How not to set your IT budget

If you have read my posts in the past, you will know that I advocate the use of the following formula for determining the ROI for any given improvement project (whether IT-related or not):

Where

• ROI = Return on Investment
• delta-T = Change in Throughput, and Throughput is defined as Revenues less Truly Variable Costs (TVC)
• delta-OE = Change in Operating Expenses
• delta-I = Change in Investment

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Incidentally, where there is no change in I (Investment, including changes in inventory) or the change in I is negative, then projects can be compared based on profit alone. That formula is simply:

Profit = delta-T – delta-OE.

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However, here’s what far too many IT project’s ROI calculations look like:

ROI (don’t know) = ((never took time to estimate it) – (never took time to calculate it)) / $200,000

 

The only figure the company knows going into the project is the estimated “investment” or “cost” of the project.

The common excuse

The common excuse for not calculating an ROI for an improvement project is that changes in Throughput and changes in Operating Expenses are “too hard to estimate,” and “if they are estimated, they will be wrong anyway.”

This argument is specious on the face of it. Think about it!
The $200,000 estimated “cost” or “investment” value of the project is likely to be wrong, too. But that does not keep the CIO and CFO from making their best efforts to calculate that value.

The Real Reason

Of course, the real reasons that CIOs and CFOs do not take time to calculate a real and measurable ROI for their IT (and other) improvement projects is likely two-fold:

1. Too many CFOs and CIOs are under the wrongheaded impression that the value of IT (or other improvements) is both “automatic” and “cannot be measured.” When it comes to new technologies they have succumbed to the strange notion that new technologies are like an engine additive for business—you just pour them in and somehow your business will run smoother, faster, longer and get higher mileage! And, just like people who buy engine additives, they never take time to calculate whether there was any real benefit from using the product.
   
2. They have never taken time to actually determine what root-cause they are attacking with the IT (or other) improvement project, so they do not really know whether the project will actually lead to increased Throughput or will, in fact, drive down or hold the line on Operating Expenses. In fact, they probably do not even know what the “weakest link” is in their customer-to-cash stream or whether that weakest link is internal to their organization or whether it lies somewhere outside their organization in their supply chain.

Isn’t it time to stop that kind of folly? Can businesses still expect to thrive and grow without taking a sound look at how and why they are spending their most valuable resources—time, energy and money?

I don’t think so.

Misleading allocations and how to fix it–Part 2

[This is a continuation that will make very little sense to you if you don’t go back to read Part 1. Sorry.]

ACTIVITY-BASED COSTING ALLOCATIONS

Well, the partners were disappointed with these results, for sure. So, they decide to try Activity-Based Costing (or ABC) allocations. The administrative overhead is allocated based on their analysis of the amount of activity that the partners must undertake with each job type.

The ABC allocation of non-administrative overhead was done based on production-hours ($9,000 divided by 1,000 hours = $9.00 per production-hour).

The results of the partners’ new calculations (based on the historical product mix) are shown in below where you will note that company profit remains the same ($4,100 per month).

However, new priorities emerge: now the most profitable jobs appear to be landscaping (at $35 per job) and gutter guards (at $28 per job).

Based on these data, the partners rearrange priorities to allocate resources (i.e., the 1,000 hours or production time available) to capture the available markets for these job-types first. The results of this change in priorities may be seen in the following table:

Like the previous example, at first things look good: “calculated profits” boost to $7,924, but after subtracting overhead not absorbed (by abandoned job-types), the results are disappointing. Only $1,300 per month in net profits.

HOW TO FIX IT: THROUGHPUT ACCOUNTING VIEW

Throughput accounting eliminates all allocations except those that are truly variable with the changes in revenue. Typically, those costs are things like raw materials, commissions (maybe), outside processing costs, piece-rate labor—but not much else.

When you look at these Throughput Calculations, you will see two critical factors:

1. Throughput per Job (Revenues less Truly Variable Costs or TVCs)
2. Throughput per Constraint-Hour (Throughput divided by the time used on the constraint—in this case, the 1,000 hours of production time from the workers is the constraint to making more money)

So, looking at the Current Business and Profitability, you will see that another column as been added that represents the company as a whole or “the system.” Throughput is totaled across the enterprise into this column and then operating expenses are deducted from Throughput.

“Direct Labor” is not included in TVC and is included in Operating Expenses. Why?

Because in most organizations, so-called direct labor is not a TVC. Many times the payroll expense for labor will be the same whether the firm produces 10,000, 12,000, or 8,000 widgets in a month. Not to mention the fact that the payroll for “direct labor” (falsely so-called) sometimes includes payments for PTO, training or other non-productive time.

Note, again, that using Throughput Accounting, we still get the same net profit calculations ($4,100 per month).

Now, with this new information in-hand, the partners decide to prioritize sales and production to capture the market in order by T/C-Hr (Throughput per Constraint-Hour) until they run out of constraint-hours (i.e., the 1,000 hours available to them each month). The results of these new priorities are shown in the table below marked as Revised by Throughput per Constraint-Hour.

Wow! Profits are boosted 230 percent—to $9,410 per month or $112,920 annually—after fully covering all of “the system’s” overhead. In this case, they sought out and captured the 250 plumbing jobs available to them in the market as a top priority. Their second priority was to capture the 145 gutter guard jobs available to them. They had a few of the 1,000 hours left, so they were able to also do 16 window cleaning jobs.

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Hopefully, this helps you see two things:

1. The inherent dangers in believing data coming from an ERP manufacturing (or project accounting) system where the profit figures are clouded by allocations of overhead.
2. The simplicity and clarity provided by looking at your clients’ organizations as “a system” and helping them view their goal as optimizing the entire “system,” not trying to make decisions based on data that may imperfectly represent “system” performance.

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Let me know if this is valuable to you. Thanks.

Misleading allocations and how to fix it–Part 1

Two things about which I warn my clients who buy manufacturing software are these:

1. Manufacturing software is capable of capturing, storing and reporting on reams of data
2. If you are not careful, you will find yourself taking “as fact” the data produced by the system and being mislead in your decision-making

Why is this so?

Because ERP systems allow the users to create allocations of overhead based on manufacturing “drivers.” In Sage 500 ERP’s case (as shown in the screen image below), the chosen driver is “labor hours”—for run time and set-up time.

In the Sage 500 ERP Set Up Work Center screen there are places for “Fixed Setup” costs and “Fixed Run” costs. The values placed here are used to absorb “Fixed” overhead costs at the rate supplied based on each hour of “Setup” or “Run” time calculated for production utilization of the Work Center.

