Andrew Stotz – What It Takes to be Financially World Class

What It Takes to be Financially World ClassToday I want to talk to you about what it means to be Financially World Class. Many years ago, the management team of the business I co-own in Thailand, https://www.coffeeworks.co.th/ (CoffeeWORKS), made it through the tenth year of an annual (and massive) quality audit done by one of our multinational customers. Our customer congratulated us for having World Class quality, the feeling among our management team and all employees was ecstatic. Since that time, we have maintained that World Class level of quality in CoffeeWORKS. Is CoffeeWORKS Financially World Class?As I drove home from the celebration at the factory, I asked myself, “How would we know if our company was Financially World Class?” I felt a bit disappointed with myself because I should have had the answer long ago. After all, as a financial analyst, I had already developed various tools to evaluate the stocks I was either recommending or owning. Developing a measurement to meet many requirementsSo at that time, I set out to develop a tool that could meet the following requirements It had to be ONE measure that definitively assessed whether a company was Financially World Class It had to be a measure that, if improved, could be shown to increase the value of the business It had to be able to stand up to rigorous scrutiny from finance academics and professionals It had to be clear whether a company was moving up or down in that ranking It had to be able to be used by both sophisticated financial analysts as well as company managers who knew nothing about finance It needed to be robust enough that we could use it in CoffeeWORKS for the assessment of management performance It needed to be a financial measure that would bring the management team together instead of pitting them against each other It needed to be able to be used for any company in the world The World Class Benchmarking scorecard was bornAbout seven years ago, I developed the World Class Benchmarking scorecard that met all of the above