With SynergyWorks' dynamic forecasting services, our customers
are capable of making frequent reviews to their businesses' performance,
and making proactive changes. We equip them with an up-to-date business
plan that aims to maximize the profit for their businesses. Different
from traditional forecasting which provides static information on past
profitability, dynamic forecasting is able to generate work plans for
The importance of business planning
Business planning is a process that evaluates opportunities,
quantifies the resources required and lays out the plan to
achieve the profits you have set for the organization. It
integrates all the functional elements -- marketing, sales,
operations and finance into a single cohesive force and helps
you communicate what you want to do to new employees, vendors,
board members and investors.
Accurate business planning ensures that resources are well
integrated in the optimal proportion. For example, without
accurate business planning, business managers may run into
the risk of over-allocating resources to market product A and
leaving insufficient resources for product B, resulting in less
than optimal profit level for the firm. Other examples of inaccurate
business planning include:
- Example 1: Over-estimating
the potential sales achievable will result in over-provision of
resources and expenses in sales staff, marketing, customer service
to support sales that won't happen. It taxes the business with
unnecessary cost and cannibalizes the profitability of the business.
- Example 2: Under-estimating the potential sales achievable will
result in lost opportunities because there are insufficient sales staff
and other functional resources to capture these sales opportunities.
As a result, the organization is not able to realize the full profit
potential for the business.
"Any enterprise is built by wise planning, becomes strong through
and profits wonderfully by keeping abreast of the facts."
Proverbs 24: 3,4 (TLB)
Maximizing Returns on Resources
SynergyWorks helps its clients evaluate the opportunities
available and identify the opportunity that will help maximize
the potential profits that could be derived by the resources
employed and therefore maximizing shareholders' returns.
The goal of resource allocation
The goal of allocating resources is to maximize returns on
the limited resources available to the company,
be it capital, manpower, time available, etc.
The accuracy in allocating resources depends on the
depth of the analysis as shown in the example given below:
- Product A can increase your sales by $10 mil
and Product B can increase your sales by $8 mil. Which
product would you choose to invest your resources?
- Product A has a profit margin of $4 mil, so does product B.
Would you have changed your choice of product to invest in?
- All things (bad debts, promotions expenses, etc) considered,
Product A generated a net profit of $1.5 mil and product B a net
profit of $3mil, what is your decision?
- Product A requires a capital injection of $1.5 mil,
and product B requires a capital injection of $5mil. What
would be your final choice product?
Data Analysis and data mining
SynergyWorks helps its customers by delving
into their corporate database and extracting hidden &
valuable information for improving business performance. SynergyWorks
transforms this information into knowledge and allows its
customers to gain insights into their own businesses,
leveraging on the knowledge created to make timely and
accurate decisions. Our customers are therefore better
equipped to take on new challenges, operate more effectively
and make better quality decisions.
The value of data analysis and data mining
The introduction of information system to automate business
processes has resulted in the accumulation of data which
was primarily used to produce summary reports such as total
sales for the month. Organizations are beginning to recognize
the added value within these vast amounts of data that they are
Through data mining and data analysis, the sales register could
be used to monitor the sales activities, such that appropriate
resources are deployed. For example, the sales activities shows
that a retail shop is able to cope with one sales person at any
one time except during the time period from 5 to 7 pm everyday,
the shop manager could employ a part-time sales person to work
during this period instead of paying a full time sales person
for the same purpose.
In another example, a company plans to launch a promotion
targeting at its customers who are retirees and have not purchased
this product before. Without customers' purchased data to rely on,
the marketer guesses that 5% of the customers belong to this
category and orders the targeted number of products for the
promotion. The promotion could earn the company $30,000 profit
if the target is met.
It turns out that 10% of the customers respond and the company
could not realize another $30,000 of profits for the unplanned
5% of the customers because the product is not available for
the next 6 months.
Through data mining and data analysis, the marketer would not need
to guess the response for this promotion. It would have revealed
to the marketer that 10% of the company's customers fall into
this category and therefore sufficient stock would be made
available for these customers.
In the above scenario case, the response exceeds the target set and
the company only loses the opportunity to make another $30,000
of profit. What would have happened if only 1% of the customers
responded? Not only would the company be able to make $30,000 of
profit as set, it may also have to write off the remaining 4% of
stocks it could not sell because of the over-estimation.