BENCHMARKING AUDIT
Financial | Operational | Strategy
Assess how your business performance compares to industry benchmarks. Identify where you are behind, where you lead, and where data is missing. Used to prioritise improvement actions with evidence.
AUDIT PHASE 1 OF 4
Financial Benchmarking
SCOPE
Revenue, margin, and cost structure vs. industry averages
SELECT PHASE
AUDIT QUESTIONS
1
What is your gross margin vs. the industry average, and what explains the gap?
High
Don't just identify the gap — identify the structural cause. Is it pricing, product mix, input costs, or scale?
DATA SOURCE
P&L Statement, Industry Report
Finding / Answer
SCORE
2
How does EBITDA margin compare to sector peers, and is the gap widening or narrowing?
High
Track the trend over 3 years. A narrowing gap under pressure is a leading risk signal.
DATA SOURCE
P&L, Industry Report
Finding / Answer
SCORE
3
What is revenue per FTE vs. the industry benchmark, and which departments drag this down?
Medium
Break down by function, not just company average. Admin-heavy businesses often have low revenue/FTE in non-value-adding roles.
DATA SOURCE
HR data, P&L
Finding / Answer
SCORE
4
What is overhead cost as % of revenue vs. benchmark, and which overhead categories are above norm?
Medium
Overhead benchmarking requires category-level detail. A blended number hides which cost lines are out of control.
DATA SOURCE
Management accounts, Industry Report
Finding / Answer
SCORE
5
What is debtor days (DSO) vs. the industry average, and which customer segments drive the gap?
High
High DSO vs. benchmark indicates either weak credit control or large customers with payment power. Segment before acting.
DATA SOURCE
Accounts receivable, Finance
Finding / Answer
SCORE
6
What is net profit margin vs. comparable companies, adjusted for capital structure?
High
Companies with high debt show low net profit even with strong operations. Compare EBIT margins to remove financing distortion.
DATA SOURCE
P&L, Industry Report
Finding / Answer
SCORE
7
Is the reinvestment rate (capex + R&D as % of revenue) in line with industry norms for sustained competitiveness?
Medium
Under-investing vs. peers is a slow-moving risk that shows up in market share loss 3–5 years later.
DATA SOURCE
Finance, Capex plan
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Operational Benchmarking
SCOPE
Productivity, throughput, and process efficiency vs. peers
SELECT PHASE
AUDIT QUESTIONS
1
What is output per productive FTE vs. the sector benchmark, and which shifts or lines underperform?
High
Aggregate productivity numbers mask shift or line-level variation. Identify the best unit, then gap-analyse the rest.
DATA SOURCE
Production data, HR
Finding / Answer
SCORE
2
What is order-to-delivery lead time vs. competitors, and where in the process does time accumulate?
High
Map the lead time by stage. Most excess time sits in queuing and handovers, not in actual processing.
DATA SOURCE
ERP system, Customer feedback
Finding / Answer
SCORE
3
What is first-pass quality rate vs. industry norm, and at which process stage do defects originate?
High
First-pass quality (right-first-time %) is the most actionable quality benchmark. Defect location drives corrective action.
DATA SOURCE
Quality reports, Production data
Finding / Answer
SCORE
4
What is inventory turnover vs. sector average, and is slow-moving stock being actively managed?
Medium
Low turnover vs. benchmark signals overbuying, demand forecasting failure, or product obsolescence.
DATA SOURCE
ERP, Finance
Finding / Answer
SCORE
5
What is the planned vs. unplanned maintenance ratio vs. industry best practice?
Medium
Industry best practice: 80%+ planned maintenance. High unplanned maintenance drives cost and downtime above benchmark.
DATA SOURCE
Maintenance records
Finding / Answer
SCORE
6
What is energy cost per unit of output vs. benchmark, and which processes consume disproportionately?
Low
Energy intensity benchmarking often reveals legacy equipment or process inefficiency invisible in financial reports.
DATA SOURCE
Utility bills, Production data
Finding / Answer
SCORE
7
What is waste/scrap rate vs. the sector standard, and what is the annual cost of this gap?
Medium
Quantify the financial impact of the benchmark gap to build the business case for investment.
DATA SOURCE
Production data, Finance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Commercial Benchmarking
SCOPE
Sales performance, pricing power, and market position vs. peers
SELECT PHASE
AUDIT QUESTIONS
1
What is customer acquisition cost (CAC) vs. benchmark, and which channels drive CAC above or below norm?
High
CAC by channel is far more useful than blended CAC. High-CAC channels may still be justified by higher lifetime value.
DATA SOURCE
CRM, P&L
Finding / Answer
SCORE
2
What is the win rate on proposals vs. industry norm, and at which stage of the funnel do losses occur?
High
Stage-level loss analysis reveals whether you lose on fit, price, competition, or process — each requires a different fix.
DATA SOURCE
CRM
Finding / Answer
SCORE
3
What is average revenue per customer vs. comparable companies, and is it growing or shrinking?
High
Declining revenue per customer with stable customer count is an early margin compression signal.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
4
What is customer retention rate vs. benchmark, and what are the top 3 stated reasons for churn?
High
Benchmark retention rates vary by sector. B2B SaaS: 90%+. Distribution: 80–85%. Know your sector norm before judging.
DATA SOURCE
CRM
Finding / Answer
SCORE
5
What is the ratio of new business revenue to total revenue vs. industry norms?
Medium
Over-reliance on existing customers (low new business %) signals stagnation. Too high means unstable, short-tenure revenue.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
6
What is the pricing premium or discount vs. market average, and is it intentional or structural?
Medium
Companies often don't know where they sit on price. Confirm through win/loss data and competitor research, not assumption.
DATA SOURCE
CRM, Market research
Finding / Answer
SCORE
7
What is the number of active products/SKUs vs. benchmark, and is complexity delivering margin or destroying it?
Medium
More SKUs than peers usually means hidden complexity cost. Rationalisation typically releases 15–25% of operational overhead.
DATA SOURCE
ERP, Finance
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Strategic Positioning & Competitor Gap
SCOPE
Market share, competitive differentiation, and strategic performance
SELECT PHASE
AUDIT QUESTIONS
1
What is your market share vs. top 3 competitors, and has it changed in the last 24 months?
High
Market share trend matters more than absolute position. Losing 2% per year compounding is a strategic crisis in 5 years.
DATA SOURCE
Market research, Sales data
Finding / Answer
SCORE
2
How does your Net Promoter Score (NPS) compare to sector benchmark and key competitors?
High
NPS is a leading indicator of retention and referral revenue. Below-benchmark NPS predicts future churn before it shows in numbers.
DATA SOURCE
Customer survey, Industry data
Finding / Answer
SCORE
3
What is your product/service development cycle time vs. competitors?
Medium
Slow innovation cycles vs. peers lead to market share erosion when competitors launch faster.
DATA SOURCE
Product roadmap, R&D data
Finding / Answer
SCORE
4
Are your key competitive differentiators validated by customer data, or assumed by management?
High
Most companies believe their differentiation is stronger than customers perceive. Test with win/loss interviews.
DATA SOURCE
CRM, Customer interviews
Finding / Answer
SCORE
5
What is your geographic market coverage vs. key competitors, and where are white-space gaps?
Medium
Geographic coverage gaps are often the fastest addressable growth opportunity — lower cost than product development.
DATA SOURCE
Sales data, Market maps
Finding / Answer
SCORE
6
How does your digital capability (e-commerce, CX, data) compare to sector leaders?
Medium
Digital maturity gaps compound over time. Assess against sector leaders, not average peers.
DATA SOURCE
IT assessment, Market research
Finding / Answer
SCORE
7
What is your talent acquisition cost and time-to-hire vs. industry benchmark?
Low
Labour market competitiveness affects growth capacity. Above-benchmark hiring costs signal positioning or compensation gaps.
DATA SOURCE
HR data, Industry report
Finding / Answer
SCORE
COST REDUCTION AUDIT
Financial | Operational
Identify structural cost reduction opportunities without damaging performance or customer value. Focuses on root causes and sustainable savings, not one-off cuts.
AUDIT PHASE 1 OF 4
Cost Structure & Overhead
SCOPE
Fixed and semi-fixed cost structure vs. revenue and output
SELECT PHASE
AUDIT QUESTIONS
1
What are the top 10 cost lines by value, and which have grown faster than revenue in the last 3 years?
High
Cost growth that outpaces revenue growth is structural deterioration. Each line above revenue growth rate is a priority.
DATA SOURCE
P&L, Management accounts
Finding / Answer
SCORE
2
Which fixed costs remain unchanged regardless of revenue decline — and what is the minimum revenue floor to cover them?
High
This defines your breakeven vulnerability. Companies with high fixed-cost floors are fragile in downturns.
DATA SOURCE
P&L, Management accounts
Finding / Answer
SCORE
3
Are there overhead functions where headcount has grown without a corresponding increase in output or revenue?
High
Overhead creep is common in growth phases. Map headcount per function vs. revenue or output over 3 years.
DATA SOURCE
HR data, Finance
Finding / Answer
SCORE
4
Which subscriptions, software licences, and recurring service contracts have not been reviewed in the past 18 months?
Medium
Zombie subscriptions accumulate silently. A full audit of recurring payments typically finds 10–20% unused or duplicated.
DATA SOURCE
Accounts payable, IT register
Finding / Answer
SCORE
5
What is the cost of non-productive space — empty offices, unused warehousing, or idle plant?
Medium
Space costs are often accepted as fixed when they are actually renegotiable or avoidable.
DATA SOURCE
Facilities contracts, Finance
Finding / Answer
SCORE
6
Are there shared service functions that could be centralised or outsourced at lower cost?
Medium
Duplicated functions across business units (HR, payroll, IT support) are a common cost structure inefficiency.
DATA SOURCE
Org chart, Budget
Finding / Answer
SCORE
7
What is the total cost of compliance and reporting activities, and is that cost proportionate to business scale?
Low
Compliance cost should scale with risk and revenue, not with administrative habit. Audit what is legally required vs. what is internal over-engineering.
DATA SOURCE
Legal, Finance
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Procurement & Supplier Costs
SCOPE
External spend on goods, services, and logistics
SELECT PHASE
AUDIT QUESTIONS
1
When were your top 10 supplier contracts last renegotiated, and what are current rates vs. market?
High
Most supplier contracts auto-renew without challenge. Benchmarking current rates against market takes hours and typically yields 5–15% savings.
DATA SOURCE
Contract register, Market data
Finding / Answer
SCORE
2
What percentage of total spend is with single-source suppliers, and what is the risk/cost premium you pay for this?
High
Single-source dependency removes competitive pressure and creates both cost and continuity risk.
DATA SOURCE
Procurement data, Supplier list
Finding / Answer
SCORE
3
Are volume discounts being fully utilised, and is purchasing fragmented across locations or buyers?
Medium
Fragmented purchasing loses volume leverage. Consolidation of spend across sites often unlocks higher discount tiers.
DATA SOURCE
Procurement data
Finding / Answer
SCORE
4
What is the total cost of inbound logistics, and have freight/carrier rates been reviewed in the last 12 months?
High
Logistics costs have been volatile. Companies that haven't renegotiated since 2022 are often overpaying significantly.
DATA SOURCE
Accounts payable, Logistics contracts
Finding / Answer
SCORE
5
What is the cost of inventory obsolescence and write-offs annually, and what is causing it?
Medium
Obsolescence is a procurement and demand planning failure. The financial cost is visible; the root cause often isn't.
DATA SOURCE
Inventory reports, Finance
Finding / Answer
SCORE
6
Are there categories of spend where specification quality exceeds what is actually required?
Medium
Over-specification is common in capex and materials. Buying grade A when grade B is sufficient is a cost problem.
DATA SOURCE
Engineering specs, Procurement
Finding / Answer
SCORE
7
Is there a preferred supplier programme, and does it actually deliver cost and quality consistency?
Low
Preferred supplier programmes often exist on paper but are bypassed in practice. Test actual usage against the approved list.
DATA SOURCE
Procurement policy, Accounts payable
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Labour & Productivity Costs
SCOPE
Labour cost efficiency and workforce productivity
SELECT PHASE
AUDIT QUESTIONS
1
What is the cost per productive hour, and how does it compare to 3 years ago and to the sector?
High
Rising cost-per-productive-hour without productivity gains means the business is paying more for the same output.
DATA SOURCE
Payroll, HR data, Production data
Finding / Answer
SCORE
2
What is the total cost of absenteeism — direct pay, replacement cover, and output loss?
High
Absenteeism cost is typically 2–4× the direct pay of absent hours when replacement and output effects are included.
DATA SOURCE
HR records, Payroll
Finding / Answer
SCORE
3
Are there roles or job families with utilisation below 70%, and what is the structural cause?
Medium
Low utilisation is usually a demand, workflow, or organisation design problem — not a people problem.
DATA SOURCE
HR data, Time tracking
Finding / Answer
SCORE
4
What is the total spend on temporary and agency labour, and what is driving the dependency?
High
High agency dependency is a symptom of poor workforce planning or structural avoidance of permanent employment decisions.
DATA SOURCE
Payroll, Finance
Finding / Answer
SCORE
5
What is the overtime cost, and is it being used to compensate for understaffing or poor scheduling?
Medium
Overtime used as a permanent supplement to understaffing is more expensive than hiring and less sustainable.
DATA SOURCE
Payroll, HR data
Finding / Answer
SCORE
6
Are there activities currently done by senior roles that could be redistributed to lower-cost resources?
Medium
Task-level role analysis often finds that 20–30% of senior time is spent on work that could be delegated or automated.
DATA SOURCE
Job profiles, Manager survey
Finding / Answer
SCORE
7
What is the total training spend, and is it generating measurable productivity or capability uplift?
Low
Training spend without measured output is overhead. ROI on training is rarely tracked and often negative when measured properly.
DATA SOURCE
HR, Finance
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Hidden Cost & Waste Elimination
SCOPE
Non-obvious costs embedded in processes, systems, and decisions
SELECT PHASE
AUDIT QUESTIONS
1
What is the total cost of rework, complaints, and quality failures annually?
High
Cost of poor quality (COPQ) typically runs at 5–15% of revenue in manufacturers. It is rarely measured and almost never managed.
DATA SOURCE
Quality reports, Finance, CRM
Finding / Answer
SCORE
2
What is the cost of expediting — rush orders, urgent freight, and last-minute changes?
High
Expediting cost is a proxy for planning failure. Companies that plan well almost never expedite.
DATA SOURCE
Logistics data, Accounts payable
Finding / Answer
SCORE
3
Are there internal approval processes that add time and cost without adding risk control?
Medium
Multi-layer approvals on low-value decisions are a hidden cost of bureaucracy. Map approval steps vs. value protected.
DATA SOURCE
Process maps, Management interviews
Finding / Answer
SCORE
4
What is the cost of maintaining legacy systems, workarounds, and manual patches on old technology?
Medium
Legacy system maintenance is often more expensive than replacement when total cost of workarounds is included.
DATA SOURCE
IT budget, Finance
Finding / Answer
SCORE
5
How much management time is spent in reporting activities that do not drive decisions?
Medium
Reporting that nobody reads or acts on is pure overhead. Audit report recipients and the decisions they make.
DATA SOURCE
Management survey, Report register
Finding / Answer
SCORE
6
Are customer-facing processes creating costs through complexity that customers don't value?
High
Order entry complexity, return processes, and invoicing errors all create cost that customers don't pay for.
DATA SOURCE
Process maps, CRM, Customer feedback
Finding / Answer
SCORE
7
What is the total cost of failed projects and initiatives in the last 3 years?
Low
Sunk costs on failed initiatives are rarely captured. They often represent 3–8% of annual capex and distract management attention.
DATA SOURCE
Finance, Project records
Finding / Answer
SCORE
KPI DASHBOARD AUDIT
Operational | Financial | Strategy
Evaluate whether the right KPIs are tracked, reported accurately, and actively used to drive decisions. A KPI system nobody acts on is not a management system — it is a reporting exercise.
AUDIT PHASE 1 OF 4
KPI Selection & Strategic Alignment
SCOPE
Whether current KPIs are the right ones for the business strategy
SELECT PHASE
AUDIT QUESTIONS
1
Does every KPI link directly and visibly to a stated strategic objective?
High
Map each KPI to a strategic goal. KPIs with no strategic link are either orphaned metrics or the strategy is incomplete.
DATA SOURCE
Strategy document, KPI register
Finding / Answer
SCORE
2
Are there strategic objectives with no KPI assigned to them?
High
Unstated KPIs mean unstated accountability. Strategic priorities without measurement are wishes, not commitments.
DATA SOURCE
Strategy document, KPI register
Finding / Answer
SCORE
3
What is the ratio of leading to lagging indicators in the current dashboard?
High
Leading indicators (activity, pipeline, quality input) predict future performance. Lagging-only dashboards report the past without enabling course correction.
DATA SOURCE
KPI dashboard
Finding / Answer
SCORE
4
How many KPIs are tracked in total, and can each manager name the top 5 that matter most?
Medium
Best practice: 5–10 KPIs per management level. If managers cannot recall the priorities, the dashboard has too many metrics.
DATA SOURCE
KPI dashboard, Manager interviews
Finding / Answer
SCORE
5
Are KPIs set to differentiate high from mediocre performance, or are targets set to guarantee achievement?
High
Targets set to guarantee achievement create false confidence. Compare actual vs. target vs. benchmark for each KPI.
DATA SOURCE
KPI register, Benchmark data
Finding / Answer
SCORE
6
Are customer-experience KPIs given equal weight to financial KPIs in management review?
Medium
Financial-only dashboards systematically under-invest in customer satisfaction until it becomes a crisis.
DATA SOURCE
KPI dashboard, Management agenda
Finding / Answer
SCORE
7
When was the KPI set last reviewed for continued relevance, and what changed in the business since then?
Medium
KPI sets drift out of relevance as strategy evolves. Metrics that were right 3 years ago may now measure the wrong things.
DATA SOURCE
KPI review records, Strategy document
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Data Quality & Measurement Integrity
SCOPE
Accuracy, timeliness, and consistency of KPI data
SELECT PHASE
AUDIT QUESTIONS
1
Are KPI definitions documented with a consistent formula, source, and owner for each metric?
High
Different teams calculating the same KPI differently makes management discussion meaningless. Test this by asking two teams to independently calculate the same metric.
DATA SOURCE
KPI definitions document
Finding / Answer
SCORE
2
Which KPIs are calculated manually, and how often do manual errors affect the reported number?
High
Manual KPI calculation is a data quality risk. Each manual step is a point where error or delay can enter.
DATA SOURCE
IT systems, Finance process
Finding / Answer
SCORE
3
How long does it take to produce the monthly management report, and what causes the longest delays?
Medium
More than 3 days to produce a monthly report indicates a data collection or systems problem. Identify the bottleneck step.
DATA SOURCE
Reporting process, Finance team
Finding / Answer
SCORE
4
Are there known data quality issues affecting any current KPIs, and are these disclosed in reports?
High
Hidden data quality issues create false confidence in reported numbers. Known issues must be flagged, not buried.
DATA SOURCE
Data audit, IT, Finance
Finding / Answer
SCORE
5
Are source systems (ERP, CRM, HRIS) integrated, or are data exports and manual reconciliations required?
Medium
Every manual reconciliation between systems is a latency and error source. Integration gaps create reporting delays.
DATA SOURCE
IT architecture
Finding / Answer
SCORE
6
Is KPI data audited periodically for accuracy, and by whom?
Medium
Self-reported KPI data is subject to gaming or rounding. Independent periodic validation is standard in mature organisations.
DATA SOURCE
Audit process, Finance
Finding / Answer
SCORE
7
Are there KPIs where the data source has changed without a restatement of prior-period comparisons?
Low
Changing data sources without restatement makes trend analysis misleading. Historical comparability must be maintained.
DATA SOURCE
KPI register, Finance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Usage & Decision-Making Impact
SCOPE
How KPIs drive management decisions and operational actions
SELECT PHASE
AUDIT QUESTIONS
1
In the last 3 management reviews, how many agenda items were directly triggered by a KPI moving off target?
High
This is the real test of a KPI system. If KPI movements don't drive agenda items, the system is decorative.
DATA SOURCE
Meeting minutes
Finding / Answer
SCORE
2
Is there a defined escalation process when a KPI breaches a threshold, and is it consistently applied?
High
Without defined escalation, off-target KPIs get noted, not acted on. Test by asking managers what they did last time a KPI missed.
DATA SOURCE
Management process, Meeting minutes
Finding / Answer
SCORE
3
Does every KPI have a single named owner accountable for performance, with authority to act?
High
Committee accountability is no accountability. Each KPI must have one person who is answerable for the result.
DATA SOURCE
KPI register
Finding / Answer
SCORE
4
Are front-line teams shown the KPIs they directly influence, with enough frequency to change behaviour?
Medium
Visibility drives behaviour only if the lag between action and feedback is short. Monthly reporting to front-line teams is often too slow.
DATA SOURCE
Internal communications, Team meetings
Finding / Answer
SCORE
5
Is there evidence that KPI trends have changed management decisions about investment, staffing, or pricing?
High
Ask for specific examples where a KPI trend changed a resource allocation decision. Absence of examples means the system is not working.
DATA SOURCE
Decision log, Management interviews
Finding / Answer
SCORE
6
Are KPIs used in performance conversations with individual managers, linked to objectives and accountability?
Medium
KPIs disconnected from individual performance management create a gap between measurement and consequence.
DATA SOURCE
HR process, Performance reviews
Finding / Answer
SCORE
7
Is there a mechanism to raise concerns about KPI targets being gamed or manipulated?
Medium
KPI gaming is common and often subtle. A culture where targets are never challenged or questioned is a risk signal.
DATA SOURCE
Management culture, HR process
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
KPI Governance & Continuous Improvement
SCOPE
Review cycle, ownership, and evolution of the KPI framework
SELECT PHASE
AUDIT QUESTIONS
1
Is there a defined review cycle for the KPI framework, and who has authority to add, remove, or change KPIs?
Medium
Without governance, KPI sets grow uncontrolled or become outdated. Authority to change must be explicit.
DATA SOURCE
KPI governance document
Finding / Answer
SCORE
2
How are new KPIs validated before being added to the management dashboard?
Medium
Poorly defined new KPIs are added under pressure and never removed. Each addition should pass a relevance and measurability test.
DATA SOURCE
KPI governance process
Finding / Answer
SCORE
3
Are KPI targets benchmarked externally or only set relative to last year's actuals?
High
Internal-only target setting anchors ambition to past performance. Benchmark-relative targets set a higher and more meaningful bar.
DATA SOURCE
KPI register, Industry data
Finding / Answer
SCORE
4
Is there a process to identify KPI blind spots — risks or opportunities not currently being measured?
High
The most dangerous risks are those not in the dashboard. Periodic 'what are we not measuring?' reviews are standard in mature governance.
DATA SOURCE
Risk register, Strategy review
Finding / Answer
SCORE
5
Are KPI reports distributed to the right people at the right frequency, or is the same report sent to everyone?
Low
Generic reporting at a single frequency is a sign that the system was designed for compliance, not decision-making.
DATA SOURCE
Reporting distribution list
Finding / Answer
SCORE
6
Is there a documented link between KPI performance and strategic planning assumptions?
Medium
KPI performance data should feed into the annual strategic planning process. If it doesn't, strategy is disconnected from operational reality.
DATA SOURCE
Strategy document, KPI report
Finding / Answer
SCORE
7
Are board-level KPIs aligned with operational KPIs, or do they measure different things?
High
Misalignment between board metrics and operational metrics is a governance risk. Board KPIs should be aggregations of operational ones, not alternatives.
DATA SOURCE
Board reports, Management reports
Finding / Answer
SCORE
PRODUCTIVITY AUDIT
Operational | HR/People
Identify productivity blockers at team, process, and system level. Focus is on output per hour, not hours worked. Organisations that improve productivity create capacity without adding headcount.
AUDIT PHASE 1 OF 4
Output & Capacity Utilisation
SCOPE
Actual output levels, capacity usage, and productivity baseline
SELECT PHASE
AUDIT QUESTIONS
1
What is actual output per FTE per week, and how does it vary across teams, shifts, or locations?
High
Aggregate productivity hides variation. The gap between your best and worst units reveals the improvement potential from levelling up.
DATA SOURCE
Production data, HR data
Finding / Answer
SCORE
2
What percentage of working time is spent on activities that directly create customer or financial value?
High
Time studies typically reveal 40–60% of working time in non-value-adding activities in knowledge work environments.
DATA SOURCE
Time study, Employee survey
Finding / Answer
SCORE
3
What are the top 3 causes of lost productive time, quantified in hours and cost per week?
High
Generic answers like 'too many meetings' are not enough. Quantify each cause and its frequency to rank by impact.
DATA SOURCE
Employee survey, Manager input
Finding / Answer
SCORE
4
Is demand-side variability (seasonal, weekly, daily) causing systematic over or under-capacity?
Medium
Misalignment between demand patterns and staffing patterns is a primary cause of both overtime and idle time.
DATA SOURCE
Production schedule, Sales data
Finding / Answer
SCORE
5
What is the ratio of direct productive roles to support and overhead roles, and has it shifted over 3 years?
Medium
Growing support ratios over time signal overhead creep. The ratio should move in the opposite direction as the business scales.
DATA SOURCE
HR data, Org chart
Finding / Answer
SCORE
6
Are productivity targets set per role, and how often are they reviewed against actual output?
High
Without role-level productivity targets, underperformance becomes normalised. Targets require data, then accountability.
DATA SOURCE
HR, Production data
Finding / Answer
SCORE
7
What is the cost of unplanned absence on daily output, and is there a contingency staffing plan?
Medium
Unplanned absence without contingency means output loss is 1:1. Planned cover can halve the productivity impact.
DATA SOURCE
HR records, Production data
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Tools, Systems & Technology
SCOPE
Technology and system-level productivity enablers and blockers
SELECT PHASE
AUDIT QUESTIONS
1
What is the top system or tool complaint cited by employees as slowing them down?
High
Ask employees directly, not managers. The answer is usually specific: a slow system, a missing integration, a broken process.
DATA SOURCE
Employee survey, IT helpdesk logs
Finding / Answer
SCORE
2
How many hours per week per FTE are lost to system downtime, slow performance, or workarounds?
High
Quantify IT-related productivity loss in hours and annualised cost. This builds the business case for IT investment.
DATA SOURCE
IT helpdesk logs, Employee survey
Finding / Answer
SCORE
3
Which repetitive, rule-based tasks are still done manually that could be automated?
Medium
Automation candidates: data entry, report generation, status updates, invoice matching. Map and prioritise by time consumed.
DATA SOURCE
Process mapping, Employee survey
Finding / Answer
SCORE
4
Is information easy to find, or do employees regularly spend time locating documents, contacts, or data?
Medium
Findability is a productivity multiplier. Poor document management and inconsistent naming conventions are silent time thieves.
DATA SOURCE
Employee survey, IT systems
Finding / Answer
SCORE
5
Are employees trained to use systems to their capability, or only to perform their own task flow?
Medium
System underutilisation is common. Most ERP and CRM systems are used at 30–50% of their capability by non-IT users.
DATA SOURCE
Training records, IT usage data
Finding / Answer
SCORE
6
Are there shadow IT tools (personal spreadsheets, WhatsApp groups, personal Dropboxes) compensating for system gaps?
High
Shadow IT signals that official systems do not meet user needs. It also creates data integrity and security risks.
DATA SOURCE
IT audit, Manager interviews
Finding / Answer
SCORE
7
What is the ratio of IT support tickets to FTE count, and is it trending up or down?
Low
Rising support ticket volume per FTE indicates growing system fragility or user frustration with technology.
DATA SOURCE
IT helpdesk data
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Meeting & Communication Overhead
SCOPE
Time consumed by meetings, emails, and communication overhead
SELECT PHASE
AUDIT QUESTIONS
1
What is the average number of hours per week spent in meetings by function, and how does this compare across levels?
High
Senior managers often average 25–35 hours/week in meetings. At that point, meeting attendance is the job, not a support activity.
DATA SOURCE
Calendar analysis, Survey
Finding / Answer
SCORE
2
What percentage of meetings end with documented decisions and assigned actions?
High
Meetings without documented outputs are time consumption, not decision-making. A rate below 70% indicates a meeting culture problem.
DATA SOURCE
Meeting minutes, Survey
Finding / Answer
SCORE
3
Are there recurring meetings that have not been evaluated for necessity in the past year?
Medium
Recurring meetings accumulate. A recurring meeting audit typically eliminates 20–30% of standing meetings without loss of information flow.
DATA SOURCE
Calendar audit
Finding / Answer
SCORE
4
How much time do managers spend preparing for internal reporting vs. customer-facing or value-creating activities?
Medium
Internal reporting preparation that exceeds 1 day per month per manager is disproportionate in most businesses.
DATA SOURCE
Manager survey, Calendar analysis
Finding / Answer
SCORE
5
Is there a cultural expectation to respond to messages immediately, and does this fragment deep-work time?
Medium
Constant interruption from instant messages reduces cognitive output. Measure perceived interruption frequency and its impact on output quality.
DATA SOURCE
Employee survey
Finding / Answer
SCORE
6
Are decision rights clear enough that communication volume is driven by information-sharing, not permission-seeking?
High
High communication overhead is often a symptom of unclear authority. People copy everyone to avoid blame rather than inform.
DATA SOURCE
Decision rights framework, Survey
Finding / Answer
SCORE
7
Do remote or hybrid workers face higher communication overhead than on-site workers, and what is the productivity effect?
Low
Remote work can increase meeting load while reducing informal information exchange. Net productivity effect must be measured, not assumed.
DATA SOURCE
HR data, Survey
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Workflow Design & Process Bottlenecks
SCOPE
How work flows through the organisation and where it stalls
SELECT PHASE
AUDIT QUESTIONS
1
Where in the key process flows does work queue most frequently, and for how long?
High
Queue time is wasted time. Map the top 3 core processes and identify where work sits waiting — for approval, information, or resource.
DATA SOURCE
Process maps, ERP/workflow data
Finding / Answer
SCORE
2
Are handover points between departments or roles documented with clear inputs, outputs, and timing expectations?
High
Most process breakdowns happen at handovers, not within functions. The gap between who hands off and who receives is where things go wrong.
DATA SOURCE
Process maps, SOP library
Finding / Answer
SCORE
3
What is the average rework rate in key processes, and what is the primary upstream cause?
High
Rework is a sign of unresolved upstream quality failure. Fix the cause in the feeding step, not the step where rework is visible.
DATA SOURCE
Quality data, Process data
Finding / Answer
SCORE
4
Are processes designed around the most common scenario or around exceptions, and what is the cost of exception handling?
Medium
Exception-driven process design is inefficient. If exception frequency is low, design for the standard case and handle exceptions separately.
DATA SOURCE
Process analysis, IT system design
Finding / Answer
SCORE
5
Are approval and sign-off chains proportionate to the risk and value of the decision being approved?
Medium
Multi-layer approvals on low-risk, low-value decisions slow throughput without protecting the business.
DATA SOURCE
Approval workflows, Process maps
Finding / Answer
SCORE
6
Is there a defined process improvement mechanism — a way for employees to flag and resolve inefficiencies?
Medium
Without a formal channel, process problems are complained about but not fixed. Kaizen or equivalent mechanisms create structural improvement.
DATA SOURCE
HR, Operations process
Finding / Answer
SCORE
7
What percentage of process steps in key workflows are documented in current, accessible SOPs?
Low
Undocumented processes are volatile — knowledge held by individuals, lost on departure, and inconsistently executed.
DATA SOURCE
SOP library, Process maps
Finding / Answer
SCORE
BUSINESS PERFORMANCE REVIEW AUDIT
Financial | Strategy | Operational
Structured review of overall business performance across financial, commercial, and operational dimensions. Use quarterly to maintain strategic alignment and identify early warning signals.
AUDIT PHASE 1 OF 4
Financial Performance
SCOPE
Revenue, margin, cash, and balance sheet health
SELECT PHASE
AUDIT QUESTIONS
1
Is revenue on track vs. plan, and what is the structural vs. timing cause of any variance?
High
Split variance into price, volume, and mix effects. A mix shift to lower-margin products is structurally different from a timing delay.
DATA SOURCE
P&L, Budget
Finding / Answer
SCORE
2
Is gross margin stable or improving, and has product/service mix contributed positively or negatively?
High
Margin trend by product or service line reveals more than blended margin. Growing lower-margin revenue is a value-destruction trap.
DATA SOURCE
P&L, Product margin analysis
Finding / Answer
SCORE
3
Is operating cash flow positive, and does it cover debt service, capex, and working capital needs?
High
Profitable companies can fail on cash. Confirm that operating cash flow is sufficient to fund the business without increasing debt.
DATA SOURCE
Cash flow statement, Finance
Finding / Answer
SCORE
4
Are debtor days trending up or down, and which customer segments or geographies are driving the movement?
High
Lengthening DSO often signals customer financial stress or weakened credit control — both require immediate response.
DATA SOURCE
Accounts receivable, Finance
Finding / Answer
SCORE
5
What is working capital as a percentage of revenue, and is it increasing faster than the business is growing?
High
Working capital growing faster than revenue signals either customer credit problems, inventory accumulation, or payable terms shortening.
DATA SOURCE
Balance sheet, Finance
Finding / Answer
SCORE
6
Are there any covenant breaches or near-covenant risks on existing credit facilities?
High
Covenant proximity is a board-level risk item. Management teams often underestimate how quickly lenders react to covenant stress.
DATA SOURCE
Finance, Banking agreements
Finding / Answer
SCORE
7
What is the variance between cash profit (EBITDA) and actual cash generated, and what explains the gap?
Medium
EBITDA is not cash. The gap is explained by working capital movements, tax, interest, and capex. Understanding it prevents cash surprises.
DATA SOURCE
Cash flow statement, Finance
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Commercial Performance
SCOPE
Pipeline, customer segments, pricing, and market position
SELECT PHASE
AUDIT QUESTIONS
1
Is the sales pipeline healthy, and does it provide sufficient coverage for the next 2 quarters?
High
Pipeline coverage ratio should be 3× target revenue for the period. Below 2× is a forward revenue risk requiring immediate action.
DATA SOURCE
CRM
Finding / Answer
SCORE
2
Which customer segments or product lines are growing, and which are in structural decline?
High
Revenue mix shifts determine future margins. A business growing in low-margin segments is getting weaker, not stronger.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
3
What is the customer retention rate this period, and what are the specific reasons for accounts lost?
High
Every lost account has a specific reason. Aggregate churn rates hide the causes. Require account-level exit data.
DATA SOURCE
CRM
Finding / Answer
SCORE
4
Are the top 5 customers growing, stable, or declining in spend, and what is the account health signal?
High
Customer concentration in declining accounts is a leading revenue risk. Monitor spend trend, not just current revenue.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
5
What is the conversion rate from proposal to closed deal, and has it changed in the last 6 months?
Medium
Declining conversion rates signal competitive pricing pressure, proposition weakness, or sales execution deterioration.
DATA SOURCE
CRM
Finding / Answer
SCORE
6
Is new business revenue sufficient to replace natural churn and grow the customer base?
