New businesses are created for a variety of reasons (more than 600,000 each year according to the SBA!), but less than 1% reach $10M in annual revenues in less than ten years. This is often because most companies have multiple daily challenges that mask the root barriers to value-creation and growth.
The checklist questionnaire below is based on a learned set of “attributes” that all high-performance, fast-growth technology-enabled business services possess.
Each question below is worth 5 points. If you can answer YES to the question, add five (5) points. (Maximum score is 100 points.)
Positioning Issues Checklist
- Have you verified that the target market is of sufficient size? (This includes creating a database of contacts)
- Are you in a red ocean (blood cutting intensely competitive market) or blue ocean (open sea of opportunity)? (If in blue ocean marketplace then sail on and add 5 points)
- Are you the dominant player in your market or niche currently?
- Is the business model of such nature that it has the potential to be a “branded” model in the sector?
- Have strategic alternatives and alternative distribution (alliances, joint ventures, partners, channels) been identified and created?
Management Discipline Checklist
- Is operational performance in the top quartile? (Benchmarking performance is key to justifying above average market valuation)
- Does your organization administer and achieve corporate targets and rely on forecasting?
- Are the business processes scalable and can they stand the test of exponential growth?
- Does your organization provide a dashboard of eight to twelve metrics for top management and the Board of Directors?
- Do you have the functional support (in-house or outsourced relationships) that is needed at each position?
- Are there current incentive programs aligning all stakeholders?
- Have leadership and training programs been implemented?
Tactical & Operational Checklist
- Do you know the effect customer satisfaction leads to referrals and cross sell opportunities?
- Does each team member from the executive team to front-line staff have a clear “definition of success”?
- Does the business have monthly, quarterly and annual corporate targets broken down to daily activity metrics for each location, department, and team member?
- Do you regularly identify classes of performers?
- Are IT/MIS and HR (Human Resources) both contributing to the strategy and financial performance of the business?
Financial Engine Checklist
- Is your capital structure adequate to ensure growth?
- Does the capital structure motivate management and facilitate additional funding needs?
- Does the capital structure support the long-term strategy of the company? (Versus settling for “good for now”)
Total Score: _________________
Evaluating Your Score: Checklist for Assessing Potential for Wealth Creation
Anything below an ‘A’ highlights the room for improvement. Score: 40 – 71 Percent: Opportunity For Rapid Improvement
Your organization is clearly not living up to its potential and the
opportunity for improvement is sizable. The fix starts with tackling your root-cause deficiencies while enabling your key executives and employees to focus on improving daily performance.
A full assessment and analysis should be completed immediately by an outside firm. By first analyzing the business holistically including strategy, operations, and financial, and unbiased from what the opinions of management, board members, or other stakeholder’s believe ensures that the right issues are identified and resolved.
Often, strategic issues are affecting the effectiveness of the organization and execution flaws are impeding strategy. Since one is caused by the other, the issues cannot be resolved without first identifying the underlying root cause issues. Improving performance starts with solving the real issues, not the perceived!
Score: 71 – 89 Percent: Rising All-Star
Your organization is well on its way to creating exponential wealth and shareholder value. While many processes and systems are in place there appears to be some areas that need attention and improvement.
Many times organizations pinpoint a singular barrier, but ninety percent of the time the solution needs a combination of strategic guidance, operational improvement, management augmentation, or capital in order to solve the root underlying issues. Shore up your deficient areas and your organization will be well on its way.
Score: 90 Percent Plus: Superior Performing Organization
Your organization is in an elite group! Congratulations on building such a refined and robust organization. Superior processes and sys
tems are in place and generating above average returns.
The next step is for the entire executive team and all Board of Directors to complete this checklist to determine if there is agreement and alignment.
Where to start? Management augmentation is standard procedure for generating operating improvement, but first start with a business assessment and analysis to determine the underlying issues before throwing away resources on a singular functional challenge.
- Assess people capabilities against performance goals;
- Assess internal capabilities: process, system (software, technology, and tools);
- Assess external opportunities and threats;
- Create detailed change management action plan towards constituency alignment;
- Collaboratively create roadmap of action items with RRM (Roles, Responsibilities, and Measurements).