Most large organizations are fat. Organizations have grown through acquisition and integration of various organizations where positions are rarely justified and aligned appropriately. Many corporate positions exist to merely hand off information between management layers. When leadership asks middle management for suggestions for trimming the organization, irrational responses occur. This comes in the form of protecting fiefdoms, creating 'make-work' and finger pointing. Making matters worse, executive leadership is reticent to second guess middle management for fear of upheaval or the unknown. When times are tough, organization leaders have to almost randomly make organization cuts with little regard to address the organization's efficiency. As soon as times return to prosperity, the organization is back where it started. When organizations address imminent right-sizing efforts, they need to get rid of the work that goes along with the organizational fat. Trenegy works with our clients to help design the right organization along with defining what processes need to be challenged.
On the surface many acquisitions appear to be sound business decisions generating rapid growth and economies of scale. However, many organizations fail to think about the tactics of actually integrating the acquired entity into their company following the acquisition. This results in failing to meet the financial objectives of the acquisition. The acquired company’s high margins are a result of a more manageable size and small company shortcuts. The new parent company’s processes require more rigor. This negatively impact margins of the acquired company. The next challenge is whether to continue branding the acquired entity as a stand-alone portfolio company or integrate the brand. Other areas that need to be considered include organization design, retention, transition service agreements, customer base, culture, business processes and technology. Post-merger integration issues need to be clearly planned and executed in an integration strategy. A successful integration requires developing and executing against a robust acquisition playbook. Trenegy helps our clients develop and integrate acquisition playbooks into the post-merger integration process. Our approach ensures complete integration and allows companies to enjoy the benefits of synergies associated with a fully integrated acquisition. Please read more on Successful Integration or a Pipe Dream?
Many companies grow in spite of themselves. Eventually an unexpected event occurs which puts the company in a reactionary mode. Surprises come in the form of exodus of talent, loss of customers or loss of control. Small companies enjoy the nimbleness of their size and the flexibility within organization roles. In the early stages of a new company, an engineer may be responsible for R&D, marketing and other administrative tasks. As a company grows more engineers are needed. An organization with many engineers doing many different things leads to confusion. Leadership finds that some level of specialization is needed. The company must begin to refine jobs and business processes as they grow, and eventually hire new resources. Clarifying roles equates to diminishing entrepreneurial spirit causing loss of key talent. Proper organizational planning can help reduce the impact of losing talent and other unexpected surprises. Trenegy helps new companies determine the appropriate organization, processes and systems to support growth and change. This includes developing a comprehensive roadmap to achieve the overall growth objectives.
Our surveys show that most leadership teams in organizations have little to no consensus on how to measure performance against their strategic goals. Operations are focused on productivity, sales teams are focused on market penetration and accounting is focused on cash flow. This results in finger pointing when the strategic goals are not being met by the organization. As a result, the organization spends an inordinate amount of time developing various cuts of different metrics that do not measure what matters. This requires pools of analysts huddled over spreadsheets that become irrelevant as soon as the data is published for management. Organizations need to take the time to simplify their performance management process through simplification and rationalization of performance metrics. Performance metrics should balance the business drivers and focus on the competitive differentiators for strategic success. Trenegy's consulting teams help executives develop the right performance metrics and management process to measure strategic success. For more information on performance management please refer to What are you hiding? Finding Metrics that Matter.
