Looking for a CCCol co-founder

I am actively looking for a partner – a co-founder of CCCol. And a co-author of my upcoming book on a comprehensive business analysis (based upon the contents of CCCol blog). An ideal candidate must have a BBA or, much better, an MBA from a good American or British school.

Preferably an American or a British national who has just left his/her job as an analyst or investment manager in an investment bank, venture- or direct investment fund to “pursue other interests” as an entrepreneur or freelancer. Ideally having extensive experience writing investment memoranda, authoring articles and her own blog on investment and/or corporate management.

Ambitious (in terms of both money and fame); with a long-term objective of starting and managing her own investment fund in the USA or the UK. As CCCol will be most likely based in New York City, he/she must be able to relocate to NYC right away. Which means that he/she must either be a U.S. citizen, permanent resident or hold a long-term U.S. business visa.

Corporate History – COA Questions

1. How comprehensive is the description of your corporate history?
2. How well-structured is the description of your corporate history?
3. How logical is the description of your corporate history?
4. How easy-to-use is the description of your corporate history?
5. How accurate is the description of your corporate history?
6. How competent is your corporate history professional?
7. How often is corporate history used for strategic decision-making?

Corporate History – Management Guide

To maximize your corporate performance, you must get the most out of not only your current resources (financial, material, human, etc.) but also from your past experiences. Capitalize on your achievements; avoid repeating costly mistakes and keep a certain degree of continuity in your company growth and overall progress. Radical rupture with the past is almost never beneficial for a business entity (until it is acquired by another company with a totally different history and corporate culture).

Hence, to maximize its aggregate value, your company needs a well-documented corporate history and an efficient process for using this corporate history for strategic and operational decision-making. Therefore, you must analyze and improve your corporate history description – just like of any other corporate object in your business system. Which requires a competent corporate history professional - either in-house or, more likely, an outside consultant.

And, naturally, you need to use your corporate history in making and implementing all of your strategic corporate decisions. 

KEF – Comprehensive Analysis Questions

Therefore, to conduct a comprehensive analysis of your Key External Factors (KEF) monitoring system, you have to find answers to the following questions:

1. How comprehensive is the description of your KEF portfolio?
2. How well-structured is the description of your KEF portfolio?
3. How logical is the description of your KEF portfolio?
4. How easy-to-use is the description of your KEF portfolio?
5. How comprehensive is your KEF monitoring knowledge base?
6. How well-structured is your KEF monitoring knowledge base?
7. How reliable is your KEF monitoring knowledge base?
8. How easy-to-use is your KEF monitoring knowledge base?
9. How competent is your KEF monitoring specialist?
10. How efficient is your business process for KEF monitoring and analysis?
11. How adequate is your KEF forecasting methodology?
12. How good are your KEF forecasting tools?
13. How adequate is your understanding of opportunities, threats and risks presented by your KEF?
14. How comprehensive is the description of KEF influence?
15. How regular is your monitoring of KEF?
16. How efficient is your KEF alert system?
17. How well are KEF used for strategic decision-making?
18. How well are KEF used for operational decision-making?

You can download KEF Aggregate Efficiency Scorecard (AES) in MS Excel format here.

Key External Factors – Management Guidelines

We are not the makers, we are the takers. For corporate management, it means that your company is like a sailboat that needs to know and take advantage of all winds and currents to get safely and rapidly to its destination – aggregate value maximization (transforming your company into a happy one and keeping it that way).

These ‘winds’ and ‘currents’ that need to be used by corporate objects – products, brands, clients, assets, etc., are your key external factors (KEF): political, macroeconomic, social, cultural, technological, environmental, industry-specific, etc.

To be able to skilfully navigate your ‘corporate boat’ in often rough ‘currents’ and ‘winds’, you must first identify them. In other words, develop a comprehensive KEF list for your company. Second, you must accurately forecast the dynamics of each KEF (such as GDP, inflation, exchange rates, political stability, etc.). As well as opportunities, threats and risks presented by the KEF in question. Always keeping in mind that even a threat or a risk is an opportunity in disguise.

And, finally, you must align your strategies, unique value propositions, brands, products, stakeholders, operational infrastructure, etc., with forecasted KEF dynamics. To take advantage of opportunities, avoid threats and optimize risks presented by your KEF.

To achieve this objective, you must develop a comprehensive, well-structured, logical and easy-to-use description of your KEF system (portfolio). As well as a highly efficient business process for KEF monitoring. Which, in turn, requires a highly competent KEF monitoring specialist (in-house); a comprehensive KEF knowledge base and possibly even KEF forecasting tools. 

