Index. Accounts payable (AP), 234, 294 Accounts receivable (AR), , 233, 294 Anchoring trap, 221

Transcription

1 Index A Accounts payable (AP), 234, 294 Accounts receivable (AR), , 233, 294 Anchoring trap, 221 B Break-even analysis, 216 Business thinking COSM model CRM, 127 definition, 127 market assessment, 128 project plan, 133 value proposition (see Value proposition model) OPEX and CAPEX models, 185 product development, 157 C Calculation specifications, 40 Calculation worksheet (CWS) description, 34 input variables, 40 Capital expenditure (CAPEX) model, 34, 206 CAPEX _CWS, 196 CAPEX-DEP_CWS, 197 CAPEX-FA_DB, 199 capital assets, 188 cash flow activities, 185 depreciation, 188 expensed items, 188 expense, types, 188 Fixed Assets Calculation Worksheet, 198 high-level component and flow chart, 190 planning, 189 straight line depreciation capital assets, 202 formula, 203 monthly capital expenditures, 202 Cash flows direct method, 239 energy control system financing activities, 242 investment activities, 241 Green Devil Energy Control System, 240 cash management ratios, 294, 314 Chart data (CHARTDAT), 34, 44 COGS-PRICEMARGIN_CWS, 92 Company business model building/coding, 40, 42, 44, 46 calculation specifications, 40 description, 25 design specifications, 36 37, 39 35,000-foot view, 30 functional requirements, 36 37, 39 initiating and planning models, naming conventions, 34, 36 performance period, 36 process flow, 26 project planning view, software development view, top-down approach, worksheet types, 34, 36 Company capital expenditures (CAPEX), 241 Compute ratios, 313 Confirming evidence trap, 222 Cost of Goods Sold and Inventory (COGS) model, 33 amount of physical model inventory, 110 annual assumptions, 110 COGS_CHART-INVENTORY back-into technique, 123 cash payment, data view,

2 index Cost of Goods Sold and Inventory (COGS) model (cont.) dollar costs, 123 formula view, inventory audits, 121 inventory usage, purchasing inventory units, 121 COGS-PRICEMARGIN_CWS company products, 112 hardware assumptions, 112 software assumptions, 113 subscription assumptions, 113 components, 109 definition, 105 Green Devil control system (see Green Devil control system) gross margin, 105 inventory assumptions, 106, 110 margin analysis worksheet, monthly inventory model account payable, , 121 modeling assumptions, process flow, 111 product configuration assumptions, 109 profitability and margin contribution, 106 REV-REVCALC_CWS, Cost of product development (DEV) model Bonus and Commission Plan model, 178 Bonus and Sales Commission Worksheet, 171 business thinking, 157 Calculation Worksheet, 174, 179 Capital Plan Calculation Worksheet, 175 customers, 162, 183 dashboard, 176 DEV_CHARTDAT, 177 development capacity, 161, 183 Green Devil Energy Control System, 163 intellectual property, 162, 183 planning, 159, 169, 182 product concept and design, 159, 182 production, 160, 183 product life cycle, 161, 183 quality, 161, 183 Staff Calculation Worksheet, 170 suppliers, 162 team, 160, 183 time to market, 159, 182 trip cost model, 178 Trip Plan Calculation Worksheet, 173 Trip Type Calculation Worksheet, 172 Cost of sales and marketing (COSM) model, 33 Bonus and Commission Plan model functionality, 147 staffing model, 151 structure, Bonus and Sales Commission Worksheet, 140 business thinking CRM, 127 market assessment, 128 project plan, 133 strategy, 128 value proposition (see Value proposition model) CAPEX _CWS, 144 COSM_CHARTDAT, 147 COSM_CWS, 143 Cost of Sales and Marketing Dashboard, 145 definition, 127 description, 127 design and process flow, 138 Green Devil Energy Control System, 133 planning, 138 Staff Calculation Worksheet, 139 trip cost model, 152 Trip Plan Calculation Worksheet, 143 Trip Type Calculation Worksheet, 142 Critical path, 28 Customer relationship management (CRM) definition, 127 product development, 162 D Dashboard (DB), 34, 43 Decision making anchoring trap, 221 confirming evidence trap, 222 decision process adverse consequences, 227 alternatives, 225 best balanced choice, 227 objective classification, 226 objectives, 225 statement, 224 financial models break-even analysis, 216 decision support tools, 217 internal rate of return, 217 net present value, 216 operating scenarios, 214 payback period, 216 quality, 214 return on investment, 216 risk mitigation, 219 sensitivity analysis, 216 subjective, 215 uncertainty, 218 variables types, 214 framing trap, 222 overconfidence/prudence trap, 223 sunk cost trap, 222

