Unraveling priorities is your recipe for growth
INSIGHT ARTICLE |
According to the recent RSM Food and Beverage Industry Survey, executives indicated improving profitability was a major focus, and in response, many companies are pursuing a variety of strategies to improve their bottom line while addressing consumer tastes and a complex economy. The 179 surveyed executives in the food and beverage industry indicated they would be employing four or more strategic marketplace trends to grow profits, including:
- Diversifying product offerings
- Fortifying sales channels and marketing strategies
- Innovating to meet consumer tastes for more specialty products
- Utilizing social media to promote products
In addition, according to the survey, executives said human resources issues are increasing in scale and complexity for their food and beverage businesses. Labor and wage concerns are impacting the ability to hire and retain skilled talent. Results revealed that at larger companies, increasing labor costs and attracting technical talent were the biggest worries, while at smaller and middle market organizations, leading challenges included:
- Minimum wage legislation
- Labor costs
- Skilled labor retention for the shop floor
Many companies are looking to address these labor issues with a variety of recruiting and training initiatives.
While addressing this imposing list of consumer trends and operational worries might seem like a smart way to stay viable in the market, are companies spreading themselves too thin with their variety of strategies that may not make sense for their long-term growth objectives? Are they trying to be too many things, too soon, for too many? Some companies may need to take a step back to evaluate aggressive operations, product and sales initiatives and perhaps establish more focus to assure profitable growth.
Staying competitive is one thing, but desperately throwing countless programs and initiatives at the wall like a bowl of tangled strategic spaghetti to see what sticks is not the solution.
Unraveling the spaghetti
So how does a company unravel their strategic spaghetti? In our experience, leading organizations identify, prioritize and manage operational initiatives effectively. They do this by diligently assessing their initiatives in play. These successful businesses use proven and established methodologies to:
- Take stock of an initiative's business case and return-on-investment expectations
- Establish actionable and sustainable quick-win opportunities
- Create longer-term planning for performance enhancements
Furthermore, leading organizations ask the following questions when prioritizing their initiatives:
- Does this strategic initiative or project have a charter or some type of governance that is linked to clearly defined and measurable goals?
- Are members and leadership clear and in agreement of defined goals? And, is goal language consistently understood among all parties?
- Is this initiative a pet project or an older project initiated prior to the current strategic goals, or one that doesn't have any formal approval or governance? If so, has the project been vetted and realigned within current strategies?
- Are supporting activities within the project structured for budget approval and resource allotment?
- Are there adequate resources allotted to successfully execute the entire initiative (i.e. people, funding, technology)?
Enabling success through project management
In order to assess the success of a strategic initiative, what should leaders look for in a project once it's been green lighted to move forward? First, at the very beginning of an initiative's life cycle, we've seen leading organizations use a project management office (PMO) structure to establish that all-important foundation and focused oversight surrounding an initiative. A PMO provides direction around a project's risk, planning and communication, and is a key component to a successful initiative and its supporting efforts.
One of the key roles of a PMO is continuous assessment. Are milestones being met? Is the project on budget? How are other operations being impacted? These challenges and risk areas typically fall into three assessment attribute categories: scope, metrics and tools, and impact level. These attributes can be objectively evaluated by the PMO and ranked using focused project interviews and project document reviews as part of the project assessment. A summary of these attributes can then be used to quickly target those areas of an initiative that are progressing positively, as well as areas needing improvement. By providing a common measurement, this assessment method can also identify issues across projects and potentially uncover cost and resource savings to the company. Effectively deploying a PMO has benefited many organizations, and can do the same for your organization.
The RSM Food and Beverage Survey used an online questionnaire to collect responses from executives, owners and decision makers at food and beverage companies with annual revenues between $10 million and $1 billion. Respondents included growers, manufacturers and processors, distributors and retailers in the United States.