The relationship matrix is a new business development analysis matrix used to analyze the market to find new business opportunity in difficult times. In the recent past we were faced by increasing difficulty to sustain our businesses during the recession. How should companies survive such difficult times? This problem was especially amplified for smaller service companies and contractors who even struggled to meet their working capital requirements. This event emphasizes the risk of not diversifying services, proactively in time to be able to tide over difficulties. The relationship matrix provides an easily understandable framework for companies to be able to identify new business in terms of activities and geographies, based on:
Experience level of the company
Attractiveness of new market segment
Potential of new market segment
Transferability of current skills
Acquireability of required skills
Demand supply disparity in new market segment
The framework also provides an investment decision guideline for the company to be able to prioritize their 'future readiness' investments. The paper contains case studies explaining how this analysis is done and its wide applicability to any service providing company. The framework was applied to a dredging company that was proactively preparing to combat thinning revenue streams from its near shore oil and gas service business. The application of the framework led to identification of skills and infrastructure that it required in order to be future ready. Geographies and market segments where business development effort is required were also identified. These opportunities were also assigned an execution priority order based on resources available.
In this paper I discuss a new way of analyzing and identifying opportunities for business to proactively mitigate declining future cash flows. The salient distinguishing factor of this approach is that the way ahead is found by collaborative effort made together with the company’s strategy setters and the execution brass of the company. Using terms that are easily relatable and understandable by the common man. Refraing to use management jargon makes the strategy that is precipitated after using the Relationship Matrix easily understandable and acceptable to the ground working force, thereby increasing its chance to succeed.
The Relationship Matrix draws on themes of:
Previous experience in a certain job type or industry type
Cross transferability of skills within a job or industry type
Completeness of learning curve within a job or industry type
Attractiveness of market
Therefore prioritizing the areas where a company should commit its resources in order to remain in business.