Frequently Used Tools for Strategy Development

Just like a hammer for a carpenter, Profit Savvy Tools help build and implement your strategy

A very profound example is the 80/20 Rule that can improve your operation up to 16 times!

  • Weights and Scores Prioritising Technique: 
    When you are faced with many alternatives, it can often be very hard to choose between them.
    They will be strong on some things and weak on others; but hardly ever the same things. 
    A quick and effective way to work through such a maze is to use a Weights and Scores technique described within this article.
  • Great Business Books:
    This is a collection of great books on business that have inspired many.
    Profit Savvy has distilled a lot of wisdom from these but, when you want to read further, it is best to hear it direct from the source of that wisdom.


  • Plan/Do/Check/Adapt (PDCA) Cycle: 
    The business world is full of uncertainty. 
    Many managers cross their fingers, build the planned addition to their business or their start-up then 
    launch it and pray
    most common outcome from this approach is - failure or, at best, mediocre success.
    The PDCA approach, substantially speeds up the migration to a profitable new avenue for the business.
  • Optimising/Streamlining Menu:
    This menu draws together the principal tools in Profit Savvy that focus on making your business as productive as possible.
    These are Tools that can be used widely throughout Profit Savvy.
  • Dice Games Simulate Profit Gains:
    Throughout Profit Savvy, we talk about several different Work Flow and Inventory models and their respective merits.
    You can quickly gain an impression of how these models work in practice by playing a simulation game with a set of dice.
    This will demonstrate the relative strengths and weaknesses of the various models and their impact on your Profit.
  • Track Progress with Fever Charts:

    Fever Charts are a visual method of alerting us to the fact that some process is becoming critical and needs our attention
    These charts can be used for any situation where we want to keep track of a process to ensure it is running within acceptable bounds.
    Examples include: Buffer stocks in front of a production station; Stages in a production cycle.

  • 80/20 and the Theory of Constraints (TOC):
    This is Profit Savvy's equivalent of Godzilla meets the Hulk!
    In our language it is the mixing of the 80/20 Rule, which promises up to 16x Growth and the TOC approach, which describes the most liberating aspect of your production line.
  • Kaizen Leads to Continuous Incremental Improvement:
    Most improvement is an incremental process.
    It is rare to get something completely right the first time, therefore, over time we improve parts of the system to continue to improve the whole.
    A Japanese phase for such incremental improvement is 'Kaizen'.
    Read this article for insights into incremental improvement of your business.
  • Kanban:

    Kanbans are a tool for structuring how work flows into the work-in-progress queues so that workers do not get overloaded and can use their time most effectively.
    Kanbans, and variations on them, are widely used in software projects (e.g. Scrum and Agile) and manufacturing (e.g. Lean and Six Sigma).
    The fundamental principle of Kanban is to only produce something when it is required by a downstream step.

  • Local Optima Problem Tool:
    It is a very widely held belief in business that each station in a production line should be working as hard as it can in order to maximise its efficiency.
    Having each step in a production line producing as hard as it can will inevitably cause work-in-progress (WIP) to pile up in front of the slowest part of the cycle.
  • Introduction to Optimise 100 (Course):
    Every manager, and owner operators, are interested in increasing the Profit of the business units they manage.
    This introductory course article goes through Who Optimise100 is for and is it even possible, siting Case Studies as examples.

80/20 Profit Optimisation

  • The Amazing 80/20 Rule Tool:
    Would you be interested in knowing a way to increase your productivity by 16 times!
    This article gives an insight into how this is possible using the principle 80 percent of what you achieve in your job comes from 20 percent of the time spent.
  • 80/20 Rule Menu:
    The principle applied to a number of business applications.
    Including: Strategy, Marketing, Sales, Decision Making, Inventory Management and Staffing to name a few.
  • 80/20 Maestro:
    It is one thing to see the benefits of the 80/20 Rule and quite another to have the discipline to implement it.
    Putting it into practice takes a lot of willpower because there are just so many dimensions that you can work on at any one time.
    Read this article to find our how to exploit this tool.
  • How to do an 80/20 Analysis:
    We frequently refer to the 80/20 Rule in Profit Savvy.
    It assumes you can spot the best and worse performers among your products, market, staff and customers.
    This article explains the simple methodology behind quickly allocating each candidate to a slot in the rankings chart.
  • 80/20 Business Analysis:

    This article looks specifically at how to analyse many parts of your business with 80/20 to rapidly improve Productivity.
    The best approach to doing an 80/20 analysis of your business is to focus on four major determinants of your business success.
    These are: Grouping by Product or Product Type, Grouping by Customer Type, by Competitive Segment or other splits that may be relevant to your particular business.

  • 80/20 Multipliers:
    Would you be interested in knowing a way to increase your business by 16 times! Got your attention?
    The applications of the 80/20 Rule within this article give an insight into how this is possible.
    The 80/20 Rule is not just a one time wonder. It is what is known as a fractal, meaning that it keeps repeating itself as you drill down.