The problem is that these “absorption rates” must be calculated based on historical (or prognosticated based on expected future) utilization rates of each Work Center. These calculations must make assumptions about product mix, work center utilization rates and operating expense levels. As soon as any of the these factors change

• Product mix
• Work center utilization rates
• Overhead expenses

The data supplied by the calculations will be wrong.

And, since either the product mix or the total of operating expenses will certainly be different than the numbers used in the calculations, the data resulting from the calculations will (virtually) always be wrong.

A simplified example

We are going to look at two different allocation methods and the decisions that might be derived from such calculations.

• Standard overhead allocations by Job (equivalent to allocation per work order in a manufacturing operation)
• Activity-Based Costing (ABC) allocation based on production hours

In order to make the allocations easy to follow, you will see that the company is a service company and that the firm has three partners (administrative overhead) and some relatively fixed overhead in the form of vehicle leases, maintenance and so forth.

The direct labor (production labor) comes from five employees who—to make it simple—all work exactly 200 hours per month and all make exactly the same rate—$10 per hour. This also gives “production” a known capacity—1,000 hours per month.

The partners have kept good track of their history over the last six months and have also done enough market research to have a good handle on the size of the market they are serving. They know, therefore, how many of each kind of job they have done each month (on average), as well as the market potential for the kinds of jobs they do.

STANDARD COST ALLOCATIONS (by Job)

In an attempt to leverage what they have learned by capturing data about past performance and, of course, to improve profitability, the partners do an analysis that includes a standard allocation of overhead to each job.

From this analysis, they discover that their most profitable jobs are landscaping jobs ($35 per job), followed closely by window cleaning jobs ($30 per job). So, they decide to satisfy the market demand in that order, using the resources they have (1,000 hours of production time).

Before we move on, note that with their present product mix, the company is producing a profit of $4,100 per month ($49,200 per year).

The results of this action are shown here:

Upon first glance, it appears that this has been a great move. Based on the calculations in the table, profit has moved from $4,100 per month to $7,200 per month!

Again, the problem is that since NO plumbing or gutter guard jobs were done, some of the overhead (allocated at $90 per job) was not absorbed in the calculations. The total overhead is $18,000 plus $9,000, or $27,000. But the 220 jobs only absorbed 220 times $90, or $19,800 in overhead. That leaves $7,200 in overhead NOT absorbed. Take that $7,200 away from the calculated profit of $7,200 and the company is actually worse off (zero profit) after having reallocated its resources to what appeared to be the “most profitable jobs.”

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[To be continued—be sure to watch for Part 2!]

Finding Common Ground Between CFO and COO–Part 10

[Continuation…]

 

Some key factors in creating Irrefusable Offers

What are some of the key elements that should be considered by the CFO and COO when creating “Mafia Offers”?

Well, if the CFO and COO have come to properly understand their market and market segmentation through analytics (simple is better), the next step is to unlock “tribal knowledge” within the organization so the customer’s experience and customer’s desired results are clearly understood for each market segment. If necessary, that may mean identifying a market segment constituted of only one customer.

Make the offer learning, anticipating or filtering

The irrefusable offer must be one that lightens the burden felt by the customer, improves the customer’s experience, and produces better results for the customer. Offers that are learning, anticipating and filtering are such offers.

Take a look at the offer give in Example 1 in Part 8 of this series. This offer lightened the burden on the customer by reducing the customer’s need to store and handle large quantities of inventory month after month. The billing method, in turn, improved the cash flow for the customer, as well.

The offer was, in fact, anticipating the customer’s needs and filtering the volume down to the quantities actually required while still providing the prices to which the customer was accustomed under the previous ordering practices.

This offer, however, could have been made even more learning, anticipating and filtering. Suppose they had offered to simply replace the quantity actually consumed each month, rather than a flat 50,000 units per month. This may have been even more appealing to the customer.

Make the offer customizable

Buyers ranging from individuals buying one-offs via the Internet to professionals buying for big-box merchants today are influenced by customizable offers. Sometimes it is the actual product that is customized (e.g., made to specification, personalized, color or style options). However, even typical commodity offers can be customized.

When the product itself cannot or is not offered as customized, that does prevent the offer itself from being customized. Offers may be customized around several parameters:

• Delivery method – online, next-day, same-day, free-freight, in-person, vendor-managed and so forth
• Delivery quantities – incremental deliveries, truck-load, on-demand quantities
• Payment terms – credit card, 90-days same as cash, consumption-based invoicing

The goal, of course, in any customization in the offer is to improve the customer’s experience and results.

Make the offer upgradable

Without renegotiating the whole deal, an upgradable offer allows the customer to add-on, extend, or improve upon an existing trading agreement. This is especially valuable where the market may be subject to significant changes—as are most markets today. I think most CFOs and COOs would agree that they would much rather keep a customer through an upgradable offer than to risk losing the customer because the customer feels that they must renegotiate “the whole deal” anyway.

Again, looking back to the offer give in Example 1 in Part 8 of this series, you can easily see that this offer was, indeed, upgradable. The offer could be extended to buy more of the same product, or additional products could be purchased under the same plan.

Make the offer online, interactive or one that provides near real-time feedback

Offers that lead to or involve sharing information in real-time or near real-time are also generally more able to be learning, anticipating and filtering. The close contact created by interaction between seller and buyer may also lead to valuable insights that could lead to more customized or upgradable offers.

Some time ago I had opportunity to discuss a new software purchase with the CFO a rapidly growing $350 million enterprise. I asked him what he thought about the software, but when he replied, he did not really talk about “the software,” at all. He said:

“The company has this great approach to support. They offer an online knowledgebase that is searchable and provides a wealth of helpful information. But what’s even better is that they monitor activity on the support site 24-hours a day. If it seems you are not finding the answer to your question after a couple of attempts, a dialog box pops-up and a live support person proactively offers to help you resolve your issue right then and there.”

Clearly, this buyer of “software” was far more impressed with online, interactive, real-time feedback from support than the software itself. This CFO has purchased “software,” but what he got was a better experience and improved results from his purchase.

Accompany the offer with anytime access and response

In a world where the typical customer is empowered by Internet access to so many options, providing an offer that includes anytime access or response is likely to improve the customer’s experience and results. This is proven by the previous example where the CFO mentioned the fact that the support site was proactively monitored “24-hours a day.”

