The DIAGNOSTIC TOOLKIT - Northrup, CPA · scheduling system and inventory data. • The order...

The DIAGNOSTIC TOOLKIT

northrupcpa.com816 Courthouse Peak Montrose, CO 81403

by C. Lynn Northrup, CPA

The Diagnostic Toolkit

1 ©All Rights Reserved

C. Lynn Northrup, CPA, CPIM 970-964-4927

[email protected] www.northrupcpa.com

Table of Contents

1. Overview 2. Business Overview Checklist 3. Detailed Operational Questionnaire 4. Human Resources Questionnaire 5. Process Management Questionnaire 6. Sales and Marketing Questionnaire 7. Lean Metrics 8. Assessment Scorecard





Overview

The Diagnostic Toolkit is a collection of tools, checklists, and questionnaires to be applied to business operations. The tools were primarily focused on manufacturing businesses but can be used for any business situation. The Operational Overview Checklist emerged from my days of conducting operational reviews and assessments. The checklist was designed to provide reminders of areas and topics to cover in our consulting engagements. Business owners should use it in the same fashion by triggering thoughts and areas for focus and investigation. The Detailed Operational Questionnaire focuses on manufacturing and production operations and provides a comprehensive basis for analyzing operations. While the questionnaire is quite detailed, it provides a good foundation for uncovering problems and identifying opportunities for improvement. The questionnaire is a good fit for use with The Self-Assessment Toolkit. Regular reviews and updates on the status of business operations should conducted by business owners. The toolkit provides reminders of things to check on and for reviewing the current situation for possible improvements and opportunities for making enhancements to business operations. The Process Management Questionnaire provides a great resource for reviewing business processes. In addition, the Human Resources Questionnaire and the Sales and Marketing Questionnaire are effective tools when conducting a business check up and determining the effectiveness of business processes. The Lean Metrics are primarily focused on manufacturing, but some of the metrics or key performance indicators have application to non-manufacturing operations. The Assessment Scorecard is a sample of what can be included in a dashboard presentation. The overall concept of the Toolkit was to provide ideas, thoughts, and questions from the perspective of a consultant that can be used by business owners and entrepreneurs. It was intended to trigger your thought process and develop ideas and concepts for business improvements.





Business Overview Checklist General Checkpoints and Questions A. Managerial / General 1. Employees 2. Systems (computerized and manual) 3. Product types 4. Sales Volume in $ 5. Sales Volume in units 6. Reporting needs 7. Type of Business

Make to Stock Make to Order Engineer to Order Assemble to Order Process Or combination of above.

B. Systems 1. Staff 2. Number of users 3. Operating system 4. WAN (Wide Area Network) C. Accounting 1. Staff 2. Consolidation 3. Multi-site 4. Reporting needs 5. Chart of accounts 6. Account number size 7. Largest transaction and balance 8. Entries - auto reversing / auto recurring 9. Processing - batch / on-line 10. Accounting periods 11. Prior monthly adjustments 12. Aging/AR Collection requirements 13. Year-end issues 14. Recurring invoicing 15. Commission issues 16. Distribution reporting 17. 1099's or magnetic data 18. LIFO/FIFO, Average, Last, Standard

19. Cloud Accounting Systems 20. Performance Measurement Dashboards





D. Sales/forecasting/master scheduling 1. Product types or families 2. Staff 3. Markets 4. History requirements and availability 5. Reporting needs 6. Lead-times (How are they determined) E. Order entry and customer service 1. Product types 2. Staff 3. Serial/lot 4. Hard/soft allocation 5. Delivery cycle time 6. Reporting needs 7. Quotations 8. Pricing 9. Substitutions 10. Credit history requirements F. Inventory management 1. Multi-location 2. Multi-bin 3. Serial/lot 4. Hard/soft allocation 5. Cycle counting 6. Reporting needs 7. Bar code 8. Physical Inventory Frequency G. Engineering/order preparation 1. Product types 2. Staff 3. Bill of Material Accuracy 4. Routing Accuracy a) Rates b) Process Steps 5. Set up time 6. Reporting needs H. Materials/purchasing 1. Raw material 2. Commodity 3. Vendor performance 4. Staff





