Book review: Management Strategies for Executing Sound Decisions

Book Review by Julie Fraser

Profit Mapping: A Tool for Aligning Operations with Future Profit and Performance

Authors: Anil Menawat and Adam Garfein
ISBN# 0-07-147228-2

Management strategy books abound, but very few focus on making sound decisions about how to execute to best achieve a strategy. Fewer still take a truly multi-faceted approach to problem-solving in a dynamic environment. Enter Profit Mapping. It offers a structured framework that can be used to make strategic, tactical, or operational decisions. It can be used iteratively as conditions shift and as knowledge grows.

Based on systems theory, it sounds a bit complex, so the first part of the book provides all of the logic about why it needs to be dynamic, multi-faceted, and systematic. Then the book lays out a simple 7-step approach to profiling a problem. The book is illustrated with simple block diagrams and manufacturing examples throughout.

Profit mapping recognizes that each business unit - and each product - has its own processes, resource needs, and financial outcomes. It does not use aggregation or cost allocation, but the simplest form of activity-based model with parameters that management can change. They warn against "boiling the ocean."

The tricky part is that a profit mapping exercise needs analytical and scenario evaluation tools that are not like those you have today. Fortunately, it is complementary to existing IT systems and current initiatives such as lean, six sigma, outsourcing, globalization, etc. (and the authors show examples of how it actually improved results). It uses as much or as little data as is available.

Like many good management books, it leaves you excited about the vision, but unsure exactly how to proceed without the consultants who wrote it and their software. Yet it does provide a new perspective on making tough decisions in the real world. More particularly, it delivers a very thorough understanding of why we struggle so mightily to succeed at executing in ways that live up to the promise of our strategies.