Mark Twain was quoted as saying, "Everyone is talking about the weather but nobody is doing anything about it." Similarly, among the corporate ranks, many talk about Knowledge Management, but very few are doing anything about it. Knowledge Management has increasingly become one of discussion points in the corporate world over the last twenty years. Organizations are realizing the knowledge being created by its people is an invaluable resource. Unfortunately, many companies have yet to find success in fully executing a Knowledge Management solution in the organization. Trenegy has found this is because Knowledge Management begins and ends with technology. Corporate executives deploy extensive databases full of information for employees to post to and collect from as the panacea for Knowledge Management. Organizations throw large amounts of money at Information Technology (IT) solutions while ending up with little sustainable results. Therein lays the problem. Knowledge Management is mistakenly viewed as a technology solution. However in reality, Knowledge Management involves people, culture, and a new way of thinking. Knowledge Management is a process and a structure made up of components working together to benefit the organization. Trenegy teams work with clients to identify critical knowledge components, the barriers to capturing and using knowledge, creating processes and organizations to manage and share knowledge as well as teaching employees how to leverage knowledge of others. We can help you manage the balance between people, processes, organizations and systems to ensure your Knowledge Management program is a success.
Organizations seem to have the 'never ending project syndrome". Organizations pull the best and brightest people in many different directions and find it difficult to focus on the activities associated with the on-going initiatives. This is no surprise as running and growing the business should be a primary focus. Our teams help companies establish realistic Program Leadership processes and models that properly balance the focus on managing the business and supporting the initiatives. We quickly establish guidelines around how to identify, evaluate, approve, prioritize and execute initiative activities, all while taking into consideration day-to-day business activities. Most importantly, we help establish guidelines around when a project is 'complete' – to help ensure projects are seen through to completion. We work with organizations to help determine when it really makes sense to 'back fill' individuals and when individuals can realistically be leveraged on a part time basis. Trenegy helps manage the portfolio of initiatives to ensure successful completion and our clients obtain the expected benefits from each project.
Planning and Forecasting
We find that Budgeting, Planning and Forecasting is typically associated with drudgery. Organizations struggle to develop a cohesive financial forecast and plan that both ties to the corporate objectives and is realistic. Organizations begin the planning process with the "1,000 spreadsheet march" and end up in a mire of miscalculations, misconceptions that make up a 'budget'. At the end of it all, management either ignores the numbers and goes about their business or will fight the numbers to the bitter end. Our belief is forecasting and planning should be a part of everyone's job, not just a side bar onerous exercise to appease the executives. At Trenegy, we help companies prioritize strategic objectives through simple actionable financial objectives. This includes developing a process where budgeting, forecasting and planning are integrated as 'one' process. This 'one' process then integrated into everyone's job. This allows individuals and teams to continuously look forward and collaborate across the organization. This collaboration allows the organization to quickly see where the company is going and what strategic adjustments need to be made to the go forward plan. These strategic changes are quickly communicated and incorporated into the next planning cycle. The planning process is a continuous process of knowledge sharing. Trenegy's consulting teams help organizations design and implement a 'one' planning process. Learn more at Roads? Where we are going, we don’t need roads.>
Close and Consolidation
Our research has shown that over half of the financial information, metrics and reports created by accounting and finance are not being used by the intended stakeholders. These financial books sit on shelves collecting dust and no one is ready to challenge the necessity of the reports. Various metrics are calculated that show that the business is doing both poorly and is healthy at the same time. Making matters worse, these reports require a significant amount of labor hours and the reconciliation of these reports and metrics delay the close process. We believe organizations should take the time to challenge their current reporting processes and streamline work. Reports need to be rationalized, the 'penny wise, pound foolish' accounting procedures need to be thrown by the way side and wasteful controls should be eliminated. Financial reporting should be a 'no-brainer' and require little work at period end. Trenegy's consulting teams help finance organizations close their books quickly and disseminate financial information in an efficient and effective manner. For more information on financial close and reporting please refer to our perspectives, Closing your Books with Organization and Discipline.
Most management reports exist to justify jobs. A new manager is hired and “requires” a series of completely new reports to help run their department, region or service line. The new reports have information that has never been captured and reported before. The reality is these new reports are not going to add value to the organization. These reports are merely justifying the new manager’s position. A new region manager is hired and has a different view from the other regional managers of what metrics are important. This requires time-consuming efforts to develop a separate set of reports. Moreover, separate metrics prevent the organization from comparing regional performance. The results of Trenegy’s latest management reporting survey found operational employees spend 60% of their time developing reports for each other. This time would be better spent serving customers. Trenegy helps organizations rationalize the management reporting processes allowing the organization to spend more time focusing the customer and less time developing reports and mining for data. Read more about Trenegy’s point of view in Metrics that Matter.
