Identify Candidate Improvement Opportunities – Essential Element #4
The Candidate Opportunity List: Collect - Rate - Rank
Identify Candidate Improvement Opportunities is the 4th of 8 articles based on:
“Profit Improvement Planning Blueprint: 8 Essential Elements for Underperforming or Distressed Companies” – Post dated Feb 24, 2024
Identify Candidate Improvement Opportunities – Essential Element #4
Identify Candidate Improvement Opportunities -
Essential Element #4
The analyses already conducted, including baseline assessments, labor reviews, discretionary cost evaluations, and product/customer profitability, have likely produced a healthy initial list of profit improvement opportunities.
During this step, the list is both expanded and rated; adding an assessment of each opportunity’s relative benefit, cost, difficulty and risk.
Step 1: Collect and Expand the List of Potential Improvement Opportunities...
As previously highlighted, numerous opportunities have likely surfaced during the completed analyses. These findings should be gathered and formally documented as the initial list of Candidate Improvement Opportunities.
Once compiled, engage the company leadership in the effort to review and expand the candidate opportunity list. Activities that can assist include:
- Review Ongoing Initiatives: Task functional leaders with providing update presentations on their team’s improvement initiatives and implementation status. Hold individual review sessions to identify areas for performance improvement.
- SWOT Analyses: Review (or conduct) SWOT (Strengths, Weaknesses, Opportunities, Threats) analyses capitalizing on strengths, addressing weaknesses, exploiting opportunities and mitigating threats.
- Leverage Available Customer Feedback: Gather insights from customer feedback obtained through surveys, interviews, focus groups, etc. to understand their needs, pain points, and expectations. This feedback provides insight into areas where the company can improve its products, services and customer experience.
- Assess Use of Technology: Evaluate the potential role of technology in enabling enhanced performance. Explore how emerging technologies such as AI, data analytics, or automation can be harnessed to drive efficiency, innovation, performance and competitive advantage.
- Conduct Brainstorming Sessions: Facilitate brainstorming sessions involving key stakeholders from various functional areas to generate new ideas and perspectives on potential opportunities for profitability improvement. Create an environment of open discussion and creativity to uncover hidden opportunities.
After each of the above, expand the Initial Candidate Improvement Opportunity List as appropriate.
Step 2: Rate the list...
For each Candidate Improvement Opportunity, assess and assign ratings (high, medium, low) on four key characteristics, with the most and least attractive opportunities having the ratings depicted in green and red respectively (see below).
Step 3: Finalize List and Rank Order Candidates...
Now that the list of candidate improvement opportunities is fully compiled and assessments of their implementation benefits and costs are incorporated, it is time to review and finalize the list with key individuals in the company. Three steps to complete this essential element include:
- Organize Final Review Session: Handpick and invite key leaders who will play pivotal roles throughout implementation. By engaging these individuals, the long-term success of the profitability improvement efforts is bolstered by ensuring they are vested in both the key decisions and the achievement of the implementation goals/results.
- Finalize the Candidate List: During the session, review and revise the Candidate Opportunity List, ensuring no significant opportunity is overlooked while validating the cost/benefit ratings. Utilize techniques such as “Beginning with the End-in-Mind” exercises to envision future outcomes. Ask the group to project 12-18 months into the future, envisioning what decisions were made today that led to the successful increase in company profitability.
- Sort the list based on the Cost/Benefit Ranking: Once the list is finalized and the ratings confirmed, sort the Candidate Improvement Opportunity list in rank order based on the cost/benefit ratings.
This sorted Candidate Improvement Opportunity list will be a crucial input element when developing the Focused Profitability Improvement Plan (Essential Element #5).
The key will be to select and include only 3-5 of the most significant opportunities. Staying focused on a limited number of initiatives ensures the company achieves its desired results. Often, organizations take on too much, leading to diluted efforts, reduced benefit yields and extended timeframes.
But more on that next week…
* * Essential Element #4 Summary from Original Article * *
4. Identify Candidate Improvement Opportunities
Leverage the insights gained from the baseline analysis, engage key leaders for their perspectives, conduct brainstorming sessions, solicit input from employees and review existing processes to pinpoint opportunities for enhancing efficiency, reducing costs, adjusting pricing, or enhancing customer experiences. Once compiled, this list will serve as the foundation for developing a targeted profitability improvement plan.
Pro Tip: When collecting the list of improvement opportunities, give each a rating (high, med, low) of Benefit Size, Time-to-Benefit, Cost of Implementation and Implementation Risk. This will help prioritize and focus the development of the profitability improvement plan.
