Philip Walcoff - "The Fast Forward MBA in Business Planning for ...

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Philip Walcoff - "The Fast Forward MBA in Business Planning for Growth"Page 116TABLE 8.3 EXAMPLES OF FIVE-YEAR PROFIT GOALS ANDRELATED ANNUAL PROFIT OBJECTIVESFive-Year GoalAchieve a pretax income of$600,000.Achieve an EBIT of 11%.Annual ObjectiveAchieve a pretax income of $50,000 (T.Mann).Achieve an EBIT of 8% (P.Katz).By DivisionGovernment, $1 million.Commercial, $500,000.International, $100,000.Government, $100,000 (L. Brown).Commercial, $50,000 (J. James).No international objective.dollars or percentage of revenues by operating organization. Notice that for the three examples in Table8.3, the profit objective is smaller than the five-year profit goal because most companies expect to seeincreased revenues and profits in the future. Notice also that the company that broke its profit out byoperating division showed a five-year profit goal stemming from an international division, whereas theannual profit objective reflects that the division has not yet gotten off the ground.EXERCISE 33: DESCRIBE YOUR ANNUAL PROFITOBJECTIVESDefine your annual profit objective by reviewing theexamples presented in Table 8.3, the five-year profit goalsyou developed earlier, and your projected income statement.Document your own profit objectives for the current (orupcoming) fiscal year in your business plan (see AppendixB). As shown in Table 8.3, you may desire to break the profitobjective down by operating organization, business area, orby some other more appropriate distinction. Don't forget toassign a champion(it may be you) for each of your profitobjectives.Customer Satisfaction Objectivesfile:///C|/Documents and Settings/gasanova/Local Setti...orward_MBA_in_Business_Planning_for_Growth/e-book.html (130 of 219)16.02.2005 13:54:23
Philip Walcoff - "The Fast Forward MBA in Business Planning for Growth"Your customer satisfaction annual objectives (Exercise 34) will stem from the five-yearcus-Page 117tomer satisfaction goals you previously developed. Using the five-year customer satisfaction goals youdeveloped earlier as a baseline, this year's customer satisfaction objectives might include those shownin Table 8.4.Referring to the five-year customer satisfaction goals in Table 8.4, it can be seen that the level ofcustomer satisfaction for annual objectives is somewhat reduced as compared to the five-year goals.This is due to the fact that you may be putting some new customer satisfaction process in place,resulting in a less aggressive set of objectives. Remember that the annualEXERCISE 34: DESCRIBE YOUR CUSTOMERSATISFACTION ANNUAL OBJECTIVESIn defining your annual customer satisfaction objectives,review the examples presented in Table 8.4 and the five-yearcustomer satisfaction goals you developed earlier. Documentyour own customer satisfaction annual objectives for thecurrent (or upcoming) fiscal year in your business plan (seeAppendix B). Don't forget to assign a champion (it may beyou) for each of your customer satisfaction objectives.TABLE 8.4 EXAMPLES OF FIVE-YEAR CUSTOMERSATISFACTION GOALS AND RELATED ANNUALCUSTOMER SATISFACTION OBJECTIVESFive-Year Goal95% customer satisfaction, asevidenced by surveysAnnual Objective85% customer satisfaction, asevidenced by surveys90% repeat business 80% repeat business95% annual client retention 80% annual client retentionClient satisfaction evidenced by90% repeat business in all marketsegments and 95% rating in clientsurveysClient satisfaction evidenced by80% repeat business in all marketsegments and 85% rating in clientsurveysfile:///C|/Documents and Settings/gasanova/Local Setti...orward_MBA_in_Business_Planning_for_Growth/e-book.html (131 of 219)16.02.2005 13:54:23
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