Clarity

Welcome to Clarity! You’ll need to set aside a good hour or so to complete this diagnostic. Once you’ve started you’ll need to complete the assessment in one session – so you could look at what information we need on this first page so you have it to hand to start.

We’ll collect some data about your organisation first, before you start the assessment. Please answer as honestly as possible – from your own gut feel, or if answering as a team – from a majority position.

Once you’ve completed Clarity, we’ll be notified you’ve finished, and we’ll then build your snapshot and email it over. You can then assess your strengths and where you currently spend time and energy – and you can reflect on where you might best spent time and energy in the forthcoming year in order to address any neglected areas you feel are of importance to your organisational capabilities.

We recommend you return to Clarity as an annual exercise – as part of your strategic management of your organisation.

Enjoy and good luck!

Marketing

Aim 1: Dealing with customer feedback, such as queries and complaints

Customer feedback may be received through sales representatives or through ‘official’ feedback channels such as the internet, email, or telephone. However, if products are sold indirectly, e.g. through independent retailers, it may be difficult to obtain feedback, apart from crude sales figures. Actively stimulating customer feedback may be achieved through focus groups, notes attached to products, internet pages, etc. Customer information may be dealt with individually, by the receiving employees, or through software, for instance customer relationship management (CRM) systems. How do you deal with customer feedback?

Aim 2: We monitor our competitors’ products/services

The first step of ‘monitoring’ competitors is to identify them. It is often difficult to say which products/services, and which firms are in direct or indirect competition, as customers may not just opt for the same product /service offered by another firm, but they may also change what they consume altogether and purchase ‘substitute products’. Monitoring competitors may include analyses of current competition, possible future rivals, and substitute products and markets. To which extent to you monitor your competitors?

AIM 3: We do market analysis for new products/services

Market analyses may include customer questionnaires or focus groups, testing prototypes, collaboration with customers in the product development stage, launching new products on test markets, or buying in information and analyses from consultants, etc. To which extent do you do market analysis?

AIM 4: We produce/use marketing plans

Marketing planning refers to the production and implementation of formal planning procedures, usually comprising a number of steps ranging from the setting of organisational goals, analyses of the internal and external environment, segmentation of the market, targeting of a particular customer group, and the positioning of the firm in relation to its competition. Marketing plans may include strategies for the development of products and services, prices, distribution and advertising.

AIM 5: Marketing activities are evaluated for their effectiveness

The control and evaluation of marketing activities is often regarded as an important aspect of an organisation’s marketing activities. Evaluations may focus on the progress and effectiveness of the marketing plan (e.g. annually as part of a five-year plan), the profitability of products/services, the efficiency of marketing expenditures (e.g. advertising), and strategic control to check whether the company is pursuing its best opportunities with respect to markets, products, sales channels, and the overall effect of our marketing activities on the organisation: Are we achieving what we did hope to achieve? How do you evaluate your marketing activities?

AIM 6: We segment the market and identify our target customers

Customer groups can be segmented in a variety of ways, for instance according to age groups, disposable incomes, fashion styles, etc. Sophisticated segmentation approaches may involve complex mathematical models. Segmentation may help to develop customer-focused products and direct advertising. However, ‘identifying’ customers remains difficult because of changing consumption patterns and the general unpredictability of trends.

People

Aim 1: Evaluation of staff training/ development needs

Many organisations readily invest in training and developing their staff but do so without relating such training to the strategic needs of the organisation. Evaluating what staff training and development is needed in order to effectively drive the business forward in both the short and long term. This is also likely to make the costs of staff training/ development more efficient.

Aim 2: Provision of staff training/ development needs

The recognition of the importance of staff skills and abilities has been stimulated by the demands and challenges of business today (e.g. technological change, organisational efficiencies and increased levels of overseas competition). Thus, continuous investment in staff training and development often underpins the ability to compete in many business environments.

