Our School. Strategic Planning 5/23/17. Four Important Practices. A strategic plan can be broken down into three key areas: Where are we now?

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1 Intentional Planning Applying Big Business Practices to Small Business Success Rob Campbell, Partner Propio Doug Judd, Partner - Propio Connecting People Living in the Windshield Preparing For The Curves In The Road 1

2 Our School Four Important Practices Operational Planning 4. Executing the Plan A strategic plan can be broken down into three key areas: Where are we now? Where do we want to go? How will we get there? 2

3 Where are we now? Mission Statement your organization s purpose and services Values / Guiding Principles What values and beliefs guide your daily interactions? SWOT Strengths, weaknesses, opportunities, and threats. Very important! Examples: ü Strengths Competitive pricing, excellent service, high quality ü Weaknesses Incomplete service offering. Need to offer phone interpreting ü Opportunity Begin offering telephone interpreting to our client base ü Threats New local competitors encroaching on our onsite interpreting business Where do we want to go? Sustainable Competitive Advantage: - What are we best at compared to competitors? - What is our uniqueness? - What can we potentially do better than competitors? Vision Statement: What will our organization look like 5 to 10 years from now? How will we get there? Strate gy Plan for matching our company s strengths with market opportunities Goals - Establish goals, priorities, initiatives Actions - Establish specific action items for your staff Score card Establish Key P erf ormance Indicators ( KP I ). KP Is measure and manage against your strategic plan. 3

4 Sales Forecast Most important component! Most of your forecasting efforts should be focused on sales. Top-down versus bottom-up approach Four key elements to building the sales forecast: ü Mature business ü Adolescent business ü New business ü Lost business Break sales forecast into lines of service (e.g. Onsite I nterpreting, D oc ument Translation, Telephone Interpreting, etc.) Be realistic! Sales Forecast Cost of Service Forecast Importance of understanding your company s cost of service. Propio s approach: Only the interpreter/translator cost goes into Cost of Service. Develop current cost of service ratios for each line of service. Integrate any new cost-savings initiatives into the cost service ratios. Cost of Service Calculation: Multiply cost of service ratio times the applicable service line sales forecast. 4

5 Administrative Cost Forecast Administrative costs are all other costs besides payments to interpreters and translators (e.g. rent, staff salaries, etc.) Develop budgets for each material administrative cost. For example: - Administrative payroll - Rent - Supplies - Benefits - Insurance - Deprec iation - IT - Commis s ions Evaluate budgets that could be reduced or eliminated. Cost control is especially important in our industry. Profit & Loss Plan Assemble the forecasted components into a Profit & Loss Plan: Sales Cost of Service Gross Margin Administrative Costs xxxx $ xxxx xxxx xxxx Pretax Profit $ xxxx Track your actual financial results against this Plan Additional steps: Balance Sheet and Cash Flow Forecast Operational Planning 1.Create annually. 2.Begin with imperatives that align with the strategic plan. 3.Create supporting goals/projects. 4.Cascade to individual associates. 5.Adjust as needed, but keep track of what has been added or dropped. 5