In fact, I personally find that my clients feel much more “connected” with me when I give them my cellular phone number and assure that they are free to call me (literally) 24-hours a day if they need my assistance.

[To be continued…]

Finding Common Ground Between CFO and COO–Part 8

[Continuation…]

Creating Irrefusable Offers: Example No. 1

A relatively small manufacturer had several large accounts in its market. However, due to the firm’s smaller size, the large accounts were quite reluctant to buy from it. Apparently, the buyers were afraid that the smaller manufacturer would not have the capacity to deliver the large quantity orders on time.

By setting about to understand its customers and its market better, this small manufacturer was able to discover that, while the larger accounts bought in large quantities—in order to get the price-breaks associated with such large quantity purchases—the firms did not actually consume the large quantities immediately. Instead, they ended up warehousing them for some period of time.

Here is the customizable/upgradeable offer that got the smaller manufacturer in the door with these big accounts:

“Agree to buy from us in the same quantities you have been buying from our competitors (e.g., 250,000 units at a time). We will match the competitors’ prices for these items during an introductory period—so you can gain assurance that we can deliver and you are fully satisfied with the quality. However, since you generally consume these at a rate of about 50,000 units a month, that is how we will deliver them to you and invoice you for them.

“In this way, we will save you the costs and headaches related to storing and handling the excess inventory. Additionally, you may customize your delivery rate—up to double—for any given month with just an email or a phone call to (XXX) XXX-XXXX and seven (7) days’ notice.

“Once you are fully satisfied with our service and quality, you may upgrade this plan by a) adding more products to the purchase agreement, and/or b) increasing your purchase volume on any product at special rates.”

This offer turned out to be a win-win. It helped the customers improve their results while allowing the small manufacturer to do business with the larger accounts without having to make additional investments in production facilities. (It was hard for the small manufacturer to produce 250,000 units at once, but they could easily produce and deliver 50,000 to 100,000 units a month without fail.)

This offer provided additional benefits for the large manufacturers: By taking delivery and being invoiced for the smaller quantities on a monthly basis, the large manufacturers actually experience improved cash-flow.

Creating Irrefusable Offers: Example No. 2

A pasta-maker wanted to take over a supermarket chain’s ordering process by employing vendor-managed inventory (VMI). When the chain’s management balked at the idea, the pasta company developed its own irrefusable offer. The pasta-maker said that they would park a truckload of pasta on the lot of the chain’s distribution center. If, at any time, the pasta-maker failed to deliver on-time what the chain needed, the chain could take whatever was short from the truck free of charge.

This irrefusable offer gave the chain’s management and buyers the assurances they needed to move ahead with the VMI plan. The pasta-maker, however, was so capable that the truck did not have to remain in the chain’s parking lot for long.

Here, again, we see the irrefusable offer being constructed around Toyota’s definition of quality—the customer’s measure of the experience and improved results. Also note that this irrefusable offer was targeted at a market of one with a consciousness of the customer’s specific needs and concerns.

[To be continued…]

Finding Common Ground Between CFO and COO–Part 6

[Continuation]

Now that we have laid the groundwork, let us begin our turn now to some specific strategies for uniting the CFO and the COO in common and practical actions. First, let us consider the proper priorities for action.

Priorities for Action

The CFO and COO should agree on the following general priorities for actions to be considered:

1. Efforts to Increase Throughput, including efforts to increase revenues and/or efforts to reduce Truly Variable Costs (TVCs)
   
2. Efforts to Reduce Inventories (or investments) or demands for new investments
   
3. Efforts to reduce Operating Expenses

“Why this order?” I hear you ask.

The Detrimental Effects Cost-World Thinking

Let me begin by saying that this order is based on the solid assumption that most companies—especially at this present time—have already trimmed away obvious waste in operating expenses. And, while most CFOs and COOs are focused on the “cost-cutting” as the road to higher profits, this is almost never the long-term result.

A study done some years ago regarding Fortune 500 companies found a trend: Among companies self-assessed themselves as being “cost-cutters,” nearly 40 percent of such companies were no longer in the Fortune 500 a decade or so later. Clearly, the focus on “cost-cutting” is wrong on the face of it.

Consider this: Any company can successfully reduce its “costs” and “operating expenses” to zero. It the easiest and simplest of maneuvers to be carried out jointly by the CFO and COO. All they have to do is close the doors to the business, fire everybody, liquidate everything, and go home. It’s done!

But, if you think I am being overly dramatic, consider the fact that cost-cutting is—by it’s very nature—an action driven inexorably by the law of diminishing returns. If the CFO and COO successfully collaborate to reduce costs and expenses by, say, ten percent in year one; then it will be very difficult to reduce costs and expenses by even five percent in year two while staying healthy. In year three it may be difficult to eek out a two-and-a-half percent reduction in costs and expenses. Each successive year, increasing profits through cost-cutting becomes more and more difficult.

Too soon, despite their very best efforts, the COO and CFO focused on cost-cutting are soon cutting away protective capacity and damaging the ability of the organization to recover from the occasional attacks of “Murphy” (Murphy’s Law). This, in turn, leads to reduced revenues and higher marketing costs as customer retention becomes that much more difficult over time.

For all of these reasons, we must agree to put efforts to reduce operating expenses at the bottom of the list. And because increasing throughput has no theoretical upper limit and is not affected by the law of diminishing returns, efforts to increase throughput should remain foremost in the thoughts of the CFO and COO seeking unified actions for ongoing improvement.

Clarifying Throughput

As a reminder, our working definition of Throughput is not some generic concept of increases in volume or output. It is carefully focused on a financial formula that the strategic CFO should readily accept:

Throughput = Revenue – Truly Variable Costs

Where Truly Variable Costs (TVCs) are restricted to those costs that vary directly (not through allocations or some estimated factors) with changes incremental revenues. Typically, TVCs would be found in raw materials, subcontract or other outside services paid for on a batch or per-unit basis, commissions, piece-rate pay for employees, and little else.

