Corporate Management


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Issues in Yacht Building Corporate Management

Questions Yacht Companies Need to Address

Owners are not created equal.  Some may use the Yachts extensively for chartering as part of a fleet portfolio, and generate major growth major growth and make a major contribution to operating profit of the Yacht building company.  In contrast, others may give rise to far fewer sales, have limited growth prospects, only using the single yacht for pleasure and actually produce a net loss for the company once one deducts the costs incurred in serving them from the revenue they generate.

The fundamental business rationale for corporate management is to maximise shareholder value by focusing on acquiring and retaining the most valuable customers in a market whilst reducing the resources used to serve lower value ones, often by migrating them to lower cost channels.

If the Super Yacht Builder wishes the Owner to act in such a way and change their behaviour, they will need to offer them something in return to behave in these new ways.

Corporate management is a complex affair involving issues across many different parts of the yacht building business.  It entails far more than the simple installation a system and training.  Fundamentally it is a question of implementing a change in business strategy.

The Business Case is a definition of the reasons for the Super Yacht project and the justification for undertaking the project, based on the estimated costs of the project and the expected business benefits and savings to come from use of the Yacht’s final outcome. However as part of a wider initiation report it also lays out how both sides of the relationship must behave.

Consequently, if a company is to achieve the increased return on investment it is seeking from its corporate management programme, it needs to address a series of questions.

STRATEGY
Where will an increased ROI come from? What Yacht Owners are being targeted? What behaviour is being sought? What will they offer to gain this behaviour?

PROCESSES
The philosophy is that a project is driven by its Business Case. The Business Case is developed at the beginning of a project and maintained throughout the life of the project. Some Business Cases will require significant effort in their development and approval because the project will have a major impact on the organisation. Also the level of investment required will influence the rigour with which the Business Case is developed.
  
Firstly, there are questions of strategy.  Where is the increased ROI to come from?  What customers are being targeted and what behaviour is the company seeking from them?


Moreover, what will the company offer them to provoke this behaviour.

Secondly, how will the Yacht Builder operationalise its strategy?  What communication planning and procedures are in place to target the appropriate potential Yacht Owners?

Leading on from this, what information will be needed to support these processes and what Yacht Designs will be required to provide this? Initiation Reports and Documentation, as well as Quality Planning will need to be carried out to ensure that expectations are managed.

Organisational infrastructure will be required to enable the effective operation of these processes.  How will they be managed and what performance objectives will be required. Procedures will need to be in place to deal with requests for change and the required impact analysis to see how much work is involved. Further procedures need to be in place to deal with events where a component is off-specification.

Corporate management is thus a complex affair involving issues across many different parts of the business.  It entails far more than the simple installation of a system and training.  Fundamentally it is a question of implementing a change in business strategy.

It is for this reason Williamson-consulting developed its ‘Working Together’ Framework to provide companies with a practical tool to help them address the diversity of issues involved in introducing corporate management effectively.