5. Serial/lot 6. Reporting needs 7. MRP I. Payables 1. Terms 2. Staff 3. Reporting needs 4. Cash projections J. Shop order scheduling and capacity loading 1. Work center 2. Department 3. Lines 4. Outside processing 5. Material issue and scrap 6. Serial/lot 7. Indirect labor 8. Direct labor 9. Product types 10. Finite / Infinite 11. Reporting needs 12. Data collection 13. Machine K. Material handling - flow 1. Plant layout 2. Equipment 3. VMI L. Plant reporting 1. Employee 2. Work center 3. Department 4. Machine 5. Bar code M. Job/cost analysis 1. Order level 2. Product level 3. Employee 4. Department 5. Work center 6. Machine N. Finished goods and shipping 1. Customer service levels 2. Drop shipments





3. Returns 4. Bar code O. Receivables 1. Staff 2. Reporting needs 3. Terms 4. Aging and cash projections P. Sales analysis and history 1. Customer 2. Products and product types 3. Period to period comparatives 4. Forecasting Processes Q. Quality Systems 1. ISO or QS 2. Cost of Quality Metrics 3. Staff 4. SPC requirements or needs

5. Reports





Detailed Operational Questionnaire The Organization’s Commitment to Excellence Is there a commitment by top management to use effective planning and control techniques using a single set of numbers by all members of the organization? Sales and Operational Planning Is there a sales and operational planning process in place that maintains a valid, current operating plan in support of customer requirements and the business plan?

• Is there a concise written S & OP policy covering purpose, process, and participants? • Is S & OP truly a process and not a meeting? • Are meeting dates set well ahead of time? • Is a formal agenda established and circulated? • For each product family, are plans reviewed in units of measure that communicate

effectively? • Is the new product development schedule reviewed in the S & OP meeting? • Does there appear to be proper preparation for the meeting? • Does presentation of information include: sales, production, inventory, backlog,

shipments, and new product development? • Is there a mechanism in place to ensure that aggregate sales plans agree with detailed

sales plans? Is there consensus from sales, marketing, and operating management? • Have time fences been established as guidelines for managing changes? • Is there an ongoing critique of the process and its effectiveness?

Financial Planning, Reporting, and Measurement Is there a single set of numbers used by all functions within the operating system, which provides the source data used for financial planning, reporting and measurement?

• If financial projections differ from financial plans, are the differences reconciled? • Does the finance department use the same source data as other departments for sales,

shipments, and any other operating system information? • Does the finance department recognize and understand the limitations of traditional

performance measurements, particularity overhead allocations and the methods to overcome this possibly misleading data?

• Are all financial systems (billing, accounts payable, cost accounting, purchasing, receiving, inventory, etc.) fully integrated with all transaction systems?

• Are accounts payable, purchasing, and receiving agreed and reconciled to material receipt transactions?

• Is labor reporting, either in the form of transactions or in the form of an allocation of labor hours, used to determine the product costs?





• When work orders are used are work order closing transactions used to generate the movement of inventory from one account to another in the general ledger and to trigger variance reports?

• Do customer order shipment transactions drive the updating of finished goods inventory and the billing system at the same time?

• Is a cash-flow plan prepared using the numbers from the operating system? • Are simulation tools actively used to convert operating data into financial data for the

purpose of simulation testing, decision-making, and contingency planning? • Is the finance department proactive in simplifying all financial processes and eliminating

non-value added activities? What If" Simulations Are "what if" simulations used to evaluate alternative operating plans and contingency plans for materials, people, equipment, and finances?

• Is rough-cut capacity planning used to evaluate the impact on critical resources of alternative production and master production schedule plans?

• Where applicable, is capacity requirements planning used to evaluate detailed capacity constraints when planning labor and equipment requirements?

• Are Material Requirement Planning and Distribution Requirements Planning methodologies utilized to evaluate planning factors (e.g. lot size, safety stock, lead time, etc.) and the resultant impact on inventory levels?

Accountable Forecasting Process Is there a process for forecasting all anticipated demands with sufficient detail and adequate planning horizon to support business planning, sales and operation planning, and master planning?

• Is there clear accountability for developing the forecast? • Are all demands included in the forecast? • Are available statistical forecasting tools utilized? • Are spare parts and other lower level demands handled within the forecasting process? • Are aggregate and detailed measurements of forecast accuracy used to improve the

process? Sales Plans Is there a formal sales planning process in place with the sales force and who is responsible and accountable for developing and executing the resulting plan?

