I think all of my team mates would agree with me when I say that from the very first rollover our company has been on a rollercoaster ride. It seems that that our success in one week has always been meet with a downturn in the following. I had a mixed reaction to our results this week, on one hand we achieved a target that we had been trying to reach for a while, but on the other our profit, cash and shareholder value all plummeted. I feel like my team and I are continuously going around in circles. Don’t get me wrong we have certainly identified WHERE we have gone wrong in our past decisions, but I feel like our problem is that we don’t really learn from our mistakes.
Baghai, Smit, & Viguerie (2009) talk a lot about growth strategies and strategic direction, but it has dawned on me this week that we never established a sound business strategy as we were too occupied in trying to enter numerous markets. If Peter were to ask me what our strategy is, I wouldn’t really know what to say. Was this where all of our problems started? It makes sense that without a clear goal and an action plan, we would focus more achieving short term success. Our spending allocations have never really been wholly justified and most of the time we have spent our cash with just the upcoming rollover in mind. Thinking back to the financial decisions that I made the week before last and I can see a pattern that has re-emerged this week which means that I have failed to carry out my proposed actions. I have once again been too naïve and not assertive enough in my budget limitations as CFO because of my lack of confidence and desire to keep my team happy. After reading the article by Thomas (2006) I’m beginning to realise the importance of seeing Mikes Bikes and all its interconnectedness as a whole, and not just from my CFO point of view. At the end of the day, I’m not fazed by the fact that we‘ve made mistakes as from the very beginning my team has always been a very learning-orientated one. However what does concern me is that i/we seem to make the same mistake multiple times. This leads me to question whether or not I actually learnt from my mistake last time, or whether I just saw it as a wee hiccup along the way.
Heading into this next week I know what I have to do to help my team improve. Vigorous analysis of our financial plans and various other reports is needed so that I am able to go into our next time meeting as prepared as I possibly can. Sitting down and honestly discussing what our strategy will be for the rest of the semester should “highlight a need for significant changes in how the company allocates resources, deploys people, and reviews results” (Baghai, Smit, & Viguerie, 2009 p.88) and hopefully see us heading on the right track. As we have now been taken over by a company that has consistently done relatively well, I believe that there is a lot I can learn from my parent company’s CFO and I will be drawing on their advice.
Baghai, M., Smit, S., & Viguerie, P. (2009). Is your growth strategy flying blind? Harvard Business Review, 87(5), 86---96.
Davenport, T. H. (2006). Competing on analytics. Harvard Business Review, 84(1), 98--107.