[To be continued…]

[Cross-posted at the Kinaxis Supply Chain Expert Community]

(c)2008, 2009, 2010, 2011 Richard D. Cushing

Finding Common Ground Between CFO and COO–Part 5

[Continuation]

A New Management Paradigm

Toyota’s success—despite Japan’s own significant recession in recent years—is attributable to management paradigms that differ significantly from traditional management practices in the U.S. Some of these are likely recognizable to you in the following table:

	Traditional Paradigm	New Paradigm
Customer requirements	Quantity	Quality – improved experience and results
Quality [1] improvement	Generally costly and tend to reduce productivity	Saves money while increasing throughput
Internal competition (through reward systems)	Produces conflict – a few win, but many lose	System-thinking eliminates internal competition leading to improved performance
Cooperation	Too frequently leads to reduced competitiveness	Brings improvement where many win – maybe, everybody wins
Management	Command and control	Creating a work environment that supports top performance of the system and ongoing improvement
Workers	Seek to satisfy or, at least, appease management	Work together with management to satisfy the customers’ demand for constantly improving quality
Worker evaluations and incentives [2]	Increases internal competition and produces little long-term improvement	Encourages better performance and ongoing improvement
Purchasing	Buy almost entirely based on cost metrics	Buy based on the system’s performance and build relationships with key vendors

Note: This table was adapted from work originally done by W. Edwards Deming.

[1] In the table above, we are employing the term “quality” just as it is described in the text [see Part 4]. However, the term “customer” may be an internal or an external customer. Work to improve quality coming from a vendor is an effort that improves the firm’s experience and results. Similarly, improving quality coming from operation ‘A', which hands off to operation ‘B’, improves the experience and the result of operation ‘B’ as the “customer” of operation ‘A’.

[2] With regard to “evaluations and incentives,” we are referencing the traditional individual performance metrics taken within silos of operations, rather than on the performance of the system as a whole.

All Profit Lies Outside Your Organization

Inside the four walls of your business, everything over which the CFO and COO have direct control can contribute nothing but cost or expense to the bottom-line. Every opportunity for making money lies outside the organization and, therefore, outside the direct control of management and executives.

You can make more money by buying smarter—raw materials, services, et cetera—thus reducing truly variable costs (TVC) and increasing throughput. And you can make more money tomorrow than you are making today by selling smarter to existing customers, new customers or both.

These actions can have other affects, as well. The affects are depicted in the figure below.

 

A side-affect of buying smarter—what you buy, from whom you buy, how (delivery terms) you buy, and when you buy—is reducing inventory. The wonderful side-affects of reducing inventories—when done wisely as a result of system-thinking—are improved profits, higher ROI, and faster cash velocity.

You probably recognize all of these factors as improvements—improvements you would like to see, perhaps.

The new management paradigm unifies the CFO and COO by turning the organization from it navel-gazing introspection to a recognition that the customer is the most important part of the production line. No matter how you fine-tune your company’s internals, if the internals are not focused on the externals as the only source of profits, you are far more likely to create internal friction and heat without actually lighting a fire that will produce increased throughput and profit.

One of the advantages of the accompanying figure is the systemic clarity—the inherent simplicity—it delivers. It helps CFO and COO begin easily translate financial goals (i.e., net profit, ROI, and cash flow) into day-to-day actions (i.e., increasing throughput, reducing inventories and reduce or hold the line on operating expenses while support significant growth in throughput). [Note: For organizations that don’t have to deal with inventories, per se, the “inventory” may be broadened into “investment” or demand for capital investment. For example, if it is possible to reduce, defer or eliminate the need for an investment in new office space, then that would qualify as a “reduction” in the demand for new investment.]

[To be continued…]

Finding Common Ground Between the CFO and COO–Part 3

[Continued from Part 2]

The concept of market segmentation—segmented down to a single customer, if necessary—has been driven to a large extent by consumers empowered by the Internet. (Here I use the term “consumer” in the broadest sense. In a supply chain, the “consumer” may be a company or even a buyer within a company in the supply chain.)

Consumers no longer need to be satisfied with what is available to them locally, regionally or even nationally. Instead, a buyer has virtually direct access to a whole world of manufacturers, wholesalers, distributors, brokers and retailers offering a huge array of products, services, delivery methods and terms of service.

Many product offerings are configurable via the seller’s Web site to meet specific requirements or tastes. Too, frequently, the various sellers are willing to offer the products via custom-tailored terms, conditions, and delivery methods. We refer to this combination of product plus related delivery terms and options as the “augmented product” of the “offer.”

Employing Business Intelligence (BI) to Segment Your Market

Business intelligence—regardless of whether it is done with specific BI tools, or just by leveraging the native capabilities of Microsoft® Excel™—can help an business better understand who buys what from the firm, and why. Here are some examples:

Hospitality Industry

A hotel franchise uses BI analytical applications to compile statistics on average occupancy and average room rates to determine revenue generated per room. It also gathers statistics on market share and data from customer surveys from each hotel to determine its competitive position in various markets. Such trends can be analyzed year-by-year, month-by-month or day-by-day, thus giving the corporation a clearer picture of how each individual property is faring.

If these data were extended to include related matters such as

• Business versus pleasure occupancies
• Local event calendars by postal codes
• Other potentially influencing factors

Then the hotel chain could begin to discover who uses their services under what circumstances and, perhaps, why their customers chose their hotels over the chain’s competitors. With this information in hand, the chain would be in an increasingly better position to construct “offers”—preferably irrefusable offers—to their clientele (or prospects) based on dates, reasons for travel, and more.

Take for example a hotel where the occupancy rate is typically below 50 percent on Sundays through Wednesdays. How much time would it take to discover businesses in the region that bring in folks regularly for training, small group conferences or other business purposes during the week.

Having identified these business organizations, making them customized offerings would make sense. For some businesses and business purposes, a discount of 35 percent off the nightly rate might be sufficient to garner the business. For others, a steeper discount might be necessary because the folks to attend their events are typically paying out of their own pockets. So, offer them a flat rate of $69 per night and throw in a free shuttle to and from the airport and to and from the conference sessions.

Since the hotels truly variable cost (TVC) for filling an additional room or ten rooms is very small, almost every additional dollar of revenue gained through such offers will fall directly to the bottom line of the business.

Let us assume that (to make the math easy) a hotel typically rents its rooms for $200 per night (annual average). This hotel’s business intelligence analysis shows that Sundays through Wednesdays during the months of January through April, they are going to have an average of 50 empty (in-service) rooms per night. If this hotel can construct a compelling offer that will fill just half of those rooms (25 rooms) at $70 per night, that would be about 1,733 nights at $70, or $121,310 in additional revenues annually.

If we assume that the truly variable cost (TVC) per additional room per night is $10, then we must subtract $17,330 from this figure to get our throughput of $103,980. That is more than $100,000 in increased annual revenues even though the rooms are being let at far below the “going rate” via the irrefusable offer.