High
New business rate must exceed churn rate for net growth. If not, the company is on a slow revenue decline even with a healthy retention rate.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
7
Are pricing and discounting decisions being made consistently and within defined authority levels?
Medium
Price erosion through unauthorised discounting is a common hidden margin leak. Audit actual sold prices vs. list prices.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Operational Performance
SCOPE
Delivery, quality, capacity, and people performance
SELECT PHASE
AUDIT QUESTIONS
1
What is the on-time delivery rate, and where in the process do delays originate?
High
OTD below 90% in most industries signals a systemic planning or capacity problem, not isolated incidents.
DATA SOURCE
Operations data, ERP
Finding / Answer
SCORE
2
What is the quality complaint rate per 1,000 orders or transactions, and is it trending up or down?
High
Quality complaint rate is a lagging indicator of production or service process integrity. Rising rates require immediate root cause work.
DATA SOURCE
Customer complaints data, Quality reports
Finding / Answer
SCORE
3
Are there capacity constraints — in production, logistics, or staffing — that are limiting revenue growth?
High
Unconstrained demand with constrained supply is a missed revenue opportunity. Identify the top bottleneck and its capacity expansion cost.
DATA SOURCE
Operations data, Sales data
Finding / Answer
SCORE
4
What is staff turnover by department, and are any functions above the sector average?
Medium
Above-average turnover in specific functions signals local management, compensation, or work environment problems — not a company-wide issue.
DATA SOURCE
HR data
Finding / Answer
SCORE
5
What is the utilisation rate of key production assets or infrastructure, and is it optimised?
Medium
Under-utilised assets represent fixed cost inefficiency. Over-utilised assets signal investment need before performance degrades.
DATA SOURCE
Production data, Maintenance records
Finding / Answer
SCORE
6
Are supplier delivery performance and quality meeting the standards required to serve your customers?
High
Supplier underperformance is a direct input to customer delivery and quality failure. Track supplier KPIs with the same rigour as internal ones.
DATA SOURCE
Procurement data, Quality reports
Finding / Answer
SCORE
7
What is the Net Promoter Score or customer satisfaction score this period, and what is driving movement?
Medium
NPS or CSAT trends are operational KPIs, not just marketing ones. Declining satisfaction predicts future churn before it shows in revenue.
DATA SOURCE
Customer survey, CRM
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Strategic Outlook & Risk
SCOPE
Forward-looking risks, strategic progress, and decision priorities
SELECT PHASE
AUDIT QUESTIONS
1
What are the top 3 risks to achieving the next 12-month plan, and what is the current mitigation status?
High
Naming risks without tracking mitigation status is incomplete governance. Each risk needs an owner, a response, and a monitoring trigger.
DATA SOURCE
Risk register, Management review
Finding / Answer
SCORE
2
Are any strategic initiatives on track — on time, on budget, and delivering expected business impact?
High
Most strategic initiative portfolios are behind schedule. An honest review of what is actually delivering vs. what is stalled is essential.
DATA SOURCE
Project portfolio, Management review
Finding / Answer
SCORE
3
What external market changes — customer behaviour, competition, regulation — are affecting the plan?
High
External factors that were not in the original plan require explicit acknowledgement and plan revision, not silence.
DATA SOURCE
Market intelligence, Management review
Finding / Answer
SCORE
4
Is the current capital allocation — across maintenance, growth, and transformation — appropriate for the strategy?
Medium
Capital allocation decisions made annually at budget often become misaligned during the year as conditions change.
DATA SOURCE
Finance, Capital plan
Finding / Answer
SCORE
5
Are there decisions being delayed that are consuming management attention and creating uncertainty?
High
Delayed decisions have costs — in management time, team uncertainty, and missed opportunity. Identify and force closure.
DATA SOURCE
Management team interviews
Finding / Answer
SCORE
6
What is the current talent risk — key person dependencies, succession gaps, and skills shortages?
Medium
Talent risk is a strategic risk, not just an HR concern. Key person dependency in revenue-critical or technical roles is a board-level item.
DATA SOURCE
HR, Succession plan
Finding / Answer
SCORE
7
Is the business model remaining relevant, or are there structural changes in the market that require strategic response?
High
Business model relevance should be tested at each quarterly review, not just at annual strategy sessions.
DATA SOURCE
Market analysis, CEO review
Finding / Answer
SCORE
CROSS-CULTURAL BUSINESS AUDIT
Strategy | HR/People
Assess readiness for cross-cultural business: communication, decision-making styles, negotiation, and team integration across cultural boundaries. Critical for international expansion and partnership success.
AUDIT PHASE 1 OF 4
Cultural Intelligence & Business Awareness
SCOPE
Team's knowledge of and adaptability to target market cultures
SELECT PHASE
AUDIT QUESTIONS
1
Does the team engaging in cross-cultural business have documented cultural briefings for each target market?
High
Generic cultural awareness is insufficient. Specific briefings on business etiquette, hierarchy norms, and communication expectations per country reduce costly missteps.
DATA SOURCE
HR training records, Commercial team
Finding / Answer
SCORE
2
What is the process for verifying that assumptions about a foreign counterpart's expectations are correct vs. assumed?
High
Most cross-cultural failures result from untested assumptions. Establish a verification practice before key meetings or proposals.
DATA SOURCE
Commercial process, Manager interviews
Finding / Answer
SCORE
3
Are local advisors or cultural brokers engaged for markets where the team has limited experience?
Medium
Relying solely on internal knowledge for unfamiliar markets is a risk. Local brokers reduce misread signals and protocol errors in high-value situations.
DATA SOURCE
Partner/advisor register
Finding / Answer
SCORE
4
How is the team's cultural intelligence formally assessed, and who is currently rated capable for which markets?
Medium
Informal cultural capability assessment creates exposure risk. Formal assessment enables targeted assignment and development.
DATA SOURCE
HR assessment process
Finding / Answer
SCORE
5
What formal mechanisms exist to capture and share learnings from past cross-cultural interactions — successful or not?
Low
Cultural learning is typically anecdotal. A structured debrief process after major cross-cultural engagements accumulates institutional intelligence.
DATA SOURCE
Knowledge management, HR
Finding / Answer
SCORE
6
Are marketing and sales materials adapted for each cultural market, not just translated?
High
Translation is the minimum. Adaptation of imagery, value propositions, case studies, and format for cultural norms is the differentiator.
DATA SOURCE
Marketing materials, Commercial team
Finding / Answer
SCORE
7
Is the company's legal and contractual approach adapted for jurisdictional and cultural differences in enforcement?
High
Contract structures and dispute resolution mechanisms appropriate in one culture may be unenforceable or offensive in another.
DATA SOURCE
Legal, Commercial team
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Communication Style Adaptation
SCOPE
Communication effectiveness across cultural and language boundaries
SELECT PHASE
AUDIT QUESTIONS
1
Are written communications reviewed for cultural appropriateness before being sent to key cross-cultural counterparts?
High
Directness, formality, tone, and even paragraph structure carry different signals in different cultures. High-value communications should be reviewed.
DATA SOURCE
Commercial process
Finding / Answer
SCORE
2
Is there clarity within the team on what constitutes a 'yes', 'maybe', and 'no' in different cultural communication styles?
High
In high-context cultures, a polite agreement often means the opposite. Understanding implicit communication is essential for accurate decision-making.
DATA SOURCE
Commercial training, Manager interviews
Finding / Answer
SCORE
3
How are language barriers managed in technical or contractual discussions where precision is critical?
Medium
Using interpreters for complex technical or legal discussions is standard. Over-reliance on one party's second language creates misunderstanding risk.
DATA SOURCE
Commercial process
Finding / Answer
SCORE
4
Are written follow-ups used consistently after verbal agreements in cross-cultural contexts?
Medium
Verbal agreements carry different weight in different cultures. Written confirmation after verbal agreement is a standard risk management practice.
DATA SOURCE
Commercial process, CRM
Finding / Answer
SCORE
5
Are communication frequency and channel preferences adapted per cultural partner?
Medium
Some cultures expect frequent proactive contact; others interpret this as pressure. Align communication rhythm to the partner's expectation.
DATA SOURCE
CRM, Partner management
Finding / Answer
SCORE
6
Are presentations and proposals formatted to match the decision-making style of the target culture?
Medium
Data-heavy, detail-first formats work in some cultures and alienate others. Relationship-first formats may be dismissed in high-efficiency contexts.
DATA SOURCE
Commercial materials
Finding / Answer
SCORE
7
Is there a process for checking that key messages have been understood as intended, not just received?
Low
Confirmation of understanding is especially important across language barriers. Ask the counterpart to summarise their understanding before proceeding.
DATA SOURCE
Commercial process
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Negotiation & Decision-Making Style
SCOPE
Cross-cultural differences in how decisions are made and negotiations are conducted
SELECT PHASE
AUDIT QUESTIONS
1
Is the team aware of the decision-making authority level of their counterparts — and is this confirmed, not assumed?
High
Negotiating with someone who lacks authority to decide wastes time and creates false confidence in agreed positions.
DATA SOURCE
Commercial process, Meeting records
Finding / Answer
SCORE
2
Are negotiation timelines calibrated to the typical decision speed of the target culture?
High
Pressing for quick closure in relationship-first cultures damages trust. Building in relationship time has commercial value that short timelines destroy.
DATA SOURCE
Commercial strategy
Finding / Answer
SCORE
3
What is the team's protocol for making and receiving concessions in a cross-cultural negotiation?
High
Concession sequencing carries different signals in different cultures. A concession given too early or too late can close rather than open a deal.
DATA SOURCE
Commercial training, Manager interviews
Finding / Answer
SCORE
4
Is the role of relationship-building formally recognised and resourced in the commercial approach to each market?
High
In markets where trust precedes business, under-investing in relationship-building extends the sales cycle and reduces win rates.
DATA SOURCE
Commercial strategy, Budget
Finding / Answer
SCORE
5
How are deadlock situations handled in negotiations with cultural counterparts where face-saving is critical?
Medium
Direct confrontation of deadlock can cause irreparable damage in face-saving cultures. Alternative resolution paths must be prepared in advance.
DATA SOURCE
Commercial training
Finding / Answer
SCORE
6
Is there a process to verify whether a signed agreement will be implemented as understood by both parties?
Medium
Contractual interpretation differs between cultures. Post-signature relationship management is often as important as the contract itself.
DATA SOURCE
Commercial process, Legal
Finding / Answer
SCORE
7
Are negotiating teams composition and seniority matched appropriately to the counterpart's expectations?
Medium
Sending a junior team to negotiate with a senior counterpart is a cultural misstep in hierarchical business cultures. Seniority matching matters.
DATA SOURCE
Commercial strategy, HR
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Team Integration & Organisational Culture Fit
SCOPE
Managing multicultural teams and integrating cultural differences internally
SELECT PHASE
AUDIT QUESTIONS
1
In multicultural teams, are differences in communication and working styles acknowledged and actively managed?
High
Unmanaged style differences create friction disguised as performance problems. Name the style differences and build explicit working agreements.
DATA SOURCE
HR, Team management
Finding / Answer
SCORE
2
Is leadership style adapted to cultural expectations of team members from different backgrounds?
High
Directive leadership is empowering in some cultures; in others it signals distrust. Adapt style consciously, not uniformly.
DATA SOURCE
HR, Management team
Finding / Answer
SCORE
3
Are performance expectations and feedback practices culturally calibrated, or applied uniformly?
High
Direct critical feedback is appropriate in some cultures and deeply damaging in others. HR processes must account for this.
DATA SOURCE
HR process, Manager training
Finding / Answer
SCORE
4
Are there measurable inclusion indicators for multicultural teams — voice, promotion, retention by cultural group?
Medium
Without measurement, inclusion remains aspirational. Track promotion rates, retention, and participation by demographic group.
DATA SOURCE
HR data
Finding / Answer
SCORE
5
Is there a formal onboarding process that addresses cultural integration for internationally placed staff?
Medium
Technical onboarding without cultural integration creates productive but disconnected staff who either leave or operate in isolation.
DATA SOURCE
HR, Onboarding process
Finding / Answer
SCORE
6
Are conflict resolution mechanisms culturally appropriate, and do team members trust them to work fairly?
Medium
Formal grievance processes work differently across cultures. Survey trust levels in available resolution mechanisms.
DATA SOURCE
HR, Employee survey
Finding / Answer
SCORE
7
Is cultural competence included in leadership development and succession planning criteria?
Low
Leaders in international businesses who lack cross-cultural capability create systemic commercial and team risk.
DATA SOURCE
HR, Succession plan
Finding / Answer
SCORE
DEALER ONBOARDING AUDIT
Sales & Marketing | Operational
Assess the effectiveness of the process for qualifying, activating, and developing new dealers. A weak onboarding process produces dealers who never reach commercial potential or who represent the brand poorly.
AUDIT PHASE 1 OF 4
Qualification & Selection Criteria
SCOPE
How new dealers are identified and evaluated before appointment
SELECT PHASE
AUDIT QUESTIONS
1
Is there a documented dealer profile that defines the minimum commercial, financial, and operational requirements for appointment?
High
Without a minimum standard, channel decisions are made on convenience or relationship rather than capability. The profile should include financial health, market coverage, and technical capacity.
DATA SOURCE
Channel policy, Sales process
Finding / Answer
SCORE
2
Are prospective dealers assessed against the profile before appointment, with documented evidence?
High
Assessment without documentation creates audit risk and inconsistent standards. Each appointment should have a signed-off qualification file.
DATA SOURCE
Sales process, CRM
Finding / Answer
SCORE
3
What is the financial health check process for new dealer candidates?
High
Appointing financially weak dealers creates credit, warranty, and brand risk. Minimum checks: credit rating, turnover history, and reference verification.
DATA SOURCE
Procurement/credit process, Finance
Finding / Answer
SCORE
4
Is market coverage analysis conducted before appointment to confirm the dealer covers the intended territory?
Medium
Appointing a dealer with coverage gaps or territory overlap with existing partners creates channel conflict and white-space risk.
DATA SOURCE
Market analysis, Sales data
Finding / Answer
SCORE
5
Are existing dealers consulted or informed before a new dealer is appointed in overlapping territories?
Medium
Channel conflict is a leading cause of distributor dissatisfaction and turnover. Transparent appointment processes reduce conflict and improve trust.
DATA SOURCE
Channel management process
Finding / Answer
SCORE
6
Is there a defined maximum number of dealers per territory, and is this ceiling being managed?
Medium
Over-distributing a territory destroys dealer economics and motivation. Each dealer must have sufficient addressable market to build a sustainable business.
DATA SOURCE
Channel strategy, Market maps
Finding / Answer
SCORE
7
Are the expected results and timeline for a new dealer made explicit before signing the appointment agreement?
High
Dealers who understand what is expected and when are more likely to invest appropriately. Vague expectations lead to both under-investment and disputed performance reviews.
DATA SOURCE
Dealer agreement, Onboarding process
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Onboarding Process & Materials
SCOPE
What happens from appointment to first sale
SELECT PHASE
AUDIT QUESTIONS
1
Is there a structured onboarding programme with defined milestones, responsibilities, and timelines?
High
An onboarding programme that exists only as a welcome call and a product brochure is not a programme. Define what must happen, by when, and who is responsible.
DATA SOURCE
Onboarding process, CRM
Finding / Answer
SCORE
2
Are product and technical training materials available in the dealer's language?
High
English-only materials are a barrier for non-English-speaking dealers. Translation of core product and technical content is a minimum standard.
DATA SOURCE
Training materials, Marketing
Finding / Answer
SCORE
3
Does the new dealer receive a dedicated contact person for the first 90 days of onboarding?
High
Dedicated first-90-day support increases early engagement and reduces early churn. Generic support desk access is insufficient.
DATA SOURCE
Sales process, CRM
Finding / Answer
SCORE
4
Are brand guidelines, visual identity, and communication standards provided with clear compliance requirements?
Medium
Dealers who do not receive clear brand standards will create their own materials. Inconsistent brand execution in-market is a common result.
DATA SOURCE
Marketing, Brand guidelines
Finding / Answer
SCORE
5
Is the dealer's marketing territory officially communicated and confirmed in writing?
High
Verbal territory agreements create disputes. Written confirmation of territory with map boundaries is non-negotiable.
DATA SOURCE
Dealer agreement
Finding / Answer
SCORE
6
Is there a defined product assortment recommendation for the new dealer's market and customer profile?
Medium
Generic product lists force dealers to guess which products to prioritise. A recommended assortment based on market profile shortens time-to-first-sale.
DATA SOURCE
Sales, Marketing
Finding / Answer
SCORE
7
Are pricing policies, discount structures, and payment terms explained in writing before first order?
High
Ambiguity in commercial terms causes disputes and erodes trust in the first weeks of a relationship. Clarity is a commercial investment.
DATA SOURCE
Dealer agreement, Finance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Training & Technical Competency
SCOPE
Product knowledge, technical capability, and sales readiness
SELECT PHASE
AUDIT QUESTIONS
1
Is there a defined product certification or competency test that new dealers must pass before selling?
High
Certifying dealer sales and technical staff before selling protects both the brand and the end customer. Without certification, quality is uncontrolled.
DATA SOURCE
Training programme, CRM
Finding / Answer
SCORE
2
Are training completion records maintained for each dealer contact, and linked to performance expectations?
Medium
Training records without follow-up on performance create administrative activity with no commercial accountability.
DATA SOURCE
Training records, CRM
Finding / Answer
SCORE
3
Is dealer training available in digital, self-paced format as well as classroom or face-to-face?
Medium
Face-to-face-only training is a bottleneck. Digital self-paced modules allow training to scale without fixed trainer time.
DATA SOURCE
Training platform, E-learning
Finding / Answer
SCORE
4
How often is product training content updated when new products are launched or specifications change?
High
Outdated training materials are a customer service risk. New product launches require parallel training content updates.
DATA SOURCE
Training process, Product management
Finding / Answer
SCORE
5
Are dealers trained on your sales methodology — not just the product, but how to sell it in their market?
Medium
Product knowledge without sales process training creates technically competent but commercially underperforming dealers.
DATA SOURCE
Sales training materials
Finding / Answer
SCORE
6
What is the pass rate on dealer certification, and is it used to identify dealers at risk of underperformance?
Medium
Low certification pass rates are an early warning of future underperformance. They require targeted support or reassessment of the appointment.
DATA SOURCE
Training records
Finding / Answer
SCORE
7
Is there a refresher training programme for existing dealer staff as products and markets evolve?
Low
Training delivered once at onboarding deteriorates rapidly. Annual refresher requirements maintain competency and engagement.
DATA SOURCE
Training programme
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
First 90 Days Performance
SCOPE
Early commercial activity and milestone achievement post-appointment
SELECT PHASE
AUDIT QUESTIONS
1
Are first 90-day commercial milestones defined for each new dealer, and reviewed at day 30, 60, and 90?
High
Three checkpoints in the first 90 days allow early intervention before a dealer falls permanently below expectation.
DATA SOURCE
Onboarding tracker, CRM
Finding / Answer
SCORE
2
What is the average time from dealer appointment to first order, and how does it compare to target?
High
Long time-to-first-order is a signal of either weak onboarding, insufficient market readiness, or wrong dealer selection. Track and act.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
3
Is there a defined intervention process for new dealers who are below milestone at day 60?
High
Without an intervention process, underperforming new dealers are managed reactively — usually too late to change the outcome.
DATA SOURCE
Channel management process
Finding / Answer
SCORE
4
Are new dealers introduced to key contacts in your organisation — logistics, technical support, finance — in the first 30 days?
Medium
New dealers who don't know who to call for operational issues lose time and confidence in the first critical weeks.
DATA SOURCE
Onboarding programme, CRM
Finding / Answer
SCORE
5
What feedback do new dealers give about the onboarding process, and is it formally collected?
Medium
Dealer feedback on onboarding quality identifies gaps and enables continuous improvement of the process.
DATA SOURCE
Survey, CRM
Finding / Answer
SCORE
6
Is the first 90-day joint business plan agreed in writing before or immediately after appointment?
High
A joint plan sets mutual expectations and creates a reference point for the 90-day review. Absence of a plan means no mutual commitment.
DATA SOURCE
Dealer agreement, CRM
Finding / Answer
SCORE
7
What is the 12-month retention rate of dealers recruited in the last 3 years, and what are the primary exit reasons?
High
Early dealer churn reflects systemic problems in selection, onboarding, or commercial conditions — not individual dealer failure.
DATA SOURCE
Sales data, CRM
Finding / Answer
SCORE
DISTRIBUTOR DEVELOPMENT AUDIT
Sales & Marketing | Strategy
Evaluate the depth and effectiveness of your distributor relationships. Goes beyond sales performance to assess capability, investment, joint planning, and long-term development trajectory.
AUDIT PHASE 1 OF 4
Distributor Selection & Qualification
SCOPE
How distributors are assessed, selected, and appointed
SELECT PHASE
AUDIT QUESTIONS
1
Is there a formal distributor selection criteria framework, and is it applied consistently before appointment?
High
Inconsistent selection criteria lead to inconsistent performance. A framework must include financial health, market coverage, technical capability, and strategic fit.
DATA SOURCE
Channel policy, Selection records
Finding / Answer
SCORE
2
Are distributor financial statements reviewed as part of the selection process?
High
A financially fragile distributor creates stock, credit, and continuity risk. Minimum check: last 2 years of accounts and credit rating.
DATA SOURCE
Finance, Selection records
Finding / Answer
SCORE
3
Is the distributor's current portfolio of brands assessed for conflict or complementarity with your offering?
High
Distributors carrying directly competing brands divide attention and loyalty. Map the brand portfolio before appointment.
DATA SOURCE
Selection records, Commercial team
Finding / Answer
SCORE
4
Is the distributor's existing customer base verified as matching your target segment?
Medium
A distributor with a strong customer base in the wrong segment does not provide market access regardless of their capability.
DATA SOURCE
Selection records, Market analysis
Finding / Answer
SCORE
5
Are distributor references — from other brand principals they represent — obtained and verified?
Medium
References from existing brand principals reveal reliability, communication quality, and commercial commitment before you are committed.
DATA SOURCE
Selection process
Finding / Answer
SCORE
6
Is the distributor's technical and after-sales capability assessed, not just their sales capacity?
High
Technical after-sales capability determines customer retention and brand reputation. Sales capability without service capability creates a one-sided relationship.
DATA SOURCE
Selection records, Technical assessment
Finding / Answer
SCORE
7
What is the average tenure of distributors in your network, and does short tenure indicate a systemic selection problem?
Medium
Short distributor tenure is a signal of either poor selection, poor support, or commercial terms that do not work in practice.
DATA SOURCE
Sales data, CRM
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Commercial Agreement & Structure
SCOPE
The terms, incentives, and governance of the distributor relationship
SELECT PHASE
AUDIT QUESTIONS
1
Are distributor agreements current, signed, and inclusive of current territory, product, and performance terms?
High
Outdated or unsigned agreements leave the relationship unprotected. Annual review of agreement currency is minimum governance.
DATA SOURCE
Contract register, Legal
Finding / Answer
SCORE
2
Do distributor agreements include minimum purchase commitments tied to market development plans?
High
Agreements without minimum commitments are orders of intent. Minimum commitments create accountability and protect market investment.
DATA SOURCE
Distributor agreements
Finding / Answer
SCORE
3
Is the pricing structure — including distributor margin, end-customer price guidance, and escalation rights — clearly defined?
High
Pricing ambiguity leads to margin erosion, price wars, and customer complaints. Structure must be documented and consistently applied.
DATA SOURCE
Distributor agreements, Finance
Finding / Answer
SCORE
4
Are exclusivity terms — where granted — tied to performance conditions with clear exit provisions?
High
Unconditional exclusivity removes incentive for performance improvement. Conditional exclusivity protects both parties' interests.
DATA SOURCE
Distributor agreements, Legal
Finding / Answer
SCORE
5
What is the termination notice period and process, and has it been tested in recent contract reviews?
Medium
Termination clauses that are unworkable in practice create legal exposure. Review enforceability periodically with legal counsel.
DATA SOURCE
Distributor agreements, Legal
Finding / Answer
SCORE
6
Are incentive structures (rebates, co-marketing funds, training support) tied to measurable outcomes?
Medium
Incentives without outcome linkage are subsidies. Each commercial incentive should have a defined commercial return.
DATA SOURCE
Commercial agreements, Finance
Finding / Answer
SCORE
7
Is there a defined process for resolving commercial disputes with distributors, including escalation levels?
Medium
Disputes managed ad hoc at field level create inconsistency and often escalate. A defined process maintains commercial relationships under pressure.
DATA SOURCE
Commercial policy, Legal
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Performance Management & Accountability
SCOPE
How distributor performance is measured, reviewed, and managed
SELECT PHASE
AUDIT QUESTIONS
1
Are distributor sales targets set annually with quarterly milestones, and reviewed formally at each checkpoint?
High
Annual targets without quarterly milestones cannot be managed. Quarterly reviews create the cadence needed for course correction.
DATA SOURCE
Sales data, CRM
Finding / Answer
SCORE
2
What is the process when a distributor misses target for two consecutive quarters?
High
Missing target twice without a structured response becomes normalised underperformance. Define the escalation before it is needed.
DATA SOURCE
Channel management process
Finding / Answer
SCORE
3
Are KPIs tracked beyond sales volume — including market coverage, customer satisfaction, and sell-through rates?
High
Revenue-only KPIs incentivise distributors to stock-load rather than develop market. Sell-through rate is the only commercially valid metric.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
4
Are distributor sales force activity levels (calls, demos, proposals) tracked and benchmarked?
Medium
Revenue is a lagging indicator. Activity level is the leading indicator. Low activity today predicts missed targets next quarter.
DATA SOURCE
CRM, Field reports
Finding / Answer
SCORE
5
How are high-performing and low-performing distributors identified and treated differently?
Medium
Treating all distributors identically regardless of performance reduces the incentive for investment and effort.
DATA SOURCE
Sales data, Channel management
Finding / Answer
SCORE
6
Is there a formal distributor scorecard reviewed at each business review meeting?
High
A scorecard creates objectivity in what can otherwise become relationship-based conversations that avoid difficult truths.
DATA SOURCE
Channel management, CRM
Finding / Answer
SCORE
7
What is the process for exiting an underperforming distributor, and has it been used in the last 3 years?
Medium
The willingness and ability to exit underperforming distributors signals that the performance management system has consequences.
DATA SOURCE
Commercial process, Legal
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Development & Growth Support
SCOPE
Investment in distributor capability and long-term partnership growth
SELECT PHASE
AUDIT QUESTIONS
1
Is there an annual joint business plan agreed with each distributor, with mutual investment commitments?
High
A joint business plan creates shared ownership of results. One-sided plans where only the distributor commits are not partnerships.
DATA SOURCE
Commercial process, CRM
Finding / Answer
SCORE
2
What training and capability development is provided to distributor sales and technical teams?
High
Distributor staff who are better trained sell more and stay longer. Training investment has a documented ROI in channel performance.
DATA SOURCE
Training programme, CRM
Finding / Answer
SCORE
3
Are co-marketing funds available to distributors, and are they conditioned on activities with measurable commercial return?
Medium
Co-marketing funds spent on untracked activities are subsidies. Each fund deployment should require an activity plan and a results report.
DATA SOURCE
Marketing, Finance
Finding / Answer
SCORE
4
What is the process for sharing market intelligence with distributors to help them identify opportunities?
Medium
Distributors who receive market data — customer trends, competitor activity, regulatory changes — make better commercial decisions.
DATA SOURCE
Commercial process, Marketing
Finding / Answer
SCORE
5
Are distributors involved in product development feedback loops and new product launch planning?
Medium
Distributors see the market daily. Excluding them from product development and launch planning wastes intelligence and reduces launch success.
DATA SOURCE
Product management, Commercial team
Finding / Answer
SCORE
6
What digital tools — ordering platforms, product configurators, training portals — are available to distributors, and is adoption tracked?
Medium
Digital tool adoption reduces distributor cost-to-serve and improves accuracy. Low adoption means the tools are not meeting the need or awareness is insufficient.
DATA SOURCE
IT, CRM, Training platform
Finding / Answer
SCORE
7
Is there a structured recognition and loyalty programme for top-performing distributors?
Low
Recognition reinforces the behaviours you want to replicate across the channel. It is lower cost than acquisition and higher impact than generic incentives.
DATA SOURCE
Commercial policy, Marketing
Finding / Answer
SCORE
EUROPE-AS-A-SERVICE (EAAS) AUDIT
Strategy | Sales & Marketing
Assess readiness, performance, and scalability of a European market entry executed via the Europe-as-a-Service model. Covers market access, distribution setup, commercial performance, and operational support infrastructure.
AUDIT PHASE 1 OF 4
Market Readiness & Entry Conditions
SCOPE
Product, regulatory, and commercial readiness for European market entry
SELECT PHASE
AUDIT QUESTIONS
1
Is the product or service fully compliant with EU regulatory and certification requirements for each target country?
High
CE marking, REACH, EMC Directive, and country-specific requirements must be confirmed before commercial activity. Regulatory non-compliance halts market entry.
DATA SOURCE
Legal, Product management
Finding / Answer
SCORE
2
Is the pricing structure viable for the European market after accounting for logistics, duties, currency, and distribution margin?
High
Many manufacturers price for their home market and apply a multiplier for Europe. The result is often uncompetitive or margin-negative after channel costs.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
3
Is there a validated customer need in the target European segments, confirmed by customer conversations — not assumed?
High
Market research reports are not market validation. Direct conversations with prospective customers in target segments are the minimum standard.
DATA SOURCE
Commercial team, Market research
Finding / Answer
SCORE
4
Is the minimum product assortment for European launch defined, and is there a clear rationale for what is excluded?
Medium
Launching with the full home-market portfolio is a common mistake. A focused entry assortment reduces complexity and accelerates learning.
DATA SOURCE
Product management, Commercial team
Finding / Answer
SCORE
5
Are warranty, return, and after-sales service processes defined for European operations before first sale?
High
European consumer protection standards require defined warranty and return processes. Failure to establish these before launch creates legal and reputational risk.
DATA SOURCE
Legal, Operations
Finding / Answer
SCORE
6
What is the planned go-live timeline, and are regulatory, logistics, and commercial dependencies mapped and resourced?
High
Go-live timelines that do not account for regulatory lead times and distribution setup are aspirational, not operational.
DATA SOURCE
Project management, Commercial team
Finding / Answer
SCORE
7
Is there a defined fallback plan if the initial market entry approach does not achieve traction within 12 months?
Medium
Market entry without a defined decision point for reassessment is an indefinite commitment. Define the criteria for continuing, adjusting, or exiting.
DATA SOURCE
Strategy, CEO
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Distribution & Channel Setup
SCOPE
Distributor selection, appointment, and channel structure for Europe
SELECT PHASE
AUDIT QUESTIONS
1
Is the target channel model — direct, distributor, dealer, or hybrid — defined and validated for each country?
High
Channel model decisions made at headquarters without country-level validation frequently fail. Each country has different channel norms.
DATA SOURCE
Commercial strategy, Market research
Finding / Answer
SCORE
2
Have distributors been selected based on documented criteria including coverage, capability, and financial health?
High
Distributor selection driven by first availability rather than fit criteria leads to systematic underperformance.
DATA SOURCE
Selection records, Commercial team
Finding / Answer
SCORE
3
Are distributor agreements signed with minimum purchase commitments and defined territory rights?
High
Agreements without commitments and clear territory rights create channel conflict and uncommitted partners.
DATA SOURCE
Legal, Contract register
Finding / Answer
SCORE
4
Is there a defined onboarding programme for European distributors that covers product, brand, and commercial standards?
High
European distributors need the same structured onboarding as any channel partner. An informal introduction does not produce consistent brand execution.
DATA SOURCE
Onboarding programme, Marketing
Finding / Answer
SCORE
5
What is the planned stock model — local warehousing, central hub, or cross-docking — and is lead time acceptable for the market?
Medium
Stock model determines delivery speed and working capital requirement. Mismatched lead times in competitive markets drive customer loss.
DATA SOURCE
Logistics, Finance
Finding / Answer
SCORE
6
Is there a process for monitoring distributor sell-through rates vs. sell-in, to detect stock accumulation?
High
Distributor sell-in growth without sell-through growth indicates stock accumulation, not market development. Detect it early.
DATA SOURCE
Sales data, CRM
Finding / Answer
SCORE
7
Are all country-specific language, labelling, and packaging requirements confirmed for each market in scope?
High
Language and labelling compliance varies by country and product category. Non-compliance delays customs clearance and risks product withdrawal.
DATA SOURCE
Legal, Operations
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Local Presence & Operations
SCOPE
Local representation, operational infrastructure, and brand visibility
SELECT PHASE
AUDIT QUESTIONS
1
Is there a named local representative or market contact in each active European country?
High
Without a local point of contact, distributors and customers escalate to headquarters in the manufacturer's time zone and language. Response quality deteriorates.
DATA SOURCE
Commercial structure, HR
Finding / Answer
SCORE
2
What is the response time for customer and distributor support queries, and is it within the committed SLA?
High
Response time is a brand quality signal in European markets. SLA commitments without measurement are meaningless.
DATA SOURCE
CRM, Customer service data
Finding / Answer
SCORE
3
Is the company registered for VAT in each country where goods are sold, and is customs compliance managed?
High
VAT registration requirements trigger at different thresholds per country. Non-compliance creates tax liability and credibility risk.
DATA SOURCE
Legal, Finance
Finding / Answer
SCORE
4
Are European trade show and market development activities planned, resourced, and linked to commercial objectives?
Medium
Trade show participation without defined commercial objectives is brand spending without return. Each show should have acquisition and relationship targets.
DATA SOURCE
Marketing, Commercial team
Finding / Answer
SCORE
5
What is the digital presence status in European markets — website localisation, SEO, and social media by country?
Medium
A non-localised digital presence makes the manufacturer invisible to European buyers who search in local languages.
DATA SOURCE
Marketing, IT
Finding / Answer
SCORE
6
Is there a defined customer service escalation path for European end-users beyond the distributor?
Medium
End-user escalation paths protect brand reputation when distributors fail to resolve issues. Absence of this path damages the manufacturer's reputation, not just the distributor's.
DATA SOURCE
Customer service, Operations
Finding / Answer
SCORE
7
Are import processes, customs broker relationships, and logistics documentation standardised and tested?
High
First shipments without tested logistics processes create costly delays and customer disappointment at the worst possible moment — the beginning of the relationship.
DATA SOURCE
Logistics, Operations
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Commercial Performance & Scaling
SCOPE
Revenue growth, channel productivity, and readiness to scale
SELECT PHASE
AUDIT QUESTIONS
1
Is revenue growth in Europe on track vs. the market entry plan, and what is the primary cause of any variance?
High
Variance analysis must separate volume, price, country mix, and channel mix effects. Each cause has a different corrective action.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
2
What is the sell-through rate per distributor, and which distributors are developing market vs. holding stock?
High
Sell-through rate is the definitive indicator of actual market penetration. Sell-in growth without sell-through is not market development.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
3
Which European countries or segments are exceeding expectations, and what can be learned and replicated?
High
The best-performing market is the proof of concept. Analyse why it outperforms and build a replication plan.