3 Index Depreciation, 188 Design specifications, 29 DEV_CWS (DEV model), 180 E Excel, 46 F Feasibility study, 27, Financial and reporting (FIN) model, 32 Balance Sheet Worksheet, 273, 303 chart data, 250 Company Balance Sheet, 249 accounts payable, 311 accounts receivable, 310 accumulated depreciation, 310 cash, 310 fixed assets, 310 inventory balance, 310 net income, 311 retained earnings, 311 total assets, 310 total long-term liabilities, 311 total property and equipment, 310 company master schedule, 273 events and risk, 265 financial ratios, 312 financial reporting and analysis, 288 (see also Financial reporting and analysis) Financial Reporting Model Chart Data Worksheet, 273, 306 financial statements and analysis dashboard, 306 investment dashboard, 249, 275, 305 Investment Worksheet, 249, 274, 304 Profit & Loss Statement Worksheet, 245, 272, 299 Statement of Cash Flow Worksheet, 247, 273, 300 valuation and investment model build-up method, 263 company A s investment profile, 264 cost of capital, 259 discount rate, 279 discounted cash flow method, 262 exit valuation, 284 incremental cash needs, 278 interactive model, 282 investor expectations, 262 percentage of ownership, 282 Financial model business thinking, 27 control strategies critical attributes, 13 entrepreneur/owners, 13 financial ownership, 13 intellectual property, 13 market, 13 operational ownership, 13 owning technology, 14 relationship, 13 design dimensions balance sheet, 20 build model, 22 monthly design, 22 operating variables, 21 profit-and-loss statement, 20 pro forma, 21 statement of cash flows, 20 unique business structure, 21 design principles math checks, 20 modular, loosely coupled design, 19 rule, 19 sanity checks, 20 entrepreneur/owner, 4 5 error, 14 performance and execution cash curve, 10 cash is king, 9 early action, 7 excellent execution, 7 feedback loop method, 8 marketing research, 8 records and books, 11 respond quickly, 7 technology and product development, 9 working prototypes, 8 process strategies key personnel, 12 operational plan, 12 putting skin, 11 securing team, 11 project planning view, software development view, value event cash flow positive, 19 proof of market (POM), 18 proof of product (POP), 17 proof of scale (POS), 18 value profile, 15 Financial reporting and analysis current assets, 292 current liabilities, 292 equity components, 293 Green Devil Control Systems financing activities, 296 investment activities, 295 operating activities, 295 long-term liabilities, 293 property and equipment assets, 292 total assets,

4 index financial statements, 293 FIN-CASHFLOW_CWS model, 250, 301 FIN_CHART-NO-INVEST charts, 302 FIN_CHART-YES-INVEST charts, 303 Fixed costs, 188 Framing trap, 222 Full operating capability (FOC) phase, 59 Full-time equivalent (FTE), 63 Functional requirements, 29, 39 G, H Generally accepted accounting principles (GAAP), 187 Green Devil control system balance sheet, 48 company deliverables, 60 critical path, 52 definition, 107 deliverables, 51 description, 85 electrical usage, 107 energy monitoring, 49 feasibility study, industry building, 48 inventory assumptions, 108 market assessment, 50 marketing strategy, 50, 60 mission, 48 naming convention, 51 operational milestones, 52 product availability assumptions, 86, 108 product, definition, 49 product development strategy, production approach, 51 product pricing, 108 prototyping process, 60 risk assumption, 51 roles and responsibilities, 51 sales forecast assumptions, sales strategy, 50, 60, 86 scope, 50 software options, target market, 50 value events, 61 value proposition, 50 variable costs, 108 work breakdown structure, 52 Green Devil Control System target market, 60 Green Devil Energy Control System (ECS) corporate structure, 267 definition, 266 investment and valuation strategy, 267 people and processes, 267 performance and execution characteristics, 266 product development, 163 sales and marketing strategy, Gross margin, 235 Gross profit margin, 106 I, J, K Initial operating capability (IOC) phase, 59 Input variables, 40 Intellectual property (IP), 162, 183 Internal Rate of return (IRR), 217 Inventory turnover, 294 L Liquidity ratios, 293, 313 M Market assessment, 50 Market feasibility, Marketing strategy, 50 Master schedule, Medical insurance, 70 N Naming conventions, 34, 36, 51 Net Present Value (NPV), 216 Nonrecurring costs, 189 O Operating expenditure (OPEX) model bar and line chart, 206 capital expenditures, 188 cash flow activities, 185 depreciation, 188 expensed items, 188 expense, types, 188 high-level component and flow chart, 190 OPEX-CAPEX_CHARTDAT, 194 OPEX _CWS, 192 OPEX-M_CWS, 193 OPEX-Y_DB, 193 planning, 189 Operating expense (OPEX) model, 34 Operational models, Organizational chart, Organizational structure, 31 Overconfidence/prudence trap, 223 P Payback period, 216 Planning operating activities, 240 Pricing strategy, 84 Production approach, 51