• Actual sales are measured against sales plans? • Are the incentives of the sales compensation program effective and unbiased? • Are aggregate forecasts reconciled with the sales plan?





• Does the sales function participate with the manufacturing function in demand planning for the S & OP meeting?

• Are sales areas provided with useful feedback regarding their performance to plan at least monthly?

• Are the assumptions underlying the sales plan documented? Integrated Customer Order Entry and Promising Determine if customer order entry and promising are integrated with the master production scheduling system and inventory data.

• The order promising has access to appropriate and timely information such as available to promise (ATP), to ensure that good promises can be made.

• Sales and marketing participate in developing appropriate time fences for managing change.

• Is there a process in place for identifying and managing abnormal demands? • Are customer orders processed on a timely basis? • Are order entry errors measured and managed to eliminate the causes of errors. • Are the numbers of customer-initiated sales change orders measured and managed to an

acceptable level? Master Production Scheduling Is the master production scheduling process perpetually managed in order to ensure a balance of stability and responsiveness. Is it reconciled with the production plan, which was developed from the S & OP process?

• Is there clear accountability for maintaining the master schedule? • Do the master schedulers understand the product, manufacturing processes,

manufacturing planning and control system together with the needs of the market place? • Does the master scheduler participate in the S & OP process? • Determine if the master scheduler responds to feedback that identifies that when the

master schedule impacts material and/or capacity availability problems by initiating a problem resolution process.

• Are planning bills of material (if used) maintained jointly by the master scheduler and sales and marketing?

• Is a written master schedule policy available, which establishes measured goals? • Is the master schedule "firmed up" over a sufficient horizon to provide for stability of

operations? Are the following guidelines established: Cumulative material lead-time? Lead-time to planned capacity? Lead-time to cover customer order backlogs?

• Are master schedule changes within the frozen (closest) zone effectively managed and with proper authorization of changes?





• Determine if there is a policy governing the use of safety stock and/or option over planning to increase responsiveness and compensate for inconsistent supply or demand variations.

• Is the master schedule summarized and reconciled with the agreed to production rate from the S & OP process.

• Are all levels of master scheduled items identified and master scheduled? • If the master schedule is in weekly, daily, or smaller periods, is it reviewed and revised if

necessary at least weekly? • Does the structure of the bills of material support the master scheduling process? • Are forecast consumption processes used to prevent planning nervousness? • Determine if alternative approaches, which are used with planning bills, are well

understood and that an alternative process is used. • Is rough-cut capacity planning used to evaluate the impact of significant master schedule

changes on critical resources? • Determine if a finishing/final assembly mechanism or kanban approach is coordinated

with the master schedule to schedule customer orders to completion or replenish finished goods.

Material Planning and Control

• Does the material planning process maintain valid schedules and a material control process that communicates priorities through a manufacturing schedule, dispatch list, supplier schedule, and/or a kanban mechanism?

• Evaluate if material planners and schedulers understand the product, the manufacturing process, the manufacturing planning and control system and are accountable for maintaining a valid plan.

• Determine if all involved employee responsibly feedback problems that cannot be resolved are addressed.

• Do planners review and analyze the accuracy and validity of planning parameters such as order quantities, lot sizes, lead times, queues, and safety stock?

• Do production supervisors and buyers understand and use the system and are they accountable for maintaining data integrity such as point of use inventory, planning parameters, schedules and order file data?

• Determine if there is a formal communication process among planning, production, and purchasing for exchanging information required to maintain a valid schedule.

• Have informal priority systems such as shortage lists, hot lists, priority codes been eliminated and replaced with one priority setting mechanism?

• Are MRP time periods weekly or smaller to provide appropriate resolution of priorities? • Is the MRP system run frequently enough to maintain valid schedules? • Does the system use standard logic to generate action/exception messages including Need

to Release Order, Need to Reschedule Order, Need to Cancel Order, Due Date, Past Due, or Release Past Due?





• Is the "firm plan order" capability of the system being used to override the suggested plan when necessary?

