Diamond FMS
The disinfectant was broken
The case and the problem
A farmer discovered that the water disinfection system in his greenhouse was no longer working. The result: less effectively disinfected water, leading to a significantly lower yield. Without properly disinfected water, the crops would continue to lag behind. However, at first glance, the investment in a new disinfection system seemed too high. The farmer doubted whether replacement was even necessary.
What went wrong?
Insufficient insight into the consequences: The entrepreneur did not immediately see the impact of the broken disinfectant on turnover.
No return on investment (ROI) calculation: There was no clear analysis of how the investment would be recouped.
Short-term thinking: The cost of replacement was seen as too high, without considering the long-term effect.
How do you solve it?
- Impact analysis: Map the direct and indirect consequences of the broken disinfectant.
- ROI calculation: Analyze what a new disinfectant can yield and how quickly the investment will be recouped.
- Long-term vision: Evaluate how not replacing the disinfectant will impact future profitability.
Application of Diamond
Diamond calculated the cost of investing in a new disinfectant and the revenue it would generate. The system demonstrated that the investment was financially sound and could be substantiated with figures for financiers. Moreover, Diamond allowed the entrepreneur to monitor the future situation to ensure the investment paid off as planned.
