From a business perspective, we often see outputs as the activities necessary to meet a business’s strategic goals. For example, the CEO is working to increase revenue, the CFO is working to increase profitability, and the board is working to increase shareholder value. However, as I’ve stated before, there are three different levels of output.
There are three different levels of output. Production output is the level of a company that produces products and services. Marketing output is the level of a company that acts as a conduit for business activities, from product sourcing, to sales, to marketing activities. Finally there is financial output, which is the level of a company that produces revenues. If you’re a CEO, you’re probably working to increase your company’s production output.
As we mentioned in the first two parts of this series, the most important aspects of any enterprise are its three levels of output. To effectively plan in a competitive environment, you have to know your strengths and weaknesses and be able to communicate them to your employees. This means having the ability to define your output in terms of different levels of marketing, production, and financial.
In the enterprise world, these levels of output are sometimes referred to by different names, such as “sales per employee,” “sales per division,” and “sales per country.” The three levels of output are usually described in terms of “increase, decrease, or remain constant.
The first level is the output of sales per employee. This is the number of sales that your company achieves when a product is sold to each employee. This is usually the number you’ll see in the company’s annual report. It’s usually reported as a percentage of the sales the company makes, which gives you a sense of what your company is doing well, but it’s not really a measure of your company’s ability to make money.
This is why you see companies reporting sales per employee as a percentage of sales. If your company does not achieve the same sales per employee each year, it doesnt necessarily mean that your company is losing money.
One tool that can take you a good step in this direction is the output of enterprise strategy formulation tool. This tool will give you at a glance a number that gives you a sense of how your organization is doing in the marketplace and what it needs to do to achieve that. I believe that this is an important tool that can help you to make better business decisions.
We have a company called Intrinsic, which does business in the space of enterprise strategy formulation for some clients. We have two clients in India where we serve as a strategic advisor and think about doing business for them. One of the clients asked us to make sure that their strategy was clear and they wanted to know what we were doing. We gave them the output of enterprise strategy formulation tool and also the input we had from their existing business model.
The output is pretty simple. It describes the business activities by their inputs. The inputs are the business activity’s activities, their resources, and their customers. Output describes the activities’ outcomes based on the inputs.
This is the first time we have seen the output of enterprise strategy formulation tool. It’s also the first time we have seen input from existing business model. Most of the other tools we have seen are based on business model inputs, but enterprise strategy formulation tool is based on business activity inputs.