[To be continued…]

Finding Common Ground Between the CFO and COO–Part 1

It seems as though many organizations are at war within. During boom-times, the war is more subdued, but is still there. But in tough—really tough—economic times the war is more evident than ever.

What is that war?

The war is that age-old dispute between meeting customer service level demands and holding inventory levels within reason. In really tough times, keeping inventory levels down becomes even more critical to the CFO—and the organization’s survival, perhaps—because cash held in inventory for long periods of time puts a real crunch in the vital cash-flow of the firm.

Now, it is likely that the COO will surrender in times like these. He or she will understand that (too frequently) it really is a matter of survival to maintain the cash-flow. So, the COO might say something like:

“Okay. I get it. I’ll reduce inventories as much as I can. But don’t blame me if we can ship orders or keep our customers happy.”

What are your options?

Some have put it this way: In tough economic times you firm is going to

1. Sink,
2. Shrink, or
3. Prevail.

I prefer to put that into four categories. Furthermore, I do not believe that those four categories are applicable only in tough times. I believe that they are fully applicable to every business enterprise all of the time. Here they are shown in the figure below: 1) failing, 2) risking, 3) competing or 4) leading.

I believe the determining factors in every business enterprise are inherently simple and are only two in number:

1. Effectiveness – The measure of how effectively the firm employs the monies invested and how effectively does it spends its working capital in the process of turning inventory (or services) into throughput? This is a measure of managements effectiveness in managing its internal workings and the inbound side of the supply chain.
   
2. Differentiation – This is the measure of effective management is in dealing externally in the outbound side of the supply chain. This measure covers everything from R&D (research and development) through to marketing, sales and customer service.

The problem with these two terms (i.e., effectiveness and differentiation) is not that they are hard to grasp. Everyone seems to know in a very general way that they need to manage the firm to be effective in using its resources and that, in order to be profitable, they need to differentiate themselves in the marketplace.The problem is that many people seem to have difficulty these two words into concrete and effective actions.

So, let me restate the same figure using a different set of terms.

Note that I have redefined the two factors as follows:

1. Effectiveness = Increasing Throughput
   
   and
   
2. Differentiation = Breadth of Market through Irrefusable Offers

But, in dealing with my clients, I go beyond that. I use Eliyahu Goldratt’s definition of throughput:

Throughput (T) = Revenues – Truly Variable Costs (TVC)

Now, simplicity is at the root of this whole approach.

I know the CFO needs to do certain things to satisfy other executives, the bank, investors, and others. I know he needs to do some relatively complex allocations of operating expenses to costs for various reasons.

But, the COO needs to have a way to tell his people—from sales to shipping—how to easily differentiate good actions from bad actions. And, those fancy allocations just get in the way—muddying up the waters—when it comes to decision-making in operations.

We will take a look at that relatively simple equation for throughput again. But before we do, we need to define another term: TVC.

Truly Variable Costs (TVC) are limited to those costs that vary in an absolute way with incremental changes in revenues. Typically, TVCs are limited to a few categories:

1. Raw materials
2. Contract labor or outside services paid for on a piece-rate or batch-rate
3. Commissions

You will note that so-called “direct labor” is not a part of TVCs. Here’s why: If your company sells, on average, 100,000 widgets a month, does your labor actually vary if, in month one you sell only 80,000 widgets and in month two you sell 130,000 widgets? In month one was your labor bill on 80 percent of “average,” and was it 130 percent of “average” in month three?

Probably not. Labor is an operating expense that does not vary directly with changes in revenues.

Given that premise for TVCs and going back to our formula, there are really only three (3) ways to increase throughput:

1. Increase revenues
2. Decrease TVCs
3. Increase revenues and decrease TVCs

Meanwhile, back at the war…

One of the problems with (the many times unspoken) “war” between the CFO and the COO is that when they do reach common ground, it is all too often found only in “cost-cutting” rather than looking at ways to increase revenues.

The reason for this leap to common ground, of course, is made most clear by my first figure: typically, both the CFO and the COO feel more prepared and confident in dealing with the internal operations than with all the nebulous factors that lie outside the organization. So, dealing with internal effectiveness trumps trying to achieve higher levels of market differentiation—especially in challenging times.

[To be continued…]

Business Intelligence, CPM and the Middle-Market

I want to take a moment to thank CFO Magazine for inviting me to be a part of the social media coverage for their 2011 Corporate Performance Management Conference in Dallas. It was, indeed, my pleasure and my privilege to be a part of this foray of theirs into social media connections with their audience, and I trust that they will continue to expand the application of social media in connection with their helpful events.

So, what did I learn while at this conference?

I learned much.

• I learned that there is a broad and increasing array of tools available for businesses to leverage as they begin or expand the business intelligence and corporate performance management efforts in their organizations.
  
• I learned that there is considerable confusion in the CPM (corporate performance management) marketplace over the application of various terms including “budgets” versus “forecasts”; the differences, similarities or where the line falls between “business intelligence” and “corporate performance management”; or even whether simply having a “budgeting” or “forecasting” system in place means that you are practicing “CPM”.
  
• I learned that many, many organizations in the small-to-mid-sized enterprise marketplace are increasingly sensible to the need for improved visibility and insights regarding their own businesses, the industries in which they participate, and the broader economics that affect them, their customers and their suppliers. Managers and executives are, therefore, turning to “business intelligence” to aid them in finding the answers they think they need.
  
• I learned that despite the tremendous interest in the middle-market for adventuring into business intelligence and CPM, most middle-market participants are still on the sidelines, mostly because they just don’t know where to start. At the same time, they are not yet convinced of an immediate ROI if they jump-in feet first.
  
• I learned that many organizations feel that they can do BI and CPM with Microsoft® Excel™ and/or Access™ and save “a ton of money” while still reaping the ROI rewards.
  
• I learned that most participants in major “forecast” and “budget” initiatives know that their processes are being undermined by “sandbagging” and “gaming,” but feel (more or less) helpless to stop these practices.
  
• I learned that when mandates are handed down from on-high (say, a parent company or corporate HQ for a division) saying, “We need you to do X next year,” that even the financial executives in the subsidiary company or division will “game the system” to satisfy the mandate—whether or not the “gaming” reflects reality.
  
