Resource Audit – A Story
To close out this content series about resource audits, how about a mini case study… a story, if you will, about a resource audit applied?
A software business with an established product in its chosen market. The management board had a development plan for a new product, and data to prove a market for the product. Now they just had to somehow use their available people, tools and money to build it.
How to do this without removing necessary attention and efforts from their bread and butter business?
The first idea was for the founder – and current CEO – to do it all. After all, he had built the original product that was now so successful. And this wouldn’t force his people to have to split their attention between different work contexts.
So: the CEO was going to code, build and then even sell the product.
We created a work plan based on the company’s launch schedule and expected growth with early adopters. Even allowing for wiggle room, the CEO would have been working close to 20 hour days by their second client.
Other parts of the business would continue to require his attention, and time is a finite resource. This analysis allowed us to understand within what boundaries we had to maneuver and made the rest of the planning much easier. Decisions were made knowing that time was being allocated realistically.
Every part of the business requires its ongoing funding. How could the team develop, market and ship a new product without removing too much capital from the other business units? This product was something completely new, so at first it would only be an expense without bringing in revenue for some time, or profit for even longer.
This client had worked with me before, so we already have created separate bank accounts for its various expenditures and business units. We knew what the minimum required in each account was, how much it needed to receive each month and what acceptable profit or loss levels were.
We revisited the numbers and determined what amount of that profit each account could comfortably do without. Then we opened an Innovation Budget account and started allocating a percentage of funds from other areas of the business to that account.
The safeguards already in place ensured they never moved too much money or financially cannibalized other parts of the business.
All their employees were full time. In other words: they all already had full time jobs. How could they contribute to the new product effectively and still keep doing their jobs?
During the first part of the People Audit I had the company look outwards as well as inwards. Each business has all sorts of partnerships, with clients, suppliers, business peers and more. Where could these relationships be further maximized?
We looked at what was in the work plan for the new product, including various tools, feedback needs, information and learning. Several of their external partners could contribute to these areas as part of their natural collaborations already.
Internally, we found the same to be true: by tightening and adapting processes, employees could be performing work that applied to both old and new products, without adding extra burden. In effect, we increased overall productivity without increasing working hours.
The management already knew that their current clients would not be the early adopters of this new product. Would they have to target a whole new market from scratch to get this venture off the ground?
We analyzed their current reach: the client relationships they had were strong and word of mouth was currently driving a good portion of their business.
So we decided to use this.
These same clients could still help drive word of mouth. It would just have to be about the brand, the service, the people and expectations rather than the product itself. We built a communication plan to connect to potential end clients through their current clients and thus maximized the reach the business already had.
A resource audit proved fundamental to effective planning for this client’s new product. It ensured the team remained in control of and happy with their work. It kept costs and cashflow well-managed. And it meant that nobody ended up burning out from work overload.
Feedback loops with current clients were set up early on, with regular requests for referrals or introductions to the key market for the new product, and the client met their deadlines.