A Systematic Guide to Effective Business Analysis and Forecasting for Management Improvement

We have talked about the informatization construction of enterprises before, with the purpose of better improving marketing efficiency and quality, and providing scientific basis for management’s decision-making. From information provision to the final improvement of marketing efficiency and marketing quality, a scientific business analysis meeting is still needed.


What is business analysis?

“Business analysis” refers to the process of analyzing the company’s operating conditions, looking at the achievement of stage goals and the obstacles and problems existing in operations, and conducting in-depth analysis to provide targeted solutions. In many large companies, there are regular business analysis meetings every month. Most of the participants are leaders of various departments. The next business plan will also be discussed at the meeting.

In essence, the business analysis meeting is a combat meeting and a combat command system for corporate operations. It has one and only one purpose: to concentrate efforts to win the battle, achieve annual business goals, and achieve stage strategic goals.

In reality, business analysis is the analysis content that is most easily criticized as “useless”. Why?

Because many business analysis meetings simply list the completion of last month’s indicators, formally talk about the work content of the past cycle, and cover up existing problems and solutions as much as possible. One thing more is worse than one less thing. Otherwise, the business analysis meeting is still a complete meeting. There were complaints meetings and fight meetings between various departments. After the meetings, there was no actual effect at all. The more the team got together, the less morale and confidence they lost.


Do you also conduct business analysis in this way?

Problems in these business analyzes are mainly reflected in the following three aspects:

Problem 1: Showing off achievements without facing the gap.

In terms of data statistics display, everyone displays performance data that is beneficial to their own performance. Data that is not beneficial to them either does not display, or the display is ambiguous. Unless the leader insists, it is easy to be fooled. Many managers try to cover up as much as possible without being exposed, but only expose it when they really can’t. However, it was revealed at the end of the year that time for flexible adjustment and improvement had been lost, which is a pity.

Almost without exception, the business analysis meeting of every company has become a meeting to show off achievements and express credit; those without achievements recount hard work and tell a touching story about overtime work. For unavoidable gaps, choose to communicate privately.

The reason why no one faces the bloody gap is because they are afraid of losing face and taking responsibility in front of colleagues, and also because the company has no requirements for gap analysis, has not built a budget accounting forecasting mechanism, and has not created a cultural atmosphere of self-criticism. As long as an organization ignores the gap, not only will it be difficult to achieve its annual business goals, but its organizational capabilities will also stagnate.

Problem 2: Directly talk about actions without looking for root causes

At a business analysis meeting of a manufacturing company, when the executives were discussing the specific rework measures for “product quality problems caused by the gold melting process”, we asked the question “Why does this problem occur during the gold melting process?” Silence fell.

If the source of the problem in the gold melting process is not clarified, the root cause has not been found; if the root cause is not found and we directly talk about rework measures, it will be in vain.

At the meeting, some executives suggested that the team leader who had problems should be fired. We asked another question, “After dismissing the squad leader, will such problems no longer occur?” The entire meeting was silent again.

Most people lack the awareness and methods of root cause analysis and would rather trust their personal experience and judgment. So when we talk about gaps, we propose improvement actions, and when we talk about problems, we prescribe prescriptions. This is a typical example of treating a headache with the head, and treating a pain with the foot.

Finding the root cause, especially the subjective root cause, is an extremely painful process. We liken it to beating our own soul. If the company has no requirements, or the management team does not know what the root cause is and how to find it, it will be almost impossible to find the root cause.

Without identifying the root cause and establishing processes to target the root cause, it is almost impossible to completely solve the problem and it will not improve organizational capabilities.

Problem 3: Only looking back but not predicting

At the business analysis meeting of an Internet company, the reporting cadre carefully prepared the content of the gap analysis and gave a relatively exciting report. After the applause, we asked a few questions:

What specific business goals are targeted by the action plan you reported on?

How to check and accept? What are your predictions for the future?

What’s next to achieve your annual goal? ”

There was silence again.

After most companies look back on the past and examine the gaps, they propose slogan-style action plans such as “strengthen…improve…” or propose action plans that do not improve business results even after they are implemented. As mentioned above, we usually call it “fake action” unceremoniously. The reason why we call it “fake action” is because we don’t know when, according to what standards, who to look for for acceptance, let alone what business results these actions will bring. changes.

Feinting is related to insufficient root cause analysis and insufficient prediction of the future. The reason why we review the last battle is to win the battle in the next cycle or even the annual business battle.

Therefore, we need to clearly predict the goals, risks, playing methods, organizational coordination and resource allocation of the next cycle of battle. This is the core goal of the business analysis meeting.


This kind of business analysis meeting can be invincible

There are two types of business analysis:

One is the semi-annual and annual business analysis meeting, which mainly includes five important components

1) Responsible department; who is responsible for business indicators?

2) Business objectives: What indicators are used to evaluate results?

3) Task time: How long does it take to complete the goal?

4) Resource investment: How many resources are available?

5) Business status: How many goals have been achieved? How much is left to finish?

With these five parts, you can clearly show the quality of your current operations and promote the next decision.

There is also a monthly and quarterly business analysis meeting, which mainly includes

1) How have the monthly/quarterly goals of each department and individual been achieved?

2) How effective are the methods and measures adopted to achieve the goals?

3) Based on the completion of the monthly goals, what are the main performance problems and their root causes?

4) How to provide targeted solutions to such problems?

5) What are the special resources that need to be provided, the specific internal division of labor to solve the problem, and the related implementation requirements?

6) What excellent experience summaries are there in this process that are worth promoting?

7) What are the problems solved and relevant experience summaries during the implementation process last month?

So how exactly does it work?

How to hold an efficient and high-quality business analysis meeting?

Only then can we close the gap and successfully achieve our goals?