• I learned that the vast majority of middle-market financial managers are still entrapped in cost-world thinking. Such executives and managers are far less likely to engage BI and CPM to discover ways to increase Throughput, and are far more likely to spend their time, energy and money in pursuit of the diminishing returns of cost-cutting.

Apart from the conference, my experience in working with an array of middle-market firms tells me that a great many executives and financial managers fall into one of two very large camps:

1. Those who feel they have no need for business intelligence or a comprehensive program of corporate performance management because they already know and understand all they need to know about their firm, how it operates, the industry(ies) in which they participate and the affects of the economy at large on their business.
   
2. Those who have set up some spreadsheets to analyze certain factors of their business and who, perhaps, actually create an annual budget. Many of these, therefore, feel like they are already doing “business intelligence” and “analytics” and “CPM.” Such folks generally have a sense that there is no significant ROI for them in doing more.

Given all of these different factors, I think it is good—an imperative, in fact—that organizations like CFO Magazine are sponsoring events and stimulating more conversation on these topics—especially in the middle market where most of the confusion appears to reside.

Let me hear your thoughts.

Implementing CPM in small business on a limited budget

Eric Lundberg’s presentation at CFO Magazine’s 2011 Corporate Performance Management Conference today was refreshing. Lundberg brought things back down from the stratosphere for the large number of small-to-mid-sized business finance people in attendance.

My sense is that many of the presentations thus far have set forward concepts of such a broad scope and relative complexity that they are far, far beyond the pale of immediate consideration by many of the firms represented at the conference. Many of the attendees with whom I have spoken are mere “beginners” in corporate performance management (CPM).

Now, do not get me wrong: I have done no scientific—or even non-scientific—polling on this subject. I say what I say based solely on conversations I have had with a relatively small handful of conference attendees.

Nevertheless, I believe that many of the folks in attendance came here really trying to find out answers to pretty basic questions about CPM. And, given the fact that Julia Homer presented—that 63 percent of CFOs surveyed are more pessimistic about the coming year than they were about last year—I would further surmise that most of them are looking for ways to implement some kind of business analytics and CPM with the smallest possible drain on their corporate cash-flow.

That is precisely why I found Eric Lundberg’s presentation so very refreshing. Lundberg introduced his remarks by saying that he wanted to present “practical applications of tools” that he and his team put in place at ALM. He went on to tell the crowd that, as CFO in a firm held by private equity, he is not in a position to "go out and spend $100,000" or more on sophisticated analytics tools. Therefore, he and his team have implemented substantial business analytics built mostly around “home-grown” applications—not the kind purchased from analytics application vendors.

Lundberg went on to describe—in considerable detail—a number of the analytics in use at ALM. Using these effective but relatively low-cost tools, Lundberg and his team have gained considerable insight into what makes—and keeps—their company profitable. They have already implemented rolling forecasts and have the facility to re-forecast every month. They also do a complete bottom-up forecast fresh every quarter.

I really believe that Lundberg’s presentation put a light at the end of the tunnel for many CFOs struggling with the question: “How can we begin gaining the advantages of business intelligence and analytics without ‘big bucks’ to invest in making it a reality?”

This is real innovation, and it is clear that the analytics Lundberg and his team have put in place at ALM are already making the firm more successful, even in the midst of the present economic doldrums. Sixty-three percent of CFOs today may be more pessimistic about the coming year than the year just past, but Lundberg has leveraged limited resources in a way that will make his firm far more likely to survive and even thrive.

Congratulations, Eric Lundberg! And thanks for giving more small businesses hope for embracing new management metrics and analytics despite severely constricted funds.

Forecasting Mistake Number 1: Forecasting to the Wall

In today’s session at CFO Magazine’s 2011 Corporate Performance Management Conference, speaker and author Steve Player, of The Player Group and North American Director of the Beyond Budgeting Round Table, brought out lots of valuable information about the need for organizations to move from a once-a-year, top-down “budgeting” process and into an ongoing process of rolling forecasts.

In doing so, he employed a striking analogy.

Player asked the attendees: Would you be happy with a new car, if, when you first bought it, the headlights gave you a good view of the road ahead—shining out maybe a 600 feet ahead of you. But after three months, the headlights only gave you visibility for 450 feet; and after owning for six months, the headlights only showed you 300 feet of the road before you?

Of course not! No one wants a car like that.

Nevertheless, that is precisely the kind of performance being actively supported with the function of traditional methods of budgeting and forecasting. First the company is looking forward a full twelve months. Three months later, the company is looking only nine months into the future. And, after another three months, their view into the future—their forecast or their budget—gives them only six months of guidance.

What is worse is the fact that the one-year forecast was likely put together from statistics collected and judgments made three to six months earlier. So, by the time the firm’s forward-looking view is obscured beyond six months, the six months they are seeing in the forecast is now nine to twelve months old and out-of-date.

Is it any wonder that such a firm’s “budget” is considered little more than a well-intentioned joke—or perhaps just something to satisfy the executives—by the workers who are all too frequently being measured against the budget?

Steve Player calls this approach “forecasting to the wall,” where no one has a clear vision beyond the 12-month “wall.” He also calls it, “Forecasting Mistake Number One.”

Forecasts, when used, ought be updated as often as necessary; and certainly every time there is a significant change in the mathematical, statistical or intuitive elements underlying the existing forecasts. Forecasts should also be rolled into the future far enough and frequently enough to allow the management changes they are intended to guide to take effect for driving ongoing improvement.

“Mistake Number One” – Think about it.

Heading to CFO Magazine’s 2011 Corporate Performance Management Conference

As I write this I am winging my way to Dallas, Texas, and the Hotel Fairmont for CFO Magazine’s 2011 Corporate Performance Management (CPM) Conference. CFO Magazine has asked me—given me the honor—of providing blog coverage of the event.
Two other outstanding gentlemen have been invited by CFO Magazine to blog (and Tweet) live from CPM2011. One is blogger, author and founder of CFOwise®, Ken Kaufman, and the other is Gary Cokins, who—while being Principal of Global Business Advisors at SAS—is also an author and blogger. I am much looking forward to meeting these fine writers and, frankly, I find myself humbled to be in the company of such accomplished executives.