DATA SOURCE
Sales data, Commercial team
Finding / Answer
SCORE
4
What are the top 3 commercial barriers reported by distributors, and is there a structured plan to address them?
High
Distributor-reported barriers are often the most accurate early warning of commercial problems. Collect them systematically and act.
DATA SOURCE
CRM, Distributor reviews
Finding / Answer
SCORE
5
Is the gross margin on European sales within the target range after all channel costs, logistics, and currency effects?
High
Gross margin pressure in new markets is common in early years. Define the acceptable floor and the recovery path.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
6
Is the organisation staffed and operationally ready to scale to the next revenue tier without adding proportionate cost?
Medium
Scalability is the test of the EaaS model. If every revenue increment requires proportionate cost, the model is not working.
DATA SOURCE
Finance, Operations, HR
Finding / Answer
SCORE
7
What is the 3-year revenue plan for Europe, and is it based on bottom-up distributor plans or top-down targets?
Medium
Top-down targets without distributor commitment are aspirations. Bottom-up plan construction creates ownership and more accurate forecasting.
DATA SOURCE
Commercial planning, CRM
Finding / Answer
SCORE
INTERNATIONAL PARTNERSHIPS AUDIT
Strategy | Sales & Marketing
Assess the health, performance, and governance of international partnership relationships. Identifies where partnerships are creating value, where they are stagnating, and where they carry unmanaged risk.
AUDIT PHASE 1 OF 4
Partner Selection & Strategic Fit
SCOPE
Whether existing and prospective partners were and are the right strategic choice
SELECT PHASE
AUDIT QUESTIONS
1
Is the strategic rationale for each active partnership documented and still valid, or has it drifted since inception?
High
Partnerships formed for sound reasons often continue beyond their strategic rationale. Review fit annually against current strategy, not the original decision.
DATA SOURCE
Strategy documents, Commercial review
Finding / Answer
SCORE
2
Does each partner bring a capability or market access that the company cannot efficiently develop internally?
High
If internal development of the partner's contribution is now feasible and cheaper, the partnership economics may no longer be justified.
DATA SOURCE
Commercial strategy, Finance
Finding / Answer
SCORE
3
Have reference checks — with other companies who work with the same partner — been conducted recently?
Medium
Partner reputation evolves. References gathered at inception may no longer reflect current capability or reliability.
DATA SOURCE
Commercial process, Partner register
Finding / Answer
SCORE
4
Is the partner's financial health monitored annually, including ability to invest in joint activities?
High
A financially stressed partner diverts attention from joint activities to survival. Detect financial stress before it becomes a crisis.
DATA SOURCE
Finance, Partner review
Finding / Answer
SCORE
5
Does the partner's customer base and market presence actually match the access and coverage originally expected?
High
Promised market access often exceeds actual delivery. Verify coverage against real sales data, not partner claims.
DATA SOURCE
Sales data, CRM
Finding / Answer
SCORE
6
Are partnership terms reviewed at each contract renewal to ensure they reflect current market conditions?
Medium
Partnerships formed under different market conditions often have terms that no longer reflect the actual balance of value exchange.
DATA SOURCE
Legal, Contract register
Finding / Answer
SCORE
7
Is there an active pipeline of potential new partnerships to replace those that are underperforming or exiting?
Medium
Dependency on existing partnerships without pipeline alternatives creates negotiating weakness and continuity risk.
DATA SOURCE
Commercial strategy, CRM
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Agreement Structure & Governance
SCOPE
The legal, commercial, and governance framework of each partnership
SELECT PHASE
AUDIT QUESTIONS
1
Are all partnership agreements current, signed, and reviewed in the last 24 months?
High
Unsigned or expired agreements leave commercial relationships legally unprotected. Lapsed agreements are a legal and governance failure.
DATA SOURCE
Contract register, Legal
Finding / Answer
SCORE
2
Are the roles, responsibilities, and authority levels of each party clearly defined in the agreement?
High
Role ambiguity in partnerships creates overlap, friction, and eventual conflict. Every shared activity needs a defined responsible party.
DATA SOURCE
Partnership agreements, Legal
Finding / Answer
SCORE
3
Is there a defined joint governance structure — meetings, escalation, and decision authority — and is it functioning?
High
Governance that exists only in the agreement but not in practice means decisions are made informally and disputes handled reactively.
DATA SOURCE
Partnership governance records
Finding / Answer
SCORE
4
Are IP, data sharing, and confidentiality terms clearly defined and audited periodically?
High
IP and data exposure are among the highest-risk elements of international partnerships. These terms require periodic audit, not one-time agreement.
DATA SOURCE
Legal, IT
Finding / Answer
SCORE
5
Is there a defined exit process — trigger conditions, notice periods, and asset/customer transition — that both parties understand?
High
Partnerships with no clear exit pathway create disputes when exit becomes necessary. Define exit before it is emotional.
DATA SOURCE
Partnership agreement, Legal
Finding / Answer
SCORE
6
Are non-compete and non-solicitation clauses still relevant and enforced in each active agreement?
Medium
Non-compete clauses lose value if not monitored. Confirm enforceability under current local law and check actual compliance.
DATA SOURCE
Legal, Commercial team
Finding / Answer
SCORE
7
Are currency, payment terms, and dispute resolution mechanisms appropriate for the current operating environment?
Medium
Agreements written in different market or regulatory conditions may have currency, payment, or legal terms that no longer work in practice.
DATA SOURCE
Finance, Legal
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Operational Integration & Execution
SCOPE
How well joint operations are executed and integrated day-to-day
SELECT PHASE
AUDIT QUESTIONS
1
Are joint delivery processes documented and followed consistently by both parties?
High
Undocumented joint processes rely on relationship and memory. When personnel change, execution quality deteriorates without documentation.
DATA SOURCE
Process maps, Operations
Finding / Answer
SCORE
2
Are communication protocols between the partner organisations defined, including escalation contacts?
Medium
Without defined contacts and escalation paths, routine issues escalate to senior management unnecessarily.
DATA SOURCE
Partnership governance, Operations
Finding / Answer
SCORE
3
Are performance data shared openly between partners, or are there information asymmetries that create mistrust?
High
Information asymmetry is a primary source of partnership dysfunction. Define what data is shared, at what frequency, and by whom.
DATA SOURCE
Partnership governance, IT
Finding / Answer
SCORE
4
Is there a defined process for handling customer complaints that cross partner boundaries?
High
Customer issues at partner boundaries are the most likely to go unresolved. Ownership must be explicit and response time defined.
DATA SOURCE
Customer service process, Partnership governance
Finding / Answer
SCORE
5
Are joint teams aligned on priorities, or do internal company pressures regularly override partnership commitments?
Medium
When internal priorities consistently override joint commitments, the partnership is structurally subordinate to company self-interest.
DATA SOURCE
Partnership reviews, Operations team
Finding / Answer
SCORE
6
Are product or service handover points between partners quality-checked, and by whom?
Medium
Quality failures at handover points are disputed and slow to resolve because ownership is unclear. Define quality checks at every handover.
DATA SOURCE
Operations, Quality process
Finding / Answer
SCORE
7
Is there a shared technology or data platform supporting joint operations, and is it performing to requirements?
Medium
Disconnected technology between partners creates manual workarounds, delay, and error. Shared platforms require investment and ongoing maintenance.
DATA SOURCE
IT, Operations
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Performance Measurement & Value Creation
SCOPE
Whether the partnership is delivering its intended commercial and strategic value
SELECT PHASE
AUDIT QUESTIONS
1
Is the financial contribution of each partnership tracked and reviewed annually vs. its cost and resource commitment?
High
Partnerships that are difficult to value are rarely exited even when they should be. Financial measurement creates objectivity.
DATA SOURCE
Finance, Partnership review
Finding / Answer
SCORE
2
Are partnership KPIs defined beyond revenue — including customer satisfaction, delivery performance, and market development?
High
Revenue-only partnership KPIs miss the indirect value and the warning signals of deteriorating partnership health.
DATA SOURCE
Partnership KPIs, CRM
Finding / Answer
SCORE
3
What is the satisfaction level of both parties with the partnership, and is it formally measured?
High
Dissatisfaction that is not formally measured accumulates in silence until it becomes a crisis. Annual mutual satisfaction surveys are standard in strong partnerships.
DATA SOURCE
Partnership review, Survey
Finding / Answer
SCORE
4
Are there joint strategic planning sessions at least annually to align on priorities and market opportunities?
Medium
Partnerships without joint planning become transactional. Strategic alignment sessions are the mechanism for shared direction.
DATA SOURCE
Partnership governance
Finding / Answer
SCORE
5
What value has the partnership delivered that could not have been achieved independently, and is that value still meaningful?
High
This is the fundamental partnership question. If the answer is unclear or the value is now achievable independently, the partnership rationale requires reassessment.
DATA SOURCE
Commercial review, Finance
Finding / Answer
SCORE
6
Are there unexploited opportunities within the partnership that both parties have agreed on but not yet acted on?
Medium
Stalled joint opportunities are a signal of either prioritisation failure or deteriorating commitment. Review and close or commit.
DATA SOURCE
Commercial review, CRM
Finding / Answer
SCORE
7
Is there a succession plan for key relationship owners on both sides of the partnership?
Medium
Partnerships that depend on two specific individuals are structurally fragile. Broaden the relationship across multiple contacts on each side.
DATA SOURCE
HR, Partnership governance
Finding / Answer
SCORE
MARKET ENTRY AUDIT
Strategy | Sales & Marketing
Assess the readiness, design quality, and execution progress of a market entry strategy. Covers research, regulatory fit, commercial model, and go-to-market execution across target markets.
AUDIT PHASE 1 OF 4
Market Research & Demand Validation
SCOPE
Quality and depth of research underpinning the entry decision
SELECT PHASE
AUDIT QUESTIONS
1
Is there primary customer research — direct interviews with target customers in the entry market — underpinning the entry decision?
High
Secondary market reports do not validate demand. Primary research with 10–20 target customer conversations is the minimum credible standard.
DATA SOURCE
Market research records, Commercial team
Finding / Answer
SCORE
2
Is the target customer segment defined at a specific level — by industry, size, geography, and buyer profile?
High
Broad segment definitions ('SMEs in Germany') create unfocused go-to-market activity. Specific segment definitions enable precise targeting.
DATA SOURCE
Strategy document, Commercial team
Finding / Answer
SCORE
3
What is the total addressable market (TAM) estimate for the entry segment, and is it based on verifiable data sources?
High
TAM estimates based on top-down calculations are often 5–10× the actual serviceable market. Verify with bottom-up segment analysis.
DATA SOURCE
Market research, Finance
Finding / Answer
SCORE
4
What are the top 3 customer problems or needs that the entering product/service addresses better than current alternatives?
High
Market entry without a clearly differentiated value proposition relative to existing solutions is a product positioning failure, not a market entry challenge.
DATA SOURCE
Customer research, Commercial team
Finding / Answer
SCORE
5
Is there analysis of customer switching costs — what must a customer give up to buy from you vs. the incumbent?
Medium
Underestimating switching costs leads to overoptimistic conversion timelines. Customers switch more slowly than expected in most B2B markets.
DATA SOURCE
Commercial analysis, Customer research
Finding / Answer
SCORE
6
Are there early customer commitments — LOIs, pilots, or paid orders — that validate real demand before full entry investment?
High
A letter of intent from a customer is worth more than 100 slides of market analysis. Demand must be validated with financial commitment.
DATA SOURCE
Commercial records, CRM
Finding / Answer
SCORE
7
Is competitive intelligence current, including pricing, channel, and proposition of top 3 competitors in target market?
High
Competitive information gathered more than 12 months ago is stale in most markets. Refresh before finalising the entry approach.
DATA SOURCE
Market research, Commercial team
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Regulatory & Compliance Readiness
SCOPE
Legal, regulatory, and compliance requirements in the target market
SELECT PHASE
AUDIT QUESTIONS
1
Is there a confirmed list of all mandatory certifications, standards, and approvals required for each product in each target country?
High
Certification requirements vary by product category, country, and end-use. A gap here delays market entry by 6–18 months in regulated sectors.
DATA SOURCE
Legal, Product management
Finding / Answer
SCORE
2
What is the status of each required regulatory approval, with a confirmed timeline?
High
Regulatory approvals on the critical path with no confirmed timeline are a launch risk. Assign ownership and monitor weekly.
DATA SOURCE
Legal, Project management
Finding / Answer
SCORE
3
Are import duties, customs classification, and country-of-origin requirements confirmed for each product?
High
Incorrect tariff classification creates customs delays, duty reclaims, and import suspension. Confirm with a customs expert before first shipment.
DATA SOURCE
Legal, Logistics
Finding / Answer
SCORE
4
Is there a defined local legal entity or appointed fiscal representative for tax and legal compliance purposes?
High
Operating in a foreign market without a local entity or representative creates tax, VAT, and legal exposure that accumulates before it is detected.
DATA SOURCE
Legal, Finance
Finding / Answer
SCORE
5
Are data protection and GDPR requirements assessed for customer data collected in European target markets?
High
GDPR applies to data on EU residents regardless of where the company is headquartered. Non-compliance penalties are material.
DATA SOURCE
Legal, IT
Finding / Answer
SCORE
6
Are employment and agent law requirements understood for any local sales or representative appointments?
Medium
Appointing local agents or employees creates ongoing legal obligations that persist after contract termination in most jurisdictions.
DATA SOURCE
Legal, HR
Finding / Answer
SCORE
7
Is there a defined process for monitoring regulatory changes in target markets after entry?
Medium
Regulatory environments change. Companies that do not monitor post-entry regulatory changes face compliance gaps as laws evolve.
DATA SOURCE
Legal, Compliance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Commercial Model & Pricing
SCOPE
Revenue model, pricing structure, and commercial viability
SELECT PHASE
AUDIT QUESTIONS
1
Is the revenue model — direct sales, distribution, licensing, or subscription — validated for the target market?
High
Revenue models from the home market are not always transferable. Validate the model with potential customers before committing to the infrastructure it requires.
DATA SOURCE
Commercial strategy, Market research
Finding / Answer
SCORE
2
Is the entry price point competitive in the target market after full cost build-up including logistics, duties, and channel costs?
High
Price competitiveness must be tested at the end-customer level, not at ex-works. The landed cost with all markups is what the customer compares.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
3
Is the margin at target pricing sufficient to sustain the business after all channel, logistics, and support costs?
High
Many market entries are financially unviable at local competitive price points. Financial modelling must confirm minimum viable margin before entry.
DATA SOURCE
Finance
Finding / Answer
SCORE
4
Is there a pricing policy that prevents grey market or inter-market arbitrage?
Medium
Price differentials between markets create grey market risk. Distributors in lower-price markets will supply higher-price markets informally.
DATA SOURCE
Commercial policy, Legal
Finding / Answer
SCORE
5
Is the payment terms structure for the target market confirmed — standard terms, credit risk, and currency?
Medium
Payment terms in new markets vary significantly. Offering domestic terms in a market with different norms creates cash flow and credit risk.
DATA SOURCE
Finance, Commercial
Finding / Answer
SCORE
6
Are there defined discounting authority levels and a minimum price floor for the target market?
Medium
Without price floors and authority limits, new market discounting pressure erodes margin in the critical early period.
DATA SOURCE
Commercial policy, Finance
Finding / Answer
SCORE
7
Is there a 3-year financial model for the market entry with breakeven timeline and investment requirements?
High
Market entry without a financial model is an act of faith. The model forces explicitness about assumptions and creates a review benchmark.
DATA SOURCE
Finance, CEO
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Go-To-Market Execution
SCOPE
Execution quality of the commercial launch and first-year market development
SELECT PHASE
AUDIT QUESTIONS
1
Is there a launch plan with named owners, milestones, and deadlines for the first 90 days in market?
High
A launch plan without named owners is a list of wishes. Each milestone needs one accountable person and a defined completion date.
DATA SOURCE
Project management, Commercial team
Finding / Answer
SCORE
2
Are the first 10 target customers identified by name, with an approach and timeline for each?
High
Named target customers are the signal that the commercial team has moved from strategy to action. Generic lists mean execution has not started.
DATA SOURCE
CRM, Commercial team
Finding / Answer
SCORE
3
Is the sales team equipped with market-appropriate materials — language, format, references, and case studies?
High
Materials from the home market are rarely appropriate for a new entry market. Local references, local language, and relevant use cases are essential.
DATA SOURCE
Marketing, Commercial team
Finding / Answer
SCORE
4
What is the planned lead generation approach, and is the budget and resource committed?
High
A go-to-market plan that relies on inbound leads or word-of-mouth in a market where the company is unknown will not generate traction.
DATA SOURCE
Marketing, Commercial plan
Finding / Answer
SCORE
5
What does successful market entry look like at 6, 12, and 24 months — in specific, measurable terms?
High
Success criteria defined only in retrospect are not criteria. Define specific metrics for each checkpoint before the entry begins.
DATA SOURCE
Commercial plan, CEO
Finding / Answer
SCORE
6
Is there a feedback loop from the field to commercial leadership that operates at weekly frequency in the first 90 days?
Medium
Early-stage market entry requires high-frequency feedback to identify what is and isn't working before resources are committed at scale.
DATA SOURCE
Commercial process, CRM
Finding / Answer
SCORE
7
Is there a defined pivot or exit decision process if traction is not achieved by the 12-month milestone?
Medium
Commitment to a failing market entry without a defined exit decision point traps capital and management attention. Define exit criteria before entry.
DATA SOURCE
Strategy, CEO
Finding / Answer
SCORE
CHANGE LEADERSHIP AUDIT
Leadership | HR/People
Assess the quality of leadership driving a significant change initiative. Covers vision clarity, coalition building, communication, and embedding. Poor change leadership is the leading cause of change programme failure.
AUDIT PHASE 1 OF 4
Vision, Urgency & Case for Change
SCOPE
Whether the need for change is clearly communicated and genuinely believed
SELECT PHASE
AUDIT QUESTIONS
1
Can every senior leader articulate the same case for change in their own words, without reference to a presentation?
High
Test this by asking 5 leaders separately. If answers diverge significantly, the case for change has not landed. Alignment requires rehearsal, not just communication.
DATA SOURCE
Leadership interviews
Finding / Answer
SCORE
2
Is the cost of not changing quantified and communicated, not just the benefit of changing?
High
People resist change when they don't feel the burning platform. The cost of inaction (market share, talent, margin) must be made explicit.
DATA SOURCE
Change communication materials
Finding / Answer
SCORE
3
Is there a specific and credible deadline or forcing event that creates urgency for the change?
High
Vague urgency ('we need to change to remain competitive') is not a burning platform. A specific forcing event — a contract expiry, a competitive threat, a financial covenant — creates real urgency.
DATA SOURCE
Strategy, Commercial data
Finding / Answer
SCORE
4
Have leaders at all levels been given the same information about why the change is necessary?
High
Information asymmetry in change programmes creates cynicism in the middle of the organisation. People speculate when they are not informed.
DATA SOURCE
Change communication records
Finding / Answer
SCORE
5
Is the strategic narrative connecting the change to customer and business outcomes, or only to internal efficiency?
Medium
Change narratives framed only as internal efficiency create resistance. Connecting to customer impact and business health creates broader alignment.
DATA SOURCE
Change materials, Leadership communication
Finding / Answer
SCORE
6
Has independent analysis of the change need been conducted, or is it driven entirely by internal management view?
Medium
Management-only diagnosis of the need for change is subject to self-interest bias. External validation strengthens credibility with sceptical stakeholders.
DATA SOURCE
Change programme records
Finding / Answer
SCORE
7
Are middle managers equipped to explain and defend the change programme to their teams?
High
Middle managers are the primary change communication channel. If they cannot explain or defend the change, front-line resistance is inevitable.
DATA SOURCE
Manager training, Change programme
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Coalition Building & Leadership Alignment
SCOPE
The depth and genuineness of leadership alignment behind the change
SELECT PHASE
AUDIT QUESTIONS
1
Is there a guiding coalition — a group of senior leaders with both authority and credibility — actively driving the change?
High
Change driven by one leader is fragile. A coalition of credible voices from different parts of the organisation is more resilient.
DATA SOURCE
Change governance, Leadership team
Finding / Answer
SCORE
2
Are there visibly resistant senior leaders, and is that resistance being managed or ignored?
High
Tolerated senior resistance signals to the organisation that the change is optional. Resistant senior leaders must be converted or removed from influential positions.
DATA SOURCE
Leadership interviews, HR
Finding / Answer
SCORE
3
Are change champions identified and resourced at operational levels below the senior leadership team?
Medium
Senior leadership cannot maintain change momentum at operational level without champions embedded in daily operations.
DATA SOURCE
Change programme, HR
Finding / Answer
SCORE
4
Is resistance being actively listened to and responded to, or dismissed as a people problem?
Medium
Resistance often contains valid concerns. Programmes that dismiss resistance lose the intelligence in it and create unnecessary opposition.
DATA SOURCE
Change management process, HR
Finding / Answer
SCORE
5
Are the personal interests of key influencers understood, and is the change framed in those terms?
High
People support change when they see how it serves their interests. Generic change messages fail where personal interest messaging would succeed.
DATA SOURCE
HR, Leadership interviews
Finding / Answer
SCORE
6
Are board members and external stakeholders aligned with the direction and pace of change?
High
Board misalignment manifests as strategic reversal or loss of investment commitment at critical moments. Confirm alignment, don't assume it.
DATA SOURCE
Board minutes, CEO interviews
Finding / Answer
SCORE
7
Is there a mechanism to surface anonymous concerns from the organisation about the change programme?
Medium
Anonymous channels capture concerns that hierarchy suppresses. Without them, leadership underestimates opposition.
DATA SOURCE
HR, Change programme
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Communication & Engagement
SCOPE
Quality, frequency, and effectiveness of change communication
SELECT PHASE
AUDIT QUESTIONS
1
Is there a written change communication plan defining messages, channels, frequency, and target audiences?
High
Ad hoc change communication creates information vacuums that fill with rumour. A written plan with scheduled communication beats reactive messaging.
DATA SOURCE
Change communication plan
Finding / Answer
SCORE
2
Are communications two-way — including mechanisms for questions, concerns, and feedback — or only broadcast?
High
One-way change communication creates passive compliance at best. Two-way communication creates engagement and surfaces problems early.
DATA SOURCE
Communication channels, Employee survey
Finding / Answer
SCORE
3
Is change communication adapted for different audiences — language, format, and level of detail?
Medium
A message written for the finance team in a financial format will not land with a production or field sales audience.
DATA SOURCE
Communication materials
Finding / Answer
SCORE
4
How is the effectiveness of change communication being measured, not just the volume of communication?
High
Message receipt is not message understood. Test comprehension and sentiment, not just send confirmation.
DATA SOURCE
Employee survey, Change programme
Finding / Answer
SCORE
5
Are employees given the opportunity to ask questions directly of change leadership, not just line managers?
Medium
Direct access to change leaders increases credibility and reduces distortion in the message chain.
DATA SOURCE
Town halls, Communication plan
Finding / Answer
SCORE
6
Is there a consistent cadence of change updates, even when there is no major news to report?
Medium
Communication silence during slow periods creates anxiety. A regular cadence of honest updates — including 'no news' — maintains trust.
DATA SOURCE
Communication schedule
Finding / Answer
SCORE
7
Is the language of change communication clear and jargon-free for the entire target audience?
Low
Change management jargon ('transformation', 'journey', 'pivot') creates distance. Plain language about specific actions and impacts is more effective.
DATA SOURCE
Communication materials
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Embedding & Sustaining Change
SCOPE
How change is locked in and prevented from reverting
SELECT PHASE
AUDIT QUESTIONS
1
Are new behaviours being reinforced through performance management systems and individual accountability?
High
Change that is not linked to performance measurement and consequence is optional. New behaviours must be explicitly measured and rewarded.
DATA SOURCE
HR process, Performance management
Finding / Answer
SCORE
2
Have systems, processes, and structures been redesigned to support new ways of working, or do old systems undermine the change?
High
Systems that predate the change force employees back to old behaviours regardless of intent. Structural change must accompany behavioural change.
DATA SOURCE
Process review, IT, Operations
Finding / Answer
SCORE
3
Are early wins being identified, celebrated, and communicated to demonstrate that the change is working?
High
Early wins are evidence that the change is achievable. Without visible proof points, momentum stalls and scepticism grows.
DATA SOURCE
Change programme, Communication
Finding / Answer
SCORE
4
What happens to people who visibly revert to old behaviours after the change has been embedded?
High
Unpunished reversion normalises resistance and signals that the change is reversible. A defined consequence is necessary.
DATA SOURCE
HR policy, Leadership interviews
Finding / Answer
SCORE
5
Is the change programme formally closing milestones and transitioning accountability to line management?
Medium
Change programmes that maintain parallel structures indefinitely create dependency and prevent genuine embedding. Line ownership must be transferred.
DATA SOURCE
Change programme governance
Finding / Answer
SCORE
6
Are new recruits being inducted into the changed organisation, not the old one?
Medium
Onboarding into old culture undermines cultural change in the medium term. Induction materials and manager briefings must reflect the new operating model.
DATA SOURCE
HR, Onboarding process
Finding / Answer
SCORE
7
Is there a post-implementation review mechanism to identify what has embedded and what remains at risk of reverting?
Medium
Changes that appear embedded at 6 months may have partially reverted at 18 months. Periodic reassessment prevents regression going undetected.
DATA SOURCE
Change programme, HR survey
Finding / Answer
SCORE
DELEGATION AUDIT
Leadership | HR/People
Assess the quality and effectiveness of delegation across management levels. Poor delegation creates leader bottlenecks, disempowered teams, and poor organisational development. Good delegation multiplies leadership capacity.
AUDIT PHASE 1 OF 4
Delegation Scope & Clarity
SCOPE
Whether delegation is clear, documented, and consistently applied
SELECT PHASE
AUDIT QUESTIONS
1
Is there a documented decision rights matrix that defines who decides, who inputs, and who is informed for each key decision type?
High
Verbal delegation agreements are forgotten, disputed, and inconsistently applied. A written decision rights matrix removes ambiguity.
DATA SOURCE
Decision rights document, HR
Finding / Answer
SCORE
2
Which decisions are currently being made at CEO or Director level that could be delegated one level down without material risk?
High
Centralised decisions at senior level are the primary cause of management bottlenecks. Identify and transfer at least 3 categories downward.
DATA SOURCE
Leadership interviews, Process maps
Finding / Answer
SCORE
3
Are managers consistently delegating within the scope they have been given, or reverting to escalation for decisions within their authority?
High
Escalation of in-scope decisions is a failure of confidence or clarity, not authority. Identify whether the cause is training, trust, or ambiguity.
DATA SOURCE
Manager interviews, Decision logs
Finding / Answer
SCORE
4
Are there tasks and activities still performed by senior leaders that were intended to be delegated to their teams?
Medium
Recapturing delegated tasks is a common leadership failure. Audit actual tasks performed by senior managers against their role profile.
DATA SOURCE
Role profiles, Leadership interviews
Finding / Answer
SCORE
5
Is delegation of a task always accompanied by a clear outcome definition, timeline, and success criteria?
High
Delegating tasks without outcome definition delegates confusion, not authority. The delegator's job is to define the 'what' and let the team own the 'how'.
DATA SOURCE
Management process, Observation
Finding / Answer
SCORE
6
Are managers held accountable for decisions made within their delegated authority, including when outcomes are negative?
High
Accountability is the counterpart of authority. If negative outcomes are absorbed by the delegator, delegation is authority without consequence.
DATA SOURCE
Performance management, HR
Finding / Answer
SCORE
7
Is there clarity on the distinction between delegation (transfer of authority) and assignment (task handover without authority)?
Medium
Confusing delegation with assignment creates frustration when the delegatee discovers they lack authority to execute.
DATA SOURCE
HR training, Manager interviews
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Accountability Structures & Governance
SCOPE
How accountability is maintained after delegation
SELECT PHASE
AUDIT QUESTIONS
1
Is there a regular check-in cadence between delegators and delegatees that reviews outcomes, not activity?
High
Check-ins focused on activity are micromanagement in disguise. Focus on outcomes and remove obstacles, not monitor steps.
DATA SOURCE
Management meetings, Process
Finding / Answer
SCORE
2
What happens when a delegated task fails — is the cause reviewed to improve future delegation or is the delegation withdrawn?
High
Withdrawing delegation after failure removes the development opportunity and trains avoidance of risk.
DATA SOURCE
HR process, Leadership interviews
Finding / Answer
SCORE
3
Are individuals who have been delegated authority given the information access they need to make good decisions?
High
Authority without information is unworkable. Delegation must include access to relevant data, contacts, and systems.
DATA SOURCE
IT access, HR, Process
Finding / Answer
SCORE
4
Is there a reporting mechanism that allows the delegator to maintain awareness without micromanaging?
Medium
Delegation without any visibility creates anxiety and encourages recapture. Define the minimum reporting requirement upfront.
DATA SOURCE
Management process
Finding / Answer
SCORE
5
Are team members aware of the boundaries of their delegated authority, and do they test those limits regularly?
Medium
Teams that never test the edges of their authority are either over-cautious or have been burned for doing so. Both signals indicate a delegation problem.
DATA SOURCE
Team surveys, Manager interviews
Finding / Answer
SCORE
6
Is there a process for team members to escalate decisions that fall outside their authority, with a committed response time?
High
Escalation processes that are slow or unresponsive force team members to either decide above their authority or wait until the opportunity is lost.
DATA SOURCE
Management process
Finding / Answer
SCORE
7
Are delegation levels formally reviewed when team members are promoted or when organisational structures change?
Medium
Delegation inherited from an old structure may be inappropriate in the new one. Role changes require delegation reassessment.
DATA SOURCE
HR, Org change process
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Capability Building & Confidence
SCOPE
Whether teams are capable and confident enough to accept and execute delegation
SELECT PHASE
AUDIT QUESTIONS
1
Are the capability requirements for each delegated responsibility formally identified and matched to the individual?
High
Delegating above current capability without development support sets people up to fail. Match task complexity to assessed readiness.
DATA SOURCE
HR, Competency framework
Finding / Answer
SCORE
2
Are employees who have been delegated new responsibilities given adequate coaching, not just instruction?
High
Instruction tells someone what to do. Coaching develops the capability to handle novel situations within the same authority scope.
DATA SOURCE
HR, Manager interviews
Finding / Answer
SCORE
3
Is there a formal mechanism for people to request support when they encounter delegation challenges beyond their current experience?
Medium
Without a safe mechanism to ask for help, people either fail silently or escalate covertly. Both outcomes undermine delegation.
DATA SOURCE
HR process, Management culture
Finding / Answer
SCORE
4
Are team members who perform well with delegated authority given progressively greater scope?
Medium
Static delegation that doesn't grow with demonstrated capability is a retention risk for high performers.
DATA SOURCE
HR, Performance management
Finding / Answer
SCORE
5
Is fear of failure — or a history of punitive responses to failure — preventing acceptance of delegated responsibility?
High
In cultures where failure is punished, delegation is declined wherever possible. Psychological safety is a prerequisite for effective delegation.
DATA SOURCE
Employee survey, HR
Finding / Answer
SCORE
6
Are managers trained in how to delegate effectively — including how to brief, check in, and release control?
Medium
Delegation is a learnable skill, not an innate management trait. Without training, delegation defaults to either micromanagement or abdication.
DATA SOURCE
HR training records
Finding / Answer
SCORE
7
Is the delegation culture assessed in employee engagement surveys, and do results drive management development actions?
Low
Engagement surveys that include delegation questions and do nothing with the results undermine the survey's credibility.
DATA SOURCE
Employee survey, HR process
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Time Liberation & Leadership Focus
SCOPE
Whether effective delegation frees senior leadership for higher-value activities
SELECT PHASE
AUDIT QUESTIONS
1
What percentage of the CEO's and senior leaders' time is currently spent on tasks that could be delegated?
High
Senior leaders who spend more than 30% of their time on operationally delegable tasks are limiting both their own contribution and their team's development.
DATA SOURCE
Time audit, Leadership interviews
Finding / Answer
SCORE
2
What are the highest-leverage activities that senior leaders should be doing but are currently displaced by delegable tasks?
High
Identify the activities that only a senior leader can do — strategy, external relationships, major decisions — and measure displacement.
DATA SOURCE
Leadership interviews
Finding / Answer
SCORE
3
Have leaders identified and communicated their own delegation development goals to their teams?
Medium
Leaders who model delegation as a personal development priority create permission for their teams to do the same.
DATA SOURCE
Leadership development, HR
Finding / Answer
SCORE
4
Is there a delegation audit conducted at least annually to review what has been retained at each level that should move down?
Medium
Delegation levels drift upward over time without a periodic reset. An annual review forces structured reconsideration.
DATA SOURCE
HR, Leadership review
Finding / Answer
SCORE
5
Are there structural features — such as sole approval requirements in systems — that prevent effective delegation even when intent exists?
Medium
System-enforced approval requirements can make delegation structurally impossible regardless of managerial intent. Identify and redesign the blockers.
DATA SOURCE
IT systems, Process review
Finding / Answer
SCORE
6
Is the time saved by effective delegation visibly reinvested in strategic activities, not absorbed by more operational work?
High
Delegation that creates space which is immediately filled with more operational tasks produces no strategic benefit.
DATA SOURCE
Leadership time audit, Calendar review
Finding / Answer
SCORE
7
What is the ratio of decisions made by leaders within vs. above their expected authority level, and is it tracked?
Medium
Decision authority creep upward is a structural indicator that delegation is failing. Track and benchmark against defined levels.
DATA SOURCE
Decision log, Management review
Finding / Answer
SCORE
DIFFICULT CONVERSATIONS AUDIT
Leadership | HR/People
Assess how well the organisation conducts difficult but necessary conversations — on performance, conflict, behaviour, and change. Avoidance of difficult conversations is one of the highest-cost leadership failures.
AUDIT PHASE 1 OF 4
Conversation Readiness & Preparation
SCOPE
How managers prepare for difficult conversations before they happen
SELECT PHASE
AUDIT QUESTIONS
1
Are managers trained in a specific framework for preparing and conducting difficult conversations?
High
Without a framework, managers either avoid the conversation, over-engineer it, or handle it inconsistently. Training in a specific model improves consistency and outcome.
DATA SOURCE
HR training records, Manager survey
Finding / Answer
SCORE
2
Is the purpose of the conversation — feedback, problem-solving, or decision — clarified before the conversation begins?
High
Mixing purpose types in one conversation creates confusion. A performance conversation and a decision conversation require different structures.
DATA SOURCE
HR process, Manager training
Finding / Answer
SCORE
3
Are managers coached to separate the observable behaviour or fact from their interpretation before the conversation?
High
Conversations that start with interpretation ('you seem unmotivated') create defensiveness. Fact-based opening ('I've noticed three missed deadlines') creates discussion.
DATA SOURCE
HR training, Manager interviews
Finding / Answer
SCORE
4
Is there a protocol for ensuring that both parties have adequate time and privacy for sensitive conversations?
Medium
Difficult conversations held in open offices, rushed between meetings, or without adequate time have poor outcomes and create legal exposure.
DATA SOURCE
HR process, Management practice
Finding / Answer
SCORE
5
Do managers document key facts and examples before a difficult performance or behaviour conversation?
