If you’re a consistent listener of my radio show KBZNZ Business Genies,you’ll see that there is a common theme to my guests: how do I do a better job of running my business and how can it be more profitable? Since I am a certified Lean practitioner myself, one area of Business Genies’ focus is Lean implementation. I continue that exploration with my guest Ankit Patel, president of The Lean Way Consulting. Ankit has implemented Lean in the industries of manufacturing, refurbishment and small businesses with companies ranging from “Ma and Pa” stores all the way to a fortune 500 company.
Two recent blog posts by my guest (http://TheLeanWayConsulting.blogspot.com) make excellent points. One post quotes The Lean Benchmark Report (2006) by the Aberdeen Group: “42% [of survey respondents] say ‘Top Management Commitment is #1 Challenge [to a Lean implementation]. Another asked, “How do you influence an organization to start Lean in some shape or form outside of manufacturing?” First, top management commitment is the only way Lean will succeed, which brings us to the second: responses to Ankit’s question about Lean in a non-manufacturing environment. Responses to his posed question seemed to focus on ROI and not “selling” Lean to management as Lean, but as “solving their own problems and controlling their own destiny.” The two are directly related. I would add, however, – solving their own problems, controlling their own destiny and controlling COSTS, which can be accomplished by management having the data that comes from consistently measuring business performance.
The problem arises when management doesn’t have the time or the tools, or in many cases with small businesses, the resources to engage a CFO, to measure and analyze their company’s business performance. Fortunately there are affordable business performance software packages, like CFO Genie, that are written for the non-financial professional that enable CEOs to understand their financials and give them the information they need to make operational changes.
Look for software that:
- Within a few hours, from start to finish, indicates specific areas where the company is losing money and where corrections need to be made.
- Encourages scheduling a demo prior to purchasing.
- Provides a built-in tutorial.
- Produces easy to read and understandable components among which are: current and optimized income statements; labor efficiency; break-even analysis; bankruptcy potential (Z-Score); ROI by line item; all major indicators and business potential.
- Is simplistic enough to use habitually so that it becomes a tool for continuous improvement.
- Does not need a financial professional to interpret the data.
Listen to KBZNZ Business Genies’ guest Ankit Patel on Friday, February 5 at 12 noon and midnight (PST); 3 p.m. (EST).
Max Gregorich, www.ceo1stop.com