The Speakers

As always, CFO Magazine has gathered a stellar array of speakers for this conference:

• Thomas H. Davenport – President’s Distinguished Professor of Information Technology and Management at Babson College and co-author of Competing on Analytics and Analytics at Work
• Dr. Kasthuri Henry – Professor and president of KasHenry, Inc.; Assistant Professor at Southern Illinois University; and Adjunct Professor at North Park University
• Eric Lundberg – Chief Financial Officer at ALM
• Wayne Eckerson – President of BI Leader Consulting and author of Performance Dashboards: Measuring, Monitoring, and Managing Your Business
• Christina Spade – Senior Vice-President of Affiliate Finance and Business Operations at Showtime Networks
• Christopher Poinsatte – Executive Vice-President and CFO of Dallas-Fort Worth (DFW) International Airport
• Roger Blanken – Director of Finance at International Flavors and Fragrances, Inc.
• Curtis Neumann – Associated Director of FP&A at AT&T
• Jay Thompson – Managing Director at Protiviti

Supplemental Workshops

• 102 Improved Performance Management through a Unique Analytical Scorecarding System presented by Forrest Breyfogle, President & CEO of Smarter Solutions Inc.
• 201 Aligning Resources through Integrated Business Planning presented by John O’Rourke, VP Product Marketing at Oracle Corporation
• 301 Beyond the Numbers: Improve Your Company’s Performance in 30 Days with Visual Analytics presented by Kurt Lueck, Practice Director at Analytics8
• 303 Driving CPM with BPM: Unlocking Critical Information through Business Process Management presented by Vince Tornillo, Global Solutions Consultant at Ricoh Solutions Group and Evan McDonnell, VP at Appian

As you can see, it should be a great few days and I will do my best to bring you the highlights and value of the information being presented at this great conference.
For those of you with a special interest in supply chain metrics, pay particular attention to Roger Blanken’s presentation. He’s going to be talking about applying corporate performance metrics in the extended supply chain. International Flavors and Fragrances buys product from almost every area of the world and is wholly reliant on an broad and greatly extended supply chain. It should be interesting to hear what he has to say on the matter.
Also, I have this sense that I will be the irreverent one here. I expect to ask some tough questions and seek real answers from the experts.
One of the things that has me curious, for example, is this:

Who’s guarding the hen-house? CPM initiatives can involve a huge investment in capital and lead to increased operating expenses on an ongoing basis. What are the metrics that tell an organization that making that investment will provide real ROI; and what are the metrics by which the CPM initiatives themselves are measured as to success or failure?

Stand by for the next report soon.

Avoiding a costly “metrics obsession”

This year, 2011, is the centennial anniversary of the publication of Frederick Winslow Taylor’s autograph work, The Principles of Scientific Management. According to Taylor, almost every challenge management faced could be solved through the application of science. This view has become the staple of business schools for the better part of the last century, as a result.

Most small businesses—which, by the way, constitute the majority of all businesses in the U.S.—found the application of “scientific management” to be unduly burdensome. Many entrepreneurs lacked the training in the application of statistics or the time and energy to conduct “time and motion” studies when they knew—by the proverbial “seat of their pants”—that they could make a profit if they took this action or that one.

By the middle of the 20th century, another great voice in “scientific management,” W. Edwards Deming, was beginning to clear the air on the subject, a bit. While Deming certainly believed in gathering data and analyzing statistics in order to improve operations, he was also unequivocal about the limitations of “metrics” in achieving business success.

It was Deming who pointed out, for example, that “The most important figures for management of any organization are unknown and unknowable.” (Emphasis added.)

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“The most important figures for management of any organization are unknown and unknowable.” – W. Edwards Deming

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However, in the 1980s, along came the introduction of the “Personal Computer” (PC) and a plethora of software that enabled small businesses to collect, analyze, store and recall hundreds of thousands or even millions of data points. With the growth of computing power and falling costs of computer hardware and software, the collection of volumes of business data was soon within the reach of even the smallest of small businesses.

Even before the dominance of the Internet as a means for sharing data and collaborating across huge distances, many small-to-mid-sized business executives and managers had become enamored with the ability of computers to store and retrieve data. Even if they were entirely unaware of the pronouncements of Frederick Winslow Taylor, these executive and managers came to believe something along the lines of: “If we can collect and access enough data about our operations, we will be able to manage flawlessly.” The obsession with metrics had, indeed, come of age.

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The mantra of the “Obsession with Metrics” crowd: “If we can collect and access enough data about our operations, we will be able to manage flawlessly.”

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Another all too frequently heard proverb from the metrics-obsessed crowd is this: “You can’t manage what you can’t measure.” This, of course, has a tincture of truth to it, but is misconceived. There are all manner of things in which management is involved in “managing” in some way or other that are not not subject to objective quantification.

Here is a (non-exhaustive) list for your consideration:

• Corporate culture
• Customer relationships (we even have software that is supposed to do this!)
• Employee relationships (we have both software—human resource management applications—and entire third-party firms that engage in this kind of “management”)
• Customer loyalty (some companies even have “teams” or “departments” engaged in “managing” this aspect)
• Creativity / innovation
• Leadership
• Ethics
• Supply chains (especially the ‘relationships’ that really make them work; not just the inventory ins-and-outs)

Now, let me very clear here: I do not oppose the application of sound scientific principles to business when the application of such principles is done in an environment where cause-and-effect can be reliably demonstrated.

The correct statement is this one: “If you cannot define the ‘process’ and the theory underlying the cause-and-effect relationships in the ‘process,’ then you cannot manage it.” More importantly, if your theory is wrong, you will not get the results you expect.

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“If you cannot define the ‘process’ and the theory underlying the cause-and-effect relationships within the ‘process,’ then you cannot manage it.”

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This clear and correct statement explains why some companies actually see significant improvements in their business results after implementing new supply chain “management” (SCM), customer relationship “management” (CRM) or human resource “management (HRM) applications” while the vast majority of companies see little or no improvement.

Understanding your existing business processes (hint: it is likely they are NOT what you think they are) and tying them to a theory that will help you understand the cause-and-effect within your processes is not as hard as it seems. Nevertheless, most businesses fail to do so simply because they don’t know they need to do so! They think they already understand them—but do not.

That’s why no matter how many “metrics” they throw at the problem and—sadly—no matter how much money they throw at “fixing” things, they typically see little or no improvement in the things that really matter—like making more money!

There is a better way!

Misaiming about metrics

In order to protect the guilty, my source for some the silly statements I read about business management will not be revealed. Recently, I read this statement in a book about business metrics.

“Measurement is the connecting fiber that can make all the parts work together [in a business or government enterprise]. Achieving this kind of coordination and alignment is impossible without exceptional performance measurement.”