5 Index Product life cycle management (PLM), 157 Profitability ratios, 294, 314 Profit and Loss (P&L) Statement accounts receivable, 233 accrual accounting, business thinking accounts payable, 234 depreciation calculation, 236 gross margin, 235 operating expenses, 235 description, 232 design, 31 operational models, worksheet, 245 Profit margin, 294 Project planning view, Q Quick ratio, 293 R Ratio analysis, 294 Resource feasibility, 49 Return on investment (ROI) model, 216 definition, 130 nonrecurring costs, 132 operations, marginal cost, 132 payback periods, 132 savings, 132 technology products, 131 total project cost, 132 REV-AR_CWS, 97 REV_CHART-MONTH-SPREAD, 91 REV_CHART-REVCHART, 94 REV_CHART-SEASONAL chart, 87 REV-COGS_CHARTDAT, 98 REV-DB, 98 Revenue (REV) model, 33 REV-REC-MAINT_CWS, REV-REVCALC_CWS, REV-SALES-FCAST_CWS Worksheet, 86, S Salary adjustment method, 66 Sales and revenue model accounts receivable worksheet, 97 elements, 83 Green Devil control system (see Green Devil control system) planning cash collection assumptions, 89 components, 88 revenue generation, 88 sales units, 88 product availability, 84 product positioning, 84 product pricing and margin worksheet, recurring revenue model AR model, formula cascading, 101 formula creation, 100 REV-REC-MAINT_CWS, 99 REV-REVCALC_CWS, subscription rate, 102 recurring service rev and maintenance rev worksheet, revenue and COGS chart data worksheet, 98 revenue calculation worksheet, revenue dashboard, 98 sales assumptions, 85 sales forecasting worksheet, 90 sales of units, 90 seasonal sales spread, sales strategy crafting, 84 target market, 84 top-level design, 89 value proposition, 84 Sales strategy, 50 Scope, 50 Semivariable costs, 189 Sensitivity analysis, 216 Sequencing model, Software development view, Spreadsheet organization, 41 STAFF_CHARDAT, 71 STAFF_CWS, 66 Staffing (STAFF) model, 33 building/coding, 40, 42, 44, 46 business thinking developments, 57 homesteaders, 58 pathfinders, 58 staff nature, 58 calculation specifications, 40 components, 61 62, 64 cost assumptions and variables, 61, 64 design specifications, 39 double axis management chart data series selection, 77 GT Headcount line, 79 Home tab, 77 ribbon Design tab, 78 ribbon Format tab, executive chart data, executive dashboard,

6 index Staffing (STAFF) model (cont.) Find and Replace command cell range, dialog box, monthly values, 76 FTE, 63 full operating capability phase, 59 functional requirements, 39 Green Devil control system (see Green Devil control system) initial operating capability phase, 59 initiating and planning, operational phase, 59 planning, staff calculation worksheet payroll tax and benefit burdens, salary computing, variable input, staffing plan worksheet, startup phase, 58 SUMIF function Excel ROUNDUP function, phone, computer, and work space, 72 top-level structure, 36 worksheets, 37 STAFFPLAN_CWS, 65 Statement of Cash Flows cash position, 253 description, 236 direct method, 236 financing activities, 238, 253 FIN model, 245 indirect method, 237 investment activities, 238, 253 operating activities, 238, 252 reading and interpretation, 239 worksheet, 247 Stockholders Contribution, 311 Straight line method, 188 Sunk cost trap, 222 T, U Target market, 50, 84 Technical feasibility, 49 Top-down approach requirements, 30 sequence of models, structure, 31 V Value events, Value proposition model customer s business, 130 establishment, 50 ROI model, 130 substantiate claims, 130 types, 130 validation, 84 Variable costs, 188 W, X, Y, Z Worksheet types, 34,