Sales Force Optimization
Facing off with the customer is the most important yet most disorganized business process in large organizations. Conflicts arise between geographies, service offerings and products. Individuals and sales teams are incented to build their individual sales presence without regard to competing interests within the organization. Moreover, information sharing is not fluid and does not come natural to sales organizations. Sales teams end up operating in silos and are only successful in their 'own rite'. We have found that effective sales organizations have the structure and process to 1) focus on attracting and retaining the right customers (customer profitability), 2) communicate expected sales to management and supply organizations and 3) integrate other sales teams and individuals across geographies, service offerings and products. Trenegy's consultants have worked with executives to build effective and efficient sales organizations whose activities and results are aligned with the organization's strategy.
The negative business impacts that result from inefficient field processes lead to endless finger pointing between Operations and Corporate. Field hands tend to forego the standard processes for customers, pricing and signature collection to accelerate the process and serve more customers. In reality, field inefficiencies result in an extended process because of an incomplete or incorrect field ticket. These consequences include a lengthened collections process and increased DSO. A field hand for a services company accepts a job ticket from a new customer with bad credit. He disregards the customer set-up process to quickly meet the customer’s needs. The field hand submits a half-completed field ticket to the Office Manager with incorrect service pricing. Moreover, the ticket sits on the Office Manager’s desk for two weeks before being sent to Corporate and forwarded to the customer. The result is a hefty dispute from the customer and a three month collection process before finally receiving payment. Trenegy helps our clients identify the gaps between the current process and an efficient and effective process in the field and corporate to decrease DSO and maintain focus on the customer. To read more on Demystifying the Oil Field Services Bid to Bill Process.
Most operational processes in organizations are an amalgamation of collective experiences from other organizations. Organizations grow by either acquiring other organizations or people from other organizations. The acquired people and organizations bring varying degrees of process into an organization. These disparate processes fly in the face of standardization and cripple an organization's capabilities to achieve any level of economies of scale. Executive leadership continues to balance differing perceptions of 'best practices' between departments, geographies, and markets served. Furthermore, executives rarely have the time, methods and intestinal fortitude to align the organization around a standard set of processes. Historical methods of under the guise of "Six Sigma", "TQM" or "Lean Manufacturing" merely add bureaucracy and fail to address the root cause of operational issues…lack of consensus on what is really important for success. Inevitably, these organizations become faced with urgency to address operational processes. Trenegy's consultants have the experience and methods to help organizations address operational issues in a matter of days and weeks instead of months and years. Learn more about our ACE Method in Teaching Elephants to Dance.
Organizations often "over-purchase" when selecting, procuring and implementing software to support day-to-day operations. Furthermore, organizations have unnecessarily embarked on painful and expensive software implementations, only to use less than 10% of the features and functions. Making matters worse, inefficient processes become more inefficient. This is often the result of buying the wrong software, choosing the wrong implementation partner and not taking into consideration the impacts on end users during the selection process. Trenegy can help avoid the common software pitfalls. We help our clients 'short-list' the right software candidates, evaluate software vendors who team with implementation partners through the process, and select to a future state process vision that is realistic, efficient and effective. We work to ensure the implementation approach is realistic and will ensure success – on time and within budget. In the end, Trenegy helps clients select, procure and implement software that will be properly used to support the organization in the most efficient and effective manner. Read more at An ERP Strategy that Works...or Another Round of Mournful Optimism?
