Strategies for Competitive Advantage – Week 5 Weekly Summary
This week felt more like a week six than a week five. Preparing the strategic plan draft so it was good enough to share with team members became more work that I had expected. I used my own company for the strategic plan which gave me good access to information on the company, but also had the negative side effect of giving me access to too much information. Filtering became a job all by itself, followed by adapting to a continually changing business. For my “What did you learn this week #1″ I chose to comment on why strategic plans must be living document (and in my case, the tactical planning derived from the plan even more so).
The main topics in the text this week were strategic controls and quality improvement. The treatment of strategic controls in this text was much weaker than a discussion we had in a previous class, so it is nice to see some of the information from that previous class get used to help this one along. I was pleased to see the discussion of six-sigma and balanced scorecards, both concepts I’ve had clients use (and also topics from previous classes). ISO 9004 was also touched on but I haven’t worked with it in my company or at client offices. For my “What did you learn this week and how are you going to use it #2″ I chose balanced scorecards for the possible applicability to how my company shares financial and operations reports with employees.
For “What did you learn this week #3″ I chose selecting financial forecast metrics and key ratios. It isn’t a specific topic we discussed in depth but it was the side effect of some of the discussions during the week. Common ratios my company uses are sales by month, bill rate by month, trailing 12-month revenue, top 10 customers, and sales by department. As a consulting firm we also look at utilization rates and headcount. Working on financial projections I also wanted to get deeper into contribution margins and variability, and this last one is where I hit a wall. Calculating variability seemed like an obvious choice when one of the long-term objectives in my strategic plan was generating multiple streams of revenue with a sub-heading of “generating annualized and highly predictable revenue”. The bottom line is that it is easy to calculate historical variability, but projecting future variability has been a crap shoot. As a business intelligence consulting company, this may become a side project for one of our data mining and artificial intelligence engineers, but it is not ready for prime time in terms of business planning at our company.
Now we’re on break for two weeks. I’m not sure what to do with myself. The end is in sight and then the next destination for Where’s Adam’s IPod will have to be chosen carefully. Maybe a trip into the past…
