What is this thing called 9Stucks?
9Stucks is a dynamic business diagnostic tool. It identifies nine distinct yet interrelated business challenges that cause a company to underperform.

Stuck in A Maze: Financial Condition

“Our financials don’t tell a very good story.”

The financial affairs of a company can be perplexing.  Management often reaches a point where they don’t really know where they stand financially, don’t know how they got there, and don’t know how to get out of the situation.  They are Stuck in A Maze.

The financials alone don’t tell the complete story because the financials are only a snapshot of the current data.  The Balance Sheet, P&L and Cash Flow don’t reveal why a company is “under financial pressure” or what’s causing the business to be experiencing “financial difficulty.”

The stories and answers can be found by digging into the observable symptoms and underlying root causes of FOUR financial dilemmas.  These are:

One:  Bad decisions or poor management of key aspects of the financial function

This would include the basics of managing receivables and inventory, controlling excessive spending (expenses and costs), and setting pricing.

Two:  An undercapitalized or over-leveraged capital structure

This constrains a company’s flexibility and ability to react to business and competitive pressures.

Three:  Outside forces that inflict temporary pressures or permanently impact the organization.

These include spikes in energy costs, drastic increases in raw material costs, or restrictions on credit and borrowing.

Four: A confusing array of non-financial business decisions or business conditions

Some examples of these would be competitive price cuts, quality/remediation problems, production inefficiencies (variances), scrap, money losing products, lost customers, and cumbersome labor contracts. These can easily create financial headaches.

Some or all of these conditons are often mixed together.  The overwhelming combination will cause a company to be Stuck in a Maze.