balance as a primary business strategy 2013

Copyright 2013, Morgan Marketing Solutions, Inc.

Balanceas a

Primary Business Strategy

Balanceas a

Primary Business Strategy

Richard P. Morgan CMC, FIMC

Morgan Marketing Solutions, Inc.


Why Balance?Why Balance?

“A business that is seriously out of balance cannot sustain profits, growth,

or customer satisfaction in the long-term.”

Richard P. Morgan CMC, FIMC in Marketing Facets


What to BalanceWhat to Balance

Balance Functions• Marketing & Sales• Finance & Administration• Operations & Distribution


What to BalanceWhat to Balance

Balance Functions• Marketing & Sales• Finance & Administration• Operations & Distribution

Balance Resources• Physical Resources• Financial Resources• Human Resources


Examples of Balance LostExamples of Balance Lost

• Lack of working capital limits growth and profit– Loss of supplier discounts - lower margin– Low marketing & employee investments

• Physical capabilities too small for volume of business– Client service complaints, quality problems, lost customers

• Not enough capable employees to properly handle clients– Client service complaints, quality problems, lost business

• Over-investment in facilities or employees without added sales– Greater interest & depreciation or higher payroll expense kills operating

profit level


Some Signs of BalanceSome Signs of Balance

• Great reputation• Sales growth• Good cash flow & bank relationship• Cash discounts taken• Low employee turnover• Active inventory turns• Accounts receivable DSO• Payments current• Fixed assets maintained• Employee benefit plans, sponsorships• Growing client base, few complaints • Good operating profits & a happy owner!


How to Maintain BalanceHow to Maintain Balance

• Create a useful financial model to help you analyze results and make better business decisions.

• Keep your eye on the ball!

• Develop a real operational business plan.

• Obtain outside facilitation of the planning & implementation process. Gain accountability.


Operating StatementsOperating Statements

• Maintain current operating statements!• Study your statements in detail. Clear picture.• Break out variable costs vs. fixed expenses correctly• Use statements as a real management tool• Break Even analysis can act as a great decision tool• Check the impact of decisions before taking the

plunge!


Financial ModelFinancial Model

• Only three factors determine Break Even and level of profit– Level of sales revenue– Variable cost to you of your products & services– Your fixed expenses of doing business

• Infinite number of ways the three factors interact

• Left alone, all three factors go in the wrong direction!– Customers go; suppliers raise prices; expenses increase

• Cope with constant change.

• You must actively manage and balance the factors!


Keep your eye on the ball!Keep your eye on the ball!

• Example: Our Chairman attended monthly management reviews. Harvard MBA with years of experience.

• Grueling meetings, all day, detailed review• He listened but remained quiet until the end. When

asked, he would make a short, pithy comment.• “Boys, you let events distract you last month. You took

your eye off the ball. Focus on what’s really important and better results will follow.”


Develop a Business PlanDevelop a Business Plan

• Operational business plan is aimed at action• You and your management team must build the plan• Get expert help the first time to facilitate the process • All hear the same things. All contribute. Bond.• Vision, mission, resources, measurable objectives• Situation analysis – internal & external• Competitive analysis – Comparative SWOT• Action plans – dates, coordinators• Contingency plans• Periodic implementation reviews to keep on track


The Other Balancing ActThe Other Balancing Act

• Business

• Personal

• Family

Can you have a life without sacrificing your business?Can you have a successful business without sacrificing your life?

Personal Business Family


Where are you?Where are you?

• Can you truly make these statements?

• “I’ve got up-to-date business and personal plans in place to accomplish my specific goals…”

• “I’ve balanced my business, personal, and family needs.”

• “I’ve taken care of my family, my employees and myself.”

• “I’ve got all my bases covered.”


Contact InformationContact Information

• Richard P. Morgan CMC, FIMCMorgan Marketing Solutions, Inc.Two Galleria Tower, Suite 100013455 Noel Rd, Dallas, TX 75240

telephone 972.931.7993 e-mail [email protected]

“We help leaders attain more profitable growth by enhancing a team's ability to create and deploy right actions, right now!

Clients say they get 5 to 10 dollars in added net profit for every buck they invest with us. One owner says his return was 40 times.”

mailto:[email protected]