High
Without documented specifics, difficult conversations devolve into 'yes you did / no I didn't'. Documentation is both a preparation tool and a legal protection.
DATA SOURCE
HR process, Manager survey
Finding / Answer
SCORE
6
Is HR or a trained mediator involved in conversations above a defined complexity or risk threshold?
High
Managers handling high-risk conversations — serious misconduct, potential discrimination, redundancy — without HR support create legal exposure.
DATA SOURCE
HR policy, Manager records
Finding / Answer
SCORE
7
Are there patterns of conversation avoidance identifiable in specific teams or managers, and is the cause diagnosed?
Medium
Consistent conversation avoidance in a function signals either leadership capability gaps or a culture where honesty is penalised.
DATA SOURCE
HR data, Manager survey
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Conversation Conduct & Communication
SCOPE
How difficult conversations are actually conducted
SELECT PHASE
AUDIT QUESTIONS
1
Do managers open difficult conversations with the specific issue, not with positive framing that dilutes the message?
High
The 'feedback sandwich' is well-intentioned but often causes the key message to be missed. Important messages should be stated directly and clearly.
DATA SOURCE
HR training, Manager interviews
Finding / Answer
SCORE
2
Is listening quality maintained during difficult conversations, or does the manager spend most of the time talking?
High
A manager who talks for 80% of a feedback conversation has not had a conversation — they have delivered a monologue. The other person must have space to respond.
DATA SOURCE
Observation, HR training
Finding / Answer
SCORE
3
Are emotions acknowledged during difficult conversations without being used to control the discussion?
Medium
Dismissing emotions ('let's not get emotional') shuts down honest communication. Acknowledging emotions ('I can see this is difficult') enables continued dialogue.
DATA SOURCE
HR training, Manager survey
Finding / Answer
SCORE
4
Is the conversation focused on specific, changeable behaviour — not personality, character, or general attitude?
High
Personality-based feedback creates shame and defensiveness without enabling change. Behaviour-based feedback identifies what specifically needs to change.
DATA SOURCE
HR training, Documentation
Finding / Answer
SCORE
5
Is there a clear, mutual understanding of what will change and by when, before the conversation ends?
High
A difficult conversation that ends without a specific commitment to action has transferred discomfort, not created change.
DATA SOURCE
HR records, Manager process
Finding / Answer
SCORE
6
Are open questions used to understand the other person's perspective before judgements are communicated?
Medium
Managers who state the problem without first exploring the other person's context may be responding to symptoms rather than causes.
DATA SOURCE
HR training, Manager interviews
Finding / Answer
SCORE
7
Is the tone of difficult conversations respectful regardless of the seriousness of the issue?
High
Tone determines whether the other person listens or defends. Disrespectful tone in difficult conversations creates grievances and legal risk.
DATA SOURCE
HR complaints data, Manager survey
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Emotional Regulation & Conflict Management
SCOPE
Managing emotional intensity and interpersonal conflict
SELECT PHASE
AUDIT QUESTIONS
1
Are managers trained to recognise when a conversation has reached a level of emotional intensity that requires a pause?
High
Continuing a conversation past the point of productive engagement is counterproductive. The ability to pause and resume is a key skill.
DATA SOURCE
HR training, Manager survey
Finding / Answer
SCORE
2
Is there a defined protocol for managing situations where a difficult conversation becomes a conflict?
High
Unstructured conflict escalation in the workplace creates legal and cultural risk. A defined de-escalation process protects both parties.
DATA SOURCE
HR policy, Manager training
Finding / Answer
SCORE
3
Do leaders model emotional regulation in difficult conversations — especially with their own managers?
High
Leaders who lose composure in difficult conversations signal to the organisation that emotion wins over process. Visible modelling matters.
DATA SOURCE
Employee survey, Leadership observations
Finding / Answer
SCORE
4
Is there a structured mediation process for interpersonal conflicts between peers or across departments?
Medium
Peer conflicts escalated to management without a mediation option become a binary forced choice that creates winners and losers.
DATA SOURCE
HR policy, Mediation records
Finding / Answer
SCORE
5
Are managers aware of their personal triggers in difficult conversations, and do they have strategies to manage them?
Medium
Self-awareness about personal triggers is a professional skill, not a personal confession. Training on self-management in high-stress conversations is standard.
DATA SOURCE
HR training, Manager survey
Finding / Answer
SCORE
6
Is there a defined process for following up after a difficult conversation to confirm the outcome has been heard and understood?
Medium
What was said in a conversation and what was heard are often different. A follow-up email or check-in confirms mutual understanding.
DATA SOURCE
HR process, Manager training
Finding / Answer
SCORE
7
Are outcomes of significant difficult conversations documented in writing with the other party's acknowledgement?
High
Documentation protects both parties in the event of dispute. It also clarifies commitment and creates a reference point for follow-up.
DATA SOURCE
HR records, Legal
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Culture, Follow-Through & Systemic Patterns
SCOPE
Whether the organisation is structurally set up to have honest conversations
SELECT PHASE
AUDIT QUESTIONS
1
Is there evidence that difficult performance conversations result in improved performance or appropriate exits — not just documentation?
High
Difficult conversations that result in no change either confirm that the conversation was too soft or that accountability is absent.
DATA SOURCE
HR data, Performance records
Finding / Answer
SCORE
2
Is the culture one where feedback — including upward feedback to senior leaders — is genuinely welcomed?
High
A culture that tolerates difficult conversations downward but suppresses them upward is not a feedback culture — it is a power dynamic.
DATA SOURCE
Employee survey, HR
Finding / Answer
SCORE
3
What is the grievance and complaint rate, and does it correlate with specific managers or teams?
High
Elevated grievance rates in specific teams are diagnostic of management style, not employee behaviour. The data usually points to the conversation avoidance or poor conduct.
DATA SOURCE
HR data
Finding / Answer
SCORE
4
Are there topics that are systematically avoided in the organisation — and do leaders know what they are?
High
Every organisation has undiscussable topics. Naming them is the first step to addressing them. They usually contain the most important strategic or cultural risks.
DATA SOURCE
Leadership survey, HR
Finding / Answer
SCORE
5
Is the time between an identified performance problem and the first formal conversation within acceptable limits?
High
Delayed performance conversations allow problems to compound and reduce the probability of positive outcomes. Define and track response time.
DATA SOURCE
HR data, Management records
Finding / Answer
SCORE
6
Are leaders who consistently avoid necessary conversations identified and developed or managed?
Medium
Conversation avoidance by specific leaders is a management risk that compounds over time. It must be diagnosed and addressed, not tolerated.
DATA SOURCE
HR data, Employee survey
Finding / Answer
SCORE
7
Is there a confidential employee feedback mechanism that captures whether difficult conversations are happening at the right time and quality?
Medium
The people best placed to report on conversation quality are the recipients. Without a confidential channel, this feedback is unavailable.
DATA SOURCE
HR survey, Employee feedback
Finding / Answer
SCORE
MEETING EFFECTIVENESS AUDIT
Operational | Leadership
Assess the quality, efficiency, and output of meetings across the organisation. Ineffective meetings are one of the most significant and most ignored drains on organisational productivity.
AUDIT PHASE 1 OF 4
Meeting Design & Purpose
SCOPE
Whether meetings are designed to achieve their intended purpose
SELECT PHASE
AUDIT QUESTIONS
1
What percentage of recurring meetings have a written agenda circulated in advance of at least 24 hours?
High
Meetings without agendas are conversations with no defined destination. Agenda requirement is the minimum standard for productive meeting culture.
DATA SOURCE
Calendar audit, Meeting policy
Finding / Answer
SCORE
2
Are the stated objectives of each meeting type — information sharing, decision-making, or problem-solving — defined and appropriate to that format?
High
Information sharing meetings scheduled as decision meetings waste senior time. Match format to objective.
DATA SOURCE
Meeting policy, Calendar audit
Finding / Answer
SCORE
3
Is the attendance list for each meeting reviewed against actual decision-making need, or does it expand by default?
High
Meeting attendance creep creates the illusion of inclusion and destroys decision-making efficiency. Only people who are necessary to the decision or whose work requires the information should attend.
DATA SOURCE
Calendar audit, Meeting policy
Finding / Answer
SCORE
4
What is the average meeting duration vs. actual working time within the meeting?
Medium
Most 60-minute meetings could achieve the same outcome in 40 minutes with a tighter agenda. Duration should be set to match content, not default timeslots.
DATA SOURCE
Calendar analysis, Survey
Finding / Answer
SCORE
5
Are pre-read materials sent before meetings that require input, and is reading completed before the meeting?
Medium
Meetings used to read documents together waste the time of everyone present. Pre-reading shifts this to individual time and allows discussion rather than broadcast.
DATA SOURCE
Meeting practice, Survey
Finding / Answer
SCORE
6
Are decision-making meetings structured with a clear decision record, alternatives considered, and decision owner?
High
Decisions made without recording the alternatives considered and the owner are prone to being relitigated. Structured decision meetings create clarity and reduce re-discussion.
DATA SOURCE
Meeting minutes, Management process
Finding / Answer
SCORE
7
Is meeting scheduling authority defined — who can call what type of meeting with whom — or is anyone free to schedule anyone's time?
Medium
Unrestricted calendar access is a productivity tax on senior leaders and high-demand contributors. Scheduling authority requires governance.
DATA SOURCE
Calendar policy
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Facilitation & Participation Quality
SCOPE
How effectively meetings are run and how participants engage
SELECT PHASE
AUDIT QUESTIONS
1
Is a facilitator or chair defined for each meeting, and are they trained or experienced in facilitation?
High
Meetings without a named facilitator run long, drift off-topic, and fail to reach closure on decisions. Facilitation is a skill, not a default responsibility.
DATA SOURCE
Meeting policy, HR
Finding / Answer
SCORE
2
Is participation balanced, or do certain voices consistently dominate while others are silent?
High
Dominant contributors in meetings are a signal that the meeting format is not creating conditions for diverse input.
DATA SOURCE
Observation, Participant survey
Finding / Answer
SCORE
3
Are meeting participants visibly present — not on phones or laptops for non-meeting work — during discussions?
Medium
Visible disengagement in meetings reduces the quality of decisions and demoralises active participants. It is a culture and meeting design problem.
DATA SOURCE
Observation, Survey
Finding / Answer
SCORE
4
Are dissenting views actively invited before key decisions are made?
High
Meetings where the leader's initial view is never challenged are not making decisions — they are ratifying them. Dissent must be structurally invited.
DATA SOURCE
Meeting observation, Management culture
Finding / Answer
SCORE
5
Is the start and end time of meetings respected consistently across the organisation?
Medium
Late starts and overruns signal that meeting time is not valued. Consistent time discipline is a cultural signal from senior leaders.
DATA SOURCE
Calendar data, Survey
Finding / Answer
SCORE
6
Are virtual or hybrid participants given equal standing in meetings, or do they become passive observers?
Medium
Hybrid meetings that do not actively include remote participants create a two-tier meeting experience and reduce input quality.
DATA SOURCE
Meeting practice, Survey
Finding / Answer
SCORE
7
Is there a mechanism for participants to provide feedback on meeting effectiveness after high-stakes or recurring meetings?
Low
Without feedback on meeting quality, facilitation does not improve. Anonymous post-meeting feedback identifies specific failure patterns.
DATA SOURCE
HR, Meeting process
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Decision & Action Management
SCOPE
Whether meetings produce clear decisions and followed-through actions
SELECT PHASE
AUDIT QUESTIONS
1
Are meeting decisions documented with the decision made, owner, and date, before the meeting ends?
High
Decisions that are not recorded before the meeting ends are subject to differing interpretation. In-meeting documentation is the only reliable standard.
DATA SOURCE
Meeting minutes, Management process
Finding / Answer
SCORE
2
Are action items documented with a single owner and specific completion date — not a team or 'by next meeting'?
High
Shared ownership of actions equals no ownership. Each action must have one name and one date.
DATA SOURCE
Meeting minutes, Management process
Finding / Answer
SCORE
3
What percentage of actions from the previous meeting are reviewed and completed at the start of the next meeting?
High
A meeting that does not open with action review from the last meeting has no accountability mechanism for its own decisions.
DATA SOURCE
Meeting minutes, Management process
Finding / Answer
SCORE
4
Are meeting minutes or notes distributed within 24 hours of the meeting?
Medium
Notes distributed days after the meeting have lost their utility for driving action. 24-hour distribution is the minimum effective standard.
DATA SOURCE
Meeting process, Management practice
Finding / Answer
SCORE
5
Is there a distinction between decisions made in the meeting and decisions that require post-meeting ratification or sign-off?
High
Meetings that make decisions that are then overturned by absent decision-makers waste time and create cynicism.
DATA SOURCE
Decision governance, Meeting policy
Finding / Answer
SCORE
6
Are recurring meetings required to report their output (decisions, actions, risks) to a meeting above them in the governance hierarchy?
Medium
Meetings that do not feed into a governance structure operate in silos. Output reporting creates accountability for meeting effectiveness.
DATA SOURCE
Meeting governance, Management structure
Finding / Answer
SCORE
7
Is there a periodic review of all recurring meetings to confirm that each one is still necessary and effective?
Medium
Recurring meetings accumulate. Without a periodic audit, organisations spend significant management time in meetings that have outlived their purpose.
DATA SOURCE
Calendar audit, Management process
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Meeting Culture & Organisational Habits
SCOPE
The cultural norms and habits around meetings across the organisation
SELECT PHASE
AUDIT QUESTIONS
1
What is the average percentage of working hours spent in meetings per level of the organisation, and is it within an acceptable range?
High
Front-line staff in more than 15% meetings: a symptom. Senior leaders in more than 50%: a crisis. Measure by level before setting targets.
DATA SOURCE
Calendar data, HR
Finding / Answer
SCORE
2
Are there protected deep-work hours — meeting-free blocks — formally established in the organisation?
High
Without protected thinking time, complex cognitive work is displaced by meeting attendance. Meeting-free blocks are a structural productivity protection.
DATA SOURCE
Calendar policy, Survey
Finding / Answer
SCORE
3
Do senior leaders model good meeting behaviour — arriving on time, pre-reading, staying on agenda, ending on time?
High
Senior leader behaviour sets the organisational meeting culture. What the CEO tolerates, the organisation practises.
DATA SOURCE
Observation, Survey
Finding / Answer
SCORE
4
Is there explicit leadership permission to decline meetings where the individual's presence is not necessary?
Medium
Without explicit permission to decline unnecessary meetings, attendance becomes a political protection mechanism rather than a work requirement.
DATA SOURCE
Calendar policy, Management culture
Finding / Answer
SCORE
5
Are meetings used as the primary decision-making forum, or are some decisions made asynchronously?
Medium
Over-reliance on meetings for decisions that could be made asynchronously creates scheduling bottlenecks and delays.
DATA SOURCE
Management process, Survey
Finding / Answer
SCORE
6
What is the culture around meeting cancellation and rescheduling — is it accepted or penalised?
Low
Organisations where cancellation is culturally penalised force unnecessary meetings. Removing cancelled meetings that were unnecessary is a productivity gain, not a failure.
DATA SOURCE
Management culture, Survey
Finding / Answer
SCORE
7
Is there a defined meeting policy — covering types, sizes, frequencies, and governance — and is it actively enforced?
Medium
A meeting policy that exists but is not enforced signals that the organisation tolerates inefficiency as a cultural norm.
DATA SOURCE
HR policy, Management observation
Finding / Answer
SCORE
TEAM MANAGEMENT & LEADERSHIP AUDIT
Leadership | HR/People
Assess the quality of team management and leadership behaviours across the organisation. Identifies where teams are under-managed, poorly directed, or disengaged — and what specific leadership gaps are driving the issues.
AUDIT PHASE 1 OF 4
Team Structure, Roles & Direction
SCOPE
Whether teams are correctly structured and clearly directed
SELECT PHASE
AUDIT QUESTIONS
1
Does every team member have a role profile that defines their specific responsibilities, decision rights, and performance expectations?
High
Teams where responsibilities overlap or have gaps between them are structurally set up for conflict and underperformance.
DATA SOURCE
HR, Role profiles
Finding / Answer
SCORE
2
Is the team size within the manageable span of control for the type of work and the manager's experience?
Medium
Span of control above 8–10 for complex knowledge work, or 12–15 for process work, typically exceeds effective management capacity.
DATA SOURCE
Org chart, HR
Finding / Answer
SCORE
3
Is the team's mission — what it exists to produce — documented and understood by every team member?
High
Teams whose members have different understandings of the team's purpose will naturally prioritise different work.
DATA SOURCE
Team charters, HR
Finding / Answer
SCORE
4
Are team priorities aligned with organisational priorities, or are teams working on internally generated objectives not connected to strategy?
High
Disconnection between team priorities and organisational strategy is a planning and communication failure, not a management one.
DATA SOURCE
Strategy, HR, Team objectives
Finding / Answer
SCORE
5
Is there a defined cadence of team meetings, one-to-one check-ins, and performance conversations?
High
Irregular or absent management rhythm creates inconsistency in direction, feedback, and problem-solving.
DATA SOURCE
Management process, HR
Finding / Answer
SCORE
6
Are cross-team dependencies understood and managed, or do they regularly create delays and disputes?
Medium
Cross-functional dependency management is a structural leadership task. Unmanaged dependencies are the primary cause of project delay.
DATA SOURCE
Project management, Process maps
Finding / Answer
SCORE
7
Is team composition reviewed annually to assess whether the current skills mix matches the team's evolving objectives?
Medium
Teams formed for historical reasons often carry skill gaps relative to current demands. Annual composition review is standard good practice.
DATA SOURCE
HR, Team manager review
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Performance Management
SCOPE
How individual and team performance is set, monitored, and managed
SELECT PHASE
AUDIT QUESTIONS
1
Are individual performance objectives set at the start of each review period, are they specific, and are they aligned to team objectives?
High
Objectives that are not specific and not aligned to team goals create effort that doesn't compound. SMART goals aligned to team mission are the minimum standard.
DATA SOURCE
HR, Performance records
Finding / Answer
SCORE
2
What is the distribution of performance ratings, and does it differentiate high from average from low performers?
High
Performance rating distributions clustered at 'meets expectations' indicate either no differentiation or avoidance of difficult conversations.
DATA SOURCE
HR data, Performance records
Finding / Answer
SCORE
3
Are underperformance situations identified early and managed with a defined performance improvement process?
High
Underperformance managed late costs more — in output loss, team morale impact, and eventual legal cost — than early structured intervention.
DATA SOURCE
HR records, Manager interviews
Finding / Answer
SCORE
4
Do high performers receive differentiated recognition, development opportunities, and compensation relative to average performers?
High
Treating high and average performers identically is a retention risk for the high performers and a signal that performance doesn't matter.
DATA SOURCE
HR data, Compensation review
Finding / Answer
SCORE
5
Are managers held accountable for the performance of their team as a whole, not just their individual contribution?
High
A manager rated highly while their team underperforms is not being held to the right standard. Team performance is the management KPI.
DATA SOURCE
Performance review, HR
Finding / Answer
SCORE
6
Is there a process to identify and manage persistent low performers — with a defined timeline and consequence?
Medium
Persistent low performance without consequence is a direct signal to high performers that effort and results don't matter.
DATA SOURCE
HR process, Manager interviews
Finding / Answer
SCORE
7
Are performance conversations conducted regularly throughout the year, or only at the annual review?
Medium
Annual-only reviews are too infrequent for meaningful performance management. Quarterly minimum is the standard for knowledge work.
DATA SOURCE
HR process, Manager survey
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Development, Motivation & Engagement
SCOPE
Whether teams are growing, engaged, and retained
SELECT PHASE
AUDIT QUESTIONS
1
Does every team member have an active personal development plan agreed with their manager?
High
Development plans that exist only in the HR system but are not actively discussed or invested in are administrative theatre.
DATA SOURCE
HR, Development records
Finding / Answer
SCORE
2
What is the voluntary turnover rate by team, and is it correlated with specific managers?
High
Turnover that clusters under specific managers is a leadership problem, not a talent or market problem. Track and act.
DATA SOURCE
HR data
Finding / Answer
SCORE
3
Are team members able to articulate their career development path within the organisation?
High
Employees who cannot see a future for themselves internally will look externally. Career visibility is a retention tool.
DATA SOURCE
Employee survey, HR
Finding / Answer
SCORE
4
What is the employee engagement score by team, and is there a defined action plan where engagement is below average?
High
Below-average engagement without a team-level action plan is an organisation that has measured but not responded.
DATA SOURCE
Engagement survey, HR
Finding / Answer
SCORE
5
Are development investments targeted to high-impact skills gaps and future roles, not only current role maintenance?
Medium
Training budgets spent only on compliance and current role skills do not build future organisational capability.
DATA SOURCE
Training records, HR
Finding / Answer
SCORE
6
Do managers actively create development opportunities — stretch assignments, cross-functional projects, external exposure — not just send people on courses?
Medium
Formal training accounts for 10% of development impact. Stretch assignments and project experience drive the other 90%.
DATA SOURCE
Manager interviews, HR
Finding / Answer
SCORE
7
Is there a formal talent review process that identifies high-potential individuals across the organisation?
Medium
High-potential employees not identified and invested in will be identified and invested in by your competitors.
DATA SOURCE
HR, Succession process
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Team Dynamics, Trust & Psychological Safety
SCOPE
The quality of relationships and safety within and between teams
SELECT PHASE
AUDIT QUESTIONS
1
Are team members willing to raise problems and mistakes openly, or do problems tend to be concealed until they escalate?
High
Concealed problems are the highest-cost form of team dysfunction. Psychological safety — permission to speak without fear — is the enabling condition.
DATA SOURCE
Employee survey, Incident data
Finding / Answer
SCORE
2
Are inter-team conflicts identified early and resolved with management facilitation, or allowed to fester?
High
Unresolved inter-team conflict is a major cause of initiative failure and talent exit. Identify where it exists and intervene.
DATA SOURCE
HR data, Manager interviews
Finding / Answer
SCORE
3
Is there evidence that team members constructively challenge each other's views, or is harmony prioritised over honesty?
High
Teams that prioritise harmony over honesty make poor decisions. Structured challenge mechanisms — devil's advocate, red team — are effective interventions.
DATA SOURCE
Team observation, Survey
Finding / Answer
SCORE
4
Does the team manager create equal voice and opportunity for all team members, regardless of personality type?
Medium
Introvert and junior team members are systematically under-heard in unstructured meetings. Active facilitation is required to include them.
DATA SOURCE
Team observation, Survey
Finding / Answer
SCORE
5
Are there sub-group dynamics or cliques that undermine team coherence?
Medium
Sub-group dynamics create in-group and out-group experiences that damage trust and reduce cohesion. They often form around informal hierarchy.
DATA SOURCE
Manager interviews, Survey
Finding / Answer
SCORE
6
Is there a team working agreement — defining how the team communicates, makes decisions, and resolves conflict — that all members know and follow?
Medium
Working agreements reduce friction from differing expectations. Without them, conflict is resolved individually each time it occurs.
DATA SOURCE
Team charter, Management process
Finding / Answer
SCORE
7
Is the physical or virtual working environment structured to enable effective team collaboration?
Low
Physical space and digital tool design significantly influence team communication patterns. Optimise the environment for the type of work.
DATA SOURCE
Facilities, IT, Survey
Finding / Answer
SCORE
LEAN BASICS AUDIT
Operational
Assess the maturity of lean thinking and practices across operations. Identifies waste, flow problems, and improvement capability. Lean is not a toolkit — it is a management discipline that requires daily practice.
AUDIT PHASE 1 OF 4
Value Stream Understanding
SCOPE
How well the organisation understands its value streams and customer-defined value
SELECT PHASE
AUDIT QUESTIONS
1
Is there a current-state value stream map for each major product or service family?
High
Value stream maps that are more than 12 months old in a dynamic environment are historical documents, not management tools. Require currency.
DATA SOURCE
Process maps, Operations team
Finding / Answer
SCORE
2
Is customer-defined value explicitly documented — what the customer pays for vs. what you assume they want?
High
Lean improvements on activities that do not contribute to customer-defined value are waste optimisation, not value creation.
DATA SOURCE
Customer research, Commercial team
Finding / Answer
SCORE
3
What percentage of total process cycle time is value-adding time vs. waiting and transport time?
High
In most manufacturing environments, value-adding time is 5–15% of total cycle time. This ratio reveals the scale of improvement opportunity.
DATA SOURCE
Process timing studies, VSM
Finding / Answer
SCORE
4
Are all handover steps between process stages mapped with the associated wait time and information requirements?
Medium
Handovers are where waste accumulates and errors are introduced. Unmapped handovers are unmanaged waste sources.
DATA SOURCE
Process maps, Operations
Finding / Answer
SCORE
5
Is takt time calculated for each production process and used to set pace and resource targets?
High
Takt time is the fundamental lean scheduling tool. Production without takt time cannot be balanced against customer demand.
DATA SOURCE
Production data, Sales data
Finding / Answer
SCORE
6
Are bottleneck processes identified and their impact on total throughput quantified?
High
Improving a non-bottleneck process has no impact on total output. Bottleneck identification is the prerequisite for meaningful throughput improvement.
DATA SOURCE
Production data, Process maps
Finding / Answer
SCORE
7
Is there a future-state value stream map, and is there a plan to implement it within a defined timeframe?
Medium
Current-state VSMs without future-state improvement plans are analytical exercises, not improvement tools.
DATA SOURCE
Process maps, Operations team
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Waste Identification & Elimination
SCOPE
How systematically the 8 wastes are identified and reduced
SELECT PHASE
AUDIT QUESTIONS
1
Are team leaders and operators trained to identify and categorise the 8 wastes in their own work area?
High
Waste identification requires training. Without shared vocabulary and classification, waste is noticed but not categorised or acted on.
DATA SOURCE
Training records, Operator survey
Finding / Answer
SCORE
2
What is the most significant waste category in the current operation, and what is the annual cost?
High
Prioritise waste elimination by cost and frequency. Defects and overproduction are the highest-cost wastes in most manufacturing environments.
DATA SOURCE
Operations data, Finance
Finding / Answer
SCORE
3
Is there a formal mechanism for operators to report and escalate waste observations?
High
Operators see waste daily but have no channel to report it. Without a formal mechanism, waste observation translates into acceptance.
DATA SOURCE
Improvement process, HR
Finding / Answer
SCORE
4
Are waste elimination projects tracked with before/after measurements and confirmed savings?
High
Waste reduction projects without measurement confirm effort, not result. Before/after data is the only valid basis for improvement claims.
DATA SOURCE
Project records, Finance
Finding / Answer
SCORE
5
Is motion waste — unnecessary movement of people or materials — analysed using spaghetti diagrams or equivalent?
Medium
Motion waste in shop floor layout is invisible until mapped. Even simple layout changes driven by spaghetti analysis yield measurable productivity gains.
DATA SOURCE
Process analysis, Operations
Finding / Answer
SCORE
6
Is over-processing waste — doing more than the customer requires — identified in production and design?
Medium
Over-processing is the hardest waste to see because it looks like quality effort. Challenge every quality check against actual customer requirement.
DATA SOURCE
Quality process, Operations
Finding / Answer
SCORE
7
Is the cost of defects and rework tracked as a specific line item and presented to management monthly?
High
Defect cost buried in overheads is not managed. A visible monthly metric drives management attention and resource allocation.
DATA SOURCE
Quality reports, Finance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Flow, Pull & Scheduling
SCOPE
How material and information flow through the process
SELECT PHASE
AUDIT QUESTIONS
1
Is production organised around continuous flow where possible, or does it rely on batch-and-queue scheduling?
High
Batch production in environments where single-piece flow is feasible creates excess WIP, lead time, and quality risk. Assess feasibility.
DATA SOURCE
Production process, Operations
Finding / Answer
SCORE
2
Are pull systems — kanban or equivalent — in place to regulate flow between process stages?
High
Push scheduling creates uncontrolled WIP accumulation. Pull systems limit WIP by design and create visible signals for replenishment.
DATA SOURCE
Production process, Inventory
Finding / Answer
SCORE
3
What is the WIP level at each process stage vs. the target level, and how is variance managed?
High
WIP accumulation above target is a signal that flow is broken. Monitor WIP at each stage as a leading indicator of flow problems.
DATA SOURCE
Production data, Inventory
Finding / Answer
SCORE
4
Is production scheduling based on customer demand signals, or on forecast and batch economic logic?
Medium
Forecast-driven production creates inventory for products customers may not want. Demand-driven scheduling builds only what is needed.
DATA SOURCE
Planning process, Sales data
Finding / Answer
SCORE
5
How are equipment changeovers managed, and what is the current changeover time vs. target?
Medium
Long changeover times create economic pressure for large batches, which increases lead time and inventory. Changeover reduction is a fundamental lean tool.
DATA SOURCE
Production data, Operations
Finding / Answer
SCORE
6
Is there a daily production planning meeting with visible performance vs. plan?
High
Daily production review with visible metrics is the operational heartbeat of a lean system. Absence of this practice signals that lean is not embedded in daily management.
DATA SOURCE
Operations process
Finding / Answer
SCORE
7
Are scheduling problems caused by upstream supply variability vs. internal process variability clearly distinguished?
Medium
Confusing supply-side and process-side variability causes misdiagnosed improvement actions. They require different interventions.
DATA SOURCE
Planning data, Supply chain data
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Continuous Improvement Culture
SCOPE
Whether lean improvement is embedded as a daily habit
SELECT PHASE
AUDIT QUESTIONS
1
Is there a documented daily management system — tiered meetings, visual management, and problem-solving — that functions every working day?
High
Lean improvement without a daily management system produces projects, not culture. The daily rhythm is what sustains lean over the medium term.
DATA SOURCE
Operations process, Manager interviews
Finding / Answer
SCORE
2
What is the number of improvement ideas submitted per employee per year, and how many are implemented?
High
High idea volume with low implementation rate creates cynicism. Low idea volume indicates either a culture problem or an unsupported submission process.
DATA SOURCE
Improvement records, HR
Finding / Answer
SCORE
3
Are team leaders empowered to implement small improvements within their work area without higher approval?
High
Improvement ideas that require management approval for small changes die in the queue. Empower team leaders with a defined scope for self-implementation.
DATA SOURCE
HR policy, Management interviews
Finding / Answer
SCORE
4
Is kaizen event activity tracked — frequency, scope, and confirmed results — by work area?
Medium
Kaizen events without tracking become annual rituals rather than improvement tools. Frequency and results should be visible and benchmarked.
DATA SOURCE
Improvement records, Operations
Finding / Answer
SCORE
5
Are lean competencies included in job profiles and performance objectives for operational management roles?
Medium
Lean embedded only in training courses but not in performance expectations is a cultural optional extra, not a management standard.
DATA SOURCE
HR, Job profiles
Finding / Answer
SCORE
6
Is there a defined lean maturity model, and does the organisation know where it sits on that scale?
Medium
Without a maturity framework, lean improvement has no direction. Assessment against a defined model creates targeted development priorities.
DATA SOURCE
Lean programme, HR
Finding / Answer
SCORE
7
Are suppliers engaged in lean improvement activities — especially those supplying high-volume or quality-critical components?
Low
Supply chain lean maturity directly affects your own process stability. Limiting lean to internal operations misses a major source of variability.
DATA SOURCE
Supply chain management, Procurement
Finding / Answer
SCORE
MAINTENANCE AUDIT
Operational
Assess the effectiveness of maintenance planning, execution, and equipment reliability management. Poor maintenance management is a direct cost driver and an indirect cause of quality failure and delivery unreliability.
AUDIT PHASE 1 OF 4
Maintenance Planning & Scheduling
SCOPE
How preventive and corrective maintenance is planned and scheduled
SELECT PHASE
AUDIT QUESTIONS
1
What is the ratio of planned preventive maintenance to unplanned reactive maintenance, and is it improving over time?
High
Best practice targets 80%+ planned maintenance. High reactive maintenance ratios indicate planning immaturity and are more expensive per event.
DATA SOURCE
Maintenance records, CMMS
Finding / Answer
SCORE
2
Is there a formal preventive maintenance schedule for all critical equipment, based on manufacturer recommendations and operational experience?
High
PM schedules based only on manufacturer data miss operational context. Experience-adjusted schedules are more accurate and cost-effective.
DATA SOURCE
Maintenance schedule, CMMS
Finding / Answer
SCORE
3
Are maintenance activities prioritised by equipment criticality — impact on safety, production, and quality?
High
Applying equal maintenance resource to all equipment regardless of criticality is inefficient. Criticality ranking should drive frequency and resource allocation.
DATA SOURCE
Criticality matrix, CMMS
Finding / Answer
SCORE
4
What is the average maintenance backlog, and is it within manageable limits relative to planned capacity?
High
A growing maintenance backlog is a leading indicator of equipment reliability deterioration. Track backlog trend as a headline maintenance KPI.
DATA SOURCE
CMMS, Maintenance records
Finding / Answer
SCORE
5
Are maintenance windows coordinated with production planning to minimise production downtime?
Medium
Maintenance executed without production planning coordination creates unnecessary throughput loss. Joint planning is a basic operational standard.
DATA SOURCE
CMMS, Production schedule
Finding / Answer
SCORE
6
Is there a defined emergency maintenance response protocol, including call-out responsibilities and escalation?
Medium
Undefined emergency response leads to slow reaction, incorrect diagnosis, and extended downtime. Protocols must be written and practiced.
DATA SOURCE
Maintenance policy, CMMS
Finding / Answer
SCORE
7
Are maintenance KPIs — MTBF, MTTR, OEE — tracked and reviewed monthly at management level?
High
Equipment reliability KPIs that are tracked but not reviewed at management level are not being managed.
DATA SOURCE
CMMS, Management reports
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Equipment Condition & Reliability
SCOPE
The current state and reliability of production and critical infrastructure assets
SELECT PHASE
AUDIT QUESTIONS
1
Is there a current asset register with condition assessment for each piece of equipment?
High
Asset registers without condition data do not support investment prioritisation or risk assessment. Condition must be formally assessed.
DATA SOURCE
Asset register, Maintenance records
Finding / Answer
SCORE
2
What is the Overall Equipment Effectiveness (OEE) for critical production assets, and how does it compare to the previous 12 months?
High
OEE below 65% in most manufacturing environments indicates significant reliability, performance, or quality losses worth investigating. Track trend.
DATA SOURCE
Production data, CMMS
Finding / Answer
SCORE
3
Which equipment items have the highest frequency of unplanned failure, and what are the root causes?
High
Pareto analysis of unplanned failures identifies the equipment where targeted maintenance investment will produce the highest return.
DATA SOURCE
CMMS, Maintenance records
Finding / Answer
SCORE
4
Are critical spare parts held for high-impact equipment, and is availability confirmed before a failure occurs?
High
Discovering that a critical spare is unavailable during an emergency extends downtime significantly. Spare availability must be confirmed in advance.
DATA SOURCE
Spare parts inventory, Procurement
Finding / Answer
SCORE
5
Is condition-based monitoring — vibration, temperature, oil analysis — used on critical rotating equipment?
Medium
Condition-based monitoring detects degradation before failure, enabling planned replacement rather than emergency response.
DATA SOURCE
Maintenance process, CMMS
Finding / Answer
SCORE
6
What is the average age of production-critical equipment relative to expected service life?
