IndustryWeek and TBM Consulting recently completed a research project that looked at the impact of continuous-improvement programs on three financial metrics -- anticipated revenue growth and operating income growth, and cash flow over the past year. Across the board, companies with no continuous -improvement programs performed worse across all three measures. Continuous-improvement initiatives drive financial benefits according to this research. EcSELL Institute members have seen the same positive results after implementing a professional development program for their sales management teams. In fact, members experienced a 28% increase in revenue growth over the previous year.
Here are the highlights from their study. Read the full article "Continuous Improvement: It Separates the Winners from the Losers"
More than 50% of survey respondents that have no continuous-improvement program reported they expect revenue growth to be 3% or less in 2012. This response compares with fewer than 20% of companies with mature continuous-improvement programs anticipating revenue growth of 3% or less in the coming year.
The same disparity holds true for operating income growth. Nearly half of survey respondents with no continuous-improvement program anticipate operating income growth of 3% or less in the upcoming year. Less than half that percentage of respondents from firms with mature continuous-improvement programs expected operating income to grow at that low a rate.
And cash flow for companies with continuous-improvement programs clearly has been a bright spot compared with firms that don't have continuous-improvement programs. Indeed, more than 50% of survey respondents with mature continuous-improvement programs reported that their cash flow had improved over the past year. Among companies with no continuous-improvement programs? Slightly greater than 20% report an increase in cash flow over the past year.
Interestingly, companies with continuous-improvement programs also were far more likely to employ forward-looking resources in their strategic planning process. Such resources include competitive analysis, market focused business analytics and information about customers' forward-looking strategies.
