Part 1 – Self Assessment (Strategy & Operations)
Orchid Advisors’ Practice Areas:
At the most basic level, like all for-profit organizations, firearm manufacturers, distributors and dealers exist to make money for their owners. Ownership structure can be private or public, and may consist of one or many individuals, entities or funds. Regardless of structure, the owners seek to achieve a financial return that is a multiple of the amount invested. And, that multiplication of return should be greater than the return(s) they can receive through alternative options, like savings, stock market investments, and others. Notwithstanding regulatory requirements, safety, and other good corporate stewardship responsibilities, we can surmise that the most important measure in a for-profit business is its financial performance.
Over the next year, we will discuss ten areas, one per Strategy & Operations focused article, that are vital to enhancing the financial performance of your firearms business.
In What Category of Need Does My Business Reside?
Orchid’s Strategy and Operations practice groups performance needs into the following four categories:
The following graphic characterizes the four categories.
Regardless of which category you align with most, the following activities play an instrumental role in achieving new performance levels. We have presented below, ten activities which can be applied to any level of need. However, the order of these activities, the emphasis and urgency may vary depending upon your current financial position, market dynamics, and owner strategy. Likewise, depending on the specifics of your firearm business, you may replace some of these topics with others. For example, you may exclude “Operational Excellence & Process Definition” if you are operating at world class levels, and replace it with a “Sales & Marketing Strategy”, and so forth.
In the following chart, consider the characterizations that insight change in the first three categories. And, look at that benefits enjoyed through transformation.
The evaluation of where you are today and where you need to be in the future should consider several factors which include but are not limited to: (1) Owner strategy; (2) Cash position; and (3) Time.
What Activities Can Improve the Financial Performance of My Business?
- Financial Analysis and Information for Decision Making
- Product Portfolio and Pricing Assessment
- Scope and Accountability Control
- Cost Containment and Optimization
- Human Capital and Performance Management
- Supply Chain Management
- Operations Excellence and Process Definition
- Technology Enablement
- Product and Market Development
- Performance Management and Governance
As we kick off this Financial Performance Improvement series which will continue March 17, it is important that you assess your current business position. Is your business “bleeding cash” such that you need to stabilize? Or, have you just come out of a turnaround and you’re ready to make quick, abrupt innovations to your business?
During our next session, we will discuss the first of ten activities for improving your financial performance. Our discussion pertaining to “Financial Analysis and Information for Decision Making” will include matters related to understanding your current financial position, competitive benchmarking, identifying areas of cost leakage and actions that you can take to make immediate impacts.