Profit Improvement in a Week by Tim Levey
Book Review - 3.5 Stars
Tim Levey sets a demanding objective for his book - Profit Improvement in a Week and whilst I didn't expect to see profits double that quickly, I did expect the book to point to a clear fast-paced profit improvement methodology.
The book is from a series by the Chartered Management Institute which is designed to bring essential skills to the managers with too much to do and not enough time to do it.
The intention is to take the reader through simple steps for profit improvement in manageable bite sized chunks.
I agree with "Profit Improvement In A Week" that there are three key phases in a profit improvement process:
- Information gathering
- Idea generation
But I don't agree with the way the profit improvement work is phased over the week.
Let's quickly go through day by day:
- Sunday - why a profit improvement process is needed, the benefits of staff involvement and why suggestions schemes often fail
- Monday - incentive schemes
- Tuesday Intentions review - where is the business heading, analysis of customers and your revised future
- Wednesday - Issue identification - from your accounts, from general observation, from staff surveys and interviews, customer interviews and focus groups and a review of systems and processes
- Thursday - ideas generation - how to organise a profit improvement workshop. I love the rules for delegates and facilitators
- Friday - implementation of the profit improvement plan
- Saturday - inspection of the process
Perhaps my problem is that this isn't the way I do it and I'm suffering from a "not invented here" problem but I don't think so.
This Profit Improvement in a Week work plan doesn't fit into the three phrases since the first two days are mainly spent explaining why you should involve your team in your profit improvement plans and designing incentives.
I'm not against team involvement but I do believe that there is a right time and a wrong time for involving your team.
It all depends on why you want to start a profit improvement program:
- Your business is doing nicely but you believe that it could do even better.
- Your business is breaking even or a little better after paying you a fair return for your time but you are not making the money that you expected.
- Your business is in trouble. You are losing money or the only reason you are not losing money is because you have reduced your salary to a subsistence level or below.
As you can see, depending on the size of the flow of profits into your business (or the losses flowing out), the urgency of the profit improvement program changes.
But it also depends on the wealth of the business, its existing financial resources and your own financial health.
In some ways it doesn't matter to a multi-millionaire that a small start-up doesn't make any money. He has other resources to fund the losses in the business and to support his day-to-day activities.
It does matter to the small business owner who has borrowed as much as he can to buy a business that doesn't turn out as expected. Without any other source of income and no financial nest egg to fall back on, the business has to be turned around and turned around quickly.
But involvement of more people slows things down and while you will get more ideas, you also risk opening up disputes and wasting time trying to build consensus when you don't have the time to waste.
If your business is doing well then the involvement based profit improvement process presented in this book could work well. If the business losses are a tiny fraction of your wealth, then again you have the time to take the team involvement approach.
But if you don't, you need to be taking more decisive control and leading your team away from the precipice.
You don't see Indiana Jones call his group together for a chat when one pilot has been shot and the other parachuted out of the aeroplane. He takes control and he takes action.
I think this is my problem with the book. The title "Profit Improvement In A Week" indicates one thing, the contents of the book delivers another.
Anyone buying this book as a turnaround guide is in for a disappointment.
I still have some doubts over the sequence, even if we are going for a full participation profit improvement process. My own Eight Pillars Of Business Prosperity model looks to answer three questions in sequence:
- Where are we?
- Where do we want to go?
- How do we get there?
Staff involvement and their ideas for improvements and any associated incentive schemes are part of the answer to question 3.
If you don't know where you are, then you don't know the problems you have to solve or how quickly.
If you don't know where you want to go, then you don't have a filter for your ideas.
The Profit Improvement In A Week book has some strengths:
- It focuses attention on the process improvement process rather than a set of random actions.
- Staff involvement backed up with the appropriate incentives is a great way to move the business forward if you have the time. It's also effective if you keep the involvement process tightly focused on particular problems e.g. how do we improve our customer service?
- There is a nice example of a simple staff survey. It's good to know what your team think.
- The section on the profit improvement workshop is a good guide for you to run your own day and I particularly like the workshop rules for delegates and the facilitator.
- The two final days focus on implementation and measurement which emphasises the point that the real work is done after the workshop and after the profit improvement plan is put together.
Summary of Profit Improvement In A Week
I rate Profit Improvement in A Week by Tim Levey with 3.5 stars which counts as a cautious recommendation.
It is suitable for people who have time to involve their team but it is not a turnaround book.
I don't believe that it deliver on its title Profit Improvement In a Week but I think that's a virtually impossible task. It's only 96 pages long and I would have liked the book to have listed suggested sources for more information.
If you need more advice on turning around your business and you are looking for an easy book to read quickly before talking to specialist turnaround advisers then I recommend "Turning A Business Around" by Mark Blayney and also available from Amazon.co.uk and Amazon.com affiliate links)