Medium
Equipment approaching or past expected service life creates increasing failure frequency and maintenance cost. Age profile drives capital investment planning.
DATA SOURCE
Asset register, Maintenance records
Finding / Answer
SCORE
7
Is there a documented planned replacement schedule for equipment approaching end-of-life?
High
Deferred equipment replacement is a short-term cost saving that compounds into long-term reliability and safety risk.
DATA SOURCE
Capital plan, Asset register
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Spare Parts & Inventory Management
SCOPE
Effectiveness of spare parts management and availability
SELECT PHASE
AUDIT QUESTIONS
1
Is there a controlled spare parts inventory linked to the asset register, with defined minimum stock levels per item?
High
Spare parts managed without reference to specific equipment creates both gaps in critical spares and excess stock of unnecessary parts.
DATA SOURCE
CMMS, Inventory system
Finding / Answer
SCORE
2
What is the value of slow-moving or obsolete spare parts in inventory, and how is this managed?
Medium
Spare parts for retired or replaced equipment accumulate silently. Annual obsolescence reviews prevent stock from becoming stranded capital.
DATA SOURCE
Inventory data, Finance
Finding / Answer
SCORE
3
Are critical spare parts sourced from single suppliers, and what is the contingency plan for supply disruption?
High
Single-source critical spares represent continuity risk. Identify alternatives or hold higher safety stock levels for items with no alternative.
DATA SOURCE
Procurement data, Spare parts register
Finding / Answer
SCORE
4
What is the average procurement lead time for critical spare parts, and does it match the maintenance urgency requirements?
High
Long lead times on critical spares are unacceptable if failure consequences are severe. Review lead times against criticality classifications.
DATA SOURCE
Procurement data, CMMS
Finding / Answer
SCORE
5
Is there a process for capturing actual spare parts usage and feeding it back into inventory planning?
Medium
Spare parts planning based on original equipment recommendations rather than actual consumption data leads to incorrect stock levels.
DATA SOURCE
CMMS, Inventory system
Finding / Answer
SCORE
6
Are spare parts managed under a controlled storage and issue process, or are they informally accessed?
Medium
Informally managed spare parts create unexplained inventory losses and inaccurate stock records.
DATA SOURCE
Maintenance process, Inventory system
Finding / Answer
SCORE
7
Is there a standardisation programme to reduce the number of unique spare parts by specifying common components across equipment?
Low
Parts standardisation reduces inventory complexity and improves availability. It requires close coordination between maintenance and procurement.
DATA SOURCE
Maintenance, Procurement, Engineering
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Maintenance Documentation & Team Competency
SCOPE
The quality of maintenance records, procedures, and team skills
SELECT PHASE
AUDIT QUESTIONS
1
Are standard maintenance procedures documented, current, and accessible in the work area for all planned maintenance tasks?
High
Maintenance executed from memory or individual experience is inconsistent and creates knowledge concentration risk.
DATA SOURCE
CMMS, Maintenance procedures
Finding / Answer
SCORE
2
Is all maintenance activity — planned, unplanned, and inspection — recorded in the CMMS with cause, action, and outcome?
High
Maintenance records not captured in CMMS are unavailable for analysis. Incomplete records prevent pattern identification and cost tracking.
DATA SOURCE
CMMS records
Finding / Answer
SCORE
3
Are maintenance team competencies formally assessed against the equipment and process complexity they maintain?
High
Technicians maintaining complex or safety-critical equipment without formal competency assessment create safety and reliability risk.
DATA SOURCE
HR, Training records
Finding / Answer
SCORE
4
What is the training and certification status of maintenance staff for all equipment and safety requirements?
High
Expired certifications and training gaps create legal liability and increase risk of maintenance error.
DATA SOURCE
HR, Training records
Finding / Answer
SCORE
5
Is there a knowledge management process to capture and transfer equipment-specific knowledge from experienced technicians?
High
Experienced maintenance technicians carry critical knowledge. Without capture, retirement or departure creates significant operational risk.
DATA SOURCE
HR, CMMS
Finding / Answer
SCORE
6
Are root cause analysis (RCA) investigations conducted for all significant equipment failures, with corrective actions tracked?
High
RCA conducted without tracked corrective actions identifies causes but does not prevent recurrence. Track implementation, not just findings.
DATA SOURCE
Maintenance records, CMMS
Finding / Answer
SCORE
7
Is the maintenance team staffed at sufficient levels, including contingency capacity for peak demand and absence?
Medium
Understaffed maintenance functions create a false economy. The cost of extended downtime events typically far exceeds the cost of adequate staffing.
DATA SOURCE
HR data, Maintenance records
Finding / Answer
SCORE
PROCESS IMPROVEMENT AUDIT
Operational
Assess the maturity and effectiveness of process improvement capability across the organisation. Covers diagnostic skills, improvement methodology, implementation quality, and the structures needed to sustain improvement over time.
AUDIT PHASE 1 OF 4
Process Mapping & Baseline Measurement
SCOPE
The quality of process documentation and performance baselines
SELECT PHASE
AUDIT QUESTIONS
1
Are current-state process maps available for all key operational processes, and when were they last validated?
High
Process maps that have not been walked and validated in the last 12 months may no longer reflect the actual process. Currency is critical.
DATA SOURCE
Process maps, Operations team
Finding / Answer
SCORE
2
Are process performance baselines — cycle time, error rate, throughput, cost — documented before improvement work begins?
High
Improvement projects without baselines cannot demonstrate results. Measurement is the foundation of credible improvement.
DATA SOURCE
Process data, Operations
Finding / Answer
SCORE
3
Is there a systematic approach to identifying which processes are candidates for improvement, based on data rather than perception?
High
Improvement resources directed to high-visibility but low-impact processes waste capacity. Data-driven prioritisation selects the highest-leverage targets.
DATA SOURCE
Process performance data, Management review
Finding / Answer
SCORE
4
Are the voices of customers and front-line staff incorporated into the process mapping and baseline activities?
Medium
Process maps drawn only by management frequently miss the actual process as experienced by the user. Field observation and user input are essential.
DATA SOURCE
Process mapping method, Operations
Finding / Answer
SCORE
5
Is there a defined scope boundary for each improvement project that prevents scope creep?
Medium
Process improvement projects that expand in scope mid-execution fail to complete and consume resources without delivering results.
DATA SOURCE
Project management, Process improvement
Finding / Answer
SCORE
6
Are process maps updated immediately when processes are changed, or do maps lag behind reality?
High
Process maps that lag behind actual processes rapidly become misleading reference documents.
DATA SOURCE
Document control, Operations
Finding / Answer
SCORE
7
What is the gap between documented process and actual observed process for key operational workflows?
High
Significant gaps between documentation and reality indicate either poor documentation discipline or unmanaged process variation.
DATA SOURCE
Process audit, Operations
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Root Cause Analysis & Problem Definition
SCOPE
The quality of problem diagnosis before solutions are implemented
SELECT PHASE
AUDIT QUESTIONS
1
Is there a defined root cause analysis methodology — 5 Why, Fishbone, Fault Tree — used consistently across improvement projects?
High
Teams that use different RCA methods produce inconsistent analysis quality. Consistency enables comparison, training, and quality review.
DATA SOURCE
Training records, Improvement process
Finding / Answer
SCORE
2
Are improvement projects prohibited from implementing solutions before a documented root cause is confirmed?
High
Jumping from problem observation to solution without root cause analysis is the primary cause of improvement project relapse.
DATA SOURCE
Project governance, Improvement process
Finding / Answer
SCORE
3
Are root cause analyses reviewed by a second person before solution design begins?
Medium
Single-person RCA is subject to confirmation bias. Independent review of root cause findings improves diagnosis quality.
DATA SOURCE
Project governance
Finding / Answer
SCORE
4
Is the difference between the symptom and the root cause explicitly documented in each improvement project?
High
Solutions targeting symptoms recur. Solutions targeting root causes resolve. Document both to confirm the analysis has gone deep enough.
DATA SOURCE
Improvement project records
Finding / Answer
SCORE
5
Are data collection and analysis methods validated before being used to diagnose process problems?
High
Analysis based on incomplete or biased data produces incorrect diagnoses. Data validation is a prerequisite for credible RCA.
DATA SOURCE
Process data, Quality records
Finding / Answer
SCORE
6
Is there a process to validate that the identified root cause is actually the cause, rather than a correlation?
Medium
Correlation without causation leads to solutions that address the wrong variable. Testing causal relationship requires structured experimentation.
DATA SOURCE
Improvement methodology, Training
Finding / Answer
SCORE
7
Are patterns identified across multiple improvement projects — shared root causes across different processes?
Medium
Systemic root causes appear across multiple processes. Identifying patterns allows higher-leverage system-level interventions.
DATA SOURCE
Improvement records, Management review
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Improvement Design, Testing & Validation
SCOPE
How improvements are designed, tested, and validated before full implementation
SELECT PHASE
AUDIT QUESTIONS
1
Are improvement solutions designed as controlled experiments — with a hypothesis, test plan, and success criteria — before full implementation?
High
Full implementation of untested solutions is the primary cause of improvement project failures that require re-work or reversal.
DATA SOURCE
Project governance, Improvement process
Finding / Answer
SCORE
2
Are pilot tests conducted at a limited scale before organisation-wide implementation?
High
Pilots identify implementation problems at low cost and low risk. Skipping pilots to accelerate implementation increases failure risk.
DATA SOURCE
Improvement process, Project records
Finding / Answer
SCORE
3
Is improvement design conducted with the involvement of the people who perform the process?
High
Improvements designed without operator or user involvement frequently fail in implementation because they do not account for practical constraints.
DATA SOURCE
Improvement methodology, HR
Finding / Answer
SCORE
4
Are the risks and unintended consequences of each proposed improvement explicitly assessed before implementation?
Medium
Process improvements that improve one metric at the expense of another are net-neutral or negative in their overall effect.
DATA SOURCE
Risk assessment, Improvement process
Finding / Answer
SCORE
5
Is there a defined success threshold — not just direction of improvement — that must be met for the improvement to be considered validated?
High
Defining success as 'any improvement' allows poorly designed solutions to be declared successful with negligible impact.
DATA SOURCE
Project governance, Improvement records
Finding / Answer
SCORE
6
Are comparison periods (before and after) of sufficient length to confirm that observed improvements are real and not statistical noise?
Medium
Short measurement windows after improvement create risk of confirming natural variation as improvement. Define minimum measurement periods.
DATA SOURCE
Improvement methodology, Data analysis
Finding / Answer
SCORE
7
Is there a formal handover from the improvement team to the process owner when the improvement has been validated?
High
Improvement projects without formal handover revert when the improvement team moves on. Process owner ownership must be explicitly transferred.
DATA SOURCE
Project governance, Process management
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Implementation & Sustainability
SCOPE
Whether improvements are implemented effectively and sustained over time
SELECT PHASE
AUDIT QUESTIONS
1
Are process improvements documented in updated SOPs, training materials, and job aids before going live?
High
Implementing improvements without updating documentation creates a system that reverts to the old process as soon as trained staff turn over.
DATA SOURCE
Document control, SOP library
Finding / Answer
SCORE
2
What percentage of improvement projects still show sustained results at 12 months post-implementation?
High
Improvement sustainability rate is the most honest measure of improvement programme quality. Rates below 70% indicate an embedding problem.
DATA SOURCE
Improvement records, Process data
Finding / Answer
SCORE
3
Is there a formal 30/60/90-day post-implementation review for each improvement project?
High
Problems in implementation are most visible in the first 90 days. Structured reviews at these intervals enable timely course correction.
DATA SOURCE
Project governance, Process management
Finding / Answer
SCORE
4
Are improvement project results reported to senior management with financial quantification?
High
Improvement projects without financial quantification cannot compete for priority against projects with clear financial returns.
DATA SOURCE
Management reports, Finance
Finding / Answer
SCORE
5
Is there a mechanism for the organisation to capture and reuse improvement learnings across different teams and sites?
Medium
Improvement knowledge that stays within a single team or project is wasted. A knowledge-sharing mechanism multiplies the return on improvement investment.
DATA SOURCE
Knowledge management, HR
Finding / Answer
SCORE
6
Is there an improvement programme backlog — prioritised and resourced — to ensure continuous work on the highest-impact improvements?
Medium
Without a managed backlog, improvement activity is reactive and episodic. A prioritised backlog creates steady-state improvement capacity.
DATA SOURCE
Process improvement, COO
Finding / Answer
SCORE
7
Are process owners trained in how to maintain the improved process and respond to drift?
Medium
Process maintenance without trained owners reverts to pre-improvement state within 6–18 months in most environments.
DATA SOURCE
Training records, HR
Finding / Answer
SCORE
QUALITY AUDIT
Operational
Assess the maturity and effectiveness of quality management across product, process, and supply chain. Identifies where quality risk is highest and where quality cost can be reduced through prevention rather than inspection.
AUDIT PHASE 1 OF 4
Quality Standards & System Compliance
SCOPE
Regulatory, certification, and customer-mandated quality requirements
SELECT PHASE
AUDIT QUESTIONS
1
Are all applicable quality management certifications (ISO 9001, IATF, sector-specific) current and surveillance audits completed on schedule?
High
Lapsed certifications create customer and regulatory risk and are frequently not discovered until a customer qualification audit.
DATA SOURCE
Certification records, Quality management system
Finding / Answer
SCORE
2
Are internal quality audits conducted at the defined frequency, and do findings drive documented corrective actions?
High
Internal audits that produce findings with no corrective action tracking are compliance theatre. Track CA closure rate and time-to-close.
DATA SOURCE
Internal audit records, CAPA system
Finding / Answer
SCORE
3
What is the current non-conformance rate vs. customer requirements, and is it trending up or down?
High
Non-conformance rate trend is more informative than the absolute rate. An improving trend with high absolute rate is different from a worsening trend with low rate.
DATA SOURCE
Quality records, Customer data
Finding / Answer
SCORE
4
Are customer-specific quality requirements documented and formally communicated to all relevant production and quality personnel?
High
Customer-specific requirements that are not communicated to production and quality teams generate customer complaints and rework.
DATA SOURCE
Quality system, Customer requirements
Finding / Answer
SCORE
5
Is there a formal management of change process that assesses quality impact before process, product, or supplier changes are implemented?
High
Process changes implemented without quality impact assessment are a primary source of post-change quality failures.
DATA SOURCE
Change management process, Quality system
Finding / Answer
SCORE
6
Are quality objectives defined at company and departmental level and reviewed at management review meetings?
Medium
Quality objectives not reviewed at management level are aspirational, not managed. Management review drives accountability.
DATA SOURCE
Quality system, Management review records
Finding / Answer
SCORE
7
Is the cost of quality — prevention, appraisal, internal failure, external failure — tracked and reported annually?
High
Companies that track cost of quality identify where to redirect investment from inspection and failure to prevention.
DATA SOURCE
Finance, Quality records
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Inspection, Testing & Non-Conformance Management
SCOPE
The effectiveness of detection and containment systems
SELECT PHASE
AUDIT QUESTIONS
1
Is incoming material inspected against defined acceptance criteria, and is the inspection rate risk-based?
High
100% inspection of all incoming materials is expensive and unnecessary. Risk-based incoming inspection focusses resource on high-impact, high-variation suppliers.
DATA SOURCE
Inspection records, Supplier data
Finding / Answer
SCORE
2
What is the in-process defect rate, and at which stage of production do defects originate?
High
In-process defects found late in the production process are more expensive to correct than those found at the originating stage. Map defect origin points.
DATA SOURCE
Quality records, Production data
Finding / Answer
SCORE
3
Is there a documented process for containing and segregating non-conforming product to prevent inadvertent shipment?
High
Non-conforming product reaching a customer is a quality failure compounded by a containment system failure.
DATA SOURCE
Quality system, Operations process
Finding / Answer
SCORE
4
What is the average time from defect identification to root cause completion and corrective action implementation?
High
Long RCA and CA cycles allow defects to continue producing non-conforming product. Define and track maximum response time by defect severity.
DATA SOURCE
CAPA records, Quality system
Finding / Answer
SCORE
5
Is first-pass yield tracked at each production stage, and are yield loss reasons coded and categorised?
High
First-pass yield without reason categorisation provides no direction for improvement. Code-based categorisation enables Pareto analysis of yield loss causes.
DATA SOURCE
Production data, Quality records
Finding / Answer
SCORE
6
Are inspection and test equipment calibrated on schedule, and are calibration records maintained?
High
Out-of-calibration measuring equipment makes all measurements from the affected period suspect. Calibration compliance is non-negotiable.
DATA SOURCE
Calibration records, Quality system
Finding / Answer
SCORE
7
Is there a defined process for customer complaint classification, root cause analysis, and formal response within committed timescales?
High
Customer complaints without structured RCA and response process repeat. They also damage customer relationships when response is slow or generic.
DATA SOURCE
CRM, CAPA system
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Supplier Quality Management
SCOPE
Quality assurance and development across the supply chain
SELECT PHASE
AUDIT QUESTIONS
1
Are suppliers formally approved against defined quality criteria before being authorised to supply?
High
Unapproved suppliers in the supply chain create uncontrolled quality risk. Approval must precede first order, not follow first failure.
DATA SOURCE
Supplier quality system, Procurement
Finding / Answer
SCORE
2
Is incoming material non-conformance tracked per supplier, and do patterns trigger formal supplier quality reviews?
High
Supplier quality problems that do not trigger formal review will recur. Non-conformance tracking must connect to a supplier management consequence.
DATA SOURCE
Supplier quality records, CAPA
Finding / Answer
SCORE
3
Are quality requirements communicated to suppliers in the form of specifications, not assumptions?
High
Assuming suppliers know your requirements is the leading cause of incoming material non-conformance. Requirements must be documented and formally accepted.
DATA SOURCE
Supplier specifications, Quality system
Finding / Answer
SCORE
4
Do suppliers have quality management systems of a standard appropriate to the products they supply?
High
Suppliers without appropriate QMS for the risk category of their product are not in a position to consistently deliver conforming product.
DATA SOURCE
Supplier audit records, Quality system
Finding / Answer
SCORE
5
Are supplier audits conducted at a frequency commensurate with the criticality and historical performance of each supplier?
Medium
Annual audits of critical high-volume suppliers and no audits of low-volume suppliers is a risk-calibrated approach. Confirm your actual audit schedule reflects this.
DATA SOURCE
Supplier audit schedule, Procurement
Finding / Answer
SCORE
6
Is there a formal supplier performance review process that covers quality, delivery, and responsiveness?
High
Suppliers measured only on price and delivery miss quality signals until they generate a customer complaint.
DATA SOURCE
Supplier reviews, Procurement
Finding / Answer
SCORE
7
What is the process for developing supplier quality capability in underperforming but strategically important suppliers?
Medium
Replacing a strategic supplier is expensive and disruptive. Investment in supplier development is often more effective than replacement.
DATA SOURCE
Supplier quality programme, Procurement
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Quality Culture & Prevention
SCOPE
Whether quality is owned by the organisation or delegated to the quality department
SELECT PHASE
AUDIT QUESTIONS
1
Are quality objectives included in individual performance targets for operational and management roles outside the quality function?
High
Quality managed only by the quality department is a departmental function, not an organisational value. Line ownership is what creates culture.
DATA SOURCE
HR, Performance management
Finding / Answer
SCORE
2
What is the ratio of quality investment in prevention vs. appraisal and failure correction?
High
Organisations that invest primarily in inspection and failure correction are managing quality, not improving it. Shift the ratio toward prevention.
DATA SOURCE
Finance, Quality budget
Finding / Answer
SCORE
3
Do team leaders have the authority to stop production when a quality concern is identified, without escalation?
High
Production continuation despite quality concerns is a culture failure that signals output over quality. Stop-and-fix authority must exist at the point of production.
DATA SOURCE
Operations policy, HR
Finding / Answer
SCORE
4
Are quality improvements celebrated and communicated across the organisation with the same prominence as production achievements?
Medium
What gets celebrated gets repeated. Quality improvement stories that are not communicated signal that quality performance is not organisationally valued.
DATA SOURCE
Communication practice, HR
Finding / Answer
SCORE
5
Is quality performance shared with and discussed by front-line production teams, not only management?
High
Teams that cannot see their own quality performance cannot influence it. Visibility at the point of production is a prerequisite for engagement.
DATA SOURCE
Quality communication, Operations
Finding / Answer
SCORE
6
Is there a formal mechanism for production staff to report quality concerns or risks before they become defects?
High
Quality risks seen by production staff but not reported create avoidable defects. Reporting must be safe, easy, and acted upon.
DATA SOURCE
HR, Operations process
Finding / Answer
SCORE
7
Are lessons learned from quality failures shared across the organisation and incorporated into training and SOPs?
Medium
Quality failures that produce lessons that are contained within the quality department do not prevent recurrence in other areas.
DATA SOURCE
Knowledge management, Training
Finding / Answer
SCORE
WASTE REDUCTION AUDIT
Operational | Financial
Assess and quantify sources of physical, process, and resource waste across the business. Identifies both environmental and financial waste reduction opportunities. Goes beyond lean manufacturing to include energy, procurement, and administrative waste.
AUDIT PHASE 1 OF 4
Material & Inventory Waste
SCOPE
Waste from materials, packaging, and inventory management
SELECT PHASE
AUDIT QUESTIONS
1
What is the total material waste volume and cost per year, by waste category and production stage?
High
Material waste quantified only at a total level cannot be targeted. Category and stage breakdown determines where investment in waste reduction will yield the highest return.
DATA SOURCE
Production data, Finance
Finding / Answer
SCORE
2
What is the ratio of waste to total material consumed, and how does it compare to industry benchmark?
High
Waste-to-input ratio is the primary material efficiency metric. Benchmark comparison reveals whether the current level is a management problem or an industry norm.
DATA SOURCE
Production data, Industry benchmark
Finding / Answer
SCORE
3
Are scrap and offcut materials separated, characterised, and directed to the highest-value recovery route?
Medium
Mixed waste streams forgo the value available from segregated recovery. Even small volumes of high-value material are worth segregating.
DATA SOURCE
Waste management process, Finance
Finding / Answer
SCORE
4
What is the annual cost of packaging waste, and have lightweighting or elimination opportunities been assessed?
Medium
Packaging waste is often accepted as a fixed proportion of cost without challenge. Lightweighting, eliminating unnecessary packaging, and returnable systems all offer savings.
DATA SOURCE
Procurement, Finance
Finding / Answer
SCORE
5
What is the value of inventory written off for obsolescence or damage annually, and what is the root cause?
High
Inventory write-off is the visible cost of forecasting failure, poor warehouse management, or slow product lifecycle management.
DATA SOURCE
Finance, Inventory data
Finding / Answer
SCORE
6
Is raw material receipt inspection catching supplier-caused waste before it enters the production process?
High
Material defects entering production are more expensive than those caught at incoming inspection. Inspection effectiveness directly affects material waste rates.
DATA SOURCE
Quality records, Supplier data
Finding / Answer
SCORE
7
Are material usage standards documented, and is actual usage tracked against standard per product?
High
Material usage above standard is waste. Without standards and tracking, excess material use is invisible and therefore unmanaged.
DATA SOURCE
Production data, Engineering
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Process & Time Waste
SCOPE
Waste embedded in operational processes and management activities
SELECT PHASE
AUDIT QUESTIONS
1
What is the total time cost of rework across all production processes, and at which stages is it concentrated?
High
Rework time quantified in cost per year creates the business case for investment in defect prevention. Most organisations underestimate it significantly.
DATA SOURCE
Quality records, Production data
Finding / Answer
SCORE
2
What is the time lost to waiting — for materials, approvals, information, or equipment — per FTE per week?
High
Waiting time is invisible in most workforce productivity reports but typically accounts for 10–20% of working time in manufacturing and knowledge environments.
DATA SOURCE
Time study, Employee survey
Finding / Answer
SCORE
3
Are there process steps that exist for historical rather than current reasons, and that add no measurable value?
Medium
Process steps invented for problems that no longer exist accumulate over time. A 'zero-based' process review annually identifies and eliminates them.
DATA SOURCE
Process review, Operations
Finding / Answer
SCORE
4
What is the administrative time consumed by compliance and reporting activities vs. the decisions they inform?
Medium
Reports prepared but not used are a form of administrative waste that can only be identified by auditing what the recipients actually do with the output.
DATA SOURCE
Management survey, Finance
Finding / Answer
SCORE
5
Is meeting time included in total waste analysis, and has it been quantified as a cost?
Medium
Meeting time rarely appears in waste analysis because it is classified as management activity. Quantify unproductive meeting time in cost terms.
DATA SOURCE
Calendar data, HR
Finding / Answer
SCORE
6
Are there IT system activities — manual data entry, re-keying between systems, or workarounds — that generate time waste measurable in hours per week?
High
Manual IT workarounds are accepted as part of the job by the people performing them. Quantify the time cost and it frequently justifies integration investment.
DATA SOURCE
IT, Employee survey
Finding / Answer
SCORE
7
Is the cost of poor scheduling — idle time, overtime, and last-minute changeovers — tracked and attributed to a specific management failure?
High
Scheduling waste is often attributed to demand volatility rather than planning quality. Distinguish controllable from uncontrollable scheduling cost.
DATA SOURCE
Production data, Finance
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Energy & Utilities
SCOPE
Energy and utility consumption, efficiency, and cost
SELECT PHASE
AUDIT QUESTIONS
1
Is energy consumption tracked by production unit, process, and facility, or only at the site meter level?
High
Site-level energy tracking cannot identify which processes are energy inefficient. Sub-metering by production area is the minimum requirement for improvement.
DATA SOURCE
Utility bills, Energy monitoring
Finding / Answer
SCORE
2
What is energy cost as a percentage of total production cost, and how has it trended over 3 years?
High
Rising energy cost as a proportion of production cost is a margin pressure signal that compounds with energy price increases.
DATA SOURCE
Finance, Utility bills
Finding / Answer
SCORE
3
What is the energy consumed per unit of output (energy intensity), and has it improved or worsened over 3 years?
High
Energy intensity improvement while output grows is true efficiency gain. Energy cost reduction during volume decline is not efficiency — it is volume effect.
DATA SOURCE
Utility data, Production data
Finding / Answer
SCORE
4
Are energy waste sources — compressed air leaks, idle equipment, lighting in unused areas — systematically identified and addressed?
Medium
Energy waste source surveys routinely find 10–20% of energy consumed in obviously addressable waste. Annual surveys are a low-cost improvement mechanism.
DATA SOURCE
Energy audit, Facilities
Finding / Answer
SCORE
5
Is energy and water consumption monitored in real time, with alerts for anomalous consumption?
Medium
Anomalous consumption detected within hours rather than at the next utility bill enables rapid diagnosis and correction.
DATA SOURCE
Energy management system, IT
Finding / Answer
SCORE
6
What is the investment horizon and return calculation for the most energy-intensive equipment replacement or upgrade?
Medium
Legacy equipment frequently consumes disproportionate energy relative to its output. Replacement ROI calculations are often shorter than assumed.
DATA SOURCE
Finance, Facilities
Finding / Answer
SCORE
7
Are renewable energy options assessed for each facility, and is there a renewable energy procurement plan?
Low
Renewable energy procurement is increasingly a supplier qualification criterion in European markets. Early adoption reduces cost and future compliance risk.
DATA SOURCE
Facilities, Finance
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Waste Governance & Reporting
SCOPE
Structures and accountability for waste management
SELECT PHASE
AUDIT QUESTIONS
1
Is waste — material, time, and energy — reported as a financial metric in the management information pack?
High
Waste visible in management reports is managed. Waste absent from reports is tolerated by default.
DATA SOURCE
Management reports, Finance
Finding / Answer
SCORE
2
Is there a waste reduction target, and is progress against it reviewed in monthly management meetings?
High
Targets without regular review are aspirations. Monthly review with visible progress creates accountability.
DATA SOURCE
Management process, Finance
Finding / Answer
SCORE
3
Are there defined waste reduction owners for each major waste category?
High
Waste without a named owner is nobody's responsibility. Assign specific individuals to specific waste categories.
DATA SOURCE
Management structure, HR
Finding / Answer
SCORE
4
Is waste reduction included in the annual budget and investment planning process?
Medium
Waste reduction projects that rely on available resource rather than allocated budget are systematically deprioritised.
DATA SOURCE
Finance, Budget process
Finding / Answer
SCORE
5
Are waste data collection and reporting methods audited for accuracy?
Medium
Waste data that is estimated rather than measured creates false confidence in performance and misdirects improvement investment.
DATA SOURCE
Finance, Quality, Operations
Finding / Answer
SCORE
6
Are regulatory waste reporting requirements (hazardous waste, emissions) fully met and documented?
High
Non-compliance with waste regulations creates material financial and reputational risk. Track compliance obligations and deadlines formally.
DATA SOURCE
Legal, Compliance, Finance
Finding / Answer
SCORE
7
Is there a formal waste hierarchy — reduce, reuse, recover, dispose — applied to all waste management decisions?
Medium
Moving waste management up the hierarchy (toward prevention) is more profitable than optimising disposal. The hierarchy must be applied at the decision point, not retrospectively.
DATA SOURCE
Waste management policy, Operations
Finding / Answer
SCORE
SOP LIBRARY AUDIT
Operational
Assess the completeness, quality, accessibility, and compliance of the Standard Operating Procedure library. An SOP library that is incomplete, outdated, or unused is a quality and operational risk, not an asset.
AUDIT PHASE 1 OF 4
SOP Coverage & Completeness
SCOPE
Whether all critical processes are covered by current SOPs
SELECT PHASE
AUDIT QUESTIONS
1
Is there a process inventory that maps every key operational process to a corresponding SOP or confirms that no SOP is required?
High
An undocumented assumption that all key processes have SOPs creates gaps. The inventory provides the evidence.
DATA SOURCE
Process inventory, SOP library
Finding / Answer
SCORE
2
What percentage of safety-critical and quality-critical processes are covered by current SOPs?
High
Safety and quality-critical processes must have 100% SOP coverage. Gaps are non-negotiable from a risk management perspective.
DATA SOURCE
SOP library, Risk register
Finding / Answer
SCORE
3
Are processes that involve regulatory compliance covered by SOPs that reflect current regulatory requirements?
High
Regulatory environments change. SOPs that do not track regulatory updates create compliance risk.
DATA SOURCE
SOP library, Legal, Quality
Finding / Answer
SCORE
4
Are SOPs available for all processes performed by temporary or contract staff?
High
Temporary staff without SOPs perform processes from verbal instruction that is inconsistent and uncaptured.
DATA SOURCE
SOP library, HR
Finding / Answer
SCORE
5
Are there processes documented only in the minds of specific individuals, creating knowledge concentration risk?
High
Tacit knowledge held by individuals is the highest-risk gap in the SOP library. Identify by asking: what processes would fail if this person were absent tomorrow?
DATA SOURCE
Manager interviews, HR
Finding / Answer
SCORE
6
Is SOP coverage reviewed and updated when new products, processes, or technologies are introduced?
High
New process introductions without corresponding SOPs create immediate knowledge gaps and quality risk.
DATA SOURCE
Change management process, SOP library
Finding / Answer
SCORE
7
Is there a formal SOP gap analysis conducted at least annually?
Medium
Annual gap analysis is the mechanism for maintaining SOP coverage in a changing operational environment.
DATA SOURCE
Quality management, SOP library
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
SOP Quality & Usability
SCOPE
Whether SOPs are written to a standard that enables consistent execution
SELECT PHASE
AUDIT QUESTIONS
1
Are SOPs written at the reading level and format appropriate to the user performing the task?
High
SOPs written for auditors rather than operators are not used by operators. Test by observing whether staff refer to the SOP when performing the task.
DATA SOURCE
SOP library, Observation
Finding / Answer
SCORE
2
Do SOPs include visual aids — photographs, diagrams, or video links — for tasks where visual reference improves accuracy?
High
Text-only SOPs for physical tasks create interpretation variability. Visual references significantly improve accuracy and reduce training dependency.
DATA SOURCE
SOP library, Training materials
Finding / Answer
SCORE
3
Are critical decision points and quality checks explicitly identified in each SOP?
High
SOPs that describe the process without highlighting the critical points where errors have the highest consequence are incomplete as risk documents.
DATA SOURCE
SOP library, Quality manager review
Finding / Answer
SCORE
4
Are safety requirements — PPE, machine guarding, COSHH — integrated into the task SOPs rather than referenced as separate documents?
High
Safety requirements in separate documents are less likely to be followed than requirements embedded in the work instruction itself.
DATA SOURCE
SOP library, Safety records
Finding / Answer
SCORE
5
Do SOPs define the inputs, outputs, tools, and quality criteria for the task, not only the steps?
Medium
SOPs that describe steps without specifying acceptable inputs and outputs cannot detect when the task should not begin or when the output is non-conforming.
DATA SOURCE
SOP library, Quality review
Finding / Answer
SCORE
6
Is SOP complexity calibrated to the actual complexity of the task — detailed for complex tasks, simple for simple tasks?
Medium
Overly complex SOPs for simple tasks create reading resistance. Under-specified SOPs for complex tasks create execution risk.
DATA SOURCE
SOP library, Operator survey
Finding / Answer
SCORE
7
Are SOPs tested by having a person unfamiliar with the task attempt to perform it using only the SOP as guidance?
Medium
SOP validation by the person who wrote it is insufficient. Blind user testing is the most reliable quality check.
DATA SOURCE
SOP review process, Quality
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Accessibility, Version Control & Maintenance
SCOPE
How SOPs are stored, accessed, updated, and controlled
SELECT PHASE
AUDIT QUESTIONS
1
Is there a document management system that provides version-controlled, single-source-of-truth storage for all SOPs?
High
Multiple versions of the same SOP in different locations is a quality disaster. One authoritative source with version control is a minimum standard.
DATA SOURCE
Document management system, IT
Finding / Answer
SCORE
2
Are current SOPs accessible at the point of use — in the work area, on a device, or on a screen — without requiring access to a central office?
High
An SOP stored on an office server that requires a PC login is not accessible in a production environment. Point-of-use access is a usability requirement.
DATA SOURCE
Document management, IT, Operations
Finding / Answer
SCORE
3
Is there a defined SOP review cycle for each document, and is it tracked and enforced?
High
SOPs without defined review cycles become outdated silently. A review schedule, tracked against actual review dates, prevents this.
DATA SOURCE
Document management system, Quality
Finding / Answer
SCORE
4
Is the approval and release process for new or revised SOPs clearly defined, and are approval records maintained?
High
SOPs released without a documented approval record create both quality and regulatory compliance risk.
DATA SOURCE
Document management system, Quality
Finding / Answer
SCORE
5
Are superseded SOP versions archived but clearly marked as obsolete to prevent accidental use?
Medium
Obsolete SOPs that are indistinguishable from current ones are a practical quality risk in paper-based or poorly controlled systems.
DATA SOURCE
Document management system
Finding / Answer
SCORE
6
Is SOP update required whenever a non-conformance or process improvement identifies that the current procedure is incorrect or suboptimal?
High
SOPs that are not updated when a process changes are misleading documents that create the appearance of control while the actual process is uncontrolled.
DATA SOURCE
CAPA process, Document management
Finding / Answer
SCORE
7
Are the languages of SOPs appropriate for all operational staff who use them?