• Are planners using single-level pegging to identify the source of demand? • Does the system have an effective component availability checking mechanism that the

planners use to determine the feasibility of releasing an order or schedule? • Does the system have the capability to alter a bill of material for an individual order when

necessary to accommodate temporary substitutions? • Inquire to determine that all action/exception messages are prioritized, reviewed, and

problems acted on in a timely manner. • Determine if action/exception messages for each planner are monitored for activity and

trends. • Where work orders are used, determine that the volume of reschedules is tracked to

monitor the stability of the plan and identify the causes of excessive rescheduling activity.

• For work order situations, evaluate that orders are released with full material availability and lead-time 95-100 percent of the time.

Shop Floor Control

• Is production management accountable to meet operation dates? • Determine if the dispatch list is the only priority tool, and operation due and start dates

are the only priority techniques used. • Does the system include detailed scheduling capability to create start and due dates on a

work order and operations within a routing? • Does the system include the capability to modify all start and due dates? • Does the system include the capability to report status by operation? • Is an anticipated-delay reporting process used to maintain due date validity? • Does the system include a dispatch list by work center showing item number, order

number, order quantity, operation number, operation start and due date, and order due date?

Supplier Planning and Control Review and determine that the supplier planning and scheduling process provides visibility for key items covering an adequate planning horizon.

• Determine if at least 80 percent of the suppliers have been educated in MRP II and/or JIT and are familiar with and understand the supplier process.

• Have suppliers agreed to plan raw material and capacity to meet the requirements displayed on the supplier schedule?

• Determine if there is a clear policy statement of the respective responsibilities of the supplier scheduler and buyer and identification of what point each becomes involved with problem resolution.





• Does the supplier schedule display planned orders and/or scheduled receipts over the planning horizon for all items provided by the supplier?

• Determine if commitment zones are established in the supplier schedule representing firm commitments, material commitments, and capacity planning commitments.

• Are time periods on the supplier schedule segmented in weeks or smaller increments for at least the first four weeks displayed?

• Ascertain if supplier schedulers and/or buyers meet with production planners as frequently as required to maintain a valid schedule.

• Determine if suppliers understand the principle behind "silence is approval" and agree to notify the buyer in advance if due dates will be missed.

• Are supplier schedules communicated to suppliers at least weekly? • Inquire if 95 percent of purchase orders for non-supplier schedule items are released with

full lead-time. • Determine if there is a purchasing policy that provides a set of criteria defining "key"

items, which are planned and scheduled through a supplier scheduling process. Typical considerations include factors such as 80 percent of purchase content, long lead times, critical items, etc.

Capacity Planning and Control Does the process use rough cut capacity planning, and, where applicable are capacity requirements based on demonstrated output and balanced with required capacity? Does the capacity control process measure and manage factory throughput and queues?

• Evaluate the level of understanding of capacity planning by appropriate personnel and determine if they are using it to plan labor and machinery requirements.

• Determine if the capacity planner and production supervisor are maintaining the accuracy of production-oriented capacity planning parameters such as planned capacity, number of workers and/or machines, number of shifts.

• Are production supervisors and capacity planners meeting at least weekly to resolve capacity issues?

• Are all activities that consume capacity such as maintenance, engineering projects, and customized parts considered in developing the capacity requirement?

• Where appropriate are constraints such as engineering and supplier capacity considered in the capacity management process?

• Determine if work centers are appropriately defined to enable control of priorities and capacities.

• Is a "Load Factor" utilized that recognizes capacity loss due to utilization, efficiency, and absenteeism are maintained and used in projecting capacity?

• Establish and evaluate how corrective action is taken to address overdue capacity requirements created by past due orders.





Capacity Requirements Planning • Determine if the system produces capacity requirements summary reports by work center

together with a detailed capacity report. • Is data used by the system audited for accuracy including capacity planning parameters

such as demonstrated capacity, planned capacity (both within reasonable tolerances), number of workers/machines, number of shifts, number of hours per shift, etc?

• Does the process include variance analysis of planned and actual input, output, and queue levels (Input/Output Report)?

Customer Service

• Has an objective been established for "on-time" deliveries and are customers in agreement?

• Is performance against the objective measured?

Performance Metrics Is delivery to first promise and/or line item fill rate at least 95 percent or higher as required

by customers? Determine if graphs or charts showing the distribution of shipments about promised or

targeted dates are maintained along with appropriate analysis and that primary causes of deviation are highlighted.