Plus, you need to have a reliable and efficient alert system that informs key decision-makers in your company about sudden KEF changes that might produce a significant effect on your corporate KPI. 

And, definitely, corporate KEF need to be used – on a permanent basis – in the process of making both strategic and operational corporate decisions.

Key External Factors Diagram Example

KPI System – Comprehensive Analysis Questions

To accomplish this objective, business managers must (1) build (‘engineer’) an optimal system of corporate KPI and (2) maximize its performance by optimizing values of these KPI.

Engineering an optimal KPI system means making sure that it (1) is complete and no KPI are missing; (2) does not have excessive KPI and (3) is well-structured and easy-to-use.

It means that your company must have – at all times – a detailed and easy-to-use description – visual and textual - of its KPI system. A description that must be comprehensive, logical, well-structured, easy-to-use and, of course, matching the reality.

An optimal KPI system for you company must meet a number of other requirements. First, KPI values generated by your information system, must be relevant, accurate and up-to-date. And easily accessible, of course. Second, benchmark values must be adequate and relevant and planned values – exhibit the exactly right degree of ‘stretch’ (realistic, but challenging). Third, your methodology for calculating your KPI values (especially qualitative) must be adequate and scientific.

And, finally, all of your strategic and operational decisions must be stated and evaluated in terms of the corresponding KPI. In other words, their results must be measurable. Always.

Therefore, to perform a comprehensive analysis of your KPI system, you must answer the following questions (using the corresponding AES):

1. How comprehensive is the description of your KPI system?
2. How logical is the description of your KPI system?
3. How well-structured is the description of your KPI system?
4. How comprehensive is the description of your KPI system?
5. How well does the description of your KPI system match the reality?
6. How comprehensive is your KPI list?
7. How many KPI are missing?
8. How many KPI are excessive?
9. How competent is your corporate KPI system manager?
10. How accurate are the KPI values?
11. How adequate is the methodology for KPI valuation & management?
12. How efficient is the business process for KPI system management?
13. How realistic are the planned KPI values?
14. How optimal are KPI benchmarks?
15. How optimal is the 'stretch' in planned KPI values?
16. How often are KPI used for strategic decision-making?
17. How often are KPI used for operational decision-making?

You can download the Aggregate Efficiency Scorecard for your KPI System (in MS Excel format) here:

KPI Tree - Example

You can download KPI tree template (in MS Visio format) here.

KPI System Management Guidelines

As I stated earlier, the fundamental objective of managing a business is to transform the business entity in question into a happy organization. And to keep it that way.

By definition, a happy organization is the one that satisfies to the maximum possible extent (and definitely better than its competition) aggregate needs – financial, functional, emotional and spiritual - of its internal and external stakeholders – owners, clients, employees, partners, etc. In other words, creates the maximum amount of aggregate value for its stakeholders.

To accomplish this objective, your company must maximize its aggregate performance measured by corporate key performance indicators (KPI). Therefore, your company must develop and maintain a truly comprehensive, well-structured and easy-to-use KPI system.

There are two complimentary ways to structure this system – and you will need to use both. The first one is built around the comprehensive system of corporate objects visualized and structured by the Key Business Management Diagram (KBMD); the second one is represented by a system of KPI trees (decomposition of composite KPI).

In both cases, KPI values must be measured, analyzed and maximized using the corresponding Object KPI Scorecards (KPIS). KPIS must contain (1) historic KPI values – benchmark, planned and actual; (2) name and title of KPI manager as each KPI must have one and only one manager responsible for optimizing value of the KPI in question; (3) ACRC section for a dynamic KPI management – analysis, conclusions, recommendations and comments; KPI values optimization plan – financial and operational; and links to all documents and queries related to the KPI in question. 

Business Re-Engineering – Corporate Process Diagram

You can find an IDEF0 diagram for the process of business system (in MS Visio format) re-enginering here.

Financial Valuation Model

Financial valuation model is essentially a MS Excel workbook that consists of the following worksheets:

1. Corporate income statement (P&L) – historic (for at least three years) plus projected (current year plus at least six years into the future). This worksheet also includes the statement of retained earnings. P&L includes important corporate financial KPI such as gross revenue, gross profit, EBITDA, EBIT, EBT, and net income (profit)
2. Corporate balance sheet – also historic (for at least three years) plus projected (current year plus at least six years into the future)
3. Free cash flow statement – also historic (for at least three years) plus projected (current year plus at least six years into the future)
4. Footnotes to the abovementioned financial statements (accessible via a hyperlink)
5. NOPLAT calculation. NOPLAT stands for Net Operating Profit Less Adjusted Taxes and is a very important financial KPI as it represents the profits generated from a company's core operations.
6. Worksheets for calculating ROIC, WACC and economic profit
7. Worksheet for calculating intrinsic financial value of your company (typically using the Discounted Cash Flow method)
8. Supplementary worksheets for calculating key components of the financial model

You can find a template for a financial valuation mode for the whole company here. In addition to financial valuation model for the whole company, I will post valuation model for other corporate objects and object portfolios (products, brands, clients, promotion campaigns, etc.)