Aim 3: Staff appraisal

Staff appraisal takes many forms and is not always beneficial either to the organisation or the employee. Thus their introduction and operation usually needs careful consideration. Where such schemes are seen to be beneficial their continued success usually requires constant monitoring.

Aim 4: Team working

Formal team working is not necessarily beneficial in all situations. However where this approach is undertaken it can provide the basis for improved productivity and commitment particularly where there is a need for knowledge sharing and flexible interaction between staff.

Aim 5: Staff recruitment

Finding the ‘right’ person for the job is no easy task. Getting this process right is an ongoing problem for many employers and employees. In an environment where competitive advantage is seen to stem from the people working in an organisation paying attention to recruitment issues becomes paramount.

Aim 6: Staff consultation

Creating effective lines of communication has long been recognised as an important aspect of the efficient running of organisations. Enabling all staff to receive and give information can provide the basis for better informed decision making at all levels of the organisation.

Aim 7: Employee relations

The foci of employee relations are the disputed (by management and employees) sources of power and legitimacy, rights and obligations in the workplace. Dealing with such issues whilst avoiding disruption is often challenging and requires time and effort.

Innovation

Aim 1: We develop new products or services and new ways of working

Developing new products and/or services is a key issue for many organisations. But even firms that do not engage in product/service development are often faced with the need to evaluate and re-design their ways of working. There are many ways in which new products/services/processes can be developed, ranging from unstructured, ad hoc approaches to planned and structured innovation processes using, for instance, market testing, prototyping or business process reengineering. Moreover, innovations do not necessarily need to involve big changes; they can also consist of regular, small alterations to the way things are done.

Aim 2: We actively pursue knowledge management

Knowledge management activities aim to convert basic ‘information’ into organisational ‘knowledge’. Knowledge management activities and policies consider how an organisation generates and stores information. Attempting to ‘manage’ organisational knowledge involves the identification of communication paths inside the organisation and of key employees (gatekeepers or boundary spanners) who are responsible of the collection and dissemination of knowledge. Mechanisms to manage knowledge can range from written procedures, review forms, consultancy reports, to complex databases. Knowledge management may also include tutorials, apprenticeships, job rotation, regular meetings and interdepartmental exchanges and cooperations, for instance with Universities.

Aim 3: We engage in continuous improvement activities

Continuous improvement principles have long been a key aspect in larger organisations, for instance in the automotive industry. Continuous improvement programmes require the involvement of employees from all levels and areas working together to identify improvement potential on a regular and structured basis. Successfully employing continuous improvement activities moreover necessitates a positive attitude towards mistakes and failures and the creation of space and time for employees to reflect and discuss possible improvements. It should also involve processes that ensure that suggestions are taken seriously, information is fed back to employees regarding their suggestions and incentives for successful improvements. These can be monetary, but also through recognition in newsletters, team meetings etc.

Aim 4: We use benchmarking

Benchmarking is intended to provide a comparison of organisational processes and practices with those of other firms. Benchmarking can take a variety of forms, ranging from company internal comparisons to other firms, industries or geographic locations. At a strategic level, organisations can use benchmarking information to measure, compare and set realistic performance targets. Benchmarking may also utilise the identification of ‘best practices’ and processes in need of improvement. Benchmarks can be conducted internally or by acquiring industry information from other sources, or by employing consultants or university partners to gather individualised information. This may also include technological systems to ‘watch’ competitors in an automated fashion.

Aim 5: We have a creative and learning culture

A ‘learning’ organisation engenders a creative and innovative atmosphere. This aim focuses on encouraging a learning culture. You should reflect on the ways in which people learn within your organisation. The creation of a climate in which employees have a desire to learn and an organisation that shares its collective knowledge for the benefit of the business and the individual is desirable.

Aim 6: We monitor technology changes within our industry sector

Changes in technology can provide businesses with more efficient ways of providing services or manufacturing products. However, the costs of technological investment have to be reconciled with the potential savings. In some industries technological advances have to be embraced in order to remain competitive but managed carefully in order to analyse the return on the investments and the depreciation of value.

