What Do We Diagnose?

You might be asking what is it that we diagnose? Facetiously, we will not be assessing how well you order paperclips, or how you plan the office party.

Diagnosis in medical terms is “the identification of the nature of an illness or problem by examination of the symptoms”. “Early diagnosis and treatment are essential” is a good catch-phrase. The history of the word comes from the Greek dia (apart) and gignoskein (to recognize and know). The together form diagignoskein (distinguish and discern). The modern word diagnosis is the word we use now.

Now we can take the medical analogy only so far as we are not suggesting every or even most firms have “an illness”. But they might desire having an “early diagnosis and treatment” as simply being very practical and foresightful at the same time. We cherish this for our personal health and we think by analogy firms do as well.

Our diagnostics get at the fundamental and root cause level of your firm as to what enhances or detracts from growing its market value. What is involved? At least a robust strategy, innovation, new product development, great people, great execution, and good risk management. Many firms engage these topics one at a time, out of necessity. The beauty of a really good diagnostic approach is we can get a baseline assessment of your competitive strategy, innovation efforts, execution prowess, people and risk management, in addition to other custom items, all at once and as part of a united system.

But what I have learned over the last thirty years in the field is that the established firm always has a law-like mix of a variety of Enhancers and Detractors to the growth of the market value of that firm, that lie underneath the topics discussed above.  Of course growth in revenue, gross profit margin, net profit margin, and reducing working capital and fixed capital expenditure, increasing free cash flow and lowering your cost of capital are involved. But these are “lag” measures. The “lead” issues are the variety of Accelerators as Enhancers and a variety of Barriers as Detractors that really are at the root causes of growth or decline in the market value of your firm. Understanding the unique mix of all of these in your firm is key to enhancing the growth of the market value of your firm or confirming you have a great firm poised for more profitable growth.

Discussing these Enhancers and Detractors can be one of the most important conversations you can have in your firm if you have a goal to grow its market value. I would be glad to discuss with you pro-bono what I have learned over the years about these Enhancers and Detractors and what they mean for the growth of the market value of your firm.