Business System – Key Performance Indicators

As I stated earlier, comprehensive object analysis (COA) consists of two components that can (and should) be executed in parallel. First, object performance is analyzed using the corresponding questions from the comprehensive COA questionnaire and COAQ-based Aggregate Efficiency Scorecard (AES) for the business system. Second, it is analyzed by measuring and analyzing the benchmark, planned and actual values of object-related KPI – using the Object KPI Scorecard (KPIS).

You can find the template KPIS for business system analysis here (KPIS tab) and the Key Business Management Diagram here.

Aggregate Efficiency Index 

Aggregate Efficiency Index (AEI) measures the aggregate efficiency of the business system as a whole. It is calculated bottom up, starting from the lowest-level performance indices (PI), AEI for individual corporate objects and object portfolios (see the AEI computation diagram here). To maximize the AEI for your whole company, you must (1) maximize PI and AEI for individual objects and object portfolios and (2) maximize the synergy between corporate objects. It is measured on a scale from 0% to 100%.

Corporate Happiness Index

Corporate Happiness Index (CHI) measures the degree of corporate happiness. In other words, it measures, how well your company satisfies the needs of its internal (employees) and external (clients, suppliers, partners, etc.) stakeholders – financial, functional, emotional and spiritual. Like AEI, CHI is measured on a scale from 0% to 100% (both extremes are highly unlikely).

To measure and maximize the CHI, you must (1) identify all aggregate needs of your external and internal stakeholders; (2) measure the degree to which the company satisfies the aggregate needs of its stakeholder and (3) develop and execute financial and operational plans to satisfy these needs to the fullest possible extent. And thus to create the maximum amount of aggregate value for its stakeholders.

It is important to compute CHI both for your company and for its competitors as your company can be truly competitive only if it satisfies the aggregate needs of its stakeholders better than its direct and indirect competition.

External Harmony Index

External Harmony Index (EHI) is the ‘mirror’ image of CHI as it measures the degree to which external stakeholders of your company satisfy its aggregate needs - financial, functional, emotional and spiritual. Like CHI, EHI is measured on a scale from 0% to 100% (both extremes are highly unlikely). External harmony principle is illustrated here.

To measure and maximize the CHI, you must (1) identify all aggregate needs of your company that can – and must – be satisfied by your external stakeholders; (2) measure the degree to which these needs are satisfy; and (3) develop and execute financial and operational plans to satisfy these needs to the fullest possible extent. And thus to maximize amount of aggregate value created for your company by its stakeholders.

Financial Value

Entrepreneurs start businesses to make money. In other words, to create financial value. Which ultimately needs to be monetized – converted into a cold, hard cash. By either conducting an Initial Public Offering (IPO) or selling the company to a strategic buyer in a Mergers & Acquisitions (M&A) deal. Or by paying out dividends. Or by buying out corporate stock.

Financial value of your company is measured in monetary terms (dollars, euro, etc.) and is determined by four interrelated and interconnected variables – revenues, expenses, changes in working capital and corporate risks reflected by weighted-average cost of capital (WACC). Therefore, in order to maximize the financial value of your company, you must optimize values of these four variables.

To calculate the financial value, you must develop a financial valuation model by engaging the services of either your internal financial analyst or an external consultant. You can find a template for a financial valuation model here.

Free Cash Flow

Free Cash Flow (FCF) determines whether your business makes financial sense. FCF is the amount of money generated by your business left after paying all corporate expenses and making all necessary investments into your working capital. In other words, FCF is the amount of money that can be distributed to owners/investors of your business.

Calculation of free cash flow is a part of a financial valuation model for your company. Like the financial value of your company, FCF is determined by several (three, in fact) variables – revenues, expenses and the increase in working capital. Therefore, in order to maximize your FCF, you must optimize values of these four variables.

Economic Profit

Economic Profit (EP) determines whether your business makes economic sense. In other words, whether the rewards are worth the risks. EP is calculated as the difference between your return on invested capital (ROIC) and your weighted-average cost of capital (WACC). It is measured in percentage points.