Sales Plan Performance

• Has accountability for the sales plan been established? • Has the method of measurement been agreed upon?

Production Plan Performance Assuming that accountability for production plan performance has been established and the method of measurement and goal have been agreed upon, is actual performance (+/-) more than 2 percent of the monthly plan? Master Production Schedule Performance

• Has accountability for master production schedule performance been established and has the method of measurement and goal been agreed upon?

• Master production schedule performance should be within 95 to 100 percent of the plan.





Manufacturing Schedule Performance

• Has accountability for manufacturing schedule performance been established and has the method of measurement and goal been agreed upon?

• The manufacturing schedule performance should be 95 -100 percent of the plan. Supplier Delivery Performance

• Check to see that supplier delivery performance has been established together with the method of measurement and that the goal has been agreed upon.

• Supplier delivery performance should be within 95-100 percent of the plan. Bill of Material Structure and Accuracy

• Is the planning and control process supported by properly structured, accurate, and integrated sets of bills of materials (formulas, recipes) and related data?

• Bill of material accuracy should be in the range of 98-100 percent. Performance Metrics

• Establish that there is a defined policy for the responsibility and accountability for development and maintenance of bills of material.

• Do all functions that use the bills of material participate in their development? • Determine that bills of material are properly structured, represent the way products are

built, and support the planning and control processes. • Audit results to determine the level of accuracy of bills of material. They should be in the

range of 98-100 percent. • Establish that finance uses the bills of material to cost the product. • Determine if a policy and procedure is in place identifying who is responsible for loading

and maintaining each field of the item master. Inventory Record Accuracy

• Is there an inventory control process in place that provides accurate warehouse, stockroom, and work-in-process inventory data?

• At least 95 percent of all item inventory records should match the physical counts, within the counting tolerance.

• Determine if cycle counting has replaced the periodic physical inventory. Routing Accuracy

• When routing is applicable, is there a development and maintenance process in place which provides accurate information?

• Routing accuracy should be in the 95-100 percent range.





Performance Metrics • Determine if all functions that use routings participate in their development. • Establish that routings represent the way products are made and are integrated with the

bills of material. • Is there a routing accuracy audit process in place that examines the routings for proper

sequence of operations, work center number, missing or unnecessary operations, and, with tolerance, set-up and run times.

• Audit results to determine that routing accuracy is in the range of 95-100 percent. • Establish that finance uses routing data in costing products.

Education and Training Is an active education process in place for all employees which is focused on business, and customer issues, and improvements. Objectives of the education process should include Continuous Improvement, enhancing the empowered worker, flexibility, employment stability, and meeting future needs. Does the education and training process utilize tools like team-based technologies, Just-in-Time (JIT), Total Quality Control (TQC), and Manufacturing Resource Planning (MRP II)? Distribution Resource Planning (DRP) Is Distribution Resource planning, where applicable, used to manage the logistics of distribution? Is DRP information used for sales and operational planning, master production scheduling, supplier scheduling, transportation planning, and scheduling of shipping?

• Distribution requirements are considered in the S & OP and master production scheduling process.

• Determine that the distribution network maintained in the DRP system is complete and reflects all items stocked at each distribution center.

• Are forecasts available for each SKU in each distribution center? • Determine that time periods for DRP are weeks or smaller. • Determine that Distribution Resource Planning is run weekly or more frequently. • Establish that the DRP system includes the following characteristics:

Firm planned orders Pegging capabilities Customer orders promised for future deliveries in addition to forecasts Ability to include backorders in netting logic Ability to maintain and change inventory records, location records, and scheduled

receipts Supplier scheduling to provide visibility to outside suppliers Rescheduling messages

• Does the system provide pertinent information for transportation planning?





• Does the system provide a shipping schedule while at the same time satisfying established loading and shipping needs?

• Are kanban methodologies used to trigger replenishment from the central supply facility to the distribution centers?





Process Management Questionnaire Value Creation

• How does your company determine its key value creation processes? • What are the company’s key product, service, and business processes for creating or

adding value? • How do these processes create value for:

The organization? Customers? Key Stakeholders?

