Our Services

Profit can be considered a dirty word by some, and Profit Optimisation a somewhat pompous concept thrown about by motivational speakers. At Sherwood’s we view Profit Optimisation as “Unlocking the Potential” warranted by doing business.

There are numerous useful measures of business success however the definitive measure is making a healthy profit relative to the market you trade in. Making a robust return on the capital and hard work invested, often with the sacrifice of time with family and friends, is simply essential for business longevity and personal satisfaction. We have witnessed many talented, hardworking entrepreneurs focus on sales growth, product development, acquisition, the next “project” etc. believing profitability follows. After all “look after the pennies and the pounds will look after themselves” can be pretty mundane. However Sherwood’s believe leakage or waste pose significant threats to profitability.

Sherwood’s first priority when reviewing businesses is retention of income earned; Net Profit. We look for leakage of income and waste. Reviewing the people, productivity, processes and policies that influence income retention can significantly improve the bottom line, quickly and at low cost. Operational areas that Sherwood analyse are use of working capital, debtors management, payroll processes and costs, the cost to sales ratio by employee, use if infrastructure, currency and relevance of SOPs, amongst others.

Optimisation of Net Profit results in increased monies in the bank quickly and more than this, it provides a rock-solid foundation from which to focus on business growth.

A business’s Net Profit is the fundamental measure of success and should be a key motivator for all working in the business.

Sherwood believes that sales growth of less than CPI plus 5% indicates the business is at risk of entering life-cycle decline. Strategic Business Review, documentation of Business Plans, and measurement of outcomes against the plan parameters are essential to Risk Mitigation and Growth. The adage attributed to Benjamin Franklin, the father of time management, “Failing to plan is planning to fail,” is just as relevant today as it was in the 1700’s.

The speed of market change and low barriers to entry of competitors requires a more rapid adaptation of products, services and systems. Customers and employee expectations are high and move with market change. We believe the adoption of a strategy that analyses business requirements and market conditions must be entrenched in the business, i.e. key personnel should constantly look at the day ahead, the week, the month, the quarter and the rolling twelve months. This approach alerts key personnel to client satisfaction, product changes, service needs and employee productivity before sales and business growth are at risk. It offers the basis of passive strategic review.

While passive review should be entrenched in the business it doesn’t negate the need for annual formalised Strategic Business and Risk analysis. Strategic Business Analysis outputs should include business plans and budgets for Sales Growth and Risk Mitigation, for a defined period. Sherwood BBC is experienced in facilitating Strategic Business Reviews and documenting business plans with senior management, and where required, can take the plans to implementation.

Organisational Development is the alignment of people and processes to the business objectives identified in its Strategic Business Plan. It is the investment in a systematic approach to improving organisational effectiveness (people, processes and productivity) resulting in improved Net Profit.

Organisational Development is not difficult to implement however it does take sustained investment of resources; expertise, time and capital.

Investment in Organisation Development should result in sales growth and improved staff retention, client satisfaction, and productivity and ultimately increased Net Profit. It requires analysis of the workforce’s understanding of businesses goals and objectives, the matching of skills to tasks, training to overcome identified competency gaps, systems development to support consistent quality delivery of products and services, and most importantly, it requires robust channels of communication between management and employees, and employees and management.

The old adage “our people are our most valuable asset” while a little trite, remains fundamental to business success.  Conscientious management of our human resource will not only increase sales and retain profit, it ensures competitive market advantage and generational sustainability.

Making a healthy Net Profit is the critical driver to investing in business, and the key resources businesses have to earn income and retain profit is its people; its human resource (HR).  Management tends to focus on sales revenue. This overt sales revenue focus tends to result in employees working in the area of sales and production enjoying 80% of the businesses HR focus and probably costing 80% of the payroll, however the 20% who are responsible for retention of income processes (Profit Optimisation) are often neglected.  Retention income personnel (administration) may even consider themselves not significant to business outcomes resulting in work apathy, employee dissatisfaction and ultimately profit leakage.

The business’s Human Resource showcase the business and its products to its customer database; they are frontline with your customers. They reflect business culture, make sales, directly impact productivity, can be responsible for innovation, work with or resist systems and processes, and will determine the costs of staff turnover; in other words the business’s Human Resource directly influences business profitability and market competitiveness.

As a result of their capacity to directly impact business success robust Human Resource Management (HRM) and HRM processes are crucial to business sustainability.  The steps involved in HRM are cyclic commencing with recruitment and selection, followed by induction, through training and development, performance management, salary review and starting again at employee separation, where no stage of the cycle can be neglected without risking impeding Business Growth and costing Net Profit.

The Structure of the Business tends to evolve rather than be planned, a bit like cities such as Paris. It’s rarely subject to strategic review and restructure unless forced by declining profits, changes to market demand or acquisition and merger.

Business Structure encompasses all elements of the organisational structure; its people, leadership, internal channels of commination, SOPs and systems, tools and infrastructure and utilisation of products and the customer base. Routine review and potential restructuring offers proprietors the opportunity to reduce redundancy or waste (increase profit), take advantage of market opportunities and will go a long way to mitigating market threats. Viewed in this light, the structure of mature businesses should be reviewed at least annually and when any significant change to the business is being considered. It can be used to reinvigorate the business life-cycle of mature businesses preventing decline and should be used more regularly in start-up businesses or businesses experiencing rapid growth, to ensure growth is turned into profit.

Conducting and actioning the outcomes of a simple Review of Business Structure(s) is certain to reinvigorate the business, re-energise the management team, engage employees and, highlight weaknesses and potential threats.

Operating Systems and Procedures like Business Structures tend to be planned at start-up then evolve in a semi-haphazard manner.  An additional complication is that they can “fly under the radar” often being implemented by employees, and without the knowledge of an appropriate level of management aware of immediate impacts on the Business and its planned direction.  Development and entrenching of SOPs and Systems in this way leads to; inefficiencies, with people endeavouring to achieve the same outcome using varying tools; lack of documentation and therefore ineffective on-boarding and training; redundancy, where SOPs are duplicated; degradation of the quality of outputs as a result of the evolution or dilution of SOPs; and employee confusion; to identify a few sources of waste.  Waste is non-bankable profit.

There is however a “fine line to be trodden” when considering taking permission away from frontline employees to developing SOPs and Systems, and that is, that senior management become or are seen to become overly autocratic, discouraging of innovation, tight-fisted, or engendering a culture lacking trust.

Management’s predicament lies in striving for lean business management, balanced against encouraging employee input and innovation. The key to countering this predicament is a business culture that is unified by an understanding and sharing of the business’s objectives, where all employees recognise that they have a voice, and trust and integrity are paramount.   However, changing the culture of a business can take an apparently unacceptable amount of time when change is required quickly and profitability is essential. Sherwood’s Systems and Procedures GAP analysis approach offers a more time-effective and inclusive methodology.