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Management Process Diagnostic
Complexity is something that can creep into an organization over time, where manufacturing complexity soars and the number of versions of the same product expands, resulting in a maze of processes and ill-defined roles and responsibilities. Consequently, everyone is expected to be responsible and accountable, which means no one is.
Typically, the adverse impact of suboptimal processes and organizational structure is not readily noticeable within the organization. “That’s the way it has always been done” is the rationale for living with poorly designed processes. Meanwhile, new product launch deadlines are missed, inventory levels build, cost overruns become the norm and investors begin slashing your value relative to peers. How can you reverse this perilous journey?
We offer an independent and analytical approach to evaluating your management processes that identifies the gaps to best practices and highlights core areas in need of upgrading. These improvements will help clear organizational congestion allowing ideas and actions to flow more swiftly while increasing accountability for outcomes. Our recommendations improve alignment with shareholders and help management to set better goals, develop better plans and drive outstanding execution throughout the organization.
Strategic Questions Fortuna Advisors Will Answer
• What are the key contributors of value creation within the business? Can we rely on these same drivers for value in the future?
• What level of growth, margin and investment is required to meet and exceed investor expectations to drive the share price higher?
• What processes are hindering our ability to achieve our required performance?
• What is our investment track record? Are we investing in the right places?
• Where are we falling behind our competitors?
• Have our decision makers learned to “game” the budgeting and capital allocation processes over time?
•Do our incentives reinforce the right behavior?
What Fortuna Advisors Will Do
Fortuna Advisors will:
• Quantify the key drivers of share price performance in terms of growth, margin, asset intensity, reinvestment rates, reinvestment effectiveness, etc.
• Determine investor expectations in terms of the future performance embedded within your company’s market value.
• Determine where competitors have the upper hand by benchmarking your performance against key peers historically, analyzing investor expectations, and determining who will capture the greatest amount of value in the future.
• Identify the top value creating strategies within your industry by conducting customized capital market research to determine whether organic or acquisitive investment strategies drive value, and the capital structure that will best support that strategy.
• Evaluate your key business management process including Target Setting, Planning, Budgeting, Investment Decision Making, Management Reporting and Incentives.
• Assess your “formal” processes including a review of reports, models, and other key documents you generate.
• Examine the “informal” processes through a series of interviews with select members of management’s team to understand how things “really” work
• Identify management process gaps and link them to performance gaps to show how the processes are driving the performance gaps.
• Recommend business process improvements and an action plan to improve manager behavior and encourage better performance.