The Business Model
The business model uses the Determinants of Business Success as input data to assess and predict a company's performance and potential. By utilising a range of quantitative metrics and qualitative insights across these determinants, the model applies formulas and user defined "weightings" to aggregate data. A scoring algorithm is used to distill these findings into a 0 to 1000 scale, providing a comprehensive, numerical evaluation of the business's viability and growth potential. This score is translated into a clear, English-language output that offers actionable insights and guidance, allowing users to easily interpret the results and make informed decisions. This approach ensures a balanced view that combines both data-driven rigor and practical understanding, enhancing strategic planning and operational effectiveness.
Data Inputs
Descriptions of the principle components of business development appear in the "Business Analytics" section. Precise values and formulas are in our training courses, coaching and consulting sessions and of course our Book - "Determined to Succeed" (by Gerry Skews).
Model Variables
For each determinant of success there are up to 10 variables used in the calculation
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A variable can be a "direct", "indirect" or an "insight" (Not initially numeric)
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Insight variables may be aggregated from other data sources
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Insight variables may be the result of subjective surveys in which case they are cross correlated.
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Each variable is designed to be "sensitive" and "specific" to the parameter and can be improved using standard correlation and regression techniques.
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Each variable has a different weighting on the outcome, for example "customer acquisition rate" and "product sales performance" are not necessarily equally weighted.
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Each variable has a user defined "Constant and Coefficient" that is used to adjust sensitivity and specificity values.
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Each "Determinant" also has a variable Constant and Coefficient for the same reason to calculate the whole business model
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The constant and coefficient may change as the business develops or the management seeks to change strategic priorities.
Data Aggregator
Data sources are explained in our training and coaching data sheets and the book that accompanies the training course. We use a variety of data gathering techniques but each are heavily distilled to ensure brevity and accuracy with cross correlation where necessary.​
The key point here is that the same data can be used in different determinants and may have different weightings (e.g. Customer Lifetime Value has a different impact on capital availability than it may have on marketing efficacy)
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The business model is designed to be NON INTRUSIVE with most data coming from routine operations and regular reporting. The aggregation occurs as the information rises through the organisation.
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Data is currently aggregated in MS Excel. Example models are built programmatically using "Jotform". (others are available)
Model Outputs
1. Stellar
A "Stellar" business is not just performing well but is redefining excellence within its industry. It sets the highest benchmarks for success and innovation, and its performance is distinguished by an exceptional blend of strategic foresight, operational excellence, and market influence.
This level of success positions the business as a leader and trendsetter, with the ability to shape industry practices, influence market dynamics, and maintain an enduring competitive edge
3. Thriving
A "Thriving" business is characterised by its dynamic growth, strong market position, and capacity to innovate and lead within its industry.
This stage involves leveraging strengths across all key determinants of success to sustain and accelerate growth. The business is highly resilient, adaptable, and well-prepared to capitalise on new opportunities, ensuring long-term prosperity and competitive dominance
5. Growing
A "Growing" business is characterised by its ability to expand its operations, increase its market share, and enhance its overall financial performance.
It has successfully moved beyond mere sustainability and is actively pursuing strategies that foster significant growth.
This stage involves leveraging strengths, addressing any remaining weaknesses, and continuously innovating to maintain momentum
2. Excellent
An "Excellent" business is recognised for its outstanding performance and leadership in its sector. It consistently sets high standards and achieves superior results in all key determinants of success.
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The business is not only thriving but also driving industry trends, influencing market dynamics, and inspiring others through its best practices.
This level of performance ensures sustained competitive advantage, resilience, and the ability to seize emerging opportunities, maintaining a position of industry leadership
4. Competent
A "Competent" business is marked by its ability to sustain and build upon its successes through effective management and strategic foresight.
This stage involves leveraging established strengths, addressing areas for improvement, and maintaining a focus on continuous improvement and innovation. The business is well-prepared to handle challenges and seize opportunities, ensuring long-term viability and competitiveness in the market.
6. Sustainable
A "Sustainable" business. While the business is not excelling in every area, it has achieved a level of stability that allows it to sustain itself over the long term.
To move beyond sustainability, the business must continue to strengthen its competencies and address any areas of weakness
7. Survivable
In the context of the model, "Survivable" is defined as achieving a score between 300 and 399 out of 1000 based on the 10 key determinants of success.
This score indicates that the business is able to sustain operations and avoid immediate failure but faces considerable challenges that hinder its potential for growth and profitability.
The business has developed some competencies but they are not strong enough to ensure long-term success. The business is surviving, but it must address its weaknesses and enhance its strengths to move beyond mere survival and achieve a more stable and prosperous position.
9. Struggling
In the context of the model, "Struggling" is defined as achieving a score between 100 and 199 out of 1000 based on the 10 key determinants of success.
This score indicates that the business faces substantial challenges and deficiencies in several critical areas.
These issues suggest that the business is having difficulty sustaining operations and may be at risk of failure if corrective actions are not taken to address the identified weaknesses.
8. Marginal
In the context of the model, "Marginal" is defined as achieving a score between 200 and 299 out of 1000 based on the 10 key determinants of success.
This score suggests that the business is operating at a minimal level of performance and has notable weaknesses across several critical areas.Although the business is not in immediate danger of failure, it is not performing well enough to ensure long-term sustainability and growth. Key areas are insufficiently developed, indicating that significant improvements are necessary to move the business from survival mode to a more stable and profitable state.
10. Failing
In the context of the model, "Fail" is defined as achieving a score between 0 and 100 out of 1000 based on the 10 key determinants of success.
This low score indicates that the business has significant deficiencies in critical areas. These deficiencies suggest a high likelihood of the business failing to achieve its objectives, sustain operations, or generate a return on investment.
Summary
The Business Model is used strategically to assess investment risk, originate and manage key performance indicators (KPI's), test business strategies and manage business intervention actions. Accurate input data improves outcomes in all cases. The business model is initially set true for generic businesses and is adjusted using basic weighting corrections for the specific business. While its main use is for guidance a key benefit is its ability to keep many things on track simultaneously during normal business operations.