A recent study by the Gartner Group has shown that 99% of all process and systems projects that are perceived as failures are the direct result of bad or non-existent Change Management programs. A Trenegy Survey of Oil & Gas organizations having implemented new systems confirms this finding. Many of these organizations have technically correct systems. However, employees find the new systems and processes difficult and have figured ways to perform day-to-day activities in spite of the new tools and processes. Most organizations view change management as a pure 'science' of getting people up the acceptance curve. The 'science' seems reasonably easy to tackle. There are countless books focused on how to identify who is going to be impacted, how much will they be impacted and how to change performance measures to encourage new behaviors. This pure 'science' rarely works. People quickly revert to what they have been doing the minute the project is finished. Organizations often overlook the 'art' of Change Management. Trenegy has found that the 'art' of Change Management is more important than the 'science'. The 'art' focuses on the 'demand' for improvement which is used to drive Change Management activities. Our team work with clients to help ensure the new processes and systems 'stick'. Read more at The Art of Change Management.
Most service companies hesitate to deploy technology to streamline the field ticket process and live with the inherent billing errors and delays associated with paper forms. A service company has manual paper forms to capture basic work order information required for billing. 80% of the work orders contain errors including misspellings of products, incorrect pricing and basic mathematical errors. DSO is over 90 days as a result of invoice disputes. Clearly the company needs to reduce DSO to a manageable level by improving field data capture. Trenegy helps clients develop strategies for deploying field technologies to address the root cause of billing errors and reduce DSO. We have found it all boils down to three things: access, ease of use and rewards. Read more at Crew Pushers and Technology: It’s Not Like Oil and Water.
Every company has data quality issues. Many attempt to solve the data quality issues with the latest and greatest technology solutions. These solutions typically come in the form of a fancy Master Data Management, Enterprise Application Integration or Data Quality Management System solution. A project team of consultants is assembled to implement these solutions. Early in the project consultants come in with a change order requiring massive configuration changes in the company’s ERP systems. Millions of dollars later the problem is not solved. Rarely do technical solutions alone solve the problem. The root cause of most information quality issues is how data is entered as a part of the business process. Data should be consistently captured on purchase orders, invoices, expense reports, etc. to ensure information quality. Trenegy has helped various organizations with improving their business processes with the ultimate goal of information quality. The most important piece of information quality is defining the metrics that matter. Please read more at Metrics that Matter.
Business Intelligence (BI) is like the weather; everyone is talking about it, but no one is doing anything about it. Frankly BI means a lot of different things to a lot of different people. The IT department thinks about data warehouses, dashboards, multi-dimensional analytic tools. The Finance people tend to think about key financial metrics. Executives think about dashboards. Most BI efforts tend to be implemented in organization silos. Each silo has a completely different set of technologies ranging from desktop tools to large scale data warehouses. Moreover, each silo has a differing view of which metrics matter. The silo approach to BI causes confusion in the organization and an overabundance of reports and information under the guise of BI. Trenegy works with our clients to establish an enterprise view of BI that ties the organization strategy to measurable results. This starts with developing a Reporting Strategy. Read more about our view on BI at Roads? Where we are going we don’t need roads and What are you hiding? Finding Metrics that Matter.
Training and Acceptance
Most companies implement new systems only to find the solution is a complete failure. People aren’t using the system and are doing as much as possible to bypass the system. A service company implemented a state of the art maintenance management system. Several years later new regulations required standardized maintenance reports. Management initially felt that the system would easily support the new requirements. However, they found the data was incomplete and inconsistent across the company. A task force determined employees were not using the system correctly. Further analysis revealed a lack of training and acceptance during the implementation. During a new system implementation, most of the attention is given to the system’s design and configuration. Training budgets get cut and acceptance is an afterthought. Trenegy helps companies develop effective training and acceptance strategies to ensure the successful implementation of new systems. For more information on training and acceptance in ERP implementations, please see our perspective But I Bought a Bowflex.
Success starts with aligning the organization for improvement to realize sustainable results. This is Trenegy’s philosophy when working with our clients when equipping them for growth and change. Select any of the above to read more about Trenegy’s service offerings.