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Creative Performance: In response to the recession
Faced with declining profitability in recession
profitability business is a challenge at any time, but never more so than during a recession because it generates cash, the lifeblood of any business. As the intervention decreases profitability is required. A common response is to cut discretionary spending quickly followed by looking at the more expensive, people. But there are other options and use of creative thinking as a working tool allows a creative response that can prevent the need for redundancies, while improving profitability and the establishment of the company to exploit the recovery.
The redundancy in these situations may be an obvious step, but can not be best or only possible move. The initial problem is to see the other options and then identifying solutions to these options. Faced with stressful and threatening situations is quite natural to find the scope of our limited thinking. Here is where creative thinking becomes a valuable business tool, their disciplines and techniques are able to advance these barriers, opening up many more options The first may have seemed possible.
The identification of the questions
The core business mechanisms are consistent with regardless of boom and crisis. This is a simple analysis highlights the main options for improving business – Figure 1 identifies a generic set. For any individual company will be others who depend on its precise nature. In good times this model highlights the keys to growth, while in bad times shown options for survival.
In the recession of the key strategies is to consider proactively ahead of any problems from becoming crises. In good times, it is advisable to regularly carry out the same analysis and determine how to improve and grow the business. In both situations the saying "Do what always get what you always "is a truth, if a different result is desired, then different action is required.
The key question for any business is "How can we improve profitability? There are two basic answers
- Increased profit margins and / or;
- Sell more products or services.
They then demand the question: How? But before that can be answered another level of detail is required, as shown in Figure 1. Each of the questions has the potential to impact on profitability and not explicitly asked about reducing headcount. You can actually emerge as the only viable strategy, but is the point, there are other options to consider. So since it seems that "to go" the company now has twelve or more likely to work.
Table 1: Options to improve profitability
I pancreas PROFIT MARGINS
Reduce costs
a) How to reduce the cost to make or buy the product / service?
b) How to reduce the cost of selling the product / service?
c) How to reduce overhead expenses?
d) How can the construction / installation costs?
e) How to reduce taxes?
A price increase
a) Can you just increase the price?
b) How can we add value to your product or service cost?
c) How can we increase the convenience?
SELL MORE OF PRODUCTS OR SERVICES
a) How can we sell more of existing products or services to existing customers?
b) How can we sell additional products or services existing customers?
c) Increase the size of the customer base
i) How to win customers from competitors?
ii) How can enter new markets?
CRITERIA
a) Maintain or increase productivity
b) Increase gross profit
c) profit in the year
d) If possible keep all personnel in advance of business growth
Thinking cliché and lack of obvious solutions
With regard to these questions may seem justified to observe that the situation has not changed much. There is still a list questions that can not seem few, or no obvious answers. This is the real point of that creative thinking into its own and demonstrates its value as a tool to improve the profitability of a business.
One of the ways in which the human mind works is to gather information in patterns that allow us to identify new situations based on their similarity to the patterns we have learned. Edward De Bono, the father of lateral thinking described this as "cliché thinking." The human mind has difficulty look beyond the well-known pattern, cliché, and we tend to fall into the answers that are part of the cliché. Creative thinking is simply the process of moving the common place to find new options that never would have happened to us.
Creative thinking requires that we be proactive, to challenge our interpretation of the situation. Annex 1 makes a logical, since it shows that there are a number of areas that may be addressed to improve profitability. Finding new options forces us to question assumptions, because assumptions limit our horizons to what our options are limited. stereotypical thinking and can lead us to the assumption that then only way to address the decline in cash generation (profitability) is to significantly reduce costs by laying off, but now we see there are other avenues to explore.
We also need to gain new perspectives by moving our thinking from the normal cliché-based perspectives. There is a number of techniques easily used to generate this new way of thinking. Edward De Bono called this lateral thinking and techniques such as object "forcing" use of random words are designed to inject new perspectives that challenge assumptions and prospects for change.
Breakthrough thinking, moving beyond the cliché
Another key element to break the cliché is thought an appeal to the collective wisdom and creativity of the company. It is often said that people of a company are its greatest asset. This is true.
When they need to address these fundamental issues else knows the business, customers, products and market better than the people in the business? A choice selection of the most valuable asset and it represents collective Company wisdom. Call the same time to examine and creatively find solutions to questions spread is a strong striker, is feasible, with an additional advantage generate acceptance and commitment when a specific set of solutions is chosen and must be applied. This approach allows the power of the company, its hidden potential, to be unleashed.
The process begins with "Mind of Mine." This is not just a store but a talking-thinking approach designed to get more creative beyond the obvious and stimulate new, creative ideas, allowing the team to the creative spark between them. This process can quickly generate a series of marks new ideas. In support of this there are a number of tools that help the team to look at things differently and to stimulate the creative process. These break the self-limiting assumptions, perspectives and beliefs that allow free many more options out of any of the team thought possible.
Then comes the refining process in which these ideas are reviewed and combined into a number of possible solutions are evaluated for feasibility and likelihood of success. The best are selected to advance planning.
Planning first considers whether the strategies, processes and procedures of the company, in its current state, are able to offer such solutions. Can unless new or modified processes are required. Then, the plan of action is set to move the chosen solution from concept to reality.
In this how a company can change its game with a new mentality, using creative thinking techniques to identify and implement options than ever before in your fingertips. It is capable cliché forward thinking in finding ways to improve their profitability, to ensure its performance during the recession and position to maximize the chance of recovery.
More details can be found in http://creative-solutions.adsidia.com
Breaking obstacles to profitability
creative thinking techniques can be used to tackle virtually any problem, challenge or opportunity. The wide range of situations in the dozens of questions in Figure 1 shows this. These techniques allow an advance team of the barriers that normally inhibit myopic problem solving, especially in times of stress, involving the team to improve their acceptance and commitment to the emerging solutions. They provide a way to make rapid progress beyond the problematic "white sheets-of-paper" and generate the kind of innovation that not only allows companies to find ways to survive but for the position for growth when the recovery comes.
Creativity is not simply a matter of art, or limited to high-tech innovation and life sciences. They represent the ability to do something new, something different, to change the game and gain the advantage. In the context of any business, creative thinking is a valuable tool regardless of economic conditions for the people of a company to make a significant difference to staff, customers and ultimately the bottom line profitability.
About the Author
Mike is co-founder and CEO of Adsidia, enabling business to improve profitability by developing excellent leadership and using creative thinking as a strategic business tool. Previously Mike was also a co-founder and VP Professional Services of a hi-tech software business providing innovative, fraud counter-measures solutions to telecoms service providers.
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