• How do they contribute to profitability and business success? • How are key value creation process requirements determined? • List the key requirements for these processes. • How does your company design these key processes to meet all the key requirements?

Technology and organizational knowledge Cycle time Productivity Cost Control

• How are these processes implemented to ensure that they meet the design requirements? • What are the key performance measures or metrics that are used to control and improve

your value creation processes? See Lean Metrics and The Assessment Scorecard) • How does the day to day operation of these processes ensure meeting key process

requirements? • How are process measures used to manage the processes? • How does the organization use customer, supplier, and partner input to manage the value

creation processes? • How does the organization minimize the overall costs associated with inspections, tests,

and performance audits? • How does the company prevent defects, rework, and minimize warranty costs? • How are the value creation processes improved to achieve:

Better performance? Reduce variability? Improve products and services? Keep processes current with business needs? Improvements shared with other organizational units and processes?





Customer Focused Results

• What are the company’s current levels and trends in key measures of customer satisfaction and dissatisfaction?

• How do they compare with your competitor’s levels of customer satisfaction? • What are your company’s levels and trends in key measures or indicators of customer-

perceived value? • How effective is customer loyalty and retention? • Are other positive referral and aspects of building relationships with customers being

effectively utilized?

Product and Service Results • What are your company’s current level and trends in key measures or indicators of

product and service performance? • How do these results compare with your competitor’s level of performance?

Financial and Market Results

• What are your company’s current levels or trends in key measures or indicators of financial performance?

• What are the aggregate measures of financial return and economic value? • What indicators are used to monitor levels of marketplace performance:

Market share Business growth New markets entered

Human Resource Results

• What are your company’s key measures or indicators of work system performance and effectiveness?

• What are the company’s key measures of employee learning and development? • What metrics are use to monitor and measure employee well-being, satisfaction, and

dissatisfaction?





Organization Effectiveness Results • What are the company’s measures of operational performance of key value creation

processes? Cycle tune Productivity Partner performance Other measures of effectiveness and efficiency

• What are key measures of the operational performance of key support processes? Productivity Cycle time Supplier and partner performance Other measures of effectiveness and efficiency

• What are the key measurements of accomplishment of organizational strategy and related action plans?

Governance and Social Responsibility Results

• What are the company’s key measurements of fiscal accountability, both internal and external?

• What are the company’s results based on key measures of ethical behavior and stakeholder trust in the governance of the organization?

• What are the results based on key measurements of regulatory and legal compliance? • What are the results based on key measurements of organizational citizenship in support

of you key communities?





Human Resources Questionnaire

Organization and Work Management

• How is the company organized to manage work projects and jobs that will promote: Cooperation? Initiative? Empowerment? Innovation? Organizational culture?

• How is work managed and organized to provide the agility to remain current with business needs and requirements?

• Do work systems capture and capitalize on the diverse ideas and thinking of employees and the communities with which you interact?

• How does the company achieve effective communication and skill sharing across work units, jobs, and locations?

Employee Performance Management System • How does the employee performance management and feedback system support high

performance work? • How does the employee performance system support a customer and a business focus? • How do compensation, recognition, and related reward and incentive practices reinforce

high-performance work and a customer and business focus? Hiring and Career Progression

• How does the company identify the characteristics and skills needed by potential employees?

• How does the company recruit, hire, and train new employees? • How does the company ensure that employees represent the diverse ideas, cultures, and

thinking of the employee hiring community? • How is effective succession planning provided for leadership and management positions? • How is effective career progression provided for all employees throughout the

organization?





Employee Education, Training, and Development • How does employee education and training contribute to the achievement of the

company’s action plans? • How do the company’s employee education, training, and development address the key

needs of the organization’s performance measurement, performance improvement, and technological change?

• How does the company’s approach to education and training balance both short and long-term organizational objectives relative to employee needs for development, learning, and career progression?

• How do employee education, training, and development programs address the key organizational needs associated with new employee orientation, diversity, ethical business practices and management and leadership development?

• How do employee education, training, and development activity address the company’s key organizational needs associated with employee, workplace, and environmental training?

• How does the company seek and use input from employees, supervisors, and managers on education and training needs?

• How does the company incorporate organizational learning and knowledge assets into education and training programs?

• How is education and training delivered? Are both formal and informal approaches utilized, as appropriate?

