Accounting 3.0 ® Case Studies

Oklahoma Blood Institute (OBI) - $70mm

OBI Executive Committee Member letter

Indignous One-Page Case Highlights - Fair Trade Organic Clothing (1500 Weavers, Stitchers, and Knitters in South America

Indigenous Case Full Study

NAPA One-Page Case Highlights - Over 50 people and over 50 years old

NAPA Auto Parts Overview One-Page

NAPA Case Full Story

Examples of Chuck Kremer's and Lou Mobley's work with 3 Bottom Line

Maryland Association of CPAs (MACPA) Case Highlight (9000 CPAs, 30+ staff)

MACPA's Story of using Integral Operations Finance - tools and methods

MACPA Sample Accounting Reports used to support the story

Pro Forma Magic Story

What have our customers achieved? 

"Accounting 3.0® client financials report $1,019,000 average increase of cash flow from operating activities for the first 12 months after implementing Accounting 3.0® BI Dashboards and Collaboration Disciplines. These results show a 79% average year 1 operating cash improvement".   Dr. Andrew Bargerstock, MBA, CPA, PhD. in his independent survey of Accounting 3.0 client cases.

1. Doubled Profits and Cash Reserves

Facing uncertainties in both higher costs and fluctuating demand, for the first time at the Oklahoma Blood Institute (OBI), the operating activities that drive cash flow and profit were identified, validated and integrated into a Chart of Success Behaviors (cc). They were then linked to financial impacts, enabling Key Performance Indicator teams to integrate multiple improvement initiates, which drove a doubling of profit and cash reserves under 24 months.

2. Funded Growth from Internal Cash Flow

At Maryland Assn. of CPAs their 100-year old business model was seriously out of date with the market. All stakeholders collaborated on a common business language that helped them relate operating activities to cash flow and profit results, worth almost $1mm in new cash flow from operating activities in less than 12 months. After 4 years of worsening negative cash flow from operating activities to reach $4 million in revenues, MACPA adopted A 3.0 Business Intelligence dashboard tools, with full staff training and engagement, and produced an average positive operating cash flow of $379,000 every year for the next five years.

3. Made Cash Flow and Profit Predictable

At a NAPA franchise, over 15 years of intense competitive pressure, as well as monthly financial peaks and valleys were not abating. Accounting 3.0's comprehensive picture of their entire work system allowed all the key players to see how the company’s success works as a whole, and the role they each play in maintaining it. Using the framework they collaborated on, everyone was able to see that out of over 40 disconnects the single greatest need to focus on the continuously testing and improving inventory accuracy. It turned out they were correct - inventory inaccuracy, which went from 50% to over 90%, was costing almost as much as all the other disconnects combined. That, combined, with other improvements, averaged over $500,000 of new operating activities cash deposited, every year for the next 5 years.

4. Operating Activities Tied to Financial Results

At Oklahoma Blood Institute (OBI), numerous improvement efforts needed metrics-driven culture change to make the best return on the separate efforts. Customized non-financial metrics were used to clarify how specific operational behaviors impact specific financial outcomes. In the 2nd Financial Improvement monthly huddle, as the Data Collection Teams were reporting on their initial findings, it became clear from defining the success behaviors sequence that a standard practice of over a decade could be eliminated, saving over $150,000 in the first year with no loss of customer quality or increased compliance risk.

5. Drove Waste to Zero

At Osborne Coinage multiple market focus shifts in less than a decade had taken its toll on organizational coherence. A 3.0 has transformed the enterprise into a high performance collaborative culture that encourages teamwork and innovation across all levels of the organization. One intractable problem for decades had been that scrap metals were mixed which rendered it all to be nearly worthless. Mixed scrap waste went effectively to zero, which adds  $40,000 per year. When combined with the other KPIs, overall cash flow from operating activities improved almost $1 million in next year.

6. Most Productive Meetings Ever - Regularly

At a NAPA franchise, company Operations, Culture, Strategy and Finance are integrated to create a common bond of grounded trust among people, generate improved communications, focus cohesively on building value, and achieve new levels of financial performance. The monthly huddles since 2006 have been so useful that the Performance Management Group now meets twice a month, timed to coincide with each pay period.

7. Weathered a Massive Industry Downturn

A $110 Million Highway Construction firm survived a 70% industry downturn that killed the rest of the companies in that state’s market using 3 Bottom Line tools. For two and a half years their banker worked with them to keep going, because heavy equipment operators like Joe Antoniak provided detailed operating cash projection and clearly defined material assumptions that showed exactly how they would connect their daily actions to crucial drivers of cash flow from operating activities. The banker could see exactly how they would honor their loan repayment covenants, even while operating at a loss every single month for two and half years.

8. Fund Growth by Acquisition

OBI's 30-person Financial Improvement Team were fully engaged and enabled to access, generate and use all the available operating data, therefore driving their own performance. One focus was to measure excess staff hours, which led to almost eliminating overtime over the next 12 months. This operating cash savings contributing significantly to OBI having the cash needed to go into acquisition mode in less than two years. With A 3.0 implemented, NAPA was also stabilized enough to acquire two more stores.

9. Increased Enterprise Agility

Increased enterprise agility and effectiveness has been achieved by A 3.0 users to meet increasing rates of business change. (Examples: Developed and delivered new products; Built new internal cash reserves; Secured new financing; Acquired a competitor.

10. Matured Financial Performance

Leadership at fair trade and organic clothing manufacturer Indigenous Designs were ready to move from a decade of investment-funded international supply chain development to making profit. A 3.0 was used to develop a system of effective problem-solving meetings and tight decision-making by using a clear and complete picture of the financial and operational business past and future. They were able to make the transition from planned start-up losses to build a robust international supply chain, to achieve consistent profitability for the last 5 years after implementing Accounting 3.0, exceeding their projected profit plan. 

l Improvement stakeholders were fully engaged and enabled to access, generate and use all the available opeating data, therefore driving their own performance, began to measure excess staff hours themselves, almost eliminating overtime over the next 12 months, contributing significantly to OBI rapidly having the internal cash to go into acquisition mode in less than two years, just as NAPA did.

Pre-2000 Cases

IBM Return on Investment Chart for 1950-2000 - on one page

What did IBM do? And 50+ Years of IBM at a Glance - from Jahn Ballard's personal relationship as a colleague and being mentored - 5pp

Lou Mobley from 1980 to his passing in the late 80s

The RPI Graph by Walt Niehoff - from IBM's GraphPak Software Group – a history of viualizing the performance of any company's return on total resources, Lou like to say. 18pp

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