The EFFEX Factor: staying strong in the recession--and beyond.

• Author: Valant, Laurence B.
• Position: GUEST [column]

Like a dank, cold fog, the economic downturn has rolled across the Colorado business landscape. Some in corporate Colorado saw it coming and prepared by altering their business strategies, becoming lean, reassessing every move.

But others--probably the majority of you--remained focused on operating for cash flow and near-term results, failing to take steps to prepare for the change in weather. And that's OK.

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For both sets of business cultures, however, now is always the time to embrace a process that we have proven over decades will help executives in all sectors of business grow revenues, strengthen organizations and sustain profitable operations.

Because it embodies almost every positive component of effective execution we have applied for more than 30 years, we named this powerful process The EFFEX Factor. Here are the basic components:

Objectives: First, everyone must set and agree to clearly defined, quantifiable objectives for the organization--initially set by the CEO and then written for every executive and manager. The objectives must be pushed right on down through all supervisory levels to line managers, and down onto the shop floor or loading dock.

Obstacles: We must then define specific elements that stand in the way of the company achieving its objectives. About 75 percent of the time, our obstacles are organizational, that is, people who are not functioning in support of the company's objectives. They must exit immediately. About 25 percent of the time, we can identify obstacles in the area of competitive pressures, market erosion, pricing, regulatory challenges, production and distribution issues, demographic shifts and even the weather.

Strategy: This is where we develop written methods, systems, plans and processes for overcoming the obstacles and reaching the company's objectives. We must scrutinize everything, everyone and consider swift changes to support hitting our goals.

Organization: Here, we define the organizational structure and key functions within that structure to effectively implement our strategies. Every level of the organization must be examined and every executive's capabilities must be considered if the management team is to be successful in achieving the company's objectives.

Compensation: Compensation from the executive level, down through...