Release the Bottlenecks on Profit Growth

  • Theory of Constraints (TOC ) Menu:

    The Theory of Constraints (TOC) is an important optimising technique that focuses on improving the throughput of work at the (usually) single bottleneck or constraint in the workflow.
    This Menu draws together a number of the Profit Savvy articles on the subject for your convenience.
    One research project demonstrated that 89% of improvement in a manufacturing business came from the application of TOC.

  • Demand Driven Materials Requirements Planning (DDMRP): 
    The Theory of Constraints (TOC) introduced the concept of Drum-Buffer-Rope (DBR) to demonstrate how to efficiently run a workflow
    If you have become an aficionado of TOC and want to know more about correctly evolving a DBR system, we have resources here that will help.
  • When a Bottleneck is Good: Theory of Constraints (TOC):
    Believe it or not, it is often a very good thing to find that you have some bottleneck in your production system.
    A body of knowledge about how to take best advantage of bottlenecks has evolved into what is now known as the Theory of Constraints (TOC).
    It is said that Jeff Bezos, who founded Amazon, made the original book on TOC required reading for his managers; and Jeff has done quite well for himself!
  • Buffer Management:
    Buffers, used strategically, will enable you to "smooth" out the flow of work through your system.  This is important to maximise production.
  • TOC Drum, Buffer, Rope Optimisation Techniques:

    The Theory of Constraints (TOC) demonstrates the importance of finding and managing the constraint in your business. 
    The Theory of Constraints approach realises this balancing act and has a three-part process for tuning the stages upstream of the constraint so the constraint is never starved or overfed.
    These are referred to as Drum, Buffer and Rope and are covered in this article.

  • Critical Chain Project Management (CCPM):
    Some businesses that use Project Management Software like the Critical Path Method (CPM) should also take the time to learn about the much less well known Critical Chain Project Management technique.
    It has a proven track record for dramatically speeding up projects.

Profitable Inventory Management

  • Small Batches Tool:
    There are merits to reducing the size of the batches you manufacture and/or hold in stock at any point in time.
    This might sound counter-intuitive because of the oft-quoted 'economies of scale' and the time cost of pulling down tool set-ups and changing them to manufacture another project.
    But, in the words of the song; "it ain't necessarily so!"
  • 80/20 Inventory Management:

    If inventory is something you have to manage in your business, the The Amazing 80/20 Rule Tool can have a powerful impact on Profit and cashflow.
    In Profit Savvy we discuss the fact that Inventory is not necessarily an Asset to a Company.
    Inappropriate Inventory Management can mean that Inventory actually becomes a Liability to a Company aspiring to high performance.

  • Cost of Over and Under Stocking:
    In a Manufacturing or Retail environment, having too much Inventory of products your customers don't want and/or too little Inventory on hand of what products your customers do want will cost you money and, consequently, Profit.
    Many service businesses also have Inventory, even if it is items like stationary, incidental to their main operation.
    This article shows you why Under and Over Stocking costs and how to reduce the damage.


  • 80/20 Problem Solving: 

    It is very common in business to be faced with a dilemma where you have a large number of alternative solutions to a problem.
    It is unclear as to which are the major contributors to the problem, or the best way to go, to help you solve the problem.
    80/20 can provide a very quick analysis between conflicting alternative approaches.

  • 5 Whys Problem Solving Technique:

    Businesses are very often presented with problems where the solution is not immediately obvious.
    5 Whys provides a methodology for using the experience of managers and staff to identify possible reasons for the problem rising and to identify solutions to those various reasons.
    The same technique can also be used as a 5 Hows approach to working out the best way to do something.


  • Getting Stuff Done When There is Lots:
    As a business manager, there is always more to be done than you possibly have time for.
    If you want to work reasonable hours and have a life outside the business, you will have to prioritise what you do.
    This article describes several techniques that can help you reduce the often seemingly overwhelming number of things you have to do to a more manageable approach.
    If you don't learn to manage the workload, you will find yourself flitting from one task to another and not getting much of importance done.
  • Agile / Scrum / Kanban:
    Businesses have struggled with prioritising time, several techniques to overcome this, that are very similar, have evolved. 
    The three best known of these are named 
    Agile, Scrum and the Japanese word Kanban
    Various references cite 
    improvements in team productivity ranging from 25% to 300% by using these methods.
    This article introduces these concepts and a way of using a free software app named 
    Trello  to manage the process. 
  • Multitasking Tool:
    The ability to, and the act of, Multitasking is sometimes seen as a good thing.
    However, it can be clearly demonstrated that Multitasking is an inefficient process that can contribute to waste in any business.
    This article discusses issues around Multitasking, how to recognise it and how to overcome its deficiencies.
  • Time Management Tool:
    There is one thing that every business person will tell you they are short of. That is TIME!
    Here is a way to drive a wedge into, and free up, more time.
    So much so that you will, rather bizarrely, find yourself with nothing to do from time to time.

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