Have you look into your organisation’s PROFIT?

Have you looked into your organisation’s PROFIT analysis?

Resource Analysis, and how to carry one out is this blog topic. Let me show you how to do a resource analysis for your business.

Firstly, Resource Analysis is the process of identifying and evaluating all the resources that are available to achieve an objective. It includes anything that can help or hinder your organisation meeting its objectives from tthe inside-out. For instance, resources include people, equipment, time, and money. The strategic capability of your business is determined by having adequate and suitable resources and competences. For competencies, think capabilities. 

Furthermore, resources and competencies are needed so your business can survive and prosper. And their analysis helps your business bridge the gap between having valuable resources and using them constructively and efficiently.

Most importantly a resource analysis helps you understand what resources are important for your business’ success. Moreover, it will give you insight into which areas need improvement or further investment (ihatenumbers).

The PROFIT analysis I introduce you below responds to a more internal analysis of the organisation. It is a tool that can help the recourse base view of an organisation’s strategy. The core idea of the theory, and an essential aspect of PROFIT analysis, is that instead of looking at the competitive (external) business environment, we look within our recourses and the potential available within the company (Grant 1991). 

PROFIT stands for:

P-Physical Resources

R-Reputational Resources

O-Organisational Resources

F-Financial Resources

I-Intellectual Resources

T-Technological Resources

Physical resources: Tangible items are necessary for any business to function (Grant 2016). Physical resources can both facilitate and constrain a company’s operational possibilities. They can have significant implications concerning the organisation’s costs and include buildings, furniture, production set and scenery, props, theatres and performing venues, among others.

Reputational Resources: Walsh et al. (2009) argued that product reputation, customer service and organisational reputation are distinct elements of reputational resources. He also emphasised the importance of understanding that these resources cannot be bought but built. In the case of many dance companies, reputation relies on the company’s ability to use, for example, its CSR strategies as a primary driver for reputational benefit. Most dance companies’ reputation rests in how they provide an “additional social attribute” through the dance they create (Arevalo and Aravind 2017). Alternatively, their ability to increase audience base through new artistic alternatives can respond to the social impact the organisation ought to create. 

Organisational Resources: Here is where all resources come together to accomplish goals. These are the assets available for use during our creative process. 

 Financial Recourses: refer to any financial/capital resources owned by an organisation, including liquid assets (cash at bank, financial investments). The money available to an organisation depends on cash reserves and, more importantly, on its borrowing capacity. Dance companies’ financial resources can determine the economic viability of the organisation, and they can also increase the legitimacy of their non-profit value. For example, a well-spent donation can have, as a result, more donations and continued growth. Thus, monetary value creation is not the most relevant measure of value for charitable companies. Hence an important aspect of our resources is heavily influenced by donors and philanthropic funders who do not typically have an ownership interest. Charitable dance organisations’ primary financial resource goal must rest on the company’s ability to maintain accurate records as a cost-effective organisation while building sustainable relationships with sponsors/donors. 

Intellectual Recourses: A dance company’s susceptibility to intellectual resources rests on its ability to maintain an adequate liability for the artistic material it creates (music/choreography/images’ copyright and dance trademarks). Lin et al. (2015) argued that intellectual resources that can be converted into intellectual capital directly correlate with the company’s ethical and social principles. Therefore dance companies’ intellectual recourses must respond to an ethical commitment that can also be measured in financial and non-financial value (Robinson and Kleiner 1996).

Technological Recourses:  With a new digital era coming towards us, dance organisations need to understand how to implement them into their business opportunities and daily corporate efficiency. However, technology here goes beyond internal high-tech mechanisms. In recent years technology has hugely affected the way dance organisations create. As part of this revolutionary change, DCs need to look into new artistic-technological approaches and training to understand better what digital culture can do for the art form’s future.

Drawing from this reeview, one can state that these resources and capabilities are essentially unproductive when used in isolation. It is not simply exploiting resources or capabilities alone, but instead exploiting them in combination to help sustain artistic growth.

© We Dance Agency