| There is one last thing to do before going on to the implications and uses of resource-accumulation. | |
| Sorry – but it’s just got to be done right! If you get this wrong, everything else you try to do with strategy dynamics will be messed up. | |
| The previous briefing explained that accumulating resources are important. | |
| So now we need to understand how to work out the result when it happens. | |
| At one level, Resource Accumulation may seem rather simple and obvious. ‘So what?’ you may ask yourself. Well, it’s monumentally, massively important, and while it may be obvious in itself, its consequences are truly staggering. |
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| The next few briefings are going to talk a lot about ‘accumulating resources’. | |
Jan 112011
| What would be a useful checklist of tangible resources?
… customers, products, production capacity, staff and cash. |
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| Since organizations exist to “supply” some form of “demand,” let’s look at demand-side resources first… | |
| Have you ever puzzled over academic concepts? …thought, “What does this mean? Should I be using this?“ | |
| This briefing discusses some academic stuff, which is important for teachers to understand. It’s useful for professionals too, because you may come across these concepts, puzzle about what they mean, and wonder if you should be using them. I have put a few key references at the end. Continue reading » |
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Dec 142010
| Does Resource based Performance Analysis work as well in non-commercial sitautions? | |
| Previous briefings explained how to understand and anticipate business performance by looking at the quantity of resources needed to drive sales and costs. Exactly equivalent thinking works just as well in non-commercial sitautions, such as voluntary groups, public services and nongovernmental organizations (NGOs). | |
| Why is the typical approach to business planning and forecasting flawed? | |
| Strategic planning generally aims to get to an estimate of future sales and profits, so how these items are estimated is critical. Typically, you would start with a forecast for demand, and by assessing how competition could affect prices, get a value-forecast for the market. Setting targets for increased market share would then give a forecast for sales volume and revenue. There are however problems associated with this typical approach to business planning and forecasting… Continue reading » |
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Nov 172010
| There is an important distinction between time-periods and instants in time. A previous briefing emphasised that ‘performance depends on resources’, but if performance is reported over a period and resources are reported at points in time, we risk comparing apples with oranges! | |
| Most of what companies report about their performance concerns how well they have done during a certain period, the latest month or a financial year for example – how high their sales rate has been, how much profit they have generated and so on. Many companies, however, also track and report how much of certain things they have got at a point in time, such as the number of customers they have. Some even declare such numbers publicly at the end of each reporting period, such as subscribers for cable TV or cellphone companies.We need to be careful about this distinction… Continue reading » | |
| Analysis needs to find explanations for why revenue has followed the path that it has and why the individual cost items have developed as they have. | |
| The previous briefing set out why we need a rigorous causal explanation for what drives profit or other performance outcomes. This analysis does not usually depart from normal practice, at least when it concerns profits, except for the addition of time charts for the revenue and cost items. Continue reading » | |
| When is theory powerful? | |
| Whether they like it or not, decision makers use theory all the time, even if it is only their own private beliefs about why things happen and the likely impact of their decisions. Theory does not need to be complex – it is simply an explanation for what causes what, and how – without which there can be little confidence in the likely effect of any strategy we develop or decisions we might take. Continue reading » | |