Let’s consider the metaphor of a multi-movement mechanical watch. You know: the kind of watch that keeps time in minutes and seconds, tells you the day of the week, the day of the month, and the phases of moon.

Now, without a doubt, a huge number of measurements were made, formulas developed, and calculations made about the sizes of the gears, the number of teeth in each gear, their placement in relationship to one another and more. A watch is all about measurement. A watch’s whole purpose “measurement.” It only exists “to measure.”

Nevertheless, it is not the accuracy of the measurements that make the watch fulfill its functions properly. When you get right down to it, it is not even the accuracy of the calculations that went into the design of hundreds of moving parts. It is not the accuracy of its manufacture that—at the root—cause the timepiece to function as a “system” and do precisely what is expected of it.

It isn’t any of those things—at the root!

What, then, is at the root of a “system” that functions smoothly, efficiently and effectively? At the root of that highly effective watch’s ability to function is something entirely distinct from “measurement.”

What is that mysterious thing that all too frequently escapes the business intelligence fanatics? What lies at the very core, but is often overlooked by the “metrics maniacs”? What seems to conceal itself from those who seem to be convinced that if management could just get enough “information”—enough metrics—they could manage flawlessly?

The answer is—as W. Edwards Deming told us years ago—“theory.”

The people who designed all of the components of the multi-movement “watch” that does what it does so smoothly, efficiently and effectively had a “theory” about watchmaking long before they ever drew the first plans or began fabricating the first gear.



The business metrics book from which I got the quote at the opening of this article contained a diagram similar to that above. But this diagram is wrong in lots of ways. But, really, only two are critical.

Here’s what the diagram ought to look like:



The foundation of making a business that works—and stays working—is theory. And, more importantly, if the only “goal” of your “measurements” and “management” is a bunch of departments surrounded by a compensation system, then your business probably won’t last too long—except by “luck.”

The “goal” of your “system” should be—indeed, must be—profit. And, as W. Edwards Deming put it so well, “Information tells you nothing without theory.” Theory is the context by which information is interpreted and made the basis for action to change the outcomes.

[Cross-posted at Kinaxis Supply Chain Expert Community.]

Simpler is better: Metrics not working? Check your complexity.

Are your metrics working against one another?

In the former Soviet Union (USSR), an professional weight-lifter was promised a bonus every time he broke a world record. So, being a shrewd “capitalist” (I guess), he decided to break world records one at a time—one or two grams at a time. Naturally, he got many, many bonuses, but it isn’t exactly what his handlers had in mind.

Some organizations pay rewards to their marketing department based on a “new customer” metric—the number of new customers garnered over a specific period of time. Of course, the idea is to build the customer base.

Meanwhile, many of these same businesses reward their sales department to meet or beat quarterly sales goals. So, in far too many cases, their salespeople are out burning through customers—alienating them through high-pressure sales techniques—in order to make their quarterly bonuses.

They may also reward their inventory managers to keep their inventory lean. So, while the salespeople are out making customers angry while getting their end-of-quarter orders (to get their sales bonuses), the warehouses are leaning out their inventory to meet end-of-quarter inventory numbers in line for their own bonuses. So, when many of those orders need to be delivered, they will be late—making the an already alienated customer all the more angry with the treatment endured.

I could go on, but I won’t. I’m sure you get the idea and you’ve suffered (or at least heard of) some similar well-intentioned reward systems go awry.

Some have suggested that these are “reward-motivated abuses,” seeking to blame the employees for doing exactly what management has told them to do, and for which management has agreed to reward them. How, then, can these be “abuses”?

Too much complexity

The problem here is not that the intended goals are not worthy: of course companies want more customers, more sales and lower inventories. The problem is the inherent conflicts evoked by the presence of too many “levers” being offered without linkages.

What’s lacking is a unified goal upon which the whole “system”—the whole organization—can be measured and each participant in the process of reaching that goal might be appropriately rewarded.

Simpler really is better.

“Simple” levers and the “simple” linkages

The linkages are simple, but in order to prevent your organization—or any part of your organization—from sacrificing tomorrow’s profits for today’s bonuses, your (for-profit) organization’s singular goal should be simple as well. Eliyahu Goldratt set it forth so clearly years ago: The goal is to make more money tomorrow than you are making today.

This simple goal is very easy to understand and very measurable—and it will help prevent improper actions like the following (an many, many more):

• Burning through customers to make short-term sales goals—because of the reduced long-term Throughput and the added operating expenses required to capture new customers
  
• Slashing inventory to reach inventory goals at the risk of alienating customers—because it drives Throughput down and operating expenses up
  
• Using company politics to cover or support inefficient or ineffective work efforts or policies—because it drives operating expenses higher (among other things)

Think about it. I think you’ll really like “simplicity” compared to “complexity” once you understand how it can drive your whole “system”—your whole organization—toward improvement (instead of piecemeal).

What do you think?

[Cross-posted at Kinaxis Supply Chain Expert Community]

CFO Magazine’s 2011 Conference on Corporate Performance Management (CPM)

I am pleased to announce that I have been selected by CFO publishing to officially blog on their Corporate Performance Management Conference to be held in Dallas, Texas, September 11-13, 2011. The focus of the conference will be improving business analysis and bottom-line performance. As you know, both topics are near and dear to my heart, so I look forward to hearing what the great line-up of speakers will have to say on the topic.

Speakers will include:

• Thomas Davenport, President’s Distinguished Professor of Information Technology, Babson College; author, Competing on Analytics and Analytics at Work
• Wayne Eckerson, Founder and President, BI Leadership Forum; author, Performance Dashboards: Measuring, Monitoring, and Managing Your Business
• Eric Lundberg, SVP & CFO, ALM
• Steve Player, North America Program Director, Beyond Budgeting Round Table (BBRT)
• Robin Washington, SVP & CFO, Gilead Sciences Inc.

If your business could benefit from better understanding the processes, structures, tools and people required to achieve the kinds of changes necessary to make you more profitable tomorrow than you are today, then this conference could be just the ticket for you or some members of your management team. By clicking here, on the picture above, or the CPM icon in the column to the right of this post you can register now. Better yet, by entering the code “BLOG” along with your registration, you can save $400 off the normal registration price! Don’t delay your registration. Do it today.

This is your opportunity to learn from real movers-and-shakers about how to leverage dashboards, budgeting, planning, and forecasting toward improving your firm’s bottom-line. Even assessing the performance of  your supply chain and the inherent risks you might face are covered.

See you there!