ROIC and WACC are interconnected; typically the higher are the risks, the higher are the rewards. But the ‘delta’ – the difference between the two peaks at certain optimal values of these two variables. Therefore, to maximize your economic profit, you must optimize values of your ROIC and WACC.

Corporate Stock Price

If your company is traded publicly, your most important KPI is the price of your corporate stock because it determines exactly how much are the owners of your company worth (in monetary terms, of course) at any given time. In other words, how much money they are going to make if they decide to monetize the value of their stock holdings.

In the long run, your stock price is determined mostly by two factors: financial value (more precisely, intrinsic value) of your company and the overall dynamic of the stock market in general and of the stock exchange where shares of your company are listed, in particular. In the shorter term, there are a number of internal and external factors that influence the day-by-day changes in your stock price.

Price of your corporate stock at any given time is quoted by the corresponding stock exchange. To maximize your stock price, you will need to (1) maximize intrinsic financial value of your company and (2) influence the relevant stock market participants – analysts, investors, brokers, traders, etc.

The best way to do it is to continuously create high market expectations of your company performance – and then exceed them no matter what. 

Business System – Key COA Questions

As I stated earlier, comprehensive object analysis (COA) consists of two components that can (and should) be executed in parallel. First, object performance is analyzed using the corresponding questions from the comprehensive COA questionnaire and COAQ-based Aggregate Efficiency Scorecard (AES) for the business system. Second, it is analyzed by measuring and analyzing the benchmark, planned and actual values of object-related KPI.

To analyze the business system as a whole, you must find answers to the following questions (computing the question-related scores, PI and AEI, completing the ACRC sections and attaching all relevant corporate documents and queries):

1. How comprehensive is the description of your business system?
2. How logical is the description of your business system?
3. How well-structured is the description of your business system?
4. How easy-to-use is the description of your business system?
5. How well does the description of your business system match the reality?
6. How many "gaps' (missing projects and processes) are there in your business system?
7. How many excessive objects are there in your business system?
8. How well-structured is your business system?
9. How competent is your business system engineer?
10. How flexible and adaptable is your business system?
11. How efficient is your business process for system improvement (kaizen)?
12. How high is the synergy in your business system?
13. How efficiently is system description used for strategic decision-making?

You can find the template AES for business system analysis here (AES Tab).

Business System Re-Engineering Guide

In order to re-engineer your existing business system to maximize its aggregate performance, you must do the following:

1.        Start with the comprehensive business system template (you can find it here)

2.       Develop the key business diagram for an optimal business system by adapting this template for the specific needs of your company (TO BE)

3.       Develop the key business diagram for your existing business system (AS IS)

4.       Identify missing objects that need to be implemented (added to your existing business system)

5.       Identify excessive objects that need to be eliminated from your existing business system

6.       Perform analysis of a business system as an object using the COA questionnaire and AES and business system – related KPI (using KPIS)

7.       Develop and implement a detailed financial and operational plan for making a transition from AS IS to TO BE

You can find an IDEF0 diagram for the process of business system re-enginering here.

Business System Engineering Guide

In order to engineer the optimal business system for your startup, you must do the following:

1.       Start with the comprehensive business system template (you can find it here)

2.       Identify objects and processes that ned to be implemented right away and structure them into a cohesive system

3.       Develop a detailed description of the objects/system to be implemented

4.       Implement the required objects/system

5.       Develop and implement a detailed plan for expanding and extending (further engineering and re-engineering) of your business system 

Business System – Brief Management Guidelines

In my previous posts, I proved – hopefully, beyond the reasonable doubt – that the fundamental objective of managing a business is to create the maximum possible amount of aggregate value – financial, functional, emotional and spiritual – for all of its stakeholders.

To accomplish this objective, business managers must (1) build (‘engineer’) an optimal business system of corporate objects and processes and (2) maximize its performance by maximizing performance of individual objects and processes and the synergy between them.

Engineering an optimal business system means making sure that it (1) is complete and no key corporate objects or processes are missing; (2) does not have excessive objects or processes; (3) is well-structured and cohesive; and (4) is easily adaptable to, alas, inevitable and continuous changes in its environment.

The last requirement means that your company must have – at all times – a detailed and easy-to-use description – visual and textual - of its business system. A description that must be comprehensive, logical, well-structured, easy-to-use and, of course, matching the reality. Ideally, of course, object-oriented – as our world is object- not process-oriented.

It also means that the re-engineering and kaizen – continuous improvement of a business system – is a permanent process and thus requires a highly efficient business process and a highly competent business engineer (internal or outsourced).

If you are just starting a business, you must engineer your business system from scratch (perform a strategic business engineering). If you are running an existing, established business, you must first perform a comprehensive business audit (CBA) and then – a strategic business re-engineering (SCR).