• How is input from employee, supervisors, and managers used to determine the options for the delivery of education and training?

• How is the use of new knowledge and skill reinforced on the job? • How is the effectiveness of education and training evaluated, taking into account

individual and organizational performance?

Motivation and Career Development • How does the company motivate employees to develop and utilize their full potential? • What formal and informal mechanisms are use to help employees attain job and career

related learning goals? • How do managers and supervisors help employees to attain job and career related

development and learning goals?





Work Environment • How does the organization provide for continuous improvement of the workplace health,

safety, security, and employees ability to adjust to the environment? • How do employees participate in this process? • What are the performance measures or targets for each of these key workplace factors? • When employee groups and work units have different work environments how does your

organization deal with differences in workplace factors and performance measures? • Does the organization have programs and procedures in place to deal with disasters and

emergencies? • Do these plans provide for business continuity for the benefit of both employees and

customers?

Employee Support and Satisfaction • How does your company determine the key factors affecting:

Employee well-being Satisfaction Motivation

• How are these factors segmented for a diverse workforce and different categories and types of employees?

• How does your company support its employees via services, benefits, and polices? • How are these programs tailored to the needs of a diverse workforce and different

categories and types of employees? • What formal and informal assessment methods and measures are used to determine

employees’ well being, satisfaction, and motivation? • How do these methods and measures differ across a diverse workforce and different

types of employees? • Describe how your company uses indicators summarized below to assess and improve

employee well-being, satisfaction, and motivation. Employee retention Absenteeism Grievances Safety Productivity

• How are these assessment findings used to relate to key business results to identify priorities for improving the work environment and employee support climate?





Teamwork • Does the company formally utilize the concepts of high-performance work teams in an

effective manner? • Are roles and jobs formally structured to support a teamwork approach? • Is each team provided with a clearly defined description of its mission together with

operating guidelines? • Do teams meet regularly to discuss and explore opportunities for improvement in its

work area? • How effectively do the team members communicate and rely on each other for cross

training, problem solving, administrative tasks, and mutual support? • Do the teams utilize structured methods to assess and review processes to improve the

effectiveness of operations? • Does each team or work group have a defined process for receiving direct feedback from

both internal and external customers? • Are requirements of customers visible in the work area? • Are the work teams directly involved in establishing quantitative and qualitative

measurement of operational effectiveness and productivity? Compensation System

• Does the company have a documented compensation administration program? Is it reasonable?

• Is the compensation program competitive and sufficient to minimize employee turnover? • Doe the company have qualified retirement plans?

Pension programs? A 401K program? Profit sharing program?

• Does the company provide benefits as compensation? Deferred Compensation? Health Insurance? Dental Insurance? Key-person Life Insurance? Group Life Insurance? Disability Insurance?

• How frequently are the benefits programs reviewed and updated?





Sales and Marketing Questionnaire Customer and Market Knowledge

• How does your organization determine the requirements, expectations, and preferences of customers and markets?

• How does the organization determine the continuing relevance of products and services to develop new opportunities?

• How do you determine or target customers, customer groups, and market segments? • How are customers of competitors and other potential customers and markets included in

this determination? • How do you listen and learn to determine key customer requirements and expectations? • What determination methods are used for different customers and customer groups? • How do you use relevant information from current and former customers?

Customer loyalty Retention Win/loss analysis Complaints

• How is this information used for the purposes of product and service planning, process improvements, and other business development?

• How are listening and learning methods kept current with business needs and directions?





Customer Relationships and Satisfaction

• How does your organization build relationships to acquire customers? Meet and exceed their expectations? Increase loyalty and repeat business? Gain positive referrals?

• What are your key access mechanisms for customers to seek information and conduct business?

• How do you determine key customer contact requirements for each mode of customer access?

• How do you ensure that these contact requirements are deployed to all people and processes in the customer response chain?

• Describe your complaint management process. • How are complaints resolved effectively and promptly? • How are complaints aggregated and analyzed for use in improvement throughout your

organization and by your partners? • How do you keep your approaches to building customer relationships current with

business needs and directions? • How do you determine customer satisfaction and dissatisfaction? • How do these determination methods differ among customer groups? • How do you ensure that your measurements capture actionable information for use in

exceeding customer expectations and securing future business and referrals? • How is customer satisfaction and dissatisfaction information used for improving the

process? • How do you follow up with customers on product, services, and transaction quality to

receive prompt and actionable feedback? • How do you obtain and use information on customers’ satisfaction relative to competitors

and industry benchmarks? • How are approaches for determining satisfaction kept current with business needs and

directions?