6 GROWTH Moderate growth. Hurt bylack of performance in direct sales. 1. One big deal. NuHealth great wi n! 2. Getting more out of th e b ase. 3. Reseller program on stero i d s. 4. Acquisition? TEC HNOLOGY 1. Complete and release v4 of the IVR 2. HiTrust 3. Client Portal 4. RTT Mobile App 5. Website/ W eb Presence Moderate organic growth. Almost doubled the revenue Results (example) Exp l o red a co u p l e o f o p p o rtu n i ti es, b u t choose to pass in A couple of bigpositives, and a couple of big wh i ffs. Su ccessfu l l y launched with no delays in Much more stable and flexible. Took the back burner to other priorities. Significantly behind schedule. Start was d eferred d u e to o th er p ri o ri ti es. Si n ce l au n ch, o n sch ed u l e wi th great functionality. After an al ysi s, n o i n tegrati o n effo rt req u i red. Project reviewed from IT Priorities list. Deferred web si te red esi gn p ro ject; no co h eren t effo rt o r p l an fo r web p resen ce (FB, Li n ked In, etc.) 6. Voicereco gn itio n? Project deferred due to cost/benefit analysis. SOUR C I NG 1. Get ahead of demand: 60% of non-sp an i sh i n - house 2. Proactive sourcing to drive new sales. 3. US-based Spanish interpreters 4. US-based call center? CLIENT EX P ER I ENC E 1. Define excellence for every step of every en co u n ter. Moderate growth. Hurt bylack of performance in direct sales. Fill rate increased modestly, and then fell for OPI. Finished far short of goal. Onsite fell in second half of year and then reco vered b y year en d. Stro n g fi rst year with several small opportunities and one large (DLA). Good success with LAMP and ALC, and ability to expand Chosenot to create Propio-sp eci fi c cal l cen ter, but semi-outsourced with ALC. Good progress, but needs to be a higher priority. Su ccessfu l i n d efi n i n g th i s reacti vel y, b u t d i d not proactively do process redesign, frontto -back. Great job developing SOPs proactively and 2. Create processes an d in responseto issu es. Fairly co n sisten t in discipline for meeting the execu ti n g n ew SOP s, b u t ro o m fo r stan d ard every ti me. improvement. Great Progress! Moving in the right direction, but needs work. Significantly underperforming Imperatives (example) GROWTH 1. Test th e Lati n A meri can market. 2. Grow reseller channel. 3. Exp an d th e su b scrip tio n mo d e l sign ifican tly. 4. Grow direct sales channel to equal or exceed the reseller channel. 5. Exp an d se rvice s re sp o n sib ly. TEC HNOLOGY 1. Attain HiTrust ce rti fi cati o n. 2. Complete and re le ase v1 o f th e Client Portal. 3. Redesign / d e ve l o p Propio we b si te. 4. Implement ticketing system. 5. Faster connect times. SOUR C I NG 1. Increase non-sp an i sh OP I mo n th l y fi l l rate to 6 5 %. 2. Increase onsite fill rate to 95%. 3. Introduce more sophisticated data analytics to support fill rates. CLIENT EXPERIENCE 1. Contact every client monthly to 1) assess unmet needs, 2) determine satisfaction with Propio, 3) offer something of value, 4) introduce a potential new purchasing opportunity. 2. Establish an ongoing client satisfaction assessment process. 3. Identify and eliminate friction in the system events. 4. Se t an d me e t aggre ssive re sp o n se ti me targe ts fo r ad d re ssin g clie nt inquirie s/issue s. 5. Comply fully with interpreter quality check and remediation process. INTERPRETER EXPERIENCE 1. Create a Propio interpreter community. 2. Communicate mo re fre q u e n tl y an d o p e n l y wi th al l i n te rp re te rs. 3. Create positive incentives for key desired interpreter behaviors using social media, gamification, and other tools. 4. Establish an o n go i n g i n terp reter sati sfacti o n assessmen t p ro cess. 5. Connect one-on-one with every direct contract interpreter twice an n u al l y to 1) assess unmet needs, 2) determine satisfaction with Propio, 3) offer positive feedback and encouragement. Not started On track, but not ye t comple te Fully imple me nte d or pe rforming above plan Executing the Plan You have to take the plan off the shelf! 6

7 Executing the Plan Key Questions: 1. Who manages and monitors the plan? 2. How is the plan c ommunic ated in the organization? 3. How c ommitted are you to implementing the plan? W ill you commit the res ources? Key Activities: 1. Review imperatives and rate progres s monthly. Involve the team in the review and rating process. 2. Re-align and adjust priorities as necessary Don t wait for the monthly review when the environment changes quickly If revenue is below plan, adjust your spending plan 3. Meet weekly or bi-weekly with team members to for a regular touch point ( scrum ). Ensure activities align with operational priorities. Have the discipline to actually DO it! The hardest parts of getting anything done are starting and finishing. Neal Patterson, CEO, Cerner Corporation 7