High
SOPs in a language not understood by the performing staff are effectively non-existent. Multi-language versions are required where the workforce requires them.
DATA SOURCE
SOP library, HR
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Training, Compliance & Audit
SCOPE
Whether staff are trained to current SOPs and compliance is verified
SELECT PHASE
AUDIT QUESTIONS
1
Are training records maintained that confirm each operator is trained to the current version of each SOP relevant to their role?
High
Training records linked to SOP version numbers allow identification of who needs retraining when an SOP is updated.
DATA SOURCE
Training records, HR, Document management
Finding / Answer
SCORE
2
Is there a mechanism to retrain staff automatically when an SOP is updated?
High
SOP updates without automatic retraining create a growing gap between documented process and trained behaviour.
DATA SOURCE
Document management system, HR
Finding / Answer
SCORE
3
Are SOP compliance rates verified through observation or formal process audits at a defined frequency?
High
SOP compliance that is assumed rather than verified is not controlled. Regular observation or audit is the only valid verification method.
DATA SOURCE
Audit records, Quality
Finding / Answer
SCORE
4
What is the SOP deviation rate identified in internal audits, and is it tracked by process area and reason?
High
SOP deviation tracking by area and reason identifies where compliance is weakest and whether the cause is training, SOP quality, or attitude.
DATA SOURCE
Audit records, Quality
Finding / Answer
SCORE
5
Is there a consequence for repeated or deliberate non-compliance with SOPs, and is it applied consistently?
High
SOPs without consequences for non-compliance are guidance documents, not standards. The consequence defines the level of commitment to the standard.
DATA SOURCE
HR policy, Quality manager
Finding / Answer
SCORE
6
Are operators involved in the development and review of SOPs for their own work areas?
Medium
Operators who contribute to SOP development have higher ownership and compliance. SOPs written entirely by quality staff without operator input miss practical detail.
DATA SOURCE
SOP development process, Operations
Finding / Answer
SCORE
7
Is SOP management included in the management review agenda at least annually?
Medium
SOP library health — coverage, currency, compliance — requires board-level visibility. It belongs in management review as a quality and risk item.
DATA SOURCE
Quality management review, Management records
Finding / Answer
SCORE
BUSINESS DEVELOPMENT AUDIT
Sales&commercial | Strategy
Assess the quality and effectiveness of business development activity. Distinguishes between genuine pipeline building and relationship maintenance disguised as BD. Focus on new revenue creation, not account management.
AUDIT PHASE 1 OF 4
Pipeline & Prospecting
SCOPE
Quality and volume of new business pipeline and lead generation activity
TARGET
Commercial Director, BD Manager
SELECT PHASE
AUDIT QUESTIONS
1
What is the total value of new business pipeline, and does it provide 3× coverage of the next 12-month new revenue target?
High
Pipeline coverage below 3× the target indicates insufficient prospecting activity. It is the earliest reliable indicator of a future revenue shortfall.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
2
How many new prospects are added to the pipeline per week, and is this tracked per BD team member?
High
Prospecting activity that is not tracked is not managed. The number of new qualified entries per week is the leading indicator of future pipeline health.
DATA SOURCE
CRM
Finding / Answer
SCORE
3
What is the source breakdown of new leads — inbound, outbound, referral, event — and which source produces the highest conversion rate?
High
Most BD teams over-invest in low-conversion sources because they feel comfortable. Conversion rate by source reveals where to shift time and budget.
DATA SOURCE
CRM, Marketing data
Finding / Answer
SCORE
4
What is the average time from first contact to first meeting, and from first meeting to qualified opportunity?
Medium
Long time-to-qualify indicates either weak initial targeting or insufficient follow-through. Both are BD process failures, not market failures.
DATA SOURCE
CRM
Finding / Answer
SCORE
5
Are BD targets set as leading activity metrics — calls, meetings, proposals — not only as revenue outcomes?
High
Revenue targets without activity targets create no accountability until it is too late to correct. Leading metrics enable real-time management.
DATA SOURCE
CRM, HR
Finding / Answer
SCORE
6
What percentage of the pipeline has had meaningful activity in the last 30 days, and how much is stale?
High
Stale pipeline inflates coverage ratios and creates false confidence. Require a 30-day activity threshold to count as active pipeline.
DATA SOURCE
CRM
Finding / Answer
SCORE
7
Is there a defined ideal customer profile (ICP) that guides prospecting, and is it consistently applied?
Medium
BD without an ICP produces a pipeline of poor-fit prospects that consumes sales capacity without converting. Define and enforce the ICP.
DATA SOURCE
CRM, Commercial strategy
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Proposition & Positioning
SCOPE
Clarity and differentiation of the value proposition in BD conversations
TARGET
Commercial Director, Marketing
SELECT PHASE
AUDIT QUESTIONS
1
Can every BD team member articulate the value proposition in one sentence — without using the words 'quality', 'service', or 'partnership'?
High
Generic value propositions produce generic responses. A specific, differentiated proposition is the foundation of effective BD.
DATA SOURCE
BD team interviews
Finding / Answer
SCORE
2
Is the value proposition differentiated by customer segment, or is one generic message used for all targets?
High
Different customer segments buy for different reasons. Segment-specific propositions outperform generic ones in conversion rate.
DATA SOURCE
Marketing materials, CRM
Finding / Answer
SCORE
3
Are customer-facing references and case studies available for each target segment, and are they used in BD conversations?
Medium
Prospects in a specific industry trust evidence from their own sector more than generic claims. Segment-specific case studies are conversion accelerators.
DATA SOURCE
Marketing, BD materials
Finding / Answer
SCORE
4
Is the competitive positioning — why us vs. the two most likely alternatives — explicit and rehearsed?
High
BD conversations that cannot address 'why not your competitor?' lose to the competitor. Explicit competitive positioning is a BD competency requirement.
DATA SOURCE
BD training, Commercial team
Finding / Answer
SCORE
5
Are pricing and commercial terms presented confidently and consistently, or does the BD team defer or discount under first pressure?
High
Price deflection under first pressure signals either low confidence in value or insufficient training on value articulation.
DATA SOURCE
CRM, BD interviews
Finding / Answer
SCORE
6
Is there a defined content strategy — articles, case studies, events — that positions the company as a credible voice in the target market?
Medium
Outbound BD is more effective when the target has already encountered the company's thinking. Content builds pre-meeting credibility.
DATA SOURCE
Marketing, Commercial team
Finding / Answer
SCORE
7
Is the proposition reviewed and updated when competitive conditions or customer needs change?
Medium
A proposition written 3 years ago for a different competitive environment may now be irrelevant or actively misleading.
DATA SOURCE
Commercial review, Marketing
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Relationship Capital & Network
SCOPE
Quality and commercial value of existing business relationships
TARGET
CEO, Commercial Director
SELECT PHASE
AUDIT QUESTIONS
1
Is the company's relationship capital — senior contacts at target accounts — documented and owned, not held only in individual BD team members' heads?
High
Relationship capital that exists only in an individual's network is lost when that person leaves. CRM must capture contact relationships, not just account data.
DATA SOURCE
CRM, BD team
Finding / Answer
SCORE
2
What percentage of new business came from referrals in the last 12 months, and is there a formal referral activation process?
High
Referral conversion rates are typically 3–5× higher than cold outreach. Most companies have more referral potential than they activate.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
3
Are existing customers actively asked for referrals and introductions at defined points in the relationship?
Medium
Most referrals happen by accident. A defined trigger point — after a successful project, at contract renewal — produces referrals systematically.
DATA SOURCE
CRM, Account management process
Finding / Answer
SCORE
4
Are strategic relationships — with partners, advisors, or complementary suppliers — leveraged for BD introductions?
Medium
Strategic partner networks can provide qualified introductions that would take months of cold outreach to reach independently.
DATA SOURCE
Commercial partnerships, CRM
Finding / Answer
SCORE
5
Is there a defined programme for maintaining senior relationships with strategic target accounts before they have a procurement need?
High
Relationship-first markets require presence before need. Companies that appear only when the tender is live lose to those who were already in the room.
DATA SOURCE
CRM, Commercial strategy
Finding / Answer
SCORE
6
Are industry events, trade associations, and speaking opportunities used as BD channels, and is their ROI tracked?
Medium
Events are expensive and time-consuming. Track leads generated, meetings booked, and revenue attributed per event to confirm ROI.
DATA SOURCE
Marketing, CRM
Finding / Answer
SCORE
7
Is the personal network of the CEO and senior leadership team actively leveraged for BD, with a defined process?
High
Senior leader networks are frequently the highest-value BD asset in the company. Leaving them unleveraged is a direct opportunity cost.
DATA SOURCE
CEO, Commercial team
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Revenue Growth Actions & Accountability
SCOPE
Execution discipline and accountability in business development
TARGET
CEO, Commercial Director
SELECT PHASE
AUDIT QUESTIONS
1
Is there a weekly BD review that covers pipeline movement, new activity, and blockers — not just revenue actuals?
High
Revenue-only reviews are retrospective. A weekly pipeline and activity review is the only mechanism for forward-looking BD management.
DATA SOURCE
CRM, Management process
Finding / Answer
SCORE
2
What is the average number of follow-up contacts made per prospect before a decision is reached, and is it sufficient?
High
Most BD teams give up after 2–3 contacts. Research consistently shows 7–12 contacts are required in B2B before a decision. Track and benchmark.
DATA SOURCE
CRM, BD team
Finding / Answer
SCORE
3
Are lost deals formally reviewed for cause, and do patterns drive changes in proposition, targeting, or process?
High
Lost deal analysis is the highest-quality feedback available to a BD function. Teams that don't analyse losses repeat the same mistakes.
DATA SOURCE
CRM, BD team
Finding / Answer
SCORE
4
Is there a defined accountability mechanism — individual BD targets, weekly reporting, and consequence for underperformance?
High
BD functions without individual accountability produce collectively average results. Individual targets with visible tracking drive individual performance.
DATA SOURCE
HR, CRM, Management
Finding / Answer
SCORE
5
Are BD investments — time, events, content, tools — evaluated annually for commercial return?
Medium
BD spend that is not evaluated tends to accumulate and persist regardless of effectiveness. Annual ROI review is minimum discipline.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
6
Is there a defined new market or new segment development plan beyond the current core business?
Medium
BD limited to existing segments is market maintenance, not development. Structured new segment entry is required for sustainable growth.
DATA SOURCE
Commercial strategy, CEO
Finding / Answer
SCORE
7
What is the 12-month new business revenue target, and what specific actions — not aspirations — are planned to achieve it?
High
Targets without specific action plans are wishes. Each target must be backed by a specific set of activities with named owners and timelines.
DATA SOURCE
Commercial plan, CRM
Finding / Answer
SCORE
CUSTOMER RETENTION AUDIT
Sales&commercial | Customer service
Assess the effectiveness of customer retention strategy, account management, and early churn detection. Retaining existing customers is typically 5–7× cheaper than acquiring new ones. Most companies invest the inverse ratio.
AUDIT PHASE 1 OF 4
Retention Metrics & Churn Tracking
SCOPE
How customer retention is measured, tracked, and reported
TARGET
Commercial Director, Finance
SELECT PHASE
AUDIT QUESTIONS
1
What is the customer retention rate by segment, product, and channel — not just the blended company average?
High
Blended retention rates hide segment-specific churn that requires different interventions. Require segment-level breakdown before drawing conclusions.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
2
What is the revenue retention rate vs. the customer count retention rate, and which is more critical for the business?
High
A company can retain 90% of customers while losing 30% of revenue if the lost customers are larger. Revenue retention is the financially material metric.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
3
Is churn tracked at the point of contract expiry, or earlier — at the point of decline in usage, engagement, or purchase frequency?
High
Churn at expiry is managed too late. Early signals — reduced usage, slower payment, lower order frequency — precede formal churn by 3–6 months.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
4
Are customers who have reduced spend by more than 20% identified and managed as at-risk accounts?
High
Revenue decline within a retained account is partial churn. Managing only full churners misses the more common pattern of gradual revenue erosion.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
5
Is Net Revenue Retention (NRR) — which includes expansion and contraction within existing accounts — tracked monthly?
High
NRR above 100% means existing customers are growing faster than churn. NRR below 90% means the base is eroding even with new customer acquisition.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
6
What is the average customer lifetime value (CLV) by segment, and is it trending up or down?
Medium
Declining CLV signals that either customers are churning earlier, spending less over time, or both. It must be tracked and managed.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
7
Is churn data fed back into the new customer acquisition process to avoid acquiring customers with high churn profiles?
Medium
Acquiring the wrong type of customer creates predictable churn. Churn analysis must inform the ideal customer profile used in acquisition.
DATA SOURCE
CRM, Commercial team
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Customer Experience & Satisfaction
SCOPE
The quality of the customer experience as a driver of retention
TARGET
Commercial Director, COO
SELECT PHASE
AUDIT QUESTIONS
1
Is customer satisfaction formally measured at defined points in the customer journey, not only annually?
High
Annual satisfaction surveys miss the specific interaction moments that trigger churn decisions. Measure at onboarding, at key delivery points, and at renewal.
DATA SOURCE
CRM, Customer survey
Finding / Answer
SCORE
2
What are the top 3 reasons customers cite for dissatisfaction, and is there a structured action plan for each?
High
Knowing dissatisfaction drivers without acting on them is a governance failure. Each identified driver requires a named owner and a specific improvement plan.
DATA SOURCE
CRM, Customer survey
Finding / Answer
SCORE
3
Is customer onboarding managed as a retention-critical process, with defined milestones and success metrics?
High
Churn rates in the first 90 days are disproportionately high in most B2B services. Onboarding quality is the primary driver of early churn.
DATA SOURCE
CRM, Operations
Finding / Answer
SCORE
4
Are customer-facing staff trained to identify and escalate early dissatisfaction signals — not just to manage complaints?
High
Complaints are late-stage dissatisfaction. Early signals — unanswered emails, skipped meetings, reduced usage — require recognition and escalation skills.
DATA SOURCE
HR, Training records
Finding / Answer
SCORE
5
What is the average response time for customer issues, and is it within the SLA commitment for each issue severity level?
High
Slow response to issues is the most commonly cited reason for B2B churn. SLA compliance by severity level must be tracked and managed.
DATA SOURCE
CRM, Customer service data
Finding / Answer
SCORE
6
Is there a formal Voice of Customer (VoC) programme that feeds customer insight into product and service development?
Medium
Customer feedback that does not feed back into what you offer creates a loop where satisfaction problems persist indefinitely.
DATA SOURCE
CRM, Product management
Finding / Answer
SCORE
7
Are customer satisfaction scores tracked at the account level and used in account prioritisation decisions?
Medium
Accounts with declining satisfaction scores should receive proactive management before they become churn statistics.
DATA SOURCE
CRM, Account management
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Proactive Account Management
SCOPE
How existing customer relationships are actively managed to retain and grow revenue
TARGET
Account Management Team, Commercial Director
SELECT PHASE
AUDIT QUESTIONS
1
Is there a defined account management programme with a contact cadence, review schedule, and development plan for each customer tier?
High
Reactive account management — responding only when customers contact you — is the primary cause of preventable churn in B2B.
DATA SOURCE
CRM, Account management process
Finding / Answer
SCORE
2
Are account managers' KPIs balanced between retention metrics and revenue growth within existing accounts?
High
Account managers measured only on satisfaction scores do not grow accounts. Those measured only on upsell revenue neglect at-risk signals.
DATA SOURCE
HR, CRM
Finding / Answer
SCORE
3
What is the ratio of account manager time spent on proactive customer development vs. reactive problem resolution?
Medium
Account managers spending more than 40% of time on reactive issues cannot proactively manage relationships. It indicates either understaffing or unresolved service quality problems.
DATA SOURCE
CRM, HR
Finding / Answer
SCORE
4
Is the renewal process initiated at least 90 days before contract expiry, with a defined engagement plan?
High
Renewals initiated within 30 days of expiry are managed under time pressure, which reduces negotiating leverage and increases churn risk.
DATA SOURCE
CRM, Account management process
Finding / Answer
SCORE
5
Are customers formally introduced to multiple contacts in your organisation, reducing single-point-of-contact dependency?
Medium
Accounts that know only one person in your company are at high churn risk when that person leaves or is unavailable.
DATA SOURCE
CRM, Account management
Finding / Answer
SCORE
6
Is there a defined escalation process for at-risk accounts, with senior leadership involvement when account value warrants it?
High
At-risk accounts handled only at account manager level often churn when a more senior conversation could have saved them.
DATA SOURCE
CRM, Commercial process
Finding / Answer
SCORE
7
Are post-project or post-delivery reviews conducted with customers, and do findings feed back into service improvement?
Medium
Companies that conduct structured post-delivery reviews demonstrate commitment to improvement and identify retention risks before the next renewal.
DATA SOURCE
CRM, Operations
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Win-Back & Re-engagement
SCOPE
How churned and dormant customers are identified and re-engaged
TARGET
Commercial Director, Marketing
SELECT PHASE
AUDIT QUESTIONS
1
Is there a formal process for conducting exit interviews with churned customers, and is the data analysed for patterns?
High
Exit interviews are the highest-quality source of churn intelligence. Companies that skip them lose the ability to fix structural retention problems.
DATA SOURCE
CRM, Commercial team
Finding / Answer
SCORE
2
What percentage of churned customers are re-engaged within 12 months, and is there a defined win-back programme?
Medium
Churned customers who had a positive history are often more convertible than new prospects. Win-back programmes are underinvested in most businesses.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
3
Is there a defined category of 'dormant' customers — those who have not purchased in a defined period — and are they actively managed?
High
Dormant customers are often counted as retained until a formal churn event. Define dormancy thresholds and manage them before formal exit.
DATA SOURCE
CRM, Finance
Finding / Answer
SCORE
4
What is the conversion rate of win-back attempts, and which approach — offer, personal outreach, or new proposition — performs best?
Medium
Win-back without a structured approach is random. Test and track which re-engagement method produces the highest conversion and replicate it.
DATA SOURCE
CRM, Marketing
Finding / Answer
SCORE
5
Are churned customers re-entered into the BD pipeline as standard practice, or does churn create permanent exclusion?
Medium
Churned customers are not lost customers forever. Market circumstances change. Define re-entry criteria and timeline.
DATA SOURCE
CRM, BD process
Finding / Answer
SCORE
6
Is the reason for churn documented at the customer level in the CRM, and is it used to personalise re-engagement messaging?
Medium
Generic win-back messaging sent to all churned customers regardless of exit reason has low conversion. Personalise based on the documented exit reason.
DATA SOURCE
CRM
Finding / Answer
SCORE
7
What is the 3-year revenue value of customers lost in the last 12 months, and is this calculated and presented to management?
High
Churn presented only as a percentage is abstract. Presenting churn as an annualised revenue loss in euros creates the urgency to act.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
DISTRIBUTOR SALES AUDIT
Sales&commercial | Operational
Assess the commercial performance, activity level, and sales effectiveness of the distributor network. Identifies which distributors are genuinely developing the market and which are order-taking or stagnating.
AUDIT PHASE 1 OF 4
Distributor Sales Performance
SCOPE
Revenue, growth, and market development results per distributor
TARGET
Channel Director, Sales Director
SELECT PHASE
AUDIT QUESTIONS
1
What is the revenue performance of each distributor vs. target, and which distributors account for 80% of total channel revenue?
High
The 80/20 rule almost always applies to distributor networks. Identify the critical few and assess whether they are growing or declining.
DATA SOURCE
Sales data, CRM
Finding / Answer
SCORE
2
What is the sell-through rate for each distributor — actual end-customer sales vs. purchase-in — and is it tracked monthly?
High
Sell-in growth without sell-through growth is stock accumulation, not market development. Sell-through is the only valid measure of market penetration.
DATA SOURCE
Distributor sales reports, CRM
Finding / Answer
SCORE
3
What is the year-on-year revenue growth rate per distributor, and how does it compare to market growth in their territory?
High
A distributor growing at 3% in a market growing at 8% is losing market share. Growth must be assessed relative to market context.
DATA SOURCE
Sales data, Market data
Finding / Answer
SCORE
4
Which product categories or SKUs are underrepresented in distributor sales relative to their market potential?
Medium
Product gaps in distributor sales often indicate either a training deficit or a positioning problem in the local market.
DATA SOURCE
Sales data, Product mix analysis
Finding / Answer
SCORE
5
What is the average order frequency and order value per distributor, and are they trending up or down?
High
Declining order frequency is an early signal of reducing market engagement, even when total revenue is stable through occasional large orders.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
6
Are there distributors growing revenue only through price increases rather than volume growth?
Medium
Revenue growth through price without volume growth signals market share loss. Separate price and volume effects in revenue analysis.
DATA SOURCE
Sales data, Finance
Finding / Answer
SCORE
7
What is the revenue contribution of the top 3 new customers acquired by each distributor in the last 12 months?
High
New customer acquisition by distributors is the primary indicator of active market development vs. harvesting existing relationships.
DATA SOURCE
Distributor reports, CRM
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Sales Support & Enablement
SCOPE
What the manufacturer provides to enable distributor sales success
TARGET
Sales Director, Marketing
SELECT PHASE
AUDIT QUESTIONS
1
Do distributors have access to current, localised sales materials — in their language, with relevant local references?
High
Sales materials that are not in the local language or do not feature relevant local cases are not used. Confirm what materials distributors actually use in sales meetings.
DATA SOURCE
Marketing, Distributor feedback
Finding / Answer
SCORE
2
Are product demonstrations, samples, and display materials available to all distributors who need them?
High
Distributors selling without demonstration capability are at a structural disadvantage against competitors who can show the product in context.
DATA SOURCE
Marketing, Commercial team
Finding / Answer
SCORE
3
Is there a dedicated sales support contact for each distributor — not a generic helpdesk — who knows the local market?
Medium
Generic support for distributors who need market-specific guidance creates friction and reduces the support team's commercial value.
DATA SOURCE
Commercial structure, CRM
Finding / Answer
SCORE
4
Are digital sales tools — configurators, pricing calculators, product selectors — available to distributor sales teams?
Medium
Digital tools that reduce the complexity of the sales process directly increase distributor sales efficiency and conversion rates.
DATA SOURCE
IT, Marketing
Finding / Answer
SCORE
5
What co-marketing support is available to distributors for local market development, and is it tied to activity plans?
Medium
Co-marketing funds without activity plans are subsidies. Each fund deployment should require a specific plan with measurable commercial targets.
DATA SOURCE
Marketing, Finance
Finding / Answer
SCORE
6
Is there a formal process for distributors to request custom pricing for specific competitive situations, and is it managed within a defined response time?
High
Pricing decisions that take more than 48 hours in competitive situations lose the deal. Define the process and enforce the response time.
DATA SOURCE
Commercial process, Finance
Finding / Answer
SCORE
7
Are competitive intelligence — market conditions, competitor moves, pricing — shared with distributors in a structured format?
Medium
Distributors who receive regular market intelligence make better commercial decisions and feel more valued as partners.
DATA SOURCE
Commercial team, Marketing
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Joint Business Planning
SCOPE
Collaborative planning and mutual commitment to growth
TARGET
Channel Manager, Commercial Director
SELECT PHASE
AUDIT QUESTIONS
1
Is there a written joint business plan agreed with each distributor annually, covering targets, activities, and mutual investment?
High
A joint business plan creates shared ownership. One-sided plans where only the distributor commits to revenue targets are not partnerships.
DATA SOURCE
CRM, Commercial process
Finding / Answer
SCORE
2
Does the joint business plan include a new customer acquisition target with a defined approach per territory?
High
Revenue targets without new customer targets allow distributors to deliver revenue through price increases or existing customer growth while losing market position.
DATA SOURCE
JBP documents, CRM
Finding / Answer
SCORE
3
Are joint business plan reviews conducted quarterly, with formal assessment of progress and updated actions?
High
Annual plans without quarterly reviews become irrelevant by month four. Quarterly cadence enables course correction while there is time to act.
DATA SOURCE
CRM, Meeting records
Finding / Answer
SCORE
4
Do distributors contribute market intelligence — customer needs, competitor activity, pricing pressure — as part of the planning process?
Medium
Joint business planning that flows only from manufacturer to distributor misses the market intelligence the distributor generates daily.
DATA SOURCE
JBP process, Commercial team
Finding / Answer
SCORE
5
Is there a product assortment recommendation per territory in the joint plan, based on market analysis not just manufacturer preference?
Medium
Manufacturers who push the same product assortment to all distributors regardless of local market mix create inventory risk and sales inefficiency.
DATA SOURCE
JBP documents, Sales data
Finding / Answer
SCORE
6
Are distributor investment commitments — in stock, training, and marketing — specified and tracked in the joint plan?
High
Distributor investment commitments without tracking create no accountability. Define the commitment in writing and review it quarterly.
DATA SOURCE
JBP documents, CRM
Finding / Answer
SCORE
7
Is there a named account list in each joint plan — specific target customers — rather than only a revenue target?
Medium
Named account targets create focus and accountability. Revenue targets without named accounts allow distributors to count any revenue regardless of strategic fit.
DATA SOURCE
JBP documents, CRM
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Field Activity & Market Coverage
SCOPE
Sales activity in the field and geographic market coverage quality
TARGET
Channel Manager, Sales Director
SELECT PHASE
AUDIT QUESTIONS
1
What is the number of end-customer sales calls made per distributor sales representative per week, and is it within the target range?
High
Field activity is the primary driver of distributor sales performance. Track calls per rep per week as a leading indicator.
DATA SOURCE
Distributor CRM, Field reports
Finding / Answer
SCORE
2
What is the conversion rate from distributor sales calls to proposals, and from proposals to orders?
High
Conversion rate analysis identifies whether the pipeline problem is activity volume (too few calls) or quality (poor conversion at specific stages).
DATA SOURCE
Distributor CRM, Sales reports
Finding / Answer
SCORE
3
Are there territories or segments within each distributor's area that are systematically undercovered?
Medium
Geographic or segment white spaces within a distributor's territory represent unaddressed market opportunity. Identify and address them in the joint plan.
DATA SOURCE
Sales data, Territory maps
Finding / Answer
SCORE
4
Does the manufacturer conduct regular joint customer visits with distributor sales teams?
High
Joint customer visits demonstrate commitment, improve relationship quality, and allow the manufacturer to hear the market directly.
DATA SOURCE
Field visit records, CRM
Finding / Answer
SCORE
5
What is the ratio of time distributor sales reps spend with existing customers vs. prospecting for new customers?
Medium
Distributors who spend more than 70% of their time with existing customers are harvesting, not developing. The ratio should be managed explicitly.
DATA SOURCE
Distributor activity reports
Finding / Answer
SCORE
6
Are demonstration events, product launches, and training days for end-customers executed in each territory, and are results tracked?
Medium
Events that are not tracked for lead generation and conversion are brand spend without commercial accountability.
DATA SOURCE
Marketing, CRM, Distributor reports
Finding / Answer
SCORE
7
What is the end-customer complaint rate attributable to distributor sales or service, and is it tracked per distributor?
High
End-customer complaints traced to distributor behaviour must be addressed at the distributor management level, not only at the customer service level.
DATA SOURCE
CRM, Customer complaints data
Finding / Answer
SCORE
NEGOTIATION AUDIT
Sales&commercial | HR/People
Assess negotiation preparation, strategy, and execution capability across commercial and leadership contexts. Poor negotiation consistently leaves value on the table and signals weakness to counterparts.
AUDIT PHASE 1 OF 4
Preparation & Strategy
SCOPE
The quality of preparation before entering a negotiation
TARGET
Commercial Team, Management
SELECT PHASE
AUDIT QUESTIONS
1
Is there a written negotiation brief for every significant negotiation — covering objectives, BATNA, walk-away point, and concession strategy?
High
Entering a negotiation without a written brief means improvising under pressure. The brief forces structured thinking before emotion enters the room.
DATA SOURCE
Commercial process, CRM
Finding / Answer
SCORE
2
Is the counterpart's BATNA (Best Alternative to a Negotiated Agreement) researched and assessed before the negotiation begins?
High
Not knowing what the counterpart will do if the negotiation fails means you cannot calibrate pressure or credibly test limits.
DATA SOURCE
Commercial preparation, Market intelligence
Finding / Answer
SCORE
3
Is a walk-away point defined in advance and held regardless of in-negotiation pressure?
High
Walk-away points decided during a negotiation are subject to loss aversion and relationship pressure. Decide before you sit down.
DATA SOURCE
Commercial process, Finance
Finding / Answer
SCORE
4
Is the full value of the deal — not just price — mapped before negotiation, including payment terms, volume, service level, and duration?
High
Multi-variable deals have more negotiating room than single-variable (price-only) negotiations. Identify all tradeable variables before the negotiation starts.
DATA SOURCE
Commercial preparation
Finding / Answer
SCORE
5
Are negotiating team roles defined in advance — lead, observer, technical expert — and is there a pre-agreed signal for requesting a break?
Medium
Uncoordinated negotiating teams send mixed signals and can be played against each other. Pre-agreed roles and signals prevent in-room errors.
DATA SOURCE
Commercial process, Training
Finding / Answer
SCORE
6
Is competitive intelligence on the counterpart's alternatives gathered before price-sensitive negotiations?
Medium
Knowing that the counterpart has no credible alternative removes their negotiating leverage. Confirming this requires market research, not assumption.
DATA SOURCE
Market intelligence, Commercial team
Finding / Answer
SCORE
7
Are minimum acceptable outcomes — the floor on each variable — defined and documented before the negotiation?
High
Negotiators who have not defined their floor will discover it under pressure, usually at a lower level than they would have chosen in advance.
DATA SOURCE
Commercial process, Finance
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Opening & Anchoring
SCOPE
How negotiations are opened and initial positions established
TARGET
Commercial Team
SELECT PHASE
AUDIT QUESTIONS
1
Does the team open negotiations with a well-reasoned first offer, or does it wait for the counterpart to anchor first?
High
Anchoring first — when you have sufficient information — produces systematically better outcomes than responding to the counterpart's anchor.
DATA SOURCE
Training records, Commercial interviews
Finding / Answer
SCORE
2
Is the first offer ambitious but defensible — supported by a specific rationale — rather than a round number guess?
High
First offers with specific rationales are challenged less than round numbers without justification. 'Based on the volume commitment and delivery timeline, our price is...' is stronger than '€100k'.
DATA SOURCE
Commercial training, Manager interviews
Finding / Answer
SCORE
3
Is the team trained to label the counterpart's anchor as unexpected rather than accepting it as a reference point?
Medium
The moment a counterpart's anchor is accepted as the reference, concessions are made from that anchor. 'That's not a number we recognise' resets the reference.
DATA SOURCE
Commercial training
Finding / Answer
SCORE
4
Are opening positions documented before each negotiation round so that concession size can be tracked vs. plan?
Medium
Without documented starting positions, concession creep goes unnoticed. Document the opening and track every movement.
DATA SOURCE
Commercial process, CRM
Finding / Answer
SCORE
5
Is silence used as a negotiating tool — after making an offer or receiving a counterproposal?
Medium
Most negotiators fill silence with concessions. Trained negotiators hold silence until the counterpart speaks. It is one of the highest-leverage negotiation tools.
DATA SOURCE
Commercial training, Observation
Finding / Answer
SCORE
6
Is the team trained to avoid making the first concession, and to give the counterpart the opportunity to move first?
High
The party that makes the first concession sets the pattern. Training on holding initial positions prevents unnecessary early value loss.
DATA SOURCE
Commercial training
Finding / Answer
SCORE
7
Are aggressive or extreme counterpart positions responded to calmly and factually, without emotional reaction?
Medium
Emotional reactions to aggressive positions are a signal of discomfort that experienced negotiators exploit. Calm factual responses protect your position.
DATA SOURCE
Commercial training, Observation
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Value Exchange & Concession Management
SCOPE
How concessions are made and value is exchanged during negotiation
TARGET
Commercial Team, Management
SELECT PHASE
AUDIT QUESTIONS
1
Is every concession made conditional on a reciprocal concession from the counterpart?
High
Unconditional concessions train the counterpart to ask for more. 'If you can do X, we can consider Y' is the correct concession frame.
DATA SOURCE
Commercial training, Observation
Finding / Answer
SCORE
2
Are concessions planned in advance — with a defined number of moves and decreasing size — rather than improvised?
High
Improvised concessions are reactive and disproportionate. Planned concessions decrease in size, signalling that you are approaching your limit.
DATA SOURCE
Commercial preparation, Training
Finding / Answer
SCORE
3
Is the team trained to concede slowly and reluctantly, regardless of how much room remains in the negotiation?
Medium
Fast, easy concessions signal that there is more room to give. Reluctance — even when conceding something easy — signals that you are near your limit.
DATA SOURCE
Commercial training
Finding / Answer
SCORE
4
Are non-monetary variables — payment terms, volume commitment, exclusivity period, service level — used as concession currency rather than only price?
High
Price concessions reduce margin permanently. Non-monetary concessions can be structured to create value for the counterpart at lower cost to you.
DATA SOURCE
Commercial training, Commercial process
Finding / Answer
SCORE
5
Is there a documented concession log for each negotiation round, tracking what was given, what was received, and the net value?
High
Concession tracking in complex multi-round negotiations prevents losing track of cumulative value surrendered.
DATA SOURCE
Commercial process, CRM
Finding / Answer
SCORE
6
Is the team trained to reframe value — moving from cost to investment, from price to ROI — rather than defending price under pressure?
Medium
Price defence is a weaker position than value reframe. Train the team to shift the conversation from cost to return before reducing price.
DATA SOURCE
Commercial training
Finding / Answer
SCORE
7
Is there a defined sign-off level for concessions above a defined financial threshold, and is it enforced in real time?
High
Concessions above the authority level of the negotiator require pre-negotiation clearance, not in-room improvisation.
DATA SOURCE
Commercial policy, Finance
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Closing, Documentation & Review
SCOPE
How negotiations are closed and learnings captured
TARGET
Commercial Team, Legal
SELECT PHASE
AUDIT QUESTIONS
1
Is there a defined closing technique used to move negotiations to conclusion rather than allowing them to drift?
High
Negotiations that drift beyond their natural closing point lose momentum and create re-opening risk. Define the close and execute it.
DATA SOURCE
Commercial training, CRM
Finding / Answer
SCORE
2
Are verbal agreements confirmed in writing within 24 hours of a negotiation session?
High
Verbal agreements are subject to selective memory. Written confirmation within 24 hours locks the agreed position before re-interpretation occurs.
DATA SOURCE
Commercial process, Legal
Finding / Answer
SCORE
3
Is there a post-negotiation review that assesses the outcome vs. the pre-negotiation brief and identifies learnings?
High
Negotiations reviewed against the pre-negotiation brief produce calibrated learning. Negotiations reviewed only against the final outcome miss whether a better outcome was possible.
DATA SOURCE
Commercial process, Training
Finding / Answer
SCORE
4
Are negotiation outcomes tracked in CRM with the pre-negotiation target, the final outcome, and the concession log?
Medium
Tracking outcomes enables pattern analysis — where is value consistently lost, which counterpart types are most challenging, which variables are most frequently traded.
DATA SOURCE
CRM, Commercial team
Finding / Answer
SCORE
5
Is the full cost of the agreed commercial terms — including payment terms, warranty, service level — calculated before sign-off?
