Delivering True Shareholder Value

Shareholder value is a business concept that can be hard to accurately define, but it is nevertheless, an important concept because without shareholder value you are unlikely to have a profitable, growing or thriving business. For certain investors it is easy to define and just means an increasing share price, but there is much more to it than that. Sometimes the share price of a company can be rising but costs could be rising even more.

Increasing shareholder value should be about establishing a business that has long-term viability and some of the areas that can contribute to that are customer satisfaction, providing a desirable product or service and making the best use of available resoures.

How to create realistic forecasts

Providing training is one way to growbusiness performance. For example, training in Scotsman sales qualification is the type of sales management training that can ensure business leaders create realistic forecasts. These will enable the company to make solid plan for future growth. A common problem with forecasting is that it is not accurate because people tend to make assumptions that may not be based on reality. Forecasts are more often based on whatpeople expect or hope to happen. Goodforecasting, based on measurable dataresults in confidence amongst the investors.

How to measure the right data

Many sales targets focus purely on numbers: numbers of deals closed or products sold but sales is not just a numbers game and numbers alone can be mis-leading. Five new clients might look good on paper but how profitable will those clients prove to be? Were the deals closed in such a way that repeat business is likely, or unlikely? These and other factors will affect the profitability of the business and the accuracy of forecasting future sakes.

Using a CRM system such as SalesForce or Microsoft Dynamicscan help make sure that the most important data is analysed, quickly and easily. The right data is readily available, all in one place, to provide valuable insights into the true state of the business and how and where it is adding value for the shareholders.

Improve Productivity

Increasing productivity is, for many companies, the holy grail. Knowing how to identify which parts of the business are profitable, and which are not, is essential for all thriving organisations because there is simply no point carrying the dead weight of unprofitable procedures, products or services. Everything should add value to the company in one way or another, and that way must be measurable.

The sales department is often one of the busiest in an organisation – lots of people making calls, making sales visits, closing deals, updating targets etc. But not everything going on is productive. Of course, no-one expects a sales professional to close every deal but you need to be certain sales people are not expending time and energy chasing unwinnable deals. That’s what can drag productivity down. The sales department need to qualify all sales so they know which deals they can win and target those.

Author: Robin Gupta