Accountability
- The acknowledgment and assumption of responsibility within the scope of a business agreement
- Encompasses the obligation to report, explain and be answerable for resulting consequences
Vision
- Where you are headed - What you want to be
Goal
What you want to accomplish
Objective
Subset of goal
Strategy
Plan for accomplishing your goal
SMART
- Specific
- Measurable
- Achievable
- Relative
- Time specific
____________________ is a strategic planning and management system
The balanced scorecard
The balanced scorecard is used in a business to __________________
- Align business activities to the vision and strategy of the organization
- Improve internal and external communications, and monitor organization performance against strategic goals
Good Performance Metrics
- Provide a way to see if our strategy (plan) is working
- Focus employees' attention on what matters
- Allow measurement of accomplishments,
- Provide a common language
- Are valid
- Are verifiable
Good Performance Metrics are explicitly defined in terms of
- owner (who will be held accountable)
- unit of measure
- collection frequency
- data quality
- expected values (targets)
- thresholds
Scorecard Goals
- Financial
- Relationship
- Service
Scorecard - Relationship Objectives and Measurement examples
Objectives
-- Commitment
-- Competitiveness
Measurement
-- Amount of training
-- Market share/Growth
Scorecard - Financial Objectives and Measurement examples
Objective
-- Financial Stability
-- Profitability
Measurement
-- Debt to Asset Ratio
-- Gross Margin %
Scorecard - Service Objectives and Measurement examples
Objectives
--On time delivery
--Lead time
Measurement
-- # of late deliveries
-- # of days/weeks
Channel compensation for a distributor is paid for by ____________________
Customer and manufacturer
SRS Sales Cycle
Procure --> Inventory --> Sell --> Collect
Although a basic business requirement, SALES provides what?
Means to cover variable and fixed operating expenses and in some distribution businesses enough margin $ to result in earnings.
Other means of compensation provided by manufacturers/suppliers
- Prompt payment discounts and terms
- Promotion, Loyalty and Marketing Allowances
- Special Pricing or Market Deviations
- Purchase Incentives or Rebates
***THE DRIVING FACTOR IN OBTAINING THESE IS RELATIONSHIPS!
Prompt payment discounts and terms
- Discount offered for early or prompt payment
- And the period of time offered by the supplier for the distributor to remit payment for goods and services.
Prompt payment discounts and terms generally reflects ___________________
The financial stability of the distributor or the strength of the business relationship
Advantage of prompt payment discounts and terms
- The use of the supplier's cash and not the distributor's,
- Prevents the use of borrowed funds -
- Avoids the payment of interest expense.