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Posts Tagged ‘International Finance’

Power of Collaborative Diversity

Mr. John (Giancarlo) Meazzo, M.A GMA’s President  provides executive coaching in financial management, operations and business management.   He always shares business concepts and theories with his clients.

To achieve success, business owners need the expertise of other professionals in the various disciplines of business.   Example of this concept: American and British mathematicians were brought together to decode the secret codes of the German electro-mechanical device called Enigma.   These mathematicians were unable to decipher the codes.   Later the secret service brought professionals together from different walks of life such as professors, crossword enthusiasts, linguists, and chess champions to crack a secret coded Nazi device.  They decoded the Enigma codes three times!   This is an example of the power of collaborative diversity.

Power of Collaborative Diversity offers individuals an opportunity to create plans for change at the organizational level.  It allows for a deepened awareness of how your own thinking, experiences, and beliefs can either hinder or contribute to success.  The goal is to benefit from a collaborative, systematic approach to assessment, visioning, and planning for change.  Organizations that are committed to leveraging diversity will tap into the richness of multiple viewpoints, create supportive learning- centered work environments, and ultimately multiply their capacity to achieve their mission.

Stagnating, uncertain of the future?  No direction, no goals, feel like you slipped into a fog bank or the doldrums?    Success is made of phases.  Motivation is key for survival and success.  Motivation will drive (spark) your spirit, soul and heart to want to succeed.   You need to be your own catalyst.   You need to want to make something happen.  Nothing will happen unless you want it and make it happen.  Collaborative diversity is a tool used to plan success such as in Strategic planning (a key element to you’re your success).  It is just but a phase in the hierarchy of success planning.

“Power of Collaborative Diversity brings together in a three dimensional model the diversity of experiences that are present as a result of cultures, ethnicities, educational and professional background as well as the breadth and depth of the levels of intelligence, knowledge and experience.   The result is an interlaced collaborative exchange of thought and ideas that bring about solutions to problems and changes in the standard methods and thoughts”  quote of Giancarlo Meazzo, M.A.


 

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Operational Indicator Reports (OIR) or Key Performance Indicators (KPI)

Operating Indicator Reports (OIR) also know as Key Performance Indicators (KPI) is to companies as EKGs, blood test and other medical tests are to humans.  Dashboard is another term used for OIR and KPI.  Mr. John (Giancarlo) Meazzo, President of GMA3000.COM, is the guru of budgeting and financial management. He developed various budgeting and KPI systems for companies with $1 million to $3 billion in revenues.    The premise for KPI reporting is to have each department of the entity report statistics, e.g. what they generate as output, labor productivity and others. Statistics would include personnel turnover ratios, departmental productivity ratios (productive hours/volume of output), financial ratios (these may be reported as part of the financial reports [i.e. income statements, balance sheet, etc.]).

KPI data or statistics are the heartbeat of any organization. Business activity volumes, productive hours and other statistics are captured and reported in the KPI. The statistics reported in the KPI can be used to understand the effects of changes in business sales strategies, management turnover, the way business is transacted, changes in policies, turnover in staff, productivity changes as a result of new policies, new management or supervisors, etc. The fluctuation in the statistics and correlation between them can help in pinpointing problem areas, e.g. productivity, turnover, and others. Example: If in a department, the total production output increases with the same amount of staff (productive hours); it may be due to changes in operation, new equipment, a new manager that is better in managing the human resources, etc. It could also denote that the staff had not previously been working at full capacity or productivity.   The question is what is the optimum staff productivity? What amount of output can staff produce?  When does the employer add new staff or reduce staff, at what level of activity?  Capturing historical statistical data is the key to answer some of these important management questions.  This information should be used to determine staff productivity levels and use this for budgeting purposes (determining staff needs based on projected sales volume).  Statistics can assist management in identifying changes in productivity, trends, business volumes of transactions, and they will facilitate pinpointing sources or effects of such changes.

Statistics should not be shown as static numbers, rather as rollover numbers showing monthly beginning balances, additions and decreases (by segments) and ending balances. Example – staffing reporting: for an entity with 300 employees, the report would show monthly, the beginning number of employees, the employees that left the company, reported by reasons of departure (voluntary and involuntary, etc.) and the number of hires and number of vacancies to be filled.  Example: a large percentage increase in involuntary departures in a particular department may be caused by the hiring of an inexperienced manager lacking supervisory skills.  You can compare your employee turnover ratios to the industry standards, departmentally or by period (month to month, year to year).   Governments around the world use statistics for understanding the changes in their economies.   Economists use them to make economic predictions.

The statistics in the KPI also become the basis and the first step in the preparation of operating budgets. Statistics drive the development of the revenue budget which in turn is used to prepare the expense budget.  This is typical but could differ upon industry e.g. grant based non profits. Financial models using this data are easy to develop and to change based upon various factors. With statistics, the correlation between primary units of service (UOS) to the secondary UOS can be calculated and makes the budgeting process a much easier task. Example:  hospital in patient days (primary UOS) will affect the ancillary (secondary) UOS such as radiology, lab and physical therapy.   If there is a correlation, once you budget the primary UOS, it would be an easy task to project secondary UOS.  GMA has over 120 combined years in development of KPIs, operating budgets and financial modeling. They implemented various KPI reporting systems. Mr. Meazzo personally developed and implemented fixed and flexible budgeting systems, break even models and provided ‘turn around’ consulting services to for profit and nonprofit companies.

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