How can we implement strategic planning and business plans step by step?

If you want to hold a high-quality business analysis meeting, you must expose problems, risks and opportunities. There are three core points:

Goals: Talk about results, gaps, strategic actions and resource allocation against goals. Whether it is January or December, we have one and only one goal, which is the annual business goal.

Risk: What are our operating gaps and operating risks? What are the root causes behind the gaps and risks? What are our actions? Business analysis meetings must solve problems and avoid risks.

Opportunities: Focusing on problems can help us improve our operations, but it’s opportunities that really help us achieve our annual operating goals.

The most important thing about business analysis is to find a list of opportunities that support us in achieving our annual business goals, and then discuss our strategies, actions and resources. The most important thing in business analysis meetings is to focus on opportunities and seize them.

How to build a business analysis system?

1. The management team agrees on the purpose and topics of the business analysis meeting

The essence of the business analysis meeting is to turn goals into results, so its most important purpose is to concentrate on winning battles every month and achieving annual business goals.

Therefore, the core topics of the business analysis meeting should be:

Did you win the last battle?

How does Ru Sheng play? Can the playing method be solidified into the company’s standard operation?

If there is no victory, what is the root cause?

If you had the chance to play again, what would you do to ensure victory?

What are the predictions for the future?

What are the gaps in achieving your goals?

What can you do to ensure you win the battle of the year?

Of course, the business analysis meeting must also create a fighting style that faces the bloody gap, is full of gunpowder smoke, and must follow through on words and actions.

2. Break down KPI indicators into months to provide a basis for judgment during the process of tracking target completion.

In the past, we required companies to break down indicators down to the individual level, down to the month/week/day. The purpose was to make everyone very clear about what their goals are, and their daily work should be carried out around the goals, without making futile actions. It should be noted that this goal does not only have result indicators, which are often difficult to achieve when we focus on the result indicators, but also has process indicators to achieve the result indicators. It is the responsibility of the department to break down indicators to people.

3. Monitor the completion of the overall goal, estimate the completion results, and prompt questions.

We need to look at the achievement of the goal. If the goal is not achieved, there will naturally be problems; if the goal is achieved, it depends on whether the process indicators are healthy. You must know that the result without process is luck, and luck does not always happen.

Enterprises should sort out the generation process of KPI indicators and set process indicators. When using process indicators, you should prompt questions about process indicators and result indicators. For example, although the performance is very good:

Is it contributed by one customer or multiple customers?

Is it contributed by new customers or old customers?

What are the main products sold?

Are there any policy activities for this type of product in this issue?

Why do customers purchase?

Are customers satisfied with the overall service?

Identifying problems through prompting questions is the purpose of the business analysis meeting.

4. The management team must go deep into the bone marrow and grasp the root causes.

For the problems discovered in the fourth step prompts, it is necessary to open, classify, quantify the data, dissect the sparrow, and attribute it to guilt; the specific analysis methods include 5Why, fishbone diagram, mind map, and discussion. In short, the fighting style and standard actions of inquiring into the root cause and never giving up until the root cause is found should be implemented in the cadre team. After forming a habit, we will find that the power of habit is infinite.

However, leaders look at these operating data every day, which often generates more questions and therefore often makes more complex requests.

Suggestion: Business analysis report, focus on five things clearly

1) How much of the goal was actually achieved, who did well and who did poorly?

2) Those who do poorly, do they fail to finish occasionally or fail to finish consistently?

3) If you do well, do you do well occasionally, or is the trend always good?

4) After balancing the good and bad, can the overall goal be achieved?

5) If it cannot be achieved, are there additional resources that can be invested?

In this way, leaders can arrange their troops based on the results of business analysis, rationally arrange resource investment, replace people when necessary, increase investment when necessary, and apply for foreign aid when necessary.

The management team must be able to formulate improvement measures for the root causes, and the criterion for judging whether the improvement measures are effective is: they can use these measures to solve the problems that have been discovered, and after these measures are implemented, they can also prevent the recurrence of currently foreseeable problems.

In short, the responsibility of managers is not only to solve problems that have occurred, but also to routinize exceptions by establishing process mechanisms to ensure that similar problems will not happen again in the future for all employee departments.

5. Master methods of prediction and effective action

The review summary and gap analysis of the business analysis meeting are for winning the battle in the future, so they are crucial for future predictions. The purpose of annual rolling forecasts is to reveal gaps and risks in advance.

What is a forecast?

Forecasting is the soul of management. Accurate forecasting helps companies make correct decisions, optimize resource allocation, and help achieve business goals.

How to make predictions?

Forecast is based on the business plan and serves the business plan. It is the monetary expression of the business plan. The rolling refresh of the business plan is the basis for financial forecasting. The business plan here mainly includes ordering, requesting goods, shipments, procurement, delivery, product development, payment collection, investment plans, etc.

Business managers in many companies have little awareness of forecasting and are not used to applying forecasting methods to manage their business; on the other hand, due to insufficient exploration of budget management methods that are in line with the nature of the business, forecasters do not have a deep understanding of business needs and cannot allow business managers to use forecasting tools to implement management improvements. . Therefore, high-quality forecasting requires the integrated and coordinated operation of finance, business lines, and human resources.

How to use prediction?

Managing business plans, goals and forecasting GAP is a key measure to manage goals. Monthly routine business reviews need to focus on rolling forecasts, timely discover and provide early warning of problems and risks that have a significant impact on operating results, and formulate clear and executable policies. action plan.

Final summary

Good business analysis will definitely help companies better discover problems in marketing strategies, marketing methods, marketing organization, marketing execution efficiency, etc., and timely find improvement countermeasures, and continuously upgrade and iterate to ensure the continued high efficiency of value delivery.

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