Control your own destiny or someone else will!
Better Business for Financial Advisers and Paraplanners
3 Dec 2019
My last article was about Business Vision, the ability to define with confidence and facts the way in which your business and life could evolve. I’d now like to look at a key step in this process, the business audit.
I’m not talking about having forensic accountants pour over your books, what I mean is taking a strategic look at your business and processes.
This allows you as Jack Welch once said, to control your own destiny before some else will!
Doing what we have always done will only get us what we have always got.
So if we want to create evolutionary change and achieve our vision then, one of the most important tasks a business can undertake is to look back over its shoulder and audit the key elements of its structure, people and processes.
You might legitimately ask what this achieves. The most important benefits are that your audit can:
- See where you are now -how is the company performing in terms of market share, profitability and customer perception?
- Identify how you got here – what strategies have worked and what have failed?
- Plot where you are going - What would you achieve or not, if you pursue your current strategies?
However, for me the greatest benefit of an exercise of reflection is that it can often reveal hidden weak spots. Once identified you can focus on strengthening them before they cause damage.
This is why some people describe the audit process as a business MOT.
What should your audit cover?
Any Business audit needs to look at 5 key areas:
- Your external analysis, which is essentially your PEST exercise looking at the Political, Economic, Social and Technological factors that will impact on your business.
- Your customer review, which identifies who your customers are, what buying criteria they use and how they rate your proposition and any future offerings.
- Your internal analysis, should look at your operating results, your sales, market share, profitability and costs.
- Your competitor analysis, should examine who are your current and future competitors. Review their strategic objectives and the generic strategies that they are pursuing. This helps you identify your competitive advantages and identify if they are sustainable?
- You also need to undertake a marketing audit to be sure you’re capable of achieving any strategic objectives you set.
Who should conduct your Marketing Audit?
There are a number of options available to a business when conducting this audit:
- Outside auditor: Company appoints an outside auditor to conduct a business audit.
- Task force audit: Business selects a team of its own senior executives to conduct a business audit.
- Self-audit: In this method, one senior manager of a company conducts the audit.
- Audit from above: Here, a senior non-executive of the business (for example, a Director) is appointed to conduct the audit.
Key learning points
I’d like to leave you with these key learning points:
- Your business audit should be a comprehensive study of all your business activities.
- The audit should be treated as a systematic-process that follows a step-by-step procedure.
- There are a number of tools available to help you.
- Your audit should be a periodic activity and must be conducted regularly.
- It can be conducted by an independent person who is not from company.
- It is a critical review of all activities of company.
- It should also include the marketing activities of company.
- It finds out business opportunities and weaknesses of company.
- It allows you to identify your Vision.
This may look daunting, but there are a range of simple tools available that can make this both an enjoyable and rewarding process. If done correctly this audit can define your future vision and ensure your business is fit for the future. And as Jack Welch says:
“An organisation’s ability to learn, and translate that learning into action rapidly, is the ultimate competitive advantage”.
Make sure you have an advantage in 2020.
John Joe McGinley
Glassagh Consulting December 2019
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