It is also very important that the description of the business system must be used in making strategic business decisions (to take into account the realities of internal and external business environment).

You can download the template for engineering/re-engineering of your business system (in MS Visio format) here.

New Business Management Paradigm

BDL essentially created a radically new business management paradigm which is expressed in the following statements:

1.       The fundamental objective of corporate management is to transform the company in question into a happy organization – and make it stay this way

2.       A ‘happy organization’ is the one that satisfies the aggregate needs (financial, functional and emotional) of its stakeholders (owners, clients, employees, partners, etc.) and thus maximizes its aggregate value for all of its key stakeholders 

3.       A happy organization is always in a state of a perfect harmony with its environment; therefore, it must maximize aggregate value created for the company by its stakeholders

4.       To maximize its aggregate value, every organization must operate at highest possible efficiency measured by optimal values of all of its corporate key performance indicators (KPI) 

5.       To maximize corporate efficiency and optimize corporate KPI values, every manager and employee must make and execute the best possible decisions in his/her responsibility areas

6.       To make and execute the best possible decisions, one must have rapid and convenient access to all necessary internal and external knowledge (information that has financial and functional value) 

7.       Therefore, to maximize corporate efficiency, it is vital to (a) build a comprehensive corporate knowledge base (CKB) and (b) to equip every manager and employee with an individual ‘corporate cockpit’ – a customized ‘window’ into the CKB, accessed on a ‘need-to-know’ basis 

8.       Our world is fundamentally object-oriented; therefore, CKB, ‘corporate cockpit’ and the whole corporate management system must be constructed around a comprehensive system of external and internal corporate objects – products; brands; SBU/departments; clients, employees, suppliers, partners, etc. 

9.       Performance of each corporate object must be measured, analyzed and maximized using a customized Aggregate Efficiency Scorecard (AES); Object KPI Scorecard (KPIS) and – in some cases – using the financial model of the object in question

10.   Each AES must include key information on object manager; list of object audit/analysis questions, ACRC section (Analysis/Conclusions/Recommendations/Comments) and analysis of KPI values (historic, benchmark, planned and actual), Aggregate Efficiency Index (AEI) for the object in question, financial and operational plans for AEI maximization (KPI value optimization) and internal and external links to all knowledge necessary for monitoring and managing the object 

11.   Each KPIS must include key information on object manager; analysis of KPI values (benchmark, planned and actual), ACRC section (Analysis/Conclusions/Recommendations/Comments), Aggregate Efficiency Index (AEI) for the object in question, financial and operational plans for KPI value optimization and internal and external links to all knowledge necessary for monitoring and managing the object

12.   Every employee and manager must maximize not only efficiency of every object in his/her responsibility area, but also its synergy with all other corporate objects (which requires effective and efficient teamwork and cooperation) 

13.   Every corporate manager and employee must be motivated and evaluated according to actual values of AEI and KPI of objects in his/her ‘responsibility areas’ 

14.   Practically every organization operates at a very low efficiency (10-15% of its true potential), wasting enormous amounts of time, money and other highly valuable resources 

15.   Therefore, practically every organization must undertake – and successfully complete! – comprehensive business analysis/audit (CBA) and strategic corporate reengineering (SCR) to maximize organizational efficiency and its aggregate value and thus to transform itself into a happy organization

Object KPI Scorecard

Object KPI Scorecard (KPIS) – see here - has been designed to measure, analyze and maximize the aggregate performance of the corresponding corporate object. There are two ways to do that: (1) by analyzing values – benchmark, planned and actual – of object-related KPI; and (2) by performing the performance audit of the object in question using the Comprehensive Object Audit (COA) questionnaire. The first approach is executed using Object KPI Scorecard; the second – using the AES (covered in detail in the previous blog post and book section).

KPIS consists of three key sections – the KPIS proper (KPI section); performance improvement plan section and the documents section.

KPI section contains a comprehensive list of object KPI with their values broken by date. For each date, three values – benchmark, planned and actual. Based on these values, KPIS computes for each KPI its Performance Index (PI).

Using these PI, AES then computes Aggregate Efficiency/Performance Index (AEI) for the whole object in question. Full commercial version of CBAW allows its user to compute – from AEI of individual objects – the AEI for object portfolios (e.g. brands, products, assets, etc.) and for the whole business system (see the AEI computation diagram).

In addition to the questions, scores and PI, KPI section contains a so-called ‘ACRC section’. This section allows for a dynamic description of each corporate object as it contains the Analysis, Conclusions, Recommendations and Comments subsections for each object-related KPI.

