Business Success Strategies, Policies and Practices

I have over the years collated the following list of strategies, policies and practices that I have found to be meaningful contributors to business improvements or success.

What can contribute to a more successful business?

ExCom

1. Have inspired, passionate, decisive, emotionally intelligent, knowledgeable, sufficiently experienced, versatile, accountable and responsible leaders who can properly manage and motivate employees, with appropriate incentives and a culture of achievement led by example, including a reasonable work-life balance.

2. Ensure that there is appropriately informed and substantiated/documented decision-making with inputs from relevant committee/excom members.

3. Define company Vision (What we aim to achieve/stand for), Mission (How we plan to do so), Business Focus, Critical Success factors and Key Performance Areas with associated Key Performance Indicators, as well as technology, product, geographical and capex focus/requirements, and the underlying SWOT Analyses that inform these, revisit these at east annually, or as circumstances change.

4. Make sure objectives, targets and measurables are Specific, Measurable, Achievable, Realistic and Time-based. Obtain up-front buy-in at the required staffing levels.

5. Define company culture, ethics and core values, including integrity, transparency, consistency, fairness, justice, interpersonal relations, valuing staff, and social and environmental responsibilities.

6. Meet regularly to monitor progress against action items (monthly/quarterly, depending on due dates/item timelines), and document appropriate corrective actions and actions to take advantage of new opportunities.

7. Ensure proper business justifications for investment and capex, tracking actual against approved spends, and conducting post-mortems to identify lessons learned and if objectives were met and assumptions were sound.

8. Conduct regular Business Risk assessments and Internal Control reviews to ensure maximum compliance and security (includes OHS, Insurance, IT).

9. Implement all required committees per the Companies Act and King (Risk, Audit, remuneration, ethics, etc.).

10. Ensure that legal compliance reviews take place regularly.

11. Communicate clearly, consistently, concisely, considerately and comprehensively.

12. Define and communicate Company Reserved Matters and Limits of Authority.

13. Implement a Whistle-blower system, monitored by an external party.

14. Have an appropriately staffed Company Secretarial and Legal department.

Marketing

1. Is there a brand and what is it about at its core? Use this as the heart of brand awareness advertising.

2. Are there several brands, with one being a premium brand, another lower key, and another possibly a ‘house’ brand? Highlight the key differentiating features of the brands and products [remarkable facts – Purple Cow], and consider using different pricing strategies.

3. Implement a formalized Engineering Change Control Process for new product introduction, including full product motivation with supplier details, minimum order quantity, lead time, pricing, space required in store and delivery patterns, and include appropriate representatives from lab, procurement, costing, operations and sales departments, with proper sign-off and the initiator taking ownership throughout, including a review to determine if assumptions were met.

4. Include product disclaimers on the company website, packing materials, helpdesk, e.g. ‘The product is used in circumstances and applications beyond our control; hence we cannot accept liability for any damages, consequential or otherwise. Goodwill settlements are without prejudice or admission of any guilt, and are in full and final settlement, but is limited to replacement product’.

5. Adopt the approach of using Influential Early Adopters [Sneezers] to gain access into niche or established (hard to enter) markets.

Sales

1. Decide on the split of sales management and staffing with defined responsibilities and accountabilities per dedicated Industry, Channel, Geography and Product Lines.

2. Formalize pricing strategies for each of the above, including trade and settlement discounts and rebates, as well as the method and frequency of price negotiations and the underlying data that is required in support as justification to be collated over time, e.g. oil price, LME prices, ROE, etc.

3. Agree on reporting by each of the above, and review GP and NP/contribution for each of the above at least quarterly (preferably monthly).

4. Agree customer call patterns for taking orders, counting stock and taking replenishment orders, or to review account performance against targets, rebates, etc.

5. Agree reasonability for managing finished goods stock levels to within 1 month’s sales, with strategies to address, e.g. promotions.

6. Formalize the procedure and target for credit notes, with senior authority for approvals.

7. Implement detailed product unit volume forecast with values compared to budgets, to drive procurement and production.

8. Report on sales order data cleanup weekly to ensure valid forward sales expectations and proper planning, procurement and scheduling.

Procurement

1. Confirm the official primary materials and supplier lists, with approved alternates.

2. Ensure suppliers acknowledge receipt of orders and confirm ETAs.

3. Formalize supply agreements with rebates and penalty clauses 9and pricing validity periods and change justifications as is pragmatic).

4. Monitor and report on supplier delivery statistics (in full, on time).

5. Measure on time order placement and delivery (based on MRP?).

6. Maintain a register of pricing per product, with justifications for accepting increases.

7. Ensure daily/weekly purchase order follow-up to tie in with production and sales plans.

8. Formalize and implement a BBBEE procurement and supplier development plan/strategy.

9. Report on PR’s not actioned or maintained/deleted where relevant, and late PO’s at least weekly.

10. Report on PO’s not actioned and GRN’d daily.

Production

1. Assign a team per work center, measuring housekeeping, attendance, performance against production plans, quality, machine/equipment availability and utilization, and injury-free days.

2. Have a detailed production plan generated by MRP/MPS/APS (with flexibility – plan B), with minimal safety stocks, and daily measuring of plan against actual with actions to address problems, and weekly review meetings.