Operations

Aim 1: We make use of external bodies to provide business advice and support

A small business may involve external bodies in a variety of ways to support their organisation. External involvement can range from advisors such as financiers, lawyers, consultants, academics, to advice agencies such as business link, chambers of commerce, domestic and international trade associations and various professional bodies. The impetus to involve external bodies may stem from legal requirements or customer demands, for instance in the case of accreditations. It may also be based on the need for external guidance or the need to justify important and difficult decisions. While external involvement may offer a variety of benefits to an organisation, these may also be costly, time-consuming and involve risks. To what extent do you involve external bodies?

Aim 2: We manage our communication techniques

Internal and external communication is often argued to be of great importance for any organisation. Difficulties may arise when different departments (e.g. finance, sales) and people (e.g. managers and staff) appear to speak a different language. While in many small and medium sized businesses internal communication may be enhanced by smaller numbers of staff who usually know each other, fluent communication with suppliers, customers and other stakeholders (e.g. banks or other finance providers) may be difficult to attain or may not receive as much attention. Some organisations therefore place great effort on developing their communication techniques in order to present a coherent corporate ‘identity’ to the outside world, also attempting to ‘nurture’ internal communication. How do you manage your communication techniques?

Aim 3: We have a business plan

It is often argued that a planned approach to running a business may be advantageous to a non-planned, or emergent approach. However, developing a business plan may not only be seen in terms of increasing a firm’s performance. Business planning is also argued to improve internal communication, stimulate reflection about the organisation’s development and it may serve as a useful means of representing the organisation vis-à-vis funding bodies when raising external finance. Various forms of business planning are available, ranging from static plans that span several years and detail strategic intentions and tactical measures to dynamic and informal business strategy approaches. What is your approach to business planning?

Aim 4: Performance is measured against key performance indicators

Keeping control of an organisation’s performance is important for the discovery of growth areas and of organisational aspects which need improving. However, is often difficult and impractical to attempt to measure every aspect of an organisation’s activity. It is therefore often argued that only a handful of ‘key’ performance indicators need to be identified to provide a good indication of an organisation’s development. While this makes sense in theory, it is often difficult to identify such ‘key’ areas of success as they may change from organisation to organisation. Common performance indicators are: price earning rations, number of defects, client retention rates, marginal cost units, value added per employee and turnover per employee. What is your approach to performance measurement?

Aim 5: We follow an accredited standard

Accreditation may serve a variety of purposes for a small and medium sized business. Implementing standards such as ISO 9000 (2000) , ISO 14 001, or Investor in People can support the reflection upon and, ultimately, the improvement of an organisation’s processes. Accreditations may also serve as a prerequisite for gaining new business and are an indispensable component of many tender specifications. Moreover, accreditations may help to attract and retain a motivated and skilled workforce and demonstrate a company’s commitment to quality to funding providers and potential partners. What is your approach to accreditation?

Aim 6: We evaluate the quality of our own suppliers

Many larger organisations have detailed supplier evaluation and control mechanisms. While it may be more difficult for small and medium sized businesses to exert control over their suppliers it can still be beneficial to regularly evaluate their quality. This can be particularly important for organisations which rely heavily on a small number of suppliers and for those firms who source highly manufactured goods and only add little value of their own to finished products. Evaluating suppliers may therefore be helpful in avoiding defects and customer dissatisfaction. It may also help to prevent sourcing problems if key suppliers experience difficulties. The evaluation of suppliers may furthermore not just be a bureaucratic burden, but may lead to improved cooperation and communication between firms, joint development of improved products and processes, and may reduce cost in the long term.

