Five actions that can help you meet your Plan

It has been just a few days past Q3 closing and you are ready to close the year.  Meeting your Operating Plan is number one priority; however, business is still volatile and in some areas softening.  What to do?  Below we present five actions that can help you meet your Plan goals:

1. Check work orders and delivery forecast

Depending on GAAP rules for revenue recognition applicable to your business products must be delivered in order to be recognized as revenue.  A tuned up value chain, starting from your suppliers to your manufacturing operations and distribution will be fundamental to achieve this goal.  Make an in-depth review of your current work orders and delivery forecast and validate that there are no anticipated bottlenecks, then, evaluate options to accelerate production and delivery.

2. Make an exhaustive dive in Billings

Once items are delivered a simple step before recognizing revenue is to issue invoices.  In organizations with mature, automated systems this is straightforward.  If this is your case, please move to the next item.  If on the contrary your processes are not automated then add extra eyes to your billing process, make sure that all delivered items are promptly billed, and there is no back-up issuing or delivering bills.

3. Evaluate opportunities in Discretionary Spending

Discretionary spending includes items such as travel and entertainment, advertising and marketing, information systems, temporary labor, energy, and more.  With two full months before the end of the year this is the best time to tighten on expenses if your plan is at risk.  Savings in these and other categories can range between 5 and 50%, which depending on your industry may expand your margins by up to 1%.

4. Challenge your Sales team

While your sales team must have been working hard during the year, is there still opportunity to close the year with additional sales? are you fully leveraging all your sales incentives? are there still any undecided clients who may say “yes” with the right incentive? Find out sooner than later and take action!

5. Reach out to your suppliers

While it may be late to implement any cost-reduction engineering changes it is never too late to request straight price reduction.  Evaluate your supply chain for suppliers who have not delivered productivity this year and have your supply chain team contact them immediately.  Focus on suppliers whose costs have evidently come down this year, i.e.  products that are dependent on oil prices and commodities (metals, plastics, and others).  Set a goal, and just ask.

This list is not exhaustive and may not apply to all businesses and industries.  For additional recommendations or to request a rapid assessment please contact us.