What to do to do well in 2017?

2016 was an extremely challenge year. 2017 will not be that different. Thus, what we should do to live through 2017?

1)    Keep focusing on the basics
When thinking in business, the basics are: assets, growth, profits and cash generation. These 4 (four) elements are interrelated and central to “validate” the chosen business model. The assets (property-plant-equipment, stocks, and accounts receivable) are the basis for sales generation. Sales growth (via increment of market share or new stores /businesses) is what attests that the clients are “accepting” the proposed business model. The profit attests the health of the business model (generated income are greater than the expenses to obtain them). Finally, cash is the thermometer responsible for attesting that everything is going well, or yet, the business is growing healthy. When cash is not being generated the reason might be that the company is overinvesting (in ppe, stocks or accounts receivable), overpaying dividends or the sales growth is insufficient or yet there is no profit.

2)    Do not forget risk management
Risk management may be seen as a loss of time and money until something bad happens. When a loss occurs a witch-hunt takes place. Nevertheless, the most important, that would be the mitigation of risks, and a quick reaction to its materialization, continues to be unaddressed. Clearly risk management has a cost. Thus, the need of be realistic when deciding on which elements to use.
An important step is to draw a risk matrix. In this document is listed the existing risks, the minimum controls to be observed; who are the responsible for its execution and for the controlling, and with which periodicity. Among the elements of risk mitigation that might exist, some are of simple implementation and are part of what could be called “internal control system” to any large organization: audit, insurance, hedging, licenses, communication channels, and a crisis management plan.

3)    Do not forget of the people
The focus on a situation of scarcity, demands:

a)    Keeping an eye on the Organizational Chart:
The organizational chart is the representation of the organizational structure, what involves activities/tasks to be performed, needs of personnel, and the line of authority and responsibility.
b)    Working to retain key-people. Key people are always important!

4)    Establish a method that leads to a continuous improvement process
A method whatever it is should stimulate:

a)    Set targets;
b)    Define a plan;
c)    Be disciplined in the execution; and
d)    Track and measure.

5)    Practical tips

1.    Dive into the details of what is important to the business;
2.    Test the limits not accepting “B.S.”, even when disguised in concepts of difficult understanding;
3.    Look for help from outside to what is not your expertise, it will be certainly cheaper;
4.    Keep your eye on the Balance Sheet;
5.    Purchase of direct and indirect (products and services) must be periodically revised;
6.    Financing clients and suppliers is a source of income;
7.    Trips, visits, trade shows must generate results;
8.    Developing commercial and institutional relations is not an activity to be forgotten;
9.    Do not let a subject to be forgotten or to “die out”;
10.    Keep the communication flowing, avoiding surprises!

At 2B Partners Consulting we are dedicated to help companies to address the questions above thru the services of advisory board, interim management, managerial applications and consulting focused on financial advisory, operations improvement and organizational efficiency. Contact us to obtain more information by sending an email to This email address is being protected from spambots. You need JavaScript enabled to view it.

This email address is being protected from spambots. You need JavaScript enabled to view it.  | Advisory Board | Interim Management