Business Diagnostics, Business-Strategic Consulting, and Business Recovery

Business diagnostics, business-strategic consulting and business recovery are often interrelated. Reviewing these three variables provides a broad perception, alongside comprehensive solutions for the business dilemmas and challenges the organization is facing and must be resolved at the organizational level.

However, often to assess the organization’s status and to address specific situations, we need only one of these services.

Auren’s financial expert team works in a structured and goal-focused manner to provide the best and most appropriate response to the organization.

Business Diagnostics:

In similarity to medical diagnostics, business diagnostics are designed to identify and predict the problems in advance, to determine the treatment or to cope better with the situation, possibly in a less expensive way. Diagnosis can be done after the appearance of the symptoms, yet it is not recommended; usually best to perform as part of a routine test to identify problems before they emerged or already got out of control.

That is, business diagnostics are designed to keep the organization healthy.

We evaluate the external environment and then focus on the core of business operations.

In the matter of responsibilities of business diagnostics, we are also identified and evaluate opportunities.

BusinessStrategic Consulting:

A business strategy consultant assists business owners or managers with the business strategy decision-making process. By leading processes and guidance to help determine; who is the organization, in which directions it should expand the business activity and how to get there, what are the criteria of measurement and how to measure and to assess business success.

A strategy planning consultant helps determine which specific strategic initiatives will provide the most beneficial response. The consulting is conducted based on market research, competitive analysis, scenario planning, and professional knowledge and experience.

Strategic planning is an ongoing process, and successful organizations will review their strategies on a regular basis.

Tasks and responsibilities:

1. Increase sales and revenue.

2. Reducing the cost of employee benefits.

3. Increase in profits.

4. Reduce workload and increase productivity

5. Strategic tax planning

6. Strategic exit ways

7. Mergers, acquisitions, and expansions.

Another subject that is worth to be noted and to be expanded separately is the negotiation process. The results of the negotiations have direct implications on the organization’s future, and while the process may appear to be short and focused, the negotiations are in fact a long process that requires synergy between different departments within and outside the organization. Proper management of the bureaucratical process, guidance in dealing and facing the regulation and in front of the regulator, suppliers, clients, banks and potential and existing investors, along with maintaining and targeting to accomplish the list of goals.

Business Recovery:

An unplanned event can have a devastating impact on the business.

An unplanned event for which there was no prior planning and no recovery plan could lead to a position of financial hardship with a horizon possibility of insolvency.

Obtaining early counseling can help the organization understand and clarify its current position and options and even prevent it from reaching a state of distress. Furthermore, if the organization is in a crisis, professional assistance in management might make a difference. Correct diagnosis includes extensive measurement next to the careful calculation of the damage, which is part of the analysis that allows a process of reconstruction and redesign of the organization.

As part of the recovery process, we are redesigning and rebuilding:

1. Reorganization of the conceptual business skeleton, as well as assistance and guidance through the process.

2. Test of the organization’s capability to meet payments.

3. Cash flow planning.

4. Constructing streamlining processes and proper work processes.

5. Close supervision of the management for exiting the crisis, with emphasis on proper management and control.

We are acting out of a shared ambition to end the crisis and return the organization to its path while minimizing the loss in minimum time; we distinguish what is important to do versus what seems urgent.

Although treating the source of the crisis often seen as the first and most important step to carry out. Most often, taking acute steps of action toward a continuance of the day-to-day functioning of the organization will be more beneficial.

Valuations, Mergers & Acquisitions, and Due Diligence

A stable organization is an organization that is aware and acknowledges the uncertainty of the market, which are endangering its stability and might undermine organizational dynamics.

To survive these kinds of situations, various actions are taken to improve positions and to contribute to the stability of the organization, if God forbid, the stability of the organization was damaged, it is required to react and take action. This is done by assessing the organization’s value, an examination of the organization to take steps towards a restructure, and in certain situations to consider and act to assimilate it within other organizational structures.

Valuations:

In valuation, we evaluate and analyze the property, business, merchandise, fixed income, etc. These estimates are based on several methods because there is no one method to evaluate all types of assets.

Under valuations are the following tasks:

  • Build economic performance measurement models when many of them rely on discount cash flow (DCF).
  • Conducting market research and identifying impacts, as well as conducting in-depth economic and industrial research on a variety of different industries to examine trends and potential impacts on the analyzed organization.
  • Review ongoing processes, carry out adjustments or present initiatives to improve efficiency and to provide more effective business support.
  • Assist in preparing the data to be submitted to the evaluation committee and present findings to pricing committees and other managers as needed.
  •  Present the findings to managers and stakeholders.

Mergers & Acquisitions:

In the process of merger and acquisition, a change in structure, along with the transformation of the main control in charge of the business. When the process is not carried out and\or properly embedded, the result and implications can be devastating for all of the business units involved.

Auren Israel serves as a bridge between purchasers and companies (as well as purchasers from abroad who expressing interest in Israeli companies); between various types of organizations, which are striving to perform a merger. Auren assists these companies and organizations at all of the stages of business or employment.
The financial department learns the specific and special needs of the clients, to customize the work methods accordingly. To create a dedicated business strategy that meets the needs of the organization throughout the process and with reference to fulfill the organization’s future goals.

The department’s work process includes the conduction of due diligence.

Due Diligence:

Due diligence is an investigation or review for a potential investment or product to confirm any financial aspects that may affect prior to entering into an agreement or financial transaction with another party and is conducted by reviewing financial records.

Its significance lies in the area of responsibility for full disclosure of material information related to the property that is for sale. Therefore, due diligence has become a standard stage in IPO (Initial public offering) and is undergoing an underwriting process to ensure that all relevant information pertaining to the asset under consideration has been disclosed to the potential investors.