Performance improvement plan section is essentially a simplified project management module that contains a combined financial and operational plan for maximizing the aggregate performance of the object in question. This plan contains specific activities assigned to specific employees; their start and finish dates and expenses/costs required to complete these activities within the required time frame.

The documents section contains links to documents (documents proper and SQL or Data Mining queries) related to the corresponding object-related KPI or the object in general. This section allows to develop a comprehensive corporate knowledge as all corporate documents will be connected to the right objects and assist in maximizing their individual performance and the synergy between corporate objects. Which is the fundamental objective – the ‘Holy Grail’ of corporate information and knowledge management.

You can view a brief PDF presentation on KPIS here.

AEI Computation Diagram

Aggregate Efficiency Scorecard

Aggregate Efficiency Scorecard (AES) – see here - has been designed to measure, analyze and maximize the aggregate performance of the corresponding corporate object. There are two ways to do that: (1) by analyzing values – benchmark, planned and actual – of object-related KPI; and (2) by performing the performance audit of the object in question using the Comprehensive Object Audit (COA) questionnaire. The first approach is executed using Object KPI Scorecard which I will cover in detail later; the second – using the AES.

COA questionnaire is essentially a hybrid of a due diligence questionnaire used by investment banks and venture/direct equity investors to analyze potential investment targets and a questionnaire used by strategic management consultants to measure and maximize the performance of the business entity in question.

AES consists of three key sections – the AES proper (COAQ section); performance improvement plan section and the documents section.

COAQ section contains a comprehensive list of object performance analysis questions. Each question covers a certain aspect of object performance which is measured on a scale of 0 (aspect/function is not implemented at all) to 10 (top performance). Based on this score (assigned by either internal performance analyst or an external management consultant), AES computes a Performance Index (PI) for the corresponding object performance aspect.

Using these PI, AES then computes Aggregate Efficiency/Performance Index (AEI) for the whole object in question. Full commercial version of CBAW allows its user to compute – from AEI of individual objects – the AEI for object portfolios (e.g. brands, products, assets, etc.) and for the whole business system (see the AEI computation diagram).

In addition to the questions, scores and PI, COAQ section contains a so-called ‘ACRC section’. This section allows for a dynamic description of each corporate object as it contains the Analysis, Conclusions, Recommendations and Comments subsections for each aspect of object performance covered by the corresponding question.

For the purposes of object performance measurement, analysis and maximization, ACRC section is much more important and useful than the still arbitrary PI and AEI. Although the latter to give a rather good understanding of aggregate object or company performance.

Performance improvement plan section is essentially a simplified project management module that contains a combined financial and operational plan for maximizing the aggregate performance of the object in question. This plan contains specific activities assigned to specific employees; their start and finish dates and expenses/costs required to complete these activities within the required time frame.

The documents section contains links to documents (documents proper and SQL or Data Mining queries) related to the corresponding question/performance aspect or the object in general. This section allows to develop a comprehensive corporate knowledge as all corporate documents will be connected to the right objects and assist in maximizing their individual performance and the synergy between corporate objects. Which is the fundamental objective – the ‘Holy Grail’ of corporate information and knowledge management. 

You can view a brief PDF presentation on AES here.

Business/Corporate Processes Analysis

BDL is an object-oriented language. Hence, the processes are attached to corporate objects, and not the other way around. Moreover, corporate process is treated as a special kind of objects. Which means that each process has its own AES and KPIS – as well as the process performance measurement, analysis and maximization.

To visualize the business/corporate process, BDL uses slightly modified IDEF0 methodology – a globally accepted standard for process visualization, modeling and analysis.

As part of object performance measurement, analysis and maximization toolbox, I will try to post on a regular basis visual diagrams of standard business processes associated with the object in question. 

Business Process Description Diagram

Corporate Products Diagram - Explained

Corporate products diagram depicts a system of corporate products and product lines (corporate products portfolio). Every object/icon on this diagram is associated with two scorecards – AES and KPIS; and with detailed guidelines on measuring, analyzing and maximizing the efficiency of the corresponding relationship and the synergy between stakeholders in the corresponding stakeholders’ portfolio.

Therefore, the corporate products diagram is one of the KBMD decomposition diagrams – associated with the ‘Products’ icon/object.

Each stakeholder must also have the corresponding financial model (which is actually much more than simply budget) designed to measure, analyze and maximize financial value created for the organization by the corporate product, product line or products portfolio in question.