High
Sales teams that do not calculate total deal cost including non-price terms may close deals that are margin-negative when total obligations are included.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
6
Are negotiation skills formally assessed in commercial role performance reviews, and is training provided based on gaps?
Medium
Negotiation is a learnable, assessable skill. Including it in performance assessment creates accountability for development.
DATA SOURCE
HR, Commercial training
Finding / Answer
SCORE
7
Is the counterpart's negotiation style and patterns documented for future reference in the CRM account record?
Medium
Counterpart style notes — what they anchor on, what they concede first, what they value most — are valuable intelligence for repeat negotiations.
DATA SOURCE
CRM
Finding / Answer
SCORE
PRICING AUDIT
Financial | Sales&commercial
Assess the pricing strategy, execution discipline, and margin management across the product and customer portfolio. Pricing is the highest-leverage commercial variable — a 1% price improvement typically delivers 8–10% operating profit uplift.
AUDIT PHASE 1 OF 4
Pricing Strategy & Positioning
SCOPE
The logic and structure of pricing relative to value and competition
TARGET
CFO, Commercial Director
SELECT PHASE
AUDIT QUESTIONS
1
Is there a documented pricing strategy that defines the basis for pricing — value-based, cost-plus, competitive, or market-rate — and is it applied consistently?
High
Companies without a documented pricing strategy make pricing decisions by instinct, precedent, or sales pressure. Each produces different and conflicting outcomes.
DATA SOURCE
Commercial policy, Finance
Finding / Answer
SCORE
2
Is pricing set relative to the value delivered to the customer, or only relative to internal cost?
High
Cost-plus pricing systematically underprices differentiated offerings and overprices commodity ones. Value-based pricing starts from the customer's willingness to pay.
DATA SOURCE
Commercial strategy, Customer research
Finding / Answer
SCORE
3
Is the price positioning — premium, at-market, or below-market — for each product or service intentional and documented?
High
Accidental price positioning is common. Companies that believe they are premium but price at market, or vice versa, cannot manage the gap between perception and reality.
DATA SOURCE
Commercial policy, Market research
Finding / Answer
SCORE
4
Are price differences between customer segments, geographies, and channels defined and managed?
High
Unmanaged price differences across segments and channels create grey market risk, customer fairness concerns, and margin erosion.
DATA SOURCE
Finance, Commercial policy
Finding / Answer
SCORE
5
Is the pricing architecture — list price, standard discount, volume band, and floor — documented and controlled?
High
Pricing architectures that are undocumented are inconsistently applied and gradually eroded by informal agreements.
DATA SOURCE
Commercial policy, Finance
Finding / Answer
SCORE
6
When did the company last conduct a formal price sensitivity analysis or willingness-to-pay study for key products?
Medium
Price sensitivity can be tested through structured customer research. Companies that have never done this are setting prices on assumption.
DATA SOURCE
Market research, Commercial team
Finding / Answer
SCORE
7
Is there a defined price review cycle — typically annual — aligned with cost changes and market conditions?
High
Prices that are not formally reviewed annually drift below market levels as costs rise and competitor prices change.
DATA SOURCE
Finance, Commercial process
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Cost-to-Serve & Margin Analysis
SCOPE
The true margin delivered by each customer, product, and channel
TARGET
CFO, Finance Manager
SELECT PHASE
AUDIT QUESTIONS
1
Is margin calculated at the customer level — not just the product level — including cost-to-serve, credit, and logistics?
High
Product margin without customer-level cost-to-serve misrepresents profitability. A high-volume customer with high service cost may be less profitable than a smaller, low-maintenance customer.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
2
Which customers or segments are below the minimum acceptable margin threshold, and what is the plan to address them?
High
Below-threshold customers should either be repriced, renegotiated, or exited. Retaining them at current terms is a choice to subsidise unprofitable relationships.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
3
Are the true costs of special pricing arrangements — custom products, extended payment terms, dedicated service — included in margin calculations?
High
Special arrangements with financial implications that are not included in margin calculations overstate profitability and enable value-destroying commercial decisions.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
4
Is there a minimum margin floor below which no deal can be approved, regardless of relationship or volume?
High
Without a floor, sales teams will close margin-negative deals to hit revenue targets. The floor must be enforced through the approval process.
DATA SOURCE
Finance, Commercial policy
Finding / Answer
SCORE
5
Are product line margins reviewed quarterly to identify lines that are structurally unviable at current pricing?
High
Products that lose money should either be repriced or discontinued. Structural margin losses on specific products are rarely visible without deliberate quarterly analysis.
DATA SOURCE
Finance, Product management
Finding / Answer
SCORE
6
What is the true net margin after all trade spend — rebates, co-marketing funds, samples, and returns — for each major customer?
High
Gross margin before trade spend is a management fiction. Net margin after all commercial commitments is the financially accurate measure.
DATA SOURCE
Finance, Commercial team
Finding / Answer
SCORE
7
Is there a product complexity cost — for custom variants, low-volume SKUs, or short runs — included in pricing for non-standard orders?
Medium
Standard pricing applied to non-standard orders subsidises complexity. A complexity premium that reflects the true cost is standard in mature pricing systems.
DATA SOURCE
Finance, Operations
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Price Execution & Discipline
SCOPE
Whether agreed pricing is executed consistently in practice
TARGET
CFO, Commercial Director
SELECT PHASE
AUDIT QUESTIONS
1
What is the actual average selling price vs. list price across the portfolio, and how has the gap trended over 3 years?
High
A widening gap between list and actual price is evidence of structural discounting. Track and present the 'price waterfall' from list to net.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
2
Are discounting decisions made against defined criteria, or are they made individually by sales managers without reference to a policy?
High
Individualised discounting decisions without policy reference produce inconsistent outcomes and systematic margin erosion.
DATA SOURCE
Commercial policy, CRM
Finding / Answer
SCORE
3
What is the discount approval matrix — who can approve what level of discount — and is it enforced in the CRM and order system?
High
Discount authority matrices that are not enforced in systems are not enforced in practice. System controls are the only reliable enforcement mechanism.
DATA SOURCE
Commercial policy, IT, Finance
Finding / Answer
SCORE
4
Are post-deal margin reports provided to the sales team, showing actual vs. target margin per deal?
High
Sales teams that do not see their own margin outcomes cannot manage them. Post-deal margin reporting creates commercial accountability.
DATA SOURCE
Finance, CRM
Finding / Answer
SCORE
5
Is there a price increase process with a defined implementation cadence and customer communication plan?
High
Price increases executed without a defined process generate customer complaints and inconsistent outcomes. A defined process reduces friction and improves success rate.
DATA SOURCE
Commercial process, Finance
Finding / Answer
SCORE
6
Are one-off pricing exceptions tracked and reviewed annually to identify patterns that should be formalised or closed?
Medium
One-off exceptions that recur without review become de facto policy. Annual exception audits prevent policy erosion through informal precedent.
DATA SOURCE
Finance, Commercial review
Finding / Answer
SCORE
7
Is there a win/loss analysis that distinguishes deals lost on price from deals lost on value proposition or fit?
High
Attributing all lost deals to price is the most common sales team rationalisation. Win/loss analysis by cause identifies whether price or proposition is the actual issue.
DATA SOURCE
CRM, Sales team
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Competitive Monitoring & Price Intelligence
SCOPE
How competitive pricing is tracked and used in commercial decisions
TARGET
Commercial Director, Marketing
SELECT PHASE
AUDIT QUESTIONS
1
Is competitor pricing actively monitored at a defined frequency, and is the intelligence shared with commercial decision-makers?
High
Competitor pricing intelligence gathered ad hoc and not distributed is not usable. Define the monitoring process, frequency, and distribution.
DATA SOURCE
Commercial team, Marketing
Finding / Answer
SCORE
2
Are win/loss interviews conducted with lost prospects to confirm the role of pricing vs. other decision factors?
High
Win/loss data from the sales team is subject to attribution bias. Direct prospect interviews produce more accurate cause analysis.
DATA SOURCE
Commercial team, CRM
Finding / Answer
SCORE
3
Is the company's price position vs. competitors tracked by segment and updated at least quarterly?
Medium
Price positioning that is assessed only annually drifts out of calibration in competitive markets. Quarterly updates are the minimum in active markets.
DATA SOURCE
Market research, Commercial team
Finding / Answer
SCORE
4
Are there markets or segments where pricing is being undercut by competitors using a structurally different cost model?
High
Cost structure differences between competitors can make price matching structurally unviable. Identify these segments and define a non-price competitive response.
DATA SOURCE
Market intelligence, Strategy
Finding / Answer
SCORE
5
Is pricing intelligence from the field — sales team, distributors, customers — collected in a structured format and reviewed monthly?
Medium
The best source of real-time competitive pricing intelligence is the sales team and distributor network. Create the collection mechanism and use the data.
DATA SOURCE
CRM, Commercial team
Finding / Answer
SCORE
6
Is there a defined response to a competitor price attack — a structured decision tree that avoids reflexive price matching?
High
Reflexive price matching in response to competitive discounting destroys margin and rarely wins back position. A structured response preserves margin while protecting key accounts.
DATA SOURCE
Commercial policy, Strategy
Finding / Answer
SCORE
7
Are price changes tested in limited geographies or segments before full portfolio implementation?
Medium
Price testing before full implementation allows the company to observe customer reaction at contained risk. Full portfolio changes without testing are higher-risk.
DATA SOURCE
Commercial process, Finance
Finding / Answer
SCORE
SALES PROCESS AUDIT
Sales&commercial | Operational
Assess the quality, consistency, and management discipline of the sales process from lead to close. A well-defined and managed sales process is the difference between a repeatable commercial system and a collection of individual behaviours.
AUDIT PHASE 1 OF 4
Lead Generation & Qualification
SCOPE
How leads are generated, qualified, and entered into the sales pipeline
TARGET
Sales Director, Marketing
SELECT PHASE
AUDIT QUESTIONS
1
Is there a documented lead qualification framework — defining what constitutes a qualified lead — and is it applied consistently by all sales team members?
High
Unqualified leads in the pipeline inflate coverage ratios, distort conversion metrics, and waste sales time. A qualification framework prevents this.
DATA SOURCE
CRM, Sales process
Finding / Answer
SCORE
2
What is the marketing-to-sales lead handover process, and is there a defined service level agreement for lead follow-up time?
High
Leads not followed up within 24–48 hours in B2B sales typically lose to a competitor or go cold. Response time must be defined and tracked.
DATA SOURCE
CRM, Marketing, Sales process
Finding / Answer
SCORE
3
What percentage of pipeline value consists of truly qualified opportunities vs. entries that have not been verified?
High
Unverified pipeline is fictional coverage. Test by asking sales managers to describe the specific opportunity for each pipeline entry above a threshold value.
DATA SOURCE
CRM, Sales management
Finding / Answer
SCORE
4
Is there a defined minimum qualification standard — budget confirmed, authority identified, need established, timeline agreed — before a lead progresses to active pipeline?
High
BANT or equivalent qualification standards prevent sales time being spent on opportunities with no credible buying signal.
DATA SOURCE
Sales process, CRM
Finding / Answer
SCORE
5
Are lead sources tracked in CRM and conversion rates reported per source at monthly review?
Medium
Lead sources with low conversion rates should be deprioritised in favour of higher-converting channels. This requires source tracking from entry to close.
DATA SOURCE
CRM, Marketing
Finding / Answer
SCORE
6
What is the average lead response time from first contact to first meaningful sales conversation, by channel?
High
Inbound leads that wait more than 24 hours for a response have a conversion rate significantly below those contacted within the hour.
DATA SOURCE
CRM, Sales process
Finding / Answer
SCORE
7
Is there a defined process for recycling leads that are not ready to buy into a nurture sequence rather than dropping them?
Medium
Leads dropped because timing is wrong represent future revenue opportunity. A nurture process maintains contact until readiness increases.
DATA SOURCE
CRM, Marketing
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Sales Methodology & Stage Management
SCOPE
How sales opportunities are developed and advanced through defined stages
TARGET
Sales Director, Sales Manager
SELECT PHASE
AUDIT QUESTIONS
1
Is there a defined sales methodology — consultative, challenger, solution selling — adopted and trained across the sales team?
High
Teams without a shared methodology produce inconsistent quality in discovery, presentation, and closing. Methodology training creates a common standard.
DATA SOURCE
Training records, Sales process
Finding / Answer
SCORE
2
Are pipeline stages defined with specific criteria for entry and exit — not just time or gut feel?
High
Stage definitions that rely on 'feels like we're at proposal stage' are not definitions. Each stage requires specific observable criteria for entry and exit.
DATA SOURCE
CRM, Sales process
Finding / Answer
SCORE
3
What is the average time an opportunity spends at each pipeline stage, and are there stages where deals routinely stall?
High
Stage-level velocity analysis identifies where the sales process loses momentum. Stall points are where coaching and intervention create the most impact.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
4
Are sales calls and customer meetings debriefed against a standard framework to capture what was learned and what the next action is?
Medium
Sales calls debriefed only informally produce inconsistent learnings. A standard debrief framework captures insight that improves the next interaction.
DATA SOURCE
Sales process, CRM
Finding / Answer
SCORE
5
What percentage of sales meetings include a defined next step agreed with the customer before the meeting ends?
High
Meetings that end without a defined and customer-confirmed next step lose momentum. Next step confirmation is the minimum close of every sales interaction.
DATA SOURCE
CRM, Sales observation
Finding / Answer
SCORE
6
Is discovery — understanding the customer's situation, problem, and buying criteria — consistently done before presentation begins?
High
Presentations made before discovery is complete propose solutions to problems that may not be the customer's actual priority.
DATA SOURCE
Sales training, Observation
Finding / Answer
SCORE
7
Are opportunity risk factors — competitor involvement, decision timeline, internal sponsor strength — formally assessed for deals above a value threshold?
Medium
High-value opportunities that are not risk-assessed are managed on optimism. Formal risk assessment triggers targeted intervention on deals at highest risk of loss.
DATA SOURCE
CRM, Sales process
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Proposal, Negotiation & Closing
SCOPE
The quality of proposal development and commercial closing
TARGET
Sales Director, Commercial Team
SELECT PHASE
AUDIT QUESTIONS
1
Is there a proposal template and quality standard, with a defined review process for high-value proposals?
High
Proposals with no quality standard are inconsistent in messaging, format, and commercial clarity. A review process improves quality and reduces errors.
DATA SOURCE
Commercial process, Sales team
Finding / Answer
SCORE
2
Are proposals tailored to the specific situation uncovered in discovery, or are they largely template-based?
High
Template proposals sent without customisation signal to the customer that the sales team was not listening in discovery. Customisation drives conversion.
DATA SOURCE
Sales process, Proposal review
Finding / Answer
SCORE
3
Is the proposal approval process — for pricing, terms, and scope — completed before the proposal is sent?
High
Proposals sent without approval authority for the terms within them create re-negotiation, delay, and customer credibility damage.
DATA SOURCE
Commercial process, Finance
Finding / Answer
SCORE
4
What is the win rate on proposals by sales representative and by customer segment, and is it reviewed monthly?
High
Win rate variation by rep identifies coaching priorities. Win rate by segment identifies where the proposition is stronger or weaker.
DATA SOURCE
CRM, Sales data
Finding / Answer
SCORE
5
Is there a defined follow-up cadence after a proposal is submitted, with escalation if the customer goes silent?
High
Proposals submitted and not followed up systematically are a common cause of lost deals that could have been won with persistence.
DATA SOURCE
CRM, Sales process
Finding / Answer
SCORE
6
Are closing techniques trained and practised, and is there evidence they are used in real sales situations?
Medium
Closing is a skill that deteriorates without practice. Managers who role-play closing scenarios with their teams produce higher conversion rates.
DATA SOURCE
Training records, Sales observation
Finding / Answer
SCORE
7
Is there a formal handover process from the sales team to the delivery team, with customer commitments documented?
High
Commitments made during the sales process that are not formally transferred to delivery create customer disappointment and churn risk.
DATA SOURCE
Sales process, Operations
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
CRM Usage & Pipeline Visibility
SCOPE
Data quality, discipline, and management use of CRM
TARGET
Sales Director, IT
SELECT PHASE
AUDIT QUESTIONS
1
What percentage of active pipeline opportunities are updated in CRM within the last 7 days?
High
CRM data that is more than a week old is unreliable for management decisions. Require weekly updates as a non-negotiable discipline.
DATA SOURCE
CRM
Finding / Answer
SCORE
2
Is CRM usage mandatory and verified, or is it optional and inconsistent across the sales team?
High
Optional CRM usage creates information asymmetry — managers cannot see what they cannot measure, and team members are accountable only for what they choose to record.
DATA SOURCE
CRM, Sales management
Finding / Answer
SCORE
3
Are management pipeline reviews conducted using live CRM data, not summary slides prepared by the sales team?
High
Summary slides are filtered and curated. Live CRM reviews surface data quality issues and prevent selective reporting.
DATA SOURCE
CRM, Sales management
Finding / Answer
SCORE
4
Is CRM integrated with finance, marketing, and customer service systems to provide a single view of the customer?
Medium
Disconnected CRM creates manual processes, data gaps, and inconsistent customer views across functions.
DATA SOURCE
IT, CRM
Finding / Answer
SCORE
5
What CRM fields are mandatory, and are they consistently completed for all opportunities above a defined value threshold?
High
Mandatory field completion is the mechanism for ensuring the minimum data quality required for pipeline management.
DATA SOURCE
CRM, Sales management
Finding / Answer
SCORE
6
Are lost deal reasons coded consistently in CRM, and is the data reviewed monthly to identify patterns?
High
Loss reason codes that are vague ('customer chose competitor', 'timing not right') do not enable improvement. Require specific, actionable reason codes.
DATA SOURCE
CRM, Sales management
Finding / Answer
SCORE
7
Is sales forecast accuracy tracked — comparing forecast at 30, 60, 90 days to actual close — and used to assess individual forecasting quality?
Medium
Forecast accuracy is a skill. Tracking it at the individual level creates accountability for realistic pipeline assessment and removes systematic over-optimism.
DATA SOURCE
CRM, Finance, Sales management
Finding / Answer
SCORE
BUSINESS RECOVERY AUDIT
Financial | Strategy | Risk management
Structured assessment of a company in financial or operational distress. Identifies the root causes of decline, evaluates the viability of recovery, and determines which actions must be taken — and in what sequence — to stabilise and rebuild the business.
AUDIT PHASE 1 OF 4
Crisis Diagnosis
SCOPE
Identify the primary causes of business decline: financial mismanagement, market loss, operational failure, or leadership breakdown. Distinguish between symptoms and root causes.
TARGET
CEO, CFO, Interim Manager, Board
SELECT PHASE
AUDIT QUESTIONS
1
When did financial performance first deteriorate, and what internal or external event triggered it?
High
Look for a clear inflection point. If management cannot identify one, the decline is likely structural and ongoing.
DATA SOURCE
P&L trend last 3 years, board minutes
Finding / Answer
SCORE
2
What is the current cash burn rate, and how many weeks of runway remain at current spend?
High
Calculate weekly cash outflow vs. available liquidity. Include committed obligations (payroll, rent, suppliers).
DATA SOURCE
Bank statements, cash flow model
Finding / Answer
SCORE
3
Which product lines, customers, or markets are generating losses, and have these been quantified?
High
Profitability by segment is often unknown. If no analysis exists, this is itself a red flag.
DATA SOURCE
Contribution margin analysis, CRM data
Finding / Answer
SCORE
4
Has the company lost key customers, contracts, or revenue streams in the past 12–18 months? What caused the losses?
High
Customer churn at this level often signals a competitiveness or relationship problem that pricing alone cannot fix.
DATA SOURCE
Customer retention data, sales reports
Finding / Answer
SCORE
5
Are current leadership and management capable of executing a recovery, or is there a competency gap?
High
Be direct. Recovery requires speed and decisiveness. A team that caused the crisis rarely fixes it without support or change.
DATA SOURCE
HR assessment, board evaluation
Finding / Answer
SCORE
6
What obligations — debt, leases, supplier contracts — are overdue or at risk of default?
High
Map all financial obligations with due dates. Prioritise by legal consequence (e.g. secured creditors vs. trade suppliers).
DATA SOURCE
Balance sheet, creditor register
Finding / Answer
SCORE
7
Is there a documented understanding of why the business is in distress, shared and accepted by leadership?
Medium
Without alignment on root cause, recovery plans will be resisted or undermined internally.
DATA SOURCE
Management interviews, board records
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Stabilisation Capacity
SCOPE
Assess whether the company has sufficient resources, relationships, and internal capability to stabilise operations within 30–60 days before a full recovery plan is executed.
TARGET
Interim Manager, CFO, Operations Director
SELECT PHASE
AUDIT QUESTIONS
1
Can payroll and critical supplier payments be met for the next 60 days without external financing?
High
Payroll default triggers immediate legal and reputational damage. This is a hard constraint, not a planning assumption.
DATA SOURCE
Cash forecast, payroll schedule
Finding / Answer
SCORE
2
Are key employees — those essential to operations and customer relationships — at risk of leaving?
High
Recovery fails if critical people exit during stabilisation. Identify retention risks now.
DATA SOURCE
HR records, management interviews
Finding / Answer
SCORE
3
What cost reductions can be implemented within 30 days without destroying customer delivery or operational capacity?
High
Quick wins: discretionary spend, contractor costs, non-critical subscriptions. Not headcount as first step.
DATA SOURCE
Cost breakdown by category
Finding / Answer
SCORE
4
Are there receivables that can be accelerated to improve immediate cash position?
Medium
Outstanding invoices, factoring opportunities, or early payment incentives can buy critical weeks.
DATA SOURCE
Aged debtors report
Finding / Answer
SCORE
5
Which operational processes are at risk of breaking down due to reduced resources or staff stress?
Medium
Under financial pressure, quality and compliance deteriorate. Identify fragile processes before they fail.
DATA SOURCE
Process map, operations manager input
Finding / Answer
SCORE
6
Does the company have assets — equipment, IP, inventory, real estate — that could be liquidated or used as collateral?
Medium
Asset-backed financing or sale-leaseback can provide liquidity without diluting ownership.
DATA SOURCE
Asset register, valuations
Finding / Answer
SCORE
7
Are key suppliers still delivering, and what is their current level of trust in the company's ability to pay?
High
Supplier confidence is fragile. Loss of a critical supplier during crisis accelerates collapse.
DATA SOURCE
Supplier interviews, payment history
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Recovery Plan Viability
SCOPE
Evaluate whether the proposed or intended recovery plan is realistic, sequenced correctly, and based on verified assumptions — not wishful thinking.
TARGET
CEO, Board, Interim Manager, Investors
SELECT PHASE
AUDIT QUESTIONS
1
Is there a written recovery plan with specific actions, owners, and 30/60/90-day milestones?
High
A plan that exists only in the CEO's head is not a plan. Specificity and ownership are non-negotiable.
DATA SOURCE
Recovery plan document
Finding / Answer
SCORE
2
Are the revenue assumptions in the recovery plan supported by confirmed orders or realistic pipeline data?
High
Recovery plans frequently overestimate revenue recovery. Challenge every assumption with evidence.
DATA SOURCE
Sales pipeline, order book
Finding / Answer
SCORE
3
Does the plan address the root cause of decline, or only the symptoms (cost cuts, refinancing)?
High
Cutting costs while the underlying business model is broken delays failure, it does not prevent it.
DATA SOURCE
Recovery plan, root cause analysis
Finding / Answer
SCORE
4
What is the break-even point under the recovery scenario, and when is it realistically reached?
High
Calculate contribution margin needed to cover fixed costs at reduced revenue. Confirm the timeline is achievable.
DATA SOURCE
Financial model, fixed cost analysis
Finding / Answer
SCORE
5
Have key stakeholders — bank, major creditors, key customers — been informed and do they support the recovery direction?
Medium
Stakeholder buy-in is a prerequisite. Surprises during execution destroy credibility.
DATA SOURCE
Stakeholder communication log
Finding / Answer
SCORE
6
Is the recovery plan stress-tested against a downside scenario (revenue 20% below plan)?
Medium
Plans built on base-case assumptions fail at the first deviation. A downside scenario reveals true resilience.
DATA SOURCE
Scenario model
Finding / Answer
SCORE
7
Who is accountable for recovery plan execution, and do they have the authority to make decisions at the required speed?
High
Recovery requires someone with real authority who moves fast. Committee-based decision-making kills turnarounds.
DATA SOURCE
Governance structure, mandate document
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Long-Term Viability Assessment
SCOPE
Determine whether the business has a viable future after stabilisation — including whether the market, product, and competitive position justify continued investment versus an orderly wind-down.
TARGET
Board, Investors, Senior Management
SELECT PHASE
AUDIT QUESTIONS
1
Does the core business model generate positive contribution margin when stripped of all non-essential costs?
High
If the business cannot generate contribution margin at any scale, it is structurally unviable regardless of intervention.
DATA SOURCE
Contribution margin analysis
Finding / Answer
SCORE
2
Is there still a relevant market for the company's core products or services, with customers willing to pay at required margins?
High
Market loss is the hardest problem to recover from. Confirm customer demand exists before investing in recovery.
DATA SOURCE
Market data, customer interviews
Finding / Answer
SCORE
3
What competitive differentiation does the business retain that can be rebuilt or leveraged in recovery?
Medium
Recovery requires something to build on. Identify remaining strengths: relationships, IP, brand, capabilities.
DATA SOURCE
Competitive analysis, customer feedback
Finding / Answer
SCORE
4
Are there structural issues — technology gap, regulatory exposure, irreversible reputation damage — that make recovery unlikely regardless of financial intervention?
High
Be honest about irreversible damage. Continuing investment in an unrecoverable business destroys value.
DATA SOURCE
Market assessment, management interviews
Finding / Answer
SCORE
5
If the business were to be sold or merged today, what would it realistically fetch, and is that better than continuation?
Medium
This is the exit-vs-continue decision. It must be modelled, not assumed.
DATA SOURCE
Valuation estimate, M&A advisor input
Finding / Answer
SCORE
6
What is the minimum viable version of the business that could be profitable — and is it achievable within 12 months?
High
Identify the smallest, most profitable core. Recovery often means shrinking to survive, then rebuilding.
DATA SOURCE
Financial model, product analysis
Finding / Answer
SCORE
7
Has the board formally evaluated all options — restructure, sale, partial wind-down, administration — and documented the rationale for the chosen path?
High
Directors have a legal duty to consider all options. Undocumented decisions create personal liability.
DATA SOURCE
Board minutes, legal advice on record
Finding / Answer
SCORE
CASH CRISIS AUDIT
Financial | Risk management
Focused assessment for companies experiencing acute cash shortfall. Identifies the immediate causes of cash depletion, evaluates short-term options to extend runway, and determines what decisions must be made within days — not weeks — to prevent insolvency.
AUDIT PHASE 1 OF 4
Cash Position & Burn Rate
SCOPE
Establish an accurate, real-time view of available cash, committed outflows, and the timeline to zero. No recovery action is meaningful without this baseline.
TARGET
CFO, Finance Director, Interim Manager
SELECT PHASE
AUDIT QUESTIONS
1
What is the exact cash balance across all bank accounts and facilities as of today?
High
Include restricted cash separately. Do not use accounting balances — use live bank balances.
DATA SOURCE
Bank statements, treasury system
Finding / Answer
SCORE
2
What are all committed cash outflows in the next 30 days, and which cannot be deferred?
High
List payroll, HMRC/tax, secured debt payments, and supplier payments with contractual obligations. Separate fixed from deferrable.
DATA SOURCE
Accounts payable, payroll schedule, loan agreements
Finding / Answer
SCORE
3
At current burn rate, how many days of liquidity does the business have?
High
Divide available cash by daily cash outflow. This number drives all decisions. If unknown, it must be calculated today.
DATA SOURCE
Cash flow model, bank statements
Finding / Answer
SCORE
4
Has burn rate increased in the past 90 days, and if so, what caused the acceleration?
High
Accelerating burn means the problem is worsening, not stable. Identify whether the driver is revenue decline, cost increase, or both.
DATA SOURCE
Monthly cash flow comparison
Finding / Answer
SCORE
5
Are there undrawn credit facilities, overdraft lines, or invoice financing arrangements available immediately?
High
Identify all sources of liquidity that do not require new negotiation or approval delays.
DATA SOURCE
Facility agreements, bank correspondence
Finding / Answer
SCORE
6
What is the current debtor book value, and what portion is collectible within 14 days?
High
Focus on invoices overdue or due within 14 days. Aggressive collection is often the fastest source of cash.
DATA SOURCE
Aged debtors report
Finding / Answer
SCORE
7
Are any tax payments — VAT, payroll tax, corporate tax — overdue or at risk of triggering enforcement?
High
Tax authority enforcement (garnishment, bank freezes) can happen rapidly and without prior warning. This is priority risk.
DATA SOURCE
Tax records, HMRC/tax authority correspondence
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Immediate Cash Generation Options
SCOPE
Identify all actions that can generate or preserve cash within 7–30 days, without requiring new financing or major structural change.
TARGET
CFO, CEO, Operations Director
SELECT PHASE
AUDIT QUESTIONS
1
Which customer invoices can be collected immediately through direct contact, early payment incentives, or escalation?
High
A 2–3% early payment discount is cheap compared to a bank overdraft. Start with the largest overdue balances.
DATA SOURCE
Aged debtors, customer contact list
Finding / Answer
SCORE
2
Which supplier payments can be deferred by 30–60 days through direct negotiation, without triggering supply disruption?
High
Most suppliers prefer a payment plan to a bad debt. Proactive communication is more effective than silence.
DATA SOURCE
Accounts payable, supplier terms
Finding / Answer
SCORE
3
Is there slow-moving or obsolete inventory that can be liquidated quickly, even at a discount?
Medium
Inventory sitting in a warehouse earns nothing. A 30% discount on dead stock recovers real cash.
DATA SOURCE
Inventory report, warehouse records
Finding / Answer
SCORE
4
Are there non-core assets — vehicles, equipment, property, IP — that can be sold or used in a sale-leaseback arrangement?
Medium
Asset monetisation can generate significant cash without affecting trading operations.
DATA SOURCE
Asset register, valuations
Finding / Answer
SCORE
5
Can any customer contracts be pre-billed, or deposits requested for upcoming work?
Medium
Advance billing or deposits shift cash timing in favour of the company. Many customers will accept if asked.
DATA SOURCE
Contract terms, sales pipeline
Finding / Answer
SCORE
6
Are there subscriptions, licences, or service contracts that can be cancelled immediately to reduce outflow?
Low
SaaS subscriptions, maintenance contracts, and professional service retainers are often overlooked cost items.
DATA SOURCE
Cost register, accounts payable
Finding / Answer
SCORE
7
Can any planned capital expenditure be delayed by 90 days without operational consequence?
Medium
Capex deferral preserves cash without affecting short-term trading. Confirm what is truly committed vs. discretionary.
DATA SOURCE
Capex plan, purchase orders
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Financing & Stakeholder Options
SCOPE
Evaluate all external financing options — bank, shareholders, alternative lenders, creditors — and assess the speed and probability of securing additional liquidity.
TARGET
CEO, CFO, Board
SELECT PHASE
AUDIT QUESTIONS
1
Have the company's existing bankers been informed of the cash position, and what is their current position on support?
High
Banks that are surprised by a crisis withdraw support faster. Early, honest communication preserves options.
DATA SOURCE
Bank relationship records, recent correspondence
Finding / Answer
SCORE
2
Are shareholders or investors willing and able to provide emergency funding, and what are their conditions?
High
Shareholder loans or equity injections are often the fastest route to liquidity. Understand their appetite and timeline.
DATA SOURCE
Shareholder agreements, board communications
Finding / Answer
SCORE
3
Is the company eligible for government-backed or alternative lender financing (revenue-based financing, asset finance)?
Medium
Alternative lenders can move faster than banks. Evaluate based on asset base and revenue visibility.
DATA SOURCE
Credit profile, asset register
Finding / Answer
SCORE
4
Can any major creditors be approached to convert outstanding debt to a payment plan or equity arrangement?
Medium
Creditor-to-equity conversion eliminates cash obligation. Requires creditor willingness and legal advice.
DATA SOURCE
Creditor register, legal advice
Finding / Answer
SCORE
5
Have any customers been approached for advance payments or contract acceleration in exchange for price concessions?
Medium
A strategic customer may provide advance payment to secure supply continuity. This requires a direct conversation.
DATA SOURCE
Key customer contracts, sales director input
Finding / Answer
SCORE
6
Is a formal insolvency or restructuring advisor already engaged, and if not, at what cash threshold should one be appointed?
High
Waiting too long removes options. Define the trigger point now, before it is reached.
DATA SOURCE
Legal counsel, board minutes
Finding / Answer
SCORE
7
What is the legal position of directors if trading continues beyond the point of inevitable insolvency?
High
Directors must understand wrongful trading risk. This question must have a legal answer, not a management answer.
DATA SOURCE
Legal advice on record
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Cash Control & Governance
SCOPE
Assess whether the company has sufficient financial controls and decision-making authority to manage a cash crisis effectively — including daily visibility, approval limits, and escalation protocols.
TARGET
CFO, CEO, Board, Interim Manager
SELECT PHASE
AUDIT QUESTIONS
1
Is there a daily cash flow report, reviewed by the CFO or equivalent, showing inflows, outflows, and closing balance?
High
In a cash crisis, cash position is monitored daily, not monthly. If this does not exist, it must be built today.
DATA SOURCE
Cash reporting system, CFO sign-off
Finding / Answer
SCORE
2
Are all non-essential purchase orders and payment authorisations frozen pending crisis review?
High
Uncontrolled spending during a liquidity crisis accelerates the timeline to zero. A payment freeze is an immediate control.
DATA SOURCE
Purchase order log, AP approvals
Finding / Answer
SCORE
3
Is there a single person with authority to approve all cash payments above a defined threshold?
High
Cash crisis governance requires centralised control. Decentralised approvals allow leakage.
DATA SOURCE
Approval authority matrix
Finding / Answer
SCORE
4
Does the board have real-time visibility of the cash position, and have they formally acknowledged the crisis?
High
Board awareness and formal acknowledgement is a governance requirement and triggers director duty obligations.
DATA SOURCE
Board minutes, cash reporting
Finding / Answer
SCORE
5
Are there any payments being made that could be classified as preferential treatment of creditors?
High
Paying some creditors over others immediately before insolvency creates legal liability. Legal advice is required.
DATA SOURCE
Payment records, legal advice
Finding / Answer
SCORE
6
Is there a crisis communication plan for customers, suppliers, and staff that controls messaging and prevents panic?
Medium
Uncontrolled information flow destroys confidence faster than the cash crisis itself.
DATA SOURCE
Communication plan document
Finding / Answer
SCORE
7
Has a 13-week cash flow model been built, updated weekly, and reviewed with the board?
High
A 13-week model is the standard tool for crisis cash management. It must be live, not a one-time exercise.
DATA SOURCE
13-week cash flow model
Finding / Answer
SCORE
TURNAROUND DECISION AUDIT
Strategy | Risk management
Structured decision framework for assessing whether a business in distress should be turned around, sold, restructured, or wound down. Forces a factual, unsentimental evaluation of viability before committing to a recovery path.