Finance

Aim 1: We monitor basic financial performance

Financial analysis helps to build a picture of the financial health of a business. Such measures include profit/sales; profit per employee; product/service profitability; return on capital employed (ROCE); inventory levels; creditors/debtors; budget-vs-variances and customer profitability. Cross referencing different measures allows management to assess position and potential. Cash-flow measures, for example, can give an idea of an organization’s liquidity, whereas a price-earnings ratios and ROCE figures give a rough idea of both of the productivity of an organization and its potential to use its assets to create new business opportunities. Financial analysis is vital for an effective growth strategy. By linking a variety of measurement techniques allows for more informed decisions to be made.

Aim 2: We use multi-criteria measurement systems, ie; financial with non financial elements (e.g. Balanced Scorecard/ Business Excellence Model).

These systems include non-financial performance as important aspects of business performance (e.g.: leadership or management operations). Multi-criteria assessment models enable an organization to identify how others (employees, customers etc.) view its performance across a range of activities. By attending to these an organization can further improve its ‘bottom line’ performance. This type of measurement system is important to organisations who consider CSR of value to their business activities.

Aim 3: We use market-based cost management techniques

These allow management to understand more fully the costs of producing a single product/service; or of supplying a specific customer, rather than simply breaking down costs using a fixed ‘overhead’. Examples include: marginal cost pricing; cost of quality; activity based costing; life cycle costing; target costing. These techniques allow an organization to integrate the design, production, marketing and delivery of products and services with cost controls.

Regulations

Aim 1: We have a risk management policy

Being unaware of risks undermines an organization’s capacity to influence its future. A risk is an event which can be described as being hazardous or harmful to the organisation and the people involved, there are often ways in which an organization can plan for such risks that may become disasters. A risk policy combines separate, regulation compliances into an integrated whole, and then combines them with policies for dealing with business risks. A simple risk management plan involves: identifying where there are risks involved in the work you do, such as working with computers – loss of data or system failure, employees eye strain, bugs and hackers; so identifying who or what may be harmed and how; the determination of a response (typically seen as transferring, mitigating or accepting the risk) and the review of the effectiveness of responses.

Aim 2: We understand our regulatory obligations under health & safety legislation

This is a basic requirement. Organizations need to check with the Health and Safety Executive as to existing and emerging regulations. This may involve undertaking an audit of existing organizational practices. Broadly, management is responsible for: ensuring the workplace is free of risks; ensuring processes and machinery are safe; ensuring articles are stored, moved and used safely; providing adequate welfare facilities; give necessary instruction and training.

Aim 3: We have a health & safety policy

A policy is a signpost to compliance, shows evidence of forward planning and offers routes to correction and revision. It is a legal requirement in businesses employing five or more people. A health and safety policy is intended to ensure an organization is able to continually improve its health and safety performance. The benefits can include: lower costs and fines; evidence of good management; increased investment potential; better workforce motivation; improved market profile and lower cost of capital/insurance. At a minimum, a policy should ensure regulations are complied with; that employees are given personal responsibility for performance for which they’re held accountable; that employees are made aware of their responsibilities to take reasonable care, use equipment correctly and co-operate with their employers. The policy should be relevant to the organization’s activities and products and services and reflect its prevailing values. The focus is upon minimising exposure to dangerous/risky situations/activities and preventing all accidents from happening.

Aim 4: We meet our obligations under environmental legislation

This is a basic minimum. Organizations needs to check with the Department for Trade and Industry, the Environment Agency and/or the Department of the Environment and Rural Affairs as to existing and emerging regulations. This may involve undertaking an audit of existing organizational practices.

Aim 5: We have an environmental policy

As a minimum, an environmental policy should ensure regulations are complied with. The policy should be relevant to the organization’s activities and products and services, and reflect its prevailing values. The focus is upon reducing the use of materials and energy used in the product and service and its production and delivery. Specific consideration can be given to: reducing the contaminants (chemical, radiological, microbiological and mineral) and so their potentially harmful effects on people, flora and fauna, the built environment and natural habitats.