Professor Patrick Georges’ six figures. An accurate way for boosting a business ?
An interview with Professor Patrick Georges by Dwight Kennedy for EFQM
Professor Patrick Georges is known for his research and publications showing that measuring and improving six carefully chosen figures are necessary and sufficient for ensuring that a business is well managed. The results seem to prove that he is right.
More and more managers are adopting a management approach based on improving performances in the following areas: Sales from New, Time Facing Customer, Gain From Processing, People Responsibility Level, Key Project Status and Return on Critical Resources.
For more information: pgeorges@arcadis.be
Patrick M. Georges is MBA Professor in Management at the University of Brussels. He is famous for his teaching on measuring and mastering performance while being at the same time an active brain surgeon at the hospital of the same university
Could you summarise for us this method that you have been recommending for many years?
It is very simple. We have demonstrated that the key to good management and growing a business is simply a matter of measuring and improving a few carefully chosen indicators. These key success factors are now well known and studied in economics and management courses. If you measure them and optimise them, your business will be successful.
What are these six key success figures?
SFN measures your organisation’s innovative capacity, TFC measures you customer focus, GFP measures your ability to deliver quality at the lowest cost, PRL measures your ability to provide the best people with more resources, KPS measures your ability to implement successfully a key change project and RCR measures your ability to channel your investments into your most profitable activities.
Why these indicators in particular?
Because they focus the business on performances which can not only be measured, and therefore can be improved, but are also relevant in the 21st century economy and are motivating for employees.
And does this method work?
Yes. In the 180 cases that we have studied over 5 years, the majority of business units that have adopted this method have improved.
What difficulties does this method entail?
First, convincing the people involved that it is necessary to measure these figures accurately and every quarter. Then, convincing them that if the figures are bad, they must activate very specific well-known methods to get them out of the red.
Are these indicators enough to manage a business?
Measuring these six figures does not mean that nothing else needs to be measured. Traditional reporting is still necessary but its monitoring can be delegated to specialists. The CEO and senior managers need to concentrate on the six figures. If they are bad, the software will then identify and “flag” in the traditional reporting the factors causing these poor performance levels.
Isn’t it somewhat simplistic to manage a business with only six figures?
It is simple, but not simplistic. These six figures cover everything. If they are good all the other results follow.
You do not leave your clients with much choice. It is these figures and no others!
That is to same extent our weakness. But there are so many economic studies and business success studies that prove that they are the most relevant indicators that we do everything possible to ensure that they are accepted by clients. However, we are also flexible. For example there are several possible indicators for measuring TFC, SFN performances, etc.
Is it absolutely necessary to measure all six figures?
Yes, for a balanced view. With the six figures, managers obtain an overview that it is well spread across all the sectors that are vital for a business to be successful: strategy, customers, sales, operations, human resources and management
They are not very operational indicators?
Few people are motivated by free cash flow! Managers need indicators which motivate them to take action; this requires indicators that are exciting and motivating for everyone! They should not bother with indicators that motivate only specialists to explain deviations from the six figures that we suggest.
In addition to measuring these performances is it necessary to optimise them?
In the six figures method, for each figure, three or four methods are recommended for improving and optimising them.
For example, to improve TFC, the recommended methods are, for example, help desks, extranets, back office automatization which frees up people for the front office, a structure which avoids creating a distance between anyone in the organisation and customers, etc.
Most managers that we have interviewed understand that they all need o be measured to take stock of the business. But can they really all be improved?
It is necessary to prioritize between the six indicators. If the strategy is innovation driven, then the business must first of all activate management tools which will increase SFN, whereas if the strategy is above all customer-oriented, then the business will need to activate methods which increase TFC, and do so on.
Managers prioritize the six figures to be improved according to their strategy.
Are there optimal values to be achieved for these six figures?
Over the past 10 years we have studied so many businesses that we obviously have a solid database to identify the optimal values for these indicators by business sector. We could easily offer corporate benchmarking services, but the most important thing for a business is to improve its own previous figures and progress.
Is it difficult to obtain data?
That is no longer a problem because there are now specialised “six figure” software programmes which make the relevant data searches at all levels of the organisation in order to make the necessary calculations.
How can businesses measure those of the six figures which are not yet measured? That must take a lot of time and cannot be easy!
We have allowed for that. The “six figures” method allows these performances to be measured without too much expense or excessively complicated administrative procedures. We proceed via samples, by checks using statistical instruments which provide an overall value which is sufficiently accurate to be used as a basis for the right decisions.
Is the method onerous to put in place?
Not at all. Within twenty days, the local team is trained and the software is prepared. If the value of an indicator is unsatisfactory for a manager, it takes approximately another twenty days to prepare and activate the corrective method.
You often mention large organisations as examples. But reading you numerous case studies, it seems that a large number of small organisations and small units within large organisations have also put in place the six figures method!
You are right. It was an error of appreciation by us. We thought that it would above all be large organisations which would be the most enthusiastic. But we realised that small units were rapidly attracted by it, undoubtedly because of the low cost of the six figures method, its simplicity and the speed with which it can be put in place.
You are far more discreet about your other activity. I see on web sites devoted to you that you are also a doctor, a brain surgeon and a specialist in human intelligence, in which areas you are still very active. What is the relationship with the six figures management method?
None.
The work that you have carried out at company level is huge. Did you work with your students?
Yes, but also with the Academic Consulting Group which is a network of university teachers from Europe’s top business schools. These teachers work as corporate consultants to finance their research.
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