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14/03/08

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PRIMO-F - The Business Growth Model

PRIMO-F Business Growth Model

The PRIMO-F model was developed as part of a SWOT analysis of an organization. It provides a consistent framework for comparison either from within the organization or to benchmark against a previous analysis or benchmark against other organizations.

The PRIMO-F model was based on some work from the Durham University Business School (DUBS), and what makes an organization and its management effective.  This research demonstrated that an effective organization needed to fulfil the following equation:

Organizational Growth Effectiveness

=

   Performance to date * Potential for the future

Where Performance to date (FiMO) included:

• Finance,
• Marketing and
• Operations

and Potential for the future (RECoIL) included:

• Resources,
• Experience,
• Controls and Systems
• Innovation and
• Leadership

This was sometimes called FiMO/ RECoIL.

The equation is not to say that an organization with a poor performance to date cannot grow or be successful - just that it has a lower starting advantage than an organization which has a proven track record, equally performance in the past does not guarantee success in the future!

One of the problems with this method was the lack of consistent application, as a tool it is fine, however many managers, consultants and business advisers each have their own priorities.  For example a person who has a financial background will major on finance, a person with marketing will focus on marketing etc.  After all we are human. 

One of the problems with the model in the 'field' is that often key issues were missed.  The BIR was developed to take these factors and review them consistently. 

In many situations it is difficult for managers to differentiate between performance to date and potential for the future, as several areas overlapped, for example resources, operational leadership and management.  To solve this problem we developed the PRIMO-F.  A simplified way of showing strengths and weaknesses in the relevant areas.

The PRIMO-F Model:

PRIMO-F

People
Resources
Innovation & Ideas
Marketing
Operations
Finance

Performance of the business.

How good is it in terms of its Finance, Marketing & its Operations?

Potential for Growth

People in terms of their experience, their leadership and the controls in place in the organization.

Experience:

Age of the business
Management experience of:

• Borrowing.
• Product development
• Different types of market
• Use of external agents
• Moving sites
• Managing growth

Leadership:

Involving a senior management
Age of owner manager
Occupational base of owner manager
Personal objectives and ambition in line vision of the future
Education and training
Attitude to staff development
Family influence
Management style
Attitude to change
Degree of strategic awareness and understanding of environment

Control:

Adequacy of information and control systems
Ability to use information
Degree of professionalism and Responsibilities of management
Adequacy of planning and monitoring
Level of delegation
How performance is assessed

Resources

Liquidity and availability of finance
Technology level and capability
Physical assets: age and state
Product range and life
Use of and access to appropriate external agents

Innovation & Ideas

Number and source of ideas innovation is being considered
How they are assessed
Level of development or market testing of these ideas
Level of market planning of these ideas
How creative they are.

Using the PRIMO-F model

At its most simplistic the model can be used as an agenda for change, where a facilitator works with the management team and between them they score the business and identify areas of action.

Typically a tool like the one below is used:

Then using this framework, identify areas of strength and capitalize them and identify weakness and develop an action plan to address them and prioritize the plan with stated outputs and measures.

Used Effectively with PEST/ PESTLE analysis the PRIMO-F can provide a structure to completing a SWOT analysis (PEST the external factors Opportunities and Threats, and PRIMOF the Strengths and Weaknesses of an organization). Together they form a very powerful diagnostic suite.

The BIR (Business Improvement Review) is a proven tool which take this process to the next level, with an organizational 360 feedback from managers and staff, with the option of having external feedback from customers and suppliers. The BIR process is one of the most robust and quickest strategic review processes available. 

Typically a whole business review can be completed in less than two days, regardless of organizational size.  If a large organization also want a divisional breakdown, this will take longer.

A Free version looking only at the people and leadership aspects is available For information on the three diagnostic reviews in the BIR family please visit www.rapidbi.com/bir

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Keywords:

PRIMO-F, PRIMOF, diagnostic, organizational development, People, Resources, Innovation & Ideas, Marketing, Operations, Finance, strategy, strategic review