Marketing Strategy • Is the business mission clearly stated in marketing oriented terms and is it feasible? • Are the organization’s marketing objectives and goals clear and adequate to guide

planning and performance measurement? • Is the marketing strategy appropriate to:

Achieving marketing objectives? Is the strategy convincing? Is it appropriate to the stage of the product life cycle? Is it appropriate to competitor’s strategies? How does it fit with the economy? What is the basis for market segmentation? Are the criteria clear for rating the segments and selecting the best one? Are accurate profiles developed for each target segment? Are marketing resources allocated optimally to the major elements of the

marketing mix? Are there enough or too many resources allocated to accomplish the marketing

objectives? Marketing Organization

• Does marketing management have adequate authority and responsibility for activities that affect customer satisfaction?

• Are marketing activities optimally structured along the following lines: Functional Product Segment End-user Geographical

• Are the lines of communications between sales and marketing effective and reliable? • Are product managers able to plan profits or just sales volume? • Are there needs for additional:

Training Motivation Supervision Evaluation

• Review the relationship between marketing and the following functions: Manufacturing R & D Purchasing Finance/Legal





Marketing Systems

• Is the marketing intelligence system producing accurate, sufficient, and timely information about marketplace developments relative to:

Customers Prospects Distributors Dealers Competitors Suppliers

• Do decision makers request adequate information for marketing research, and are they using the results?

• Is the company using the best methods for market measurement and sales forecasting? • How effective is the marketing planning system? • Do decision makers have adequate support systems available? • Does the planning system result in adequate sales targets and quotas? • Are control procedures adequate to ensure that plan/objectives are being achieved? • Does management periodically analyze the profitability of:

Products Markets Territories Channels of Distribution

• What process does the company use to gather, generate, and screen new product ideas? • Does the company conduct adequate research and business analysis before investing in

new ideas? • Does the company carry out adequate product and market testing before launching new

products? Marketing Productivity

• What is the profitability of the company’s: Products Markets Territories Channels of distribution

• Should the company enter, expand, contract, or withdraw from any business segments? • Does marketing have any activities where the costs appear excessive?





Marketing Function Products

• What are the company’s product line objectives? Are they sound? Are they meeting their objectives? Should they be expanded or contracted? What products should be phased out? What products should be added?

• What are the buyers’ knowledge and attitudes toward the company’s products? • Toward the competitor’s products? • What product and brand strategies need improvement or modification?

Pricing • What are the companies’s pricing objectives, policies, strategies, and procedures? • To what extent are prices set on cost? • Do customers see the company’s prices as being in line with the value of its offer? • What does management know about the price elasticity of demand, experience curve

effects, and competitors’ prices and pricing policies? • To what extent are price policies compatible with the needs of distributors and dealers,

suppliers, and government regulation? Distribution

• What are the company’s distribution objectives and strategies? • Is there adequate market coverage and service? • How effective are distributors, manufacturers’ representatives, brokers, agents, and

others? • Are any changes in the company’s distribution channels needed?

Advertising, Promotion, and Direct Marketing • What are the advertising objectives? • Are proper amounts being spent on advertising? • Are the ad themes and copy effective? • What do customers think about the advertising? • Are the advertising media well chosen? • How adequate is the internal advertising staff? • Is the sales promotion budget adequate? • Is there effective use of sales promotion tools such as samples, coupons, displays, and

sales contests? • How effective and creative is the public relations team? • Does the company make adequate use of direct, online, and database marketing?





Sales Force

• Define the objectives of the sales force? • Is the sales force large enough to accomplish the company’s objectives? • How is the sales force organized?

Territory Market Product

• Are there enough sales managers to guide the field sales representatives? • Does the sales compensation level and structure provide adequate incentive and

structure? • Describe and define the morale, ability, and effort of the sales force? • What is the adequacy of the procedures for setting quotas and evaluating performance? • How does the company’s sales force compare to the competitor’s sales force?

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