Developing vision, key indicators and strategic plans
Situation
A mid-sized company has been involved in the retailing of fashion products for the last 20 years. The sales have been increasing since inception but have remained stagnant at about RM35 million a year over the last 3 years. It was a frustrating experience for the owner-management team, which has no professional management skills, to lead the company to the next level.
Actions / Challenges
Leap Forth was engaged as the Corporate Advisor to review the situation, identify the problems and propose viable solutions. A 6-month timeline detailing the scope of work was drawn up, in consultation with the management. The major problems identified are: lack of clear corporate direction, inexperienced staff to operate the growing company and poor cash flow management.
Basing on the problems identified, the following action plans were executed:
Results
Immediate visible results include staff are more motivated and eager to contribute as increment is based on direct performance. Cash flows improved as expenses were reduced due to stringent financial control. It is anticipated that sales will gradually grow once the business plan is fully executed. Management is now more confident in managing and growing the business with the contribution of more experienced professional staff.
A mid-sized company has been involved in the retailing of fashion products for the last 20 years. The sales have been increasing since inception but have remained stagnant at about RM35 million a year over the last 3 years. It was a frustrating experience for the owner-management team, which has no professional management skills, to lead the company to the next level.
Actions / Challenges
Leap Forth was engaged as the Corporate Advisor to review the situation, identify the problems and propose viable solutions. A 6-month timeline detailing the scope of work was drawn up, in consultation with the management. The major problems identified are: lack of clear corporate direction, inexperienced staff to operate the growing company and poor cash flow management.
Basing on the problems identified, the following action plans were executed:
- Revised the organization structure with proper segregation of profit and cost centres
- Developed corporate vision & mission, and clearly communicated it to all staff
- Pinched several experienced professional staff to head various departments
- Developed simplified standard operating procedures for all critical functions
- Implemented few key performance indicators at corporate and departmental levels
- Revised compensation plan based on corporate and respective profit centre performance
- Developed business plans ensuring availability of resources to support sales target
- Practiced stringent financial governance and discipline in managing cash flow
Results
Immediate visible results include staff are more motivated and eager to contribute as increment is based on direct performance. Cash flows improved as expenses were reduced due to stringent financial control. It is anticipated that sales will gradually grow once the business plan is fully executed. Management is now more confident in managing and growing the business with the contribution of more experienced professional staff.
