By Chet Holmes, President of Jordan Productions

Times are tough. The economy is in a constant state of upheaval. Is your company doing better than most?

Are you placing greater emphasis on pure performance?

If you haven’t maybe it’s time for a serious round of intense corporate soul searching. But do you know how?

Business consultant Chet Holmes says that beyond pure financial performance, most companies can really benefit from finding out what it really means to be a great company.

And answer lies within.

Holmes is a man who is heavily engaged in corporate introspection with Fortune 500 companies.

He is widely credited with bringing a consultant's passion for rigorous self assessment and performance measurement with him.

Now, however, Holmes is obsessed with more than just numbers. He's saying that companies must examine company's culture and inner workings to find ways to be more than just profitable.

He’s discovered that breakthroughs can be achieved only if you figure out how to can tap into incredible treasure trove of knowledge, harness energies and then channel efforts of your employees to help you become great.

Just think, you may have invested millions in automated systems. Have you any real idea how they are being used?

Ask employees.

Your people may know how to make money for you, but are procedures and processes based on intuition, personal and professional experience, and corporate memory? Can these systems be readily duplicated or transferred in event of accidents, sickness or major changes in personnel?

Ask employees.

“It’s possible to become world's most efficient, relentless, and competitive machine,” says Holmes. “But you have to find out what your company is really doing.”

How do you do that?

Ask employees.

Holmes is regularly brought in to lead companies through a discussion to find out what this really means. He has mastered processes needed to identify changes needed to make a company better. His skills are in demand.

Usually, he gets permission to hold a series of strategy sessions. He starts by asking employees to tell boss how company is doing.

How are we doing?

Is top management strategy on track? What are we doing right? What hurts? What needs fixing?

Holmes helps company identify specific items that reveal things that standing in way of becoming a much better company.

“Even one process improvement meeting can give you six months of things to fix in your company,” Holmes says.

Case in point: Too Many Exceptions to Rule…”

In one company session one of items that came up was a vague notion:

"Too many exceptions to rule."

Holmes asked people for specific instances or situations where this occurs. In an hours time he facilitated creation of a list of specific examples to document what people meant.

The list revealed 19 different situations where this company had never bothered to create procedures, policies or standards by which people operate.

Turned out that very few people really had any concrete idea how things were done across company. The shock and pain was deep and felt company wide.

Holmes then asked very same people how to fix it or make it better:

“What can we do to make pain go away?”

They used a whiteboard to capture all brainstormed ideas. Then they focused on culling list of possible actions until they came up with two viable correction strategies for each problem. Using consensus, they went for reasonable solutions that could reduce most pain first.

The employees worked with management and implemented corrective actions until all 19 problems were fixed within two weeks.

Some of solutions involved simple form letters. Some involved putting up a section on their website where many of these questions were answered (the customer service people would then send an email with link).

Some solutions required setting boundaries by which customer service people could operate, even creating a tiered approach to what they could do. (Meaning, try this, if that doesn't work, do this, if that doesn't work do this, etc...)

Virtually every area where they once had to go to a supervisor was fixed, creating some standard operating procedure for people to refer to and follow that didn’t involve supervisor to same extent.

The results were astonishing. The entire company runs better now. In two weeks, they solved problems company had had for a decade.

Many of problems went all way up to president of company. And when they solved all these problems, it lightened his load, and that of his direct reports, very significantly.

What Would you Do with $1,000,000?

With $1 Million would you: •Pay off debt? •Purchase new equipment? •Invest/save for future? •Give yourself a bonus?

$1,000,000 Waiting in Wings

What do you and your business need that you have been putting off because you don’t have money today? $1 Million certainly would fill those needs. But where do you find 1 Million just lying around your business right now? Well, you probably have $250,000 in each of four areas in your everyday business, and you don’t even realize it.

Money in Business Procedures

And so let’s look at four places in your business where we will find $250,000 each and see how we can help you find it:

Part 1: Inventory - $250,000.00 Part 2: Receivables - $250,000.00 Part 3: Sales - $250,000.00 Part 4: Accounts Payable - $250,000.00 Part 5: Procedures - $1,000,000.00

Turn Cash into Time with a New Company Policy

But just what exactly is this source for cash? It’s time. If you are looking for $250,000 then it costs you $4,808 every week that you delay. So what you do with your time quite literally amounts to either costs of delaying, or it can amount to savings when you take action and control of your time. To correct this cost of delay, an increase in velocity must follow - which will set difference between 'good' and 'great'. The consequences of this shift in system velocity increases discipline and competency: ability to maintain increased velocity and ability to make adjustments to achieve 'great'. So how do you realize difference?

Eliminate Inventory and Increase Cash

Let’s start with biggest, most obvious source – your balance sheet, specifically inventory. If you are a manufacturer with $300,000 or more of inventory (raw materials, work in process or finished goods) then STOP! We found it. Why? Because inventory is an unproductive asset. Inventory is money, and having it lying around your factory is not where your money belongs. So if we reduce inventory to Just-In-Time (JIT) levels, then we can eliminate 85% or more of your inventory, which translates into $250,000 in cash. But that's not all. You will also save another $50,000 or more in annual inventory carrying costs. With less inventory, there are lower costs of holding inventory. Let's look at an example of what we're talking about.

Manufacturing Business Procedures Case Study

A manufacturing organization with 2 Million in average inventory balances needed assistance. We examined their inventory consisting of raw materials, work in process and finished goods to understand and quantify workflow, workload, and demand forecasting issues. Then we designed and implemented a process to improve their inventory cycle and tie it closer to their actual sales.