Corporate Products Diagram Example

The fundamental objective of managing any organization

Hence, the fundamental objective of managing any organization is maximization of the aggregate value of the organization in question (financial + functional + emotional + spiritual) for all of its stakeholders - business owners, NGO sponsors, personnel, clients/customers, suppliers, partners, etc. In other words, to transform the company in question into a happy organization – and keep it that way (in the permanent state of corporate happiness)

In order to achieve harmony between the organization in question and its environment, one must also maximize the aggregate value of each stakeholder to the organizations.

Now I will prove that this fundamental management objective is the one that best fits objective reality, facts, logic and common sense.

Why does an entrepreneur start a business?

First, to make as much money as possible – in other words, to create the maximum amount of financial value. Second, to create an organization which will provide its clients/ with functionally useful products - in other words, to create the maximum amount of functional value. 

Third, to maximize his/her emotional pleasure from both the process and the result - in other words, to create the maximum amount of emotional value. And, finally, to implement in his/her company his/her fundamental values, beliefs and principles - in other words, to create the maximum amount of spiritual value.

Why does an employee work for an organization?

First, to earn as much money as possible – in other words, to create the maximum amount of financial value. Second, to earn his or her living by providing his/her internal and/or external customers with useful products and/or services – in other words, to create the maximum amount of functional value. 

Third, to maximize his/her emotional pleasure from both the process and the result - in other words, to create the maximum amount of emotional value. And, finally, to implement in his/her on-the-job activities his/her fundamental values, beliefs and principles - in other words, to create the maximum amount of spiritual value.

Why does a stakeholder work with an organization?

To satisfy his/her/its aggregate needs and desires – financial, functional, emotional and spiritual – to the maximum possible extent. In other words, to obtain from these interactions/relationships the maximum possible aggregate value.

Therefore, the stakeholders of a company in question are interested in building and maintaining relationships with the company in question only to the extent that this organization is capable of satisfying their aggregate needs (create aggregate value for them). And the higher is the amount of financial value created by the organization for its stakeholders, the more interested are they in building and maintaining relationships with the company in question. And the more competitive is this organization.

Hence, maximization of aggregate value for all of its stakeholders is, indeed, the truly fundamental organization management objective best corresponding to objective reality, facts, logic and common sense.

Corporate Happiness and a ‘Happy Company’

The company that satisfies the aggregate needs – financial, functional, emotional and spiritual – of all of its internal and external stakeholders (and thus creates the maximum amount of aggregate value both ways) can be rightfully labeled a ‘happy company’. As, indeed, happiness is achieved when all needs of an individual in question are satisfied to the fullest possible extent.

To transform itself into a ‘happy company’ and maximize its aggregate value, every business (or any other organization, for that matter) must (1) have the optimal structure – system of objects and processes; and (2) operate at highest possible efficiency measured by optimal values of all of its key performance indicators (KPI).

Hence, the ultimate objective of the Corporate Cockpit Collaborative project is to help as many business as possible (ideally, all of them) transform themselves into ‘happy companies’. 

Key SRM Diagram

Corporate Stakeholders

Each icon on the corporate stakeholders diagram represents one key corporate stakeholder – consumer, partner, supplier, creditor, etc. This is the second key business management diagram as the only raison d'être for any business entity (in fact, for any organization) is to satisfy the aggregate needs – financial, functional, emotional and spiritual – of its stakeholders. Internal – employees and external – all other.

In other words, to create the maximum amount of aggregate value (financial, functional and emotional) for all of its key stakeholders (owners/sponsors, clients, employees, partners, etc.). In the most natural way for the organization question (typically described in the Declaration of Corporate Identity and/or corporate Mission and Vision statements).

However, this goes both ways. In order to remain in the state of harmony with its environment, the company in question must ensure that its stakeholders create the maximum amount for the organization in question as well - see the key Stakeholders’ Relationships Management (SRM) diagram.

Each of the stakeholder icons on this diagram is associated with two object scorecards – AES and KPIS; and with detailed guidelines on measuring, analyzing and maximizing the efficiency of the corresponding relationship and the synergy between stakeholders in the corresponding stakeholders’ portfolio.

Each stakeholder must also have the corresponding financial model (which is actually much more than simply budget) designed to measure, analyze and maximize financial value created for the organization by the stakeholder in question.

Corporate Stakeholders Diagram

Corporate Organization Chart

Corporate organization chart can be presented in two versions – as a hierarchy of either functional units (departments, divisions, groups, etc.) – associated with the ‘Organization Chart’ icon on KBMD or employees - associated with the ‘Personnel’ icon on KBMD. Thus, both diagrams are essentially decomposition diagrams for the corresponding KBMD objects/icons.

Each of the object icons on this decomposition diagram is associated with two object scorecards – AES and KPIS; and with detailed guidelines on measuring, analyzing and maximizing the efficiency of the corresponding object and the synergy between objects (and thus the overall efficiency of the organization chart in question).

