How to use the Ansoff Matrix: The Ansoff Matrix is used for planning and analysis of alternatives for business growth. This matrix considers existing and new markets and existing and new products for business growth and development. The Ansoff Matrix has four quadrants: Business Growth with Existing Products in Existing Markets. This approach is Market … Read more
How is MVA calculated? The MVA formula: MVA = Market Value – Capital Value What is the relationship between MVA and Economic Value Added (EVA)? Market value added is the present value of any future EVAs. How is EVA calculated? EVA formula: EVA = after tax net operating profit – weighted average cost of capital … Read more
PDCA PDCA is a general methodology or framework for continuous problem solving process: Plan Do Check Act It is used in quality management as a foundation of the overall quality management approach in the organization.
Average marketing and sales cost associated with acquiring new customer. Example: total marketing investment divided by number of new customers. Example: % gross margin % net margin margin per product category margin per customer segment
What is a metric? Metric is a measure expressed in qualitative or quantitative way. Example of qualitative metric is excellent customer service or below average product quality. Example of quantitative metric is 25% sales growth or inventory value of $1,000. Business metrics are developed and used for tracking business performances and improving the business. Because … Read more
Customer / Market Segmentation Customer segmentation is critical and challenging. Understanding and quantifying your current customer base is the starting point for any successful segmentation. This step in the process requires decision makers to analyze the customer data. You need to define your current and relevant customer segments and quantify the segment size … Read more
Traditional vs. ABC Costing Effective cost analysis allows organizations to identify all costs related to doing business. When costs are allocated to particular products, departments, activities, services, customers, etc. managers can improve their knowledge and understanding of the real cost structure. As a result, management is capable of making informed decisions such as how to … Read more