 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
Quick Links
Copernicus and your business development
Translating the vision into operational goals;
Our normal practice is to run away from acronyms and consultants speak, but for this page we make a slight exception. If you have the time and the inclination read on and discover a little more about how Copernicus guides your business to success in practical terms.
If you don’t want to read all this or have the low boredom threshold of many of our entrepreneurial clients, then simply mail us on info@copernicus-consulting.com or call us +44 161955 3681 for an exploratory chat without the consultant speak.
However if you want to learn more, please do read on, after all we did write it for you….
Working with you we will……
Drive strategy execution
Clarify strategy and make strategy operational
Identify and align strategic initiatives
Link budget with strategy
Align the organization with strategy
Conduct periodic strategic performance reviews to learn about and improve strategy.
A “Vision” is just a few words, maybe a document, unless you bring it to life. If you do, it can be the most powerful, empowering, driving force in your business. Setting you apart from your competitors and on the way to success. This isn’t consultant waffle, this is hard business fact. Read on further and see what Copernicus can bring to your business
Communicate the vision and link it to individual performance;
Plan the business
Feedback, learning and adjusting the strategy accordingly.
The four Copernicus perspectives
The grouping of performance measures in general categories (perspectives) is seen to aid in the gathering and selection of the appropriate performance measures for the enterprise. Four general perspectives are used. These are:
The financial perspective examines if the company’s implementation and execution of its strategy are contributing to the bottom-line improvement of the company. It represents the long-term strategic objectives of the organization and thus it incorporates the tangible outcomes of the strategy in traditional financial terms. The three possible stages as described by Kaplan and Norton (1996) are rapid growth, sustain and harvest. Financial objectives and measures for the growth stage will stem from the development and growth of the organization which will lead to increased sales volumes, acquisition of new customers, growth in revenues etc. The sustain stage on the other hand will be characterized by measures that evaluate the effectiveness of the organization to manage its operations and costs, by calculating the return on investment, the return on capital employed, etc. Finally, the harvest stage will be based on cash flow analysis with measures such as payback periods and revenue volume. Some of the most common financial measures that are incorporated in the financial perspective are EVA, revenue growth, costs, profit margins, cash flow, net operating income etc.
The customer perspective defines the value proposition that the organization will apply in order to satisfy customers and thus generate more sales to the most desired (i.e. the most profitable) customer groups. The measures that are selected for the customer perspective should measure both the value that is delivered to the customer (value position) which may involve time, quality, performance and service and cost and the outcomes that come as a result of this value proposition (e.g., customer satisfaction, market share). The value proposition can be centered on either operational excellence, customer intimacy or product leadership, while maintaining threshold levels at the other two.
The internal process perspective is concerned with the processes that create and deliver the customer value proposition. It focuses on all the activities and key processes required in order for the company to excel at providing the value expected by the customers both productively and efficiently. These can include both short-term and long-term objectives as well as incorporating innovative process development in order to stimulate improvement. In order to identify the measures that correspond to the internal process perspective, Copernicus use certain clusters that group similar value creating processes in an organization. The clusters for the internal process perspective are operations management (by improving asset utilization, supply chain management, etc), customer management (by expanding and deepening relations), innovation (by new products and services) and regulatory & social (by establishing good relations with the external stakeholders).
The learning and growth perspective is the foundation of any strategy and focuses on the intangible assets of an organization, mainly on the internal skills and capabilities that are required to support the value-creating internal processes. The learning and growth perspective is concerned with the jobs (human capital), the systems (information capital), and the climate (organization capital) of the enterprise. These three factors relate to the infrastructure that is needed in order to enable ambitious objectives in the other three perspectives to be achieved. This of course will be in the long term, since an improvement in the learning and growth perspective will require certain expenditures that may decrease short-term financial results, whilst contributing to long-term success.
Key performance indicators
According to each perspective there are a number of KPIs that can be used such as:
Financial
Cash flow
ROI
Financial Result
Return on capital employed
Return on equity
Customer
Delivery Performance to Customer - by Date
Delivery Performance to Customer - by Quantity
Customer satisfaction rate
Customer retention
Internal Business Processes
Number of Activities
Opportunity Success Rate
Accident Ratios
Defect Rates
Learning & Growth
Investment Rate
Illness rate
Internal Promotions %
Employee Turnover
Gender/Racial Ratios
Identifying indicators
Performance indicators differ from business drivers and aims (or goals). A school might consider the failure rate of its students as a Key Performance Indicator which might help the school understand its position in the educational community, whereas a business might consider the percentage of income from return customers as a potential KPI.
But it is necessary for an organization to at least identify its KPI's. The key environments for identifying KPI's are:
Having a pre-defined business process.
Having clear goals/performance requirements for the business processes.
Having a quantitative/qualitative measurement of the results and comparison with set goals.
Investigating variances and tweaking processes or resources to achieve short-term goals.
When identifying KPI's the acronym SMART is often applied. KPI's need to be:
Specific
Measurable
Achievable
Result-oriented or Relevant
Time-bound
Areas to be analyzed
Among the areas top management analyzes are:
Customer related numbers:
New customers acquired
Status of existing customers
Customer attrition
Turnover generated by segments of the customers - these could be demographic filters.
Outstanding balances held by segments of customers and terms of payment - these could be demographic filters.
Collection of bad debts within customer relationships.
Demographic analysis of individuals (potential customers) applying to become customers, and the levels of approval, rejections and pending numbers.
Delinquency analysis of customers behind on payments.
Profitability of customers by demographic segments and segmentation of customers by profitability.
Many of these aforementioned customer KPIs can be developed and improved with Customer Relationship Management.
What is important is:
KPI-related data which is consistent and correct.
Timely availability of KPI related Data.
Categorization of indicators
Key Performance Indicators define a set of values used to measure against. These raw sets of values fed to systems to summarize information against are called indicators. Indicators identifiable as possible candidates for KPIs can be summarized into the following sub-categories:
Quantitative indicators which can be presented as a number.
Practical indicators that interface with existing company processes.
Directional indicators specifying whether an organization is getting better or not.
Actionable indicators are sufficiently in an organization's control to effect change.
Key Performance Indicators in practical terms and strategy development means are OBJECTIVES that will add the MOST VALUE to the business
Copernicus are here to help guide your business to success