AUDIT PHASE 1 OF 4
Business Viability Assessment
SCOPE
Determine whether the core business model has the commercial foundation to support recovery — regardless of current financial condition.
TARGET
Board, Investors, Interim Manager
SELECT PHASE
AUDIT QUESTIONS
1
Is the company's core product or service still in demand in its target market at margins that can sustain the business?
High
Market demand is the first test. A business with no customers cannot be turned around — it must be replaced.
DATA SOURCE
Market data, customer interviews, sales reports
Finding / Answer
SCORE
2
Does the company have a differentiated position that competitors cannot easily replicate?
High
Commoditised businesses with no differentiation face structural margin pressure that no turnaround can overcome.
DATA SOURCE
Competitive analysis, customer feedback
Finding / Answer
SCORE
3
What percentage of current revenue comes from repeat customers or contracted income?
High
Recurring revenue is the most reliable indicator of underlying business value. One-time revenue masks structural weakness.
DATA SOURCE
CRM data, revenue breakdown
Finding / Answer
SCORE
4
Has the company lost its primary market position — key accounts, distribution channels, brand relevance — in the past 24 months?
High
Market position loss is often irreversible. Identify whether this has occurred before committing to recovery.
DATA SOURCE
Market share data, key account status
Finding / Answer
SCORE
5
Can the business reach cash-flow break-even within 12 months with realistic cost and revenue assumptions?
High
If break-even requires revenue growth that has no supporting evidence, the plan is not a plan — it is a hope.
DATA SOURCE
Financial model, sales pipeline
Finding / Answer
SCORE
6
Are there identifiable buyers, partners, or investors who would value the business or its assets?
Medium
Even if turnaround is not viable, a sale or merger may preserve more value than wind-down.
DATA SOURCE
M&A advisor input, asset valuation
Finding / Answer
SCORE
7
What is the minimum viable version of this business — stripped to its most profitable core — and is that version sustainable?
High
Often the answer is not to save the whole business but to identify and isolate what works.
DATA SOURCE
Contribution margin analysis, product review
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Root Cause Identification
SCOPE
Identify the primary driver(s) of decline — financial mismanagement, market shift, operational failure, leadership deficit, or external shock — and determine whether each is addressable.
TARGET
Interim Manager, Board, Management Team
SELECT PHASE
AUDIT QUESTIONS
1
Is the decline primarily driven by internal factors (costs, leadership, operations) or external factors (market, competition, regulation)?
High
Internal causes are more controllable. External causes may require a strategic pivot, not just operational fixes.
DATA SOURCE
P&L analysis, market data, management interviews
Finding / Answer
SCORE
2
Has management accurately diagnosed the root cause, or are they addressing symptoms while the underlying problem continues?
High
Organisations under stress tend to focus on visible problems (cash, headcount) while structural causes go unaddressed.
DATA SOURCE
Management diagnosis document, advisor assessment
Finding / Answer
SCORE
3
Were there early warning signals that were ignored or misinterpreted by management or the board?
Medium
Identifying missed signals is not about blame — it is about understanding whether governance can support recovery.
DATA SOURCE
Historical board minutes, financial reports
Finding / Answer
SCORE
4
Is the leadership team that caused the decline the same team being asked to lead the recovery?
High
This is not automatic disqualification, but it requires honest assessment of capability and accountability.
DATA SOURCE
Management assessment, board evaluation
Finding / Answer
SCORE
5
Are there operational root causes — process failures, quality issues, IT breakdowns — that have not been addressed?
Medium
Operational failures compounding financial distress require parallel resolution, not sequential.
DATA SOURCE
Operations review, quality data, customer complaints
Finding / Answer
SCORE
6
Has the company been structurally over-invested — too much fixed cost, excess capacity, overextended premises — relative to its revenue base?
High
Structural over-investment is a common turnaround driver. The fix is usually painful: closures, write-offs, renegotiation.
DATA SOURCE
Fixed cost analysis, capacity utilisation data
Finding / Answer
SCORE
7
Are there identifiable decisions — acquisitions, contracts, investments — that created the current situation and are now understood?
Medium
Understanding the origin of distress prevents repetition and informs the recovery design.
DATA SOURCE
Board minutes, management interviews
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Options Analysis
SCOPE
Evaluate all strategic options — full turnaround, partial restructure, sale, merger, administration — and determine which option maximises value for stakeholders.
TARGET
Board, Investors, Legal Advisors
SELECT PHASE
AUDIT QUESTIONS
1
Has the board formally considered all options — full recovery, partial recovery, sale, merger, administration — with written analysis of each?
High
Directors are legally required to consider all options. Undocumented decisions increase personal liability.
DATA SOURCE
Board minutes, options analysis document
Finding / Answer
SCORE
2
Is there a buyer or investor who could acquire the business or its assets at a price better than wind-down value?
Medium
A trade sale to the right buyer often recovers more value than a turnaround requiring capital and time.
DATA SOURCE
M&A process status, asset valuation
Finding / Answer
SCORE
3
What is the estimated recovery value for creditors under each option (turnaround vs. sale vs. administration)?
High
Creditors have rights. If turnaround destroys more value than an orderly sale, directors face legal exposure.
DATA SOURCE
Insolvency valuation, financial model
Finding / Answer
SCORE
4
Is there a strategic partner — distributor, customer, competitor — who would benefit from acquiring or merging with this business?
Medium
Strategic buyers pay premiums for assets that fit their strategy. Identify these before defaulting to financial buyers.
DATA SOURCE
Market map, strategic relationship list
Finding / Answer
SCORE
5
If the business is to be restructured, what specifically will be closed, sold, or wound down — and what will remain?
High
Restructuring without specificity is not restructuring. Define what the new shape of the business will be.
DATA SOURCE
Business unit analysis, restructuring plan
Finding / Answer
SCORE
6
What are the costs and timelines of each option, including redundancy, lease break penalties, and advisor fees?
High
Options must be compared on a fully-loaded basis. Cheap options that create liability are not cheap.
DATA SOURCE
Legal and financial advisory input
Finding / Answer
SCORE
7
Has independent legal and financial advice been obtained to validate the chosen option?
High
Management cannot objectively evaluate options they are emotionally or financially invested in. Independent advice is essential.
DATA SOURCE
Advisor engagement letters, opinion letters
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Stakeholder Alignment
SCOPE
Assess the degree of alignment — or misalignment — among key stakeholders (board, investors, creditors, management) on the chosen path, and identify what is needed to secure their support.
TARGET
CEO, Board, CFO, Legal Advisors
SELECT PHASE
AUDIT QUESTIONS
1
Do the board and major shareholders agree on the diagnosis of the problem and the chosen recovery or exit path?
High
Disagreement at board level paralyses execution. Identify dissenting positions and address them before proceeding.
DATA SOURCE
Board meeting records, shareholder correspondence
Finding / Answer
SCORE
2
Have secured creditors (banks, asset financiers) been briefed, and what is their current position on support?
High
Secured creditors have contractual rights that can override management decisions. Their position must be known.
DATA SOURCE
Bank and creditor correspondence
Finding / Answer
SCORE
3
Are key unsecured creditors (major suppliers, landlords) aware of the situation and engaged in constructive dialogue?
High
Hostile creditor action during a turnaround — winding-up petitions, retention of title claims — can derail execution.
DATA SOURCE
Creditor register, negotiation status
Finding / Answer
SCORE
4
Is the management team aligned on the chosen path, and are key individuals committed to staying through execution?
High
Management departures during a turnaround destroy knowledge and confidence simultaneously.
DATA SOURCE
Retention agreements, management interviews
Finding / Answer
SCORE
5
Have key customers been managed appropriately — informed enough to maintain confidence, but not alarmed?
High
Customer defection accelerates decline. Managed communication preserves relationships during uncertainty.
DATA SOURCE
Key account manager reports, customer communication log
Finding / Answer
SCORE
6
Are there employee representatives, unions, or works councils whose engagement is required before restructuring decisions can be implemented?
Medium
Labour law obligations in many jurisdictions require consultation before redundancy or restructuring. Failure creates legal risk.
DATA SOURCE
HR and legal advice, union engagement record
Finding / Answer
SCORE
7
Is there a communication plan that controls the narrative — internally and externally — during the turnaround process?
Medium
Uncontrolled information creates panic among customers, suppliers, and staff. Narrative control is a turnaround tool.
DATA SOURCE
Communication plan, PR advisor input
Finding / Answer
SCORE
FIRST 100 DAYS AUDIT
Strategy | HR/People | Risk management
Assessment framework for interim managers, new CEOs, or turnaround leaders entering a distressed or underperforming business. Evaluates whether the first 100 days are being used to build the right foundation: diagnosis, quick wins, trust, and a credible plan — not premature action.
AUDIT PHASE 1 OF 4
Entry & Diagnosis
SCOPE
Assess the quality and speed of the initial diagnosis phase — including stakeholder mapping, financial assessment, operational review, and identification of urgent vs. structural issues.
TARGET
Incoming Leader, Board, Sponsor
SELECT PHASE
AUDIT QUESTIONS
1
Has a structured diagnostic been completed within the first 30 days covering financials, operations, people, and market position?
High
Entry without diagnosis leads to action on incomplete information. The first 30 days are for understanding, not deciding.
DATA SOURCE
Diagnostic report, meeting notes
Finding / Answer
SCORE
2
Have all key stakeholders — board, senior management, key customers, key suppliers, creditors — been met individually within the first 3 weeks?
High
Stakeholder mapping through direct conversation is more reliable than briefing documents. Prioritise listening.
DATA SOURCE
Meeting log, stakeholder map
Finding / Answer
SCORE
3
Has the incoming leader identified the 3–5 most critical issues that require immediate attention versus issues that can wait?
High
Triage is a core competency of turnaround leadership. Everything urgent is not equally important.
DATA SOURCE
Issue log, priority matrix
Finding / Answer
SCORE
4
Is there an accurate picture of the financial position — cash, debt, obligations, run rate — built from primary data, not management presentations?
High
Management presentations in distressed businesses are often optimistic. Verify independently.
DATA SOURCE
Financial review, bank statements, creditor register
Finding / Answer
SCORE
5
Has the incoming leader identified who in the organisation can be trusted, who is capable, and who is a risk to execution?
High
People assessment in the first 30 days is critical. Decisions made without this lead to delegation to the wrong individuals.
DATA SOURCE
Confidential assessment, HR records
Finding / Answer
SCORE
6
Are there quick wins — low-effort, high-visibility improvements — identifiable within the first 30 days that can build credibility?
Medium
Early wins create momentum and signal competence. They are not the strategy — they are the foundation for trust.
DATA SOURCE
Operational review, staff interviews
Finding / Answer
SCORE
7
Has the incoming leader resisted the pressure to announce a detailed plan before the diagnostic is complete?
Medium
Premature plans destroy credibility when they must be revised. A 30-day diagnostic is a non-negotiable step.
DATA SOURCE
Board communication, plan timeline
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Quick Wins & Stabilisation
SCOPE
Evaluate whether the incoming leader has identified and executed early stabilisation actions that stop the bleeding, build confidence, and demonstrate competence — without committing to a full strategy prematurely.
TARGET
Incoming Leader, Senior Management Team
SELECT PHASE
AUDIT QUESTIONS
1
Have the most visible operational or financial problems been addressed within the first 30–45 days?
Medium
Quick wins must be real — not cosmetic. Focus on issues that staff and stakeholders have been aware of and frustrated by.
DATA SOURCE
Action log, staff feedback
Finding / Answer
SCORE
2
Has cash burn been stabilised or reduced through immediate cost control actions?
High
Cash control is non-negotiable in distressed situations. Even symbolic freezes on discretionary spending send the right message.
DATA SOURCE
Cash flow report, cost review
Finding / Answer
SCORE
3
Have customer-facing issues — delivery failures, quality problems, relationship gaps — been addressed as a priority?
High
Revenue walks out the door during leadership transitions. Protecting existing customer relationships is a first 30-day priority.
DATA SOURCE
Customer complaint log, account manager reports
Finding / Answer
SCORE
4
Has the incoming leader established a regular cadence of communication with the team — not announcements, but genuine dialogue?
Medium
Trust is built through presence and listening. Town halls, floor walks, and small group sessions outperform email broadcasts.
DATA SOURCE
Communication schedule, team feedback
Finding / Answer
SCORE
5
Are there any people decisions — roles that are clearly wrong, urgent hires, acting appointments — that have been actioned?
Medium
Waiting too long on obvious people decisions signals indecision and allows underperformers to influence outcomes.
DATA SOURCE
Org chart changes, HR actions
Finding / Answer
SCORE
6
Have board expectations been managed — providing regular updates without overpromising?
High
Boards during turnarounds oscillate between over-interference and under-support. Structured, honest reporting prevents both.
DATA SOURCE
Board report, communication log
Finding / Answer
SCORE
7
Is there visible progress in the areas the organisation was told would be addressed first?
Medium
Credibility is built by doing what you said you would do. Track early commitments and their delivery.
DATA SOURCE
Action tracker, staff/stakeholder feedback
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Strategy & Plan Development
SCOPE
Assess whether the 60–90 day plan development phase is producing a credible, evidenced recovery or transformation strategy — not a repackaging of existing management thinking.
TARGET
Incoming Leader, Board, Senior Team
SELECT PHASE
AUDIT QUESTIONS
1
Is the recovery or transformation plan based on diagnostic findings, not on pre-existing assumptions brought by the incoming leader?
High
Leaders who arrive with their plan already decided ignore evidence. The plan must emerge from the diagnosis.
DATA SOURCE
Plan document, diagnostic link
Finding / Answer
SCORE
2
Does the plan identify what must stop, what must change, and what must start — not just what must be improved?
High
Effective turnaround plans include explicit decisions to exit activities, not just to improve everything.
DATA SOURCE
Plan document, scope analysis
Finding / Answer
SCORE
3
Are the plan's financial assumptions (revenue recovery, cost reduction, capex) supported by evidence and tested against a downside scenario?
High
Optimistic assumptions in turnaround plans are common and dangerous. Independent challenge of key numbers is essential.
DATA SOURCE
Financial model, assumption log
Finding / Answer
SCORE
4
Has the plan been stress-tested by an external party — advisor, non-executive, or independent expert?
Medium
The incoming leader's plan reflects their biases. External challenge before commitment reduces the risk of a bad bet.
DATA SOURCE
Advisor review, board challenge record
Finding / Answer
SCORE
5
Are there clear milestones at 30, 60, 90, and 180 days against which progress will be measured?
High
Plans without milestones cannot be tracked or managed. Milestones must be specific and measurable, not directional.
DATA SOURCE
Plan document, KPI tracker
Finding / Answer
SCORE
6
Does the plan reflect input from the organisation — not just senior management but operational staff who understand the detail?
Medium
Frontline staff often know exactly what is broken. Excluding their input creates blind spots and resistance to change.
DATA SOURCE
Consultation records, staff input log
Finding / Answer
SCORE
7
Has the plan been formally presented to and approved by the board, with clear accountability for delivery?
High
Board approval is not bureaucratic — it locks in commitment, authority, and resource allocation.
DATA SOURCE
Board minutes, approved plan document
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Culture & Trust Building
SCOPE
Evaluate how effectively the incoming leader is building the trust, psychological safety, and cultural conditions needed for sustained execution — particularly in a stressed or resistant organisation.
TARGET
Incoming Leader, HR, Board
SELECT PHASE
AUDIT QUESTIONS
1
Is the incoming leader visible and present on the floor — not managed from behind closed doors or remote locations?
High
Physical presence signals commitment. Remote leadership in a crisis organisation creates distance and speculation.
DATA SOURCE
Leadership behaviour observation, staff feedback
Finding / Answer
SCORE
2
Have honest conversations been had with the organisation about the seriousness of the situation, without creating panic?
High
People in distressed organisations already know something is wrong. Honest communication builds more trust than managed silence.
DATA SOURCE
Town hall records, staff survey
Finding / Answer
SCORE
3
Are decisions being made at appropriate speed — fast enough to signal action, deliberate enough to avoid costly mistakes?
Medium
Turnaround leaders who move too slowly lose credibility. Those who move too fast create chaos. Calibrate to the situation.
DATA SOURCE
Decision log, timeline review
Finding / Answer
SCORE
4
Is there evidence of the incoming leader changing their position when presented with better information or challenge?
Medium
Leaders who cannot update their views destroy candour. Openness to being wrong is a critical trust signal.
DATA SOURCE
Management meeting records, staff observation
Finding / Answer
SCORE
5
Are there signs of internal resistance or sabotage — passive non-compliance, information withholding, competing agendas?
High
Resistance in distressed organisations is common and can be silent. Identify it early before it undermines execution.
DATA SOURCE
Management observations, HR input
Finding / Answer
SCORE
6
Has the incoming leader avoided taking sides in existing internal conflicts or political dynamics?
Medium
New leaders who enter existing conflicts lose neutrality and create enemies. Stay above internal politics in the first 90 days.
DATA SOURCE
Stakeholder interviews, management observations
Finding / Answer
SCORE
7
Is the organisation beginning to believe that recovery is possible — is there a measurable shift in morale or confidence?
Medium
Belief in recovery is a precondition for execution. Without it, the best plan fails. Assess sentiment regularly.
DATA SOURCE
Staff survey, informal feedback
Finding / Answer
SCORE
RESTRUCTURING AUDIT
Operational | HR/People | Risk management
Assessment of a planned or in-progress organisational or operational restructuring. Evaluates whether the restructuring is correctly scoped, properly sequenced, legally compliant, and likely to deliver the intended outcome — rather than creating new problems while solving old ones.
AUDIT PHASE 1 OF 4
Restructuring Design & Scope
SCOPE
Evaluate whether the restructuring has been correctly designed — with a clear rationale, defined scope, and realistic assumptions about what will change and what will not.
TARGET
CEO, CFO, Restructuring Lead, Board
SELECT PHASE
AUDIT QUESTIONS
1
Is the restructuring scope clearly defined — what is in scope, what is out of scope, and why?
High
Scope creep in restructuring programmes destroys timelines and budgets. The boundary must be explicit.
DATA SOURCE
Restructuring plan, scope document
Finding / Answer
SCORE
2
Does the restructuring address the root cause of underperformance, or is it primarily a cost-reduction exercise?
High
Headcount reduction without structural change improves P&L temporarily but does not fix the business model.
DATA SOURCE
Root cause analysis, restructuring rationale
Finding / Answer
SCORE
3
Has the target operating model been defined — what the organisation will look like after restructuring is complete?
High
Restructuring without a target model is removal without replacement. The destination must be defined before departure.
DATA SOURCE
Target operating model document
Finding / Answer
SCORE
4
Are the financial savings or efficiency gains quantified, with a clear link between structural change and expected outcome?
High
Every restructuring decision should have a modelled outcome. Vague claims of 'efficiency' are not a plan.
DATA SOURCE
Financial model, savings tracker
Finding / Answer
SCORE
5
Has the restructuring been sized correctly — not so deep that capability is destroyed, not so shallow that the problem persists?
High
Over-cutting destroys the organisation's ability to recover. Under-cutting fails to solve the financial problem.
DATA SOURCE
Headcount/cost analysis, operational capacity review
Finding / Answer
SCORE
6
Are there interdependencies between restructured areas that could cause unintended operational failures?
Medium
Removing a layer or function often has downstream effects that are not immediately visible. Map them before acting.
DATA SOURCE
Process map, operations review
Finding / Answer
SCORE
7
Has an independent review of the restructuring design been conducted before implementation begins?
Medium
Management-designed restructurings suffer from institutional blind spots. External review adds objectivity.
DATA SOURCE
Advisor review, board challenge
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Legal & HR Compliance
SCOPE
Assess whether the restructuring process is legally compliant — covering redundancy consultation, TUPE, works council obligations, contractual requirements, and director duties.
TARGET
HR Director, Legal Counsel, CEO
SELECT PHASE
AUDIT QUESTIONS
1
Have all redundancy consultation obligations been met — including the minimum statutory consultation periods?
High
Collective redundancy rules vary by jurisdiction. Failure to consult is automatically unfair dismissal in most EU countries.
DATA SOURCE
HR records, legal advice, consultation timeline
Finding / Answer
SCORE
2
Are there TUPE (Transfer of Undertaking) obligations relevant to any outsourcing, sale of division, or service provider change within the restructuring?
High
TUPE is commonly misidentified or missed entirely. Incorrect handling creates significant legal liability.
DATA SOURCE
Legal advice, transaction documents
Finding / Answer
SCORE
3
Have works councils or employee representative bodies been informed and consulted in accordance with their statutory rights?
High
In Germany, Netherlands, France, and many other EU countries, works council consultation is a legal prerequisite, not courtesy.
DATA SOURCE
Works council consultation records, legal advice
Finding / Answer
SCORE
4
Are selection criteria for redundancy objective, consistently applied, and documented?
High
Subjective or undocumented selection criteria create unfair dismissal claims. Criteria must be defined and applied uniformly.
DATA SOURCE
Selection matrix, HR records
Finding / Answer
SCORE
5
Are enhanced redundancy packages or retention payments compliant with existing employment contracts and collective agreements?
Medium
Departing from contractual terms creates liability. Payments must be within defined parameters or separately negotiated.
DATA SOURCE
Contract review, HR legal advice
Finding / Answer
SCORE
6
Have all director duties — including obligations to creditors where insolvency risk exists — been reviewed by legal counsel?
High
Restructuring while insolvent or near-insolvent creates personal liability for directors. Legal advice is not optional.
DATA SOURCE
Legal advice on record, board minutes
Finding / Answer
SCORE
7
Is there a signed-off legal risk register for the restructuring, reviewed and approved by the board?
High
Legal risks in restructuring are numerous and serious. A documented risk register demonstrates governance and due diligence.
DATA SOURCE
Legal risk register, board minutes
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Communication & Change Management
SCOPE
Evaluate the quality of the communication strategy and change management approach — both for those leaving and those staying — during and after the restructuring.
TARGET
HR Director, CEO, Communications Lead
SELECT PHASE
AUDIT QUESTIONS
1
Is there a communication plan that sequences what is said, to whom, and when — including a clear announcement day protocol?
High
Uncontrolled information flow before announcement day destroys trust and creates legal risk. Sequence is everything.
DATA SOURCE
Communication plan, announcement protocol
Finding / Answer
SCORE
2
Have managers been briefed and trained on how to have redundancy conversations before announcements are made?
High
Managers who are unprepared for redundancy conversations handle them poorly, creating legal claims and reputational damage.
DATA SOURCE
Manager briefing records, training log
Finding / Answer
SCORE
3
Is there a plan for the people who remain — addressing morale, workload redistribution, and the 'survivor syndrome' risk?
High
The people who stay are often more affected than those who leave. Without attention to survivors, performance collapses post-restructuring.
DATA SOURCE
Change management plan, HR plan for retained staff
Finding / Answer
SCORE
4
Are outplacement support, career transition assistance, and notice arrangements in place for those leaving?
Medium
How people leave reflects the organisation's values. Poor exit management creates reputational damage and legal risk.
DATA SOURCE
Outplacement plan, HR records
Finding / Answer
SCORE
5
Is the external communication strategy — for customers, suppliers, press — aligned with the internal announcement timing?
Medium
External stakeholders hearing about restructuring from press before internal announcement destroys trust.
DATA SOURCE
External communication plan, PR strategy
Finding / Answer
SCORE
6
Has the leadership team been aligned on the rationale and messaging before any communication goes out?
High
Leadership team members who contradict the rationale undermine the process and create confusion.
DATA SOURCE
Leadership alignment session records
Finding / Answer
SCORE
7
Is there a feedback mechanism for employees during the restructuring period — a way to ask questions and receive honest answers?
Medium
Uncertainty during restructuring drives speculation. A structured Q&A process reduces anxiety and information gaps.
DATA SOURCE
Employee communication channel, FAQ document
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Execution & Post-Restructuring Stability
SCOPE
Assess whether the restructuring is being executed to plan, and whether post-restructuring stabilisation measures are in place to prevent performance deterioration after the change is made.
TARGET
CEO, Operations Director, HR Director
SELECT PHASE
AUDIT QUESTIONS
1
Is restructuring execution tracked against a detailed project plan with weekly milestones and named owners?
High
Restructuring without a project management framework slips, creating extended uncertainty that is more damaging than a clean break.
DATA SOURCE
Project plan, weekly status report
Finding / Answer
SCORE
2
Have the operational risks of restructuring — process gaps, knowledge loss, capacity reduction — been identified and mitigated?
High
Removing people removes knowledge. Document critical processes before the people who own them leave.
DATA SOURCE
Risk log, process documentation plan
Finding / Answer
SCORE
3
Is there a 90-day post-restructuring performance monitoring plan to detect unintended operational failures quickly?
High
The impact of restructuring often shows up 30–90 days later in operational performance. Monitoring must be active, not passive.
DATA SOURCE
Post-restructuring KPI plan, monitoring schedule
Finding / Answer
SCORE
4
Are there business continuity plans for functions or roles that are being significantly reduced or consolidated?
Medium
Continuity plans prevent operational failure during the transition period. They must be tested, not assumed.
DATA SOURCE
Business continuity plan, transition schedule
Finding / Answer
SCORE
5
Has the new organisational structure been clearly communicated — with updated reporting lines, roles, and responsibilities?
High
Ambiguity about who reports to whom and who owns what decisions is the primary cause of post-restructuring dysfunction.
DATA SOURCE
Org chart, role descriptions, communication
Finding / Answer
SCORE
6
Are there early warning indicators in place to detect if the restructuring is not delivering expected savings or performance improvements?
High
Restructuring plans frequently underdeliver. Early detection allows course correction before the gap becomes critical.
DATA SOURCE
KPI tracker, savings tracker
Finding / Answer
SCORE
7
Has the leadership team been reinforced — through new hires, promotions, or interim appointments — to fill gaps created by the restructuring?
High
Restructuring often removes management capacity. If leadership gaps are not filled, the performance improvement will not materialise.
DATA SOURCE
Org chart changes, open positions
Finding / Answer
SCORE
STAKEHOLDER MANAGEMENT AUDIT
Strategy | Financial | Risk management | HR/People
Systematic assessment of how effectively a business under pressure is identifying, engaging, and managing its key stakeholders — including investors, creditors, customers, employees, and regulators. Poor stakeholder management is one of the most common causes of turnaround failure.
AUDIT PHASE 1 OF 4
Stakeholder Identification & Mapping
SCOPE
Evaluate whether all critical stakeholders have been identified, their interests and influence assessed, and a management approach defined for each.
TARGET
CEO, CFO, Interim Manager, Board
SELECT PHASE
AUDIT QUESTIONS
1
Has a complete stakeholder map been built, covering all parties with influence over or interest in the business outcome?
High
Missing a significant stakeholder — a major creditor, a key regulator, an influential shareholder — creates blind spots.
DATA SOURCE
Stakeholder register, management interviews
Finding / Answer
SCORE
2
For each key stakeholder, is their primary interest (financial return, supply continuity, employment, regulatory compliance) understood and documented?
High
Stakeholder management that treats all parties the same ignores the fact that different stakeholders want different things.
DATA SOURCE
Stakeholder analysis document
Finding / Answer
SCORE
3
Has each stakeholder been assessed for their level of influence and their current disposition (supportive, neutral, hostile)?
High
Influence and disposition together determine the priority and approach for each stakeholder. Both dimensions are needed.
DATA SOURCE
Stakeholder matrix, management assessment
Finding / Answer
SCORE
4
Are there stakeholders who have not been engaged yet but whose support or neutrality is required for the plan to succeed?
High
Unstated opposition is more dangerous than open opposition. Identify and engage silent stakeholders proactively.
DATA SOURCE
Stakeholder map, gap analysis
Finding / Answer
SCORE
5
Are there conflicting interests between stakeholders — for example, shareholders wanting value protection while creditors want repayment — that must be managed?
Medium
Stakeholder conflicts are common in turnarounds. Unmanaged conflicts become escalation risks.
DATA SOURCE
Stakeholder analysis, legal advice
Finding / Answer
SCORE
6
Is there a named owner for each critical stakeholder relationship — not a committee, but a specific individual?
Medium
Accountability for stakeholder relationships must be personal. Committees do not build relationships.
DATA SOURCE
Stakeholder register, relationship owner list
Finding / Answer
SCORE
7
Has the stakeholder map been updated in the last 30 days to reflect changes in position, new parties, or resolved risks?
Medium
Stakeholder positions change during a turnaround. A static map becomes quickly outdated and misleading.
DATA SOURCE
Stakeholder register date, update log
Finding / Answer
SCORE
AUDIT PHASE 2 OF 4
Financial Stakeholder Management
SCOPE
Assess the quality and frequency of engagement with banks, investors, and major creditors — the stakeholders with the most immediate ability to accelerate or prevent business failure.
TARGET
CFO, CEO, Board
SELECT PHASE
AUDIT QUESTIONS
1
Have all secured creditors been briefed on the current situation, the recovery plan, and the expected timeline to resolution?
High
Secured creditors who feel excluded from communication become hostile faster than those who are kept informed.
DATA SOURCE
Bank and creditor meeting log
Finding / Answer
SCORE
2
Is there a regular reporting rhythm — weekly or bi-weekly — with the primary banking relationship, including a current cash flow model?
High
Banks need predictable, structured communication. Ad hoc updates signal poor control and create anxiety.
DATA SOURCE
Bank reporting schedule, cash flow model
Finding / Answer
SCORE
3
Have waiver agreements or covenant amendments been secured where existing debt covenants are in breach?
High
Covenant breaches create technical default. Waivers must be formal, documented, and time-limited.
DATA SOURCE
Covenant compliance review, waiver agreements
Finding / Answer
SCORE
4
Are major trade creditors being managed on a structured payment plan — communicated clearly and adhered to consistently?
High
Trade creditors who feel managed fairly will not take legal action. Inconsistent communication triggers escalation.
DATA SOURCE
Creditor payment plan, communication log
Finding / Answer
SCORE
5
Have shareholders or investors been updated on the situation with sufficient frequency and honesty?
High
Investors who feel misled react more aggressively than those who receive bad news early. Transparency is risk management.
DATA SOURCE
Investor update schedule, board papers
Finding / Answer
SCORE
6
Is there a legal advisor engaged who is monitoring the company's obligations to creditors under insolvency law?
High
Directors must be advised on their obligations before they become liabilities. Legal advice must be proactive.
DATA SOURCE
Legal engagement letter, advisor relationship
Finding / Answer
SCORE
7
Are there any creditors who are actively threatening legal action, and what is the plan to resolve or contain this?
High
A winding-up petition or injunction from a single creditor can destroy a turnaround. These must be identified and managed.
DATA SOURCE
Legal threat register, resolution plan
Finding / Answer
SCORE
AUDIT PHASE 3 OF 4
Customer & Supplier Stakeholder Management
SCOPE
Evaluate how effectively the business is managing its key commercial relationships — protecting revenue from customer defection and supply continuity from supplier withdrawal.
TARGET
CEO, Sales Director, Operations Director
SELECT PHASE
AUDIT QUESTIONS
1
Have the top 10 customers been personally contacted by a senior leader to provide reassurance about supply continuity?
High
Key customers need to hear from a senior person, not a sales manager. Silence from the top creates anxiety and exit.
DATA SOURCE
Key account contact log, customer meeting records
Finding / Answer
SCORE
2
Are there customer contracts that include change-of-control, insolvency, or material adverse change clauses that could be triggered?
High
These clauses can give customers the right to exit contracts without penalty during a turnaround. Legal review is essential.
DATA SOURCE
Contract review, legal advice
Finding / Answer
SCORE
3
What percentage of revenue is at risk from customers who are aware of the company's financial difficulty?
High
Revenue at risk must be quantified. It is a key input to the recovery plan and the stakeholder management priority list.
DATA SOURCE
Customer risk assessment, revenue breakdown
Finding / Answer
SCORE
4
Are critical suppliers — those without whom operations would stop within 30 days — identified and actively managed?
High
Single-source suppliers in a turnaround require proactive relationship management. Loss of one can be catastrophic.
DATA SOURCE
Supplier criticality assessment, supplier contact log
Finding / Answer
SCORE
5
Have key suppliers been given honest information about the company's situation, with a clear commitment to payment?
High
Suppliers who hear rumours before they are contacted escalate defensively. Proactive, honest communication prevents this.
DATA SOURCE
Supplier communication log
Finding / Answer
SCORE
6
Are there supplier retention risks — threats to stop delivery, demands for prepayment or cash on delivery — that have been identified and addressed?
High
Supplier withdrawal during a turnaround creates operational failure. Early identification allows early resolution.
DATA SOURCE
Supplier risk register, operations report
Finding / Answer
SCORE
7
Is there a contingency plan for losing a critical supplier — an alternative source, an inventory buffer, a substitute product?
Medium
Dependency on a single supplier without a contingency is an unmanaged risk that cannot be disclosed away.
DATA SOURCE
Business continuity plan, supplier contingency register
Finding / Answer
SCORE
AUDIT PHASE 4 OF 4
Employee & Board Stakeholder Management
SCOPE
Assess the quality of engagement with the internal stakeholder groups — the board, management team, and workforce — who determine whether execution succeeds or fails.
TARGET
CEO, HR Director, Board Chair
SELECT PHASE
AUDIT QUESTIONS
1
Is the board receiving accurate, timely, and complete information — including bad news — without filtering by management?
High
Boards that are managed rather than informed cannot fulfil their governance role. Selective disclosure is a governance failure.
DATA SOURCE
Board papers, board meeting records
Finding / Answer
SCORE
2
Does the board have the right composition — relevant expertise, sufficient independence, appropriate time commitment — for a turnaround situation?
High
A board assembled for normal operations is often inadequate for a turnaround. Skills gaps must be addressed.
DATA SOURCE
Board composition review, skills matrix
Finding / Answer
SCORE
3
Are employees being kept informed with sufficient honesty and regularity to prevent rumour-driven anxiety?
High
In turnarounds, what employees imagine is usually worse than the reality. Honest, regular communication manages this.
DATA SOURCE
Employee communication schedule, survey results
Finding / Answer
SCORE
4
Are key employees — those whose loss would significantly damage recovery prospects — identified and on retention arrangements?
High
Key employee departure during a turnaround is both a practical and a confidence signal. Retention must be structured.
DATA SOURCE
Key employee register, retention agreements
Finding / Answer
SCORE
5
Is the senior management team aligned on the plan and the messaging — are they communicating consistently to their teams?
High
Mixed messages from the senior team during a turnaround destroy confidence faster than any external factor.
DATA SOURCE
Management alignment session records, communication audit
Finding / Answer
SCORE
6
Are there internal 'influencers' — respected individuals below senior management level — who are engaged and supportive of the recovery direction?
Medium
Informal leaders shape how the organisation responds to change. Their engagement or opposition often determines execution success.
DATA SOURCE
Staff engagement assessment, HR input
Finding / Answer
SCORE
7
Is there a mechanism for employees to raise concerns confidentially — without fear of career consequences?
Medium
Psychological safety during a turnaround enables early warning of problems. Without it, management learns too late.
DATA SOURCE
Whistleblower or feedback channel, HR policy
Finding / Answer
SCORE