3. Have the floor layout defined and painted, with designated areas and signage for tools, scrap, WIP, rework, raw materials, walkways, fire and safety equipment, and forklift channels.

4. Complete and regularly review proper time and motion studies to optimize flow and determine true production setup and runtimes, and to allocate costs to optimize the product costing.

5. Implement proper controls on the shop floor to ensure accurate recording and posting of actual production time and material usage, with scrap/rejects properly accounted for with a formalized procedure and authorized signatures and ‘hand-shake’ points.

6. Analyze job variances and implement root cause analyses and corrective actions to prevent recurrence.

7. Implement inline QC & QA before acceptance into the warehouse to minimize customer rejects or complaints/returns.

8. Have detailed controlled work instructions with required PPE and tools displayed/available per work station, with regular training refreshing/replacement/rotation defined.

9. Ensure that there is a designated SHEQ Officer to deal with all related matters and ensure compliance and regular internal audits and corrective/preventive actions.

10. Defined detailed procedures and methods to manage any outsourced//off site production.

11. Where required, implement incentives for achieving targets and initiating improvements, based on teams working together to solve problems, and not abdicate responsibility.

Plant Maintenance

1. Implement preventative maintenance schedules and standard operating procedures to cover boilers, generators, chillers, compressors, electrical panels, etc.

2. Maintain equipment and tool registers with regular inspections, including shelving and forklift and safety officers’ refresher training.

Laboratory/R&D

1. Formalize a customer complaints handling process, with any financial settlements to be defined by the Finance department.

2. Define which technologies and projects require priority emphasis, and properly plan, staff, resource, and monitor and report progress using a uniform, formalized methodology with timelines, budgets and accountability for deliverables.

Stores/Warehousing

1. Have a physically closed/demarcated/walled store, with staff picking (and recording/posting) using calibrated scales with correct tolerances, with handshakes to the production supervisors, by agreed daily deadlines to prevent production backlogs.

2. Implement a visually friendly layout with designated bin locations for easy identification of replenishment orders needed to be fed to procurement.

3. Implement detailed stock count procedures (using different color stickers for counters and checkers, pre-numbered stock sheets, etc.) with detailed cut-offs strictly adhered to, and with designated areas of responsibility.

4. Implement a stock rotation system (based on stock age, FIFO, shelf life, etc.)

5. Have a designated returns location.

Distribution

1. Have route planning, with designated trucks per route/area.

2. Measure cost per unit of measure delivered per route delivery method or area.

3. Have handshakes with branches for what is planned to be sent as IBT’s and what is required, and then what was actually sent and received.

4. Have security check what is loaded, with lock ties.

5. Implement vehicle tracking systems to check on routes and stops and thus optimize deliveries and costs.

Finance

1. Define formalized forex exposure management, credit control, expense and capex control, and capex financing policies.

2. Assign responsibility for GL reconciliations (especially GRN suspense, sub ledger to GL control accounts, suspense, recovery, staff loans and salary and wages accounts), and monthly VAT turnover and input VAT reasonability checks [and annual VAT turnover recon], and review these monthly.

3. Define and agree a monthly timetable with key deadline dates and responsible party, for at least 3 months forward at a time, and measure actual performance.

4. Implement methods to reduce interest costs (e.g. overnight call facilities).

5. Maintain a cash flow forecast and actual system to optimize cash flows, for at least 2 months’ forward.

6. Implement a contingency (self-funding) level to reduce short-term traditional insurance premiums.

7. Implement comprehensive tax strategies and systems.

IT/IS

1. Define a structure DRP, either site or cloud-based, with replication and virtualization and synchronization and off-site backup storage, as is relevant.

2. Define password control, e-mail and internet access and usage policies.

3. Implement software and hardware registers, with license keys and serial numbers, updated as changes occur.

4. Prepare site and network configuration diagrams to assist in fault identification.

5. Prepare IIT/IS Vision and/or Roadmap (based on the company SWOT analyses), identifying key projects to be tracked over time, with priorities.

6. Have proper firewalls, antivirus, antispam, anti-phishing, and antispyware policies and systems in place.

7. Ensure controlled remote access to systems by the off-site locations, sales force, customers, suppliers, etc.

8. Implement data warehousing and archiving/purging.

HR

1. Have formalized KPA documents with KPI’s tying in to the defined company KPIs, with at least bi-annual objective appraisals, and pay based on appraisals.

2. Implement incentive schemes, rewarding based on performance.

3. Define formalized policies for office hours, leave (annual, sick, family responsibility, maternity, compassionate, other), recruitment, promotion, remuneration, sexual harassment, grievances, disciplinary action, etc.

4. Ensure formalized detailed training succession and continuity plans are in place for all areas (will MERSETA ATP, ATR, etc.)

5. Define a BBBEE policy with plans and targets (and budgets).

6. Encourage regular face-to-face communication, as opposed to ‘fire-and-forget’ e-mails, and ensure all items in inboxes are at least scanned daily.

7. Train staff on task organization and prioritization, customer satisfaction, negotiation skills, proper communication and staff management courses.

8. Use Tasks and prompts in Outlook calendars to remind staff of key dates, meetings and tasks.

9. Implement fines for late-coming or failure to attend or arrive properly prepared for meetings.

(These lists are not intended to be exhaustive or to be relevant in all organizations/countries/jurisdictions).