The following list of due diligence steps is not complete as there are many types of securities and as a result, many variations of due diligence:

1. Analysis of the capital (total value) of the organization.

2. Overview of Income and Profits of the Organization: It is important to keep track of any trends in the income of the organization, operating expenses, profit margins and return on capital.

3. Competitor and Industry Review: Each organization is partially defined by its environment of competition and competitors in it. A look at its main competitors teaches a lot about the state of the organization, i.e., does the organization lead in its industry or in specific target markets? Is the industry likely to grow? Perform due diligence on several organizations in the same branch can provide investors with insights on the organization and especially if it has advantages over its competitors.

4. Multiplier Assessment: There are many financial ratios and metrics that investors can use while assessing organizations. There is not one ideal value for all types of investment, and it is, therefore, advisable to integrate connections into different parameters to create a complete picture and lead to a more informed decision-making process. For example, a price-to-earnings ratio or a price-to-growth rate or sales ratio.

5. Management and Shareholders Review: Is the organization still managed by its founders? Research conducted by the board members to examine their own focus and professional experience. The examination of the shareholders and their retention ratio might indicate the organization’s status. Does the person in the management have many shares? (there is a connection between the management holding the shares and the desire to benefit from the shares).

6. Balance Sheet Review: An overview of assets and liabilities, as well as the amount of cash to monitor and supervise the level of debt, and how is it compared to other organizations in the same industry. Big debt is not necessarily a bad thing; this determination depends on the business model of the organization and the nature of the industry. The goal is to see if the organization can provide enough cash to pay off debt and dividends.

7. Stock Price History: Is the stock volatile or stable? (it is important to remember that past prices do not necessarily predict future price movements).

8. Dilution Inventory: Investors need to know how many shares exist for the company and how that number is relative to the competition. Does the organization plan to issue additional shares, thereby reducing the proportion of shareholders or actually diluting its number of shares?

9. Examining long-term and short-term risks: Understanding the risks inherent in the industry as well as the organization’s specific risks. Are there any political or regulatory risks? Is the management stable?

Risk Management

In the past, it was common to think that for every risk there is someone in the organization was responsible for, whether they had a specific role or a specific department, and that crises most often occurred due to irresponsibility at the top of the organization, strategic deficiencies and transparency problems to the lower echelons.

Today, we understand that risk management is a process that concerns everyone, from the CEO down to the organization hierarchy.

The current understanding of the overall responsibility of the entire organization results in rigid expectations from all stakeholders that are regarding corporate discipline demonstration, and the control over all the elements of the organization.

In business, risk management is defined as a process of identifying, monitoring and manipulating potential risks in order to minimize their negative impact on the organization. An effective risk management process will help to identify the risks pose the greatest threat to the organization and even provide guidelines for dealing with them.

Effective risk assessment and analysis of an organization helps protect assets, improve decision-making and optimize operational efficiency to save money, time and resources.

The risk management process is conducted using the ERM method and consists of four parts:

1. Risk Assessment: Evaluate the organization’s exposure to uncertain events that could affect its ongoing operations, and also to assess the potential damage that could affect its income and reputation.

2. Risk Analysis: Comparison of the estimated risks against the risk groups that the organization has already tested. The risk groups can include costs, socio-economic factors, legal requirements, and deficiencies.

3. Building a response procedure: Risk management is the implementation of policies and procedures that will help prevent or minimize the risks and consequences.

4. Business continuity management: Implementing work procedures, building a process of learning lessons and examinee the level and amount of risk ideal for the various situations in which the organization manages.

Bank Credit and Circulating Capital Management

Conducting activity with banks and other activities related to maintaining the current balance sheet of the business is critical to a properly conducted ongoing of any organization.

Bank Credit

Bank credit is the total credit available to a business or an individual provided by a banker. The credit depends on the loaner’s ability to obligate to repay the loan, and the total credit available at the banking institution.

Circulating Capital Management

Circulating Capital Management refers to the organization’s management accounting strategy; its role is to monitor and use the two components of circulating capital: current assets and joint liabilities; to ensure the most efficient economic activity of the organization. The primary purpose of circulating capital management is to ensure that the organization always maintains sufficient cash flow to meet the short-term operating costs.

Corporate & Finance

Auren Israel’s consulting services are developed and designed to meet most of the requirements and needs of the organization during the phases of its business lifecycle. Auren’s Corporate & Finance department strives to address the changing needs of the organization, whether it is ongoing or urgent needs.

The department consists of experts with knowledge and experience in a wide range of areas of expertise. Therefore, the business-financial solutions provided by the expert team provides a multidisciplinary response and consultation on the one hand and deep on the other.

The combination of the vast knowledge and experience gained in the broad spectrum of expertise allows us to use both our understanding and professionalism, which enables the consultants in the department to provide integrated counseling and best practices that the organization needs to consider. As a result, our clients enjoy the advantages and the added value we have to offer.

Every organization required to be attentive, and be acquainted with the know-how of its fields of activity in which it operates. Adequate support is a powerful tool whose purpose is to differentiate and optimize organizational vision, by inner proper organizational conduct, and through the outside to outstand in your business environment and over your competitors in the field.

State Grants

State grants in Israel are provided either by the Office of Chief Scientist or by the Ministry of Economy. A structured pathway will take you closer toward the approval of a state grant; this pathway requires understanding and professional knowledge to succeed.

The application process includes many aspects that require consideration as well as bureaucracy. We assist with the construction of the application and the entire submission process.

Auren’s team of experts studies the various paths of the optional and relevant state grants, performs a compliance check and the fulfillment conditions for the client, register and submit of the request on behalf of the client, and supervises the status of the request.