk, converse, pandora uk, converse shoes, parajumpers outlet, lancel, moncler, coach outlet, moncler outlet, louboutin, moncler, supra shoes, ugg, links of london uk, baseball bats, moncler, oakley, louis vuitton canada, air max, pandora jewelry, hollister canada, swarovski uk, hollister, juicy couture outlet, juicy couture outlet, moncler outlet, replica watches, ralph lauren, wedding dress, canada goose pas cher, canada goose
cách nấu giò heo giả cầy
vịt om sấu
vịt nấu chao
thiết kế nội thất chung cư
thiết kế nội thất văn phòng
thiết kế nội thất nhà ống
nhà đẹp
thiết kế nhà đẹp
nội thất nhà đẹp
thi công nội thất
thiết kế chung cư
quảng cáo lê gia
in ấn giá rẻ
thiết kế nhà hàng
thiết kế nội thất
nội thất nhà hàng
This blog is so nice to me. I will continue to come here again and again. Visit my link as well. Good luck
شركة تنظيف كنب مجالس بالدمام
شركة تنظيف كنب مجالس بالخبر
شركة تنظيف كنب مجالس بالجبيل
شركة تنظيف كنب مجالس بالاحساء
شركة تنظيف كنب مجالس بالقطيف
شركة مكافحة النمل الابيض بالدمام
شركة مكافحة النمل الابيض بالخبر
شركة مكافحة النمل الابيض بالجبيل
شركة مكافحة النمل الابيض بالاحساء
شركة مكافحة النمل الابيض بالقطيف
شركة انوار الجنة للخدمات المنزلية
شركة تنظيف بالباحة
شركة تنظيف واجهات حجر بالدمام
شركة تنظيف موكيت بالدمام
شركة تنظيف كنب بالدمام
شركة تنظيف مجالس بالدمام
شركة تنظيف خزانات بالدمام
شركتنا من افضل واقدم الشركات في مجال مكافحه جميع انواع الحشرات المرئيه والغير مرئيه ولديها خبره عاليه في اباده الحشرات بجميع انواعها وتستخدم اقوي المبيدات العاليه والمسرح بها من وزاره الصحه حفاظا منا علي صحه وسلامه الانسان والبيئه المحيطه بها
شركة مكافحه حشرات بالدمام
نحن الافضل علي الاطلاق في هذا المجال فلدينا خبره كبيره في رش مبيدات امنه للقضاء علي كافه انواع الحشرات فلدينا مبيدات عاليه الجوده مصنوعه من مواد طبيعيه امنه علي صحه الانسان وعلي البيئه ومتخصصه في كيفيه رش المبيدات في اسرع وقت وباقل التكاليف
شركة رش مبيدات بالدمام
الحمام من الطيور المنتشره في المملكه وتسبب اضرار ماديه ومعنويه فنحن متخصصون في مكافحه الحمام والقضاء عليه بطرق جديده ومبتكره بدون حدوث خسائر او قلق لصاحب المنزل او المكان الذي يعاني من انتشار الحمام عليه فنحن لدينا الخبره الكافيه لذلك وممتازين باسعارنا التي لا مثيل لها وادواتنا والعماله المدربه جيدا علي كيفيه اصطياد الحمام والقضاء عليه
شركة مكافحه الحمام بالدمام
الطبيعه الرمليه بالارض السعوديه تعمل علي انتشار النمل الابيض في كل مكان ويسبب اضرار حميمه بالاشخاص والممتلكات فنحن متخصصون في مكافحه النمل الابيض بافضل مبيدات مصنوعه حصيصا لذلك للتخلص منه في اسرع وقت وباقل الاسعار والتكاليف فنحن نعمل علي راحتك وخدمتك اينما كنت ففروعنا كبيره ومنتشره في كافه اشخاص المملكه
شركة مكافحه النمل الابيض بالدمام
عملائنا الكرام نحن من اكبر واقدم الشركات في مجال مكافحه كافه انواع الحشرات فلدينا الخبره لذلك والعمال المدربين جيدا في مكافحه جميع انواع الحشرات بافضل المبيدات الاوربيه المميزه والامنه صحيا فنحن نتنافس مع انفسنا والاخرين للوصول الي افضل حذمه باقل الاسعار الممكنه
شركة مكافحه الحشرات بالاحساء
Any disease will surely recover, if we want businesses seek treatment :)
Obat Dermatitis Statis
Cara Ampuh Menyembuhkan Kaligata
Pengobatan Alternatif Atasi Sinusitis
Cara Ampuh Menyembuhkan Penyakit Muntaber
Obat Herbal Mimisan Menahun
Pengobatan Herbal Jantung Bengkak
http://www1.judiayam.org/
http://linkalternatifmaxbet.info/
http://129.121.21.5/
http://www.judislotterbaru.com/
daftar sabung ayam
livechat bluebet33
cbet indonesia
daftar kiss918
osg88
osg777 live chat
Post a Comment