Each functional unit and all key employees must also have the corresponding financial models (which are actually much more than simply budgets) designed to measure, analyze and maximize financial value created by the unit or employee in question. 

Corporate Organization Chart - Example

KBMD – A Brief Description

KBMD depicts all key corporate objects – both simple (corporate mission, vision, strategies, etc.) and composite (brands, products, target markets, etc.). Each of the object icons on the diagram is associated with two object scorecards – Aggregate Efficiency Scorecard (AES) and Object KPI Scorecard (KPIS) and with detailed guidelines on measuring, analyzing and maximizing the efficiency of the corresponding object and the synergy between objects (and thus the overall corporate performance).

In order to maximize this performance, you must (1) develop a comprehensive system of corporate objects and their KPI; (2) measure and analyze the aggregate performance of each object; (3) develop financial and operational object performance improvement plans and (4) implement these plans

Key Business Management Diagram

CCCol Community

CCCol project will utilize the principle of continuous improvement (the famous Kaizen). To implement this principle, I intend to transform this blog into a global online community for business owners, executives, managers and professionals. Possibly augmented by an online forum and/or Facebook group (LinkedIn and Google+ groups are also a possibility).

The objective of this community is to help business management professionals – using CBAW modules as a foundation - jointly develop the most efficient tools and guidelines to satisfy the abovementioned corporate management needs. And keep improving them to make sure that at any given time they have access to the best, newest and the most efficient tools and guidelines that satisfy their corporate management needs.

Book on Comprehensive Business Analysis

By clicking on the book title, you can download my free e-book ‘How to Become the Best of the Best’ – a concise guide to conducting a comprehensive business analysis (CBA) of your company. You can use this book and free CBA scorecard templates to develop your own CBA scorecards and a comprehensive CBA workbook for your company. 

Structure of the Blog & the Corporate Cockpit Book

To satisfy these fundamental corporate management needs, I have developed the Business Description Language (BDL) intended to satisfy exactly these needs. BDL includes diagrams that visualize all corporate objects and scorecards designed to measure, analyze and maximize performance of each corporate object; synergy between objects and efficiency of relationships with corporate stakeholders.

Using BDL as a foundation, I developed a software product – Comprehensive Business Analysis Workbench (CBAW). You can find the demonstration of this software here and its presentation here.

CBAW is built around the comprehensive system of corporate objects which will be used as a central reference point in both this blog and the upcoming e-book. 

This system is visualized on the Key Business Management Diagram (KBMD) which is a part of BDL. KBMD – together with its decomposition diagrams and two key scorecards – Aggregate Efficiency Scorecard (AES) and Object KPI Scorecard (KPIS) – will be covered in the next blog posts and in the introductory section of the e-book.

Each of the subsequent blog posts and book sections (I plan to post a new one every day) will cover the corresponding object or a portfolio of objects – products, brands, assets, clients, etc. – see the KBMD. The text in each blog post and in each book section will present detailed guidelines for measuring, analyzing/auditing and maximizing the aggregate performance of the object in question.  Including a comprehensive system of object-related KPI.

These guidelines will be accompanied by two free scorecards for the object in question – AES and KPIS. These free CBAW modules are implemented as stand-alone MS Excel workbooks which can be assembled – vial hyperlinks – into a comprehensive free CBAW edition. If you are interested in a more convenient, fully functional, MS SQL – based edition, you can purchase it as a stand-alone or Saas solution.

Fundamental Needs of Corporate Management

I started the CCCol project to satisfy the fundamental needs of corporate management. Hence, I need to start this blog by presenting and briefly discussing these needs.

Every corporate manager and employee needs a uniform and comfortable access to ALL knowledge that he or she needs to maximize his/her performance in the corresponding responsibility areas. In other words, they need complete corporate transparency. Top to bottom; left to right.

Which, in turn, requires both a comprehensive corporate knowledge base and a ‘Corporate Cockpit’ – a uniform interface into this knowledge base. Sort of a ‘Holy Grail’ for information and knowledge management technologies.

They need this knowledge to measure, analyze and maximize performance of each corporate object – product, service, asset, employee, etc. And the efficiency of relationship with each corporate stakeholder – client, partner, supplier, etc. As well as the synergy between corporate objects, resulting in maximization of overall corporate performance (measured by the corporate KPI). Which is, indeed, the fundamental objective of corporate management.

To achieve this very fundamental objective, company managers must develop an optimal system of corporate objects and their KPI. In other words, to perform a comprehensive corporate engineering (or re-engineering).