• How is your firm doing compared to the state-of-the-art?
• Where do you stand in the marketplace?
• What needs to change?

Often we assume a benchmark analysis is an engineering study.  While a benchmark analysis can be approached that way, it is more productive to let the financial results speak and thereby direct any purely engineering studies.

Financial Engineering   The starting point to benchmark your company is the financial statements.  We operate in a mature industry in a market economy.  Competition shapes the financial appearance of every firm.  For those willing to listen, there are powerful messages that are revealed with a structured financial analysis.   We build that analysis around a mathematical system that ties together all aspects of your firm.  We call it Financial Engineering.

The most valuable resource in your firm is management time and attention.   Financial Engineering results let you find and set priorities based on the key leverage points in your firm.

It's not magic, its mathematics.

• Return on investment   The starting point for Financial Engineering is to accurately measure your return on investment.  It is the most important benchmark.  This is what counts, beyond all else.  We take into account both risk and return; both return on total investment, and return on equity.
• Sales margin is a component of return on investment.  Sales margin is made up of the profitability of individual product lines and the cost components such as labor, materials, plant expense and the like.  Sales margin must be benchmarked against industry norms and financial requirements.  Typical action items in this area range from new product lines to improved batching controls.
• Asset management.  This is the other half of return on investment.  Producers typically have attractive opportunities here.  Typical action items in this area are improved inventory management and the creative challenge of high land values.

• Margin by product line or market segment Your product lines or market segments typically will fit into four classes.  There are several options for each class.
 
1. Losers   Where you are losing money on a product line, you need to take immediate action.  What are the barriers to action? Do you know the product lines on which you are losing money?
2. Bleeders  Product lines with margins 0% - 5% sap your firm.  You will find the return on investment is terrible.  This has to change. What action do you take?  Start by finding them.
3. Cash cows:  High volume. Built to a precast spec. Workable margin. Cash Cows become Bleeders without marketing management.  Don't let that happen.  It is hard to turn a Bleeder back into a Cash Cow.
4. Stars:          Typically compete with other building systems rather than precast, and at good margin.  They are out there, but you must find them and protect them.

• New products.   If there was a new product in your marketplace that would fill your plant in a few months, somebody would already be producing it.  We have a 7-step process to find new products and bring them to commercial significance.  Stars become Cash Cows that then become Bleeders.  Some become losers.  What happens without a regular addition of new products?
• Benchmarking margin analysis will both show your competitive position and suggest the action steps.
• Bid analysis can accurately determine your competitors' cost.  This provides take-action benchmarks.

• Bring you structured methods to benchmark your firm. -  Know where you stand.
• Apply Balanced Scorecard to your organization.  For more information, click here
• Facilitate the process with your key managers.
• Show what's worked elsewhere.
• Improve your Return on Investment
• Improve your profitability
• Improve your bidding success ratio.
• It's not magic, it's mathematics

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