It appears that we may have seen the worst of the COVID-19 pandemic and now I am seeing more and more articles about the “New Normal” and “Next Normal.” Interestingly enough, I have also been seeing a few articles over the past two weeks about this being an opportunity. Once the fear, uncertainty, and doubt (aka “FUD”) began to diminish, people finally began to look for a silver lining.
Fear is a powerful demotivator, which is why I find it interesting that some managers and executives use it as a tool to help achieve their goals. There may be short-term gains, but the long-term effects can be devastating. In times of chaos (real or perceived), one of the best things that a leader can do is be genuine and concerned for the welfare of their team, communicate in an honest and timely manner, and display confidence as a way to help shift emotions from a negative state towards a positive state. Fear holds you and your team back.
What I find interesting is that two months ago I posted about this unfortunate time being an opportunity – something that led to several negative comments at the time. Three weeks ago I posted about changes that would be coming as part of the “New Normal.” I believe that this is simply insight coming into play, which is one reason why Consultants, great Salespeople, and new Executives are often able to add immediate value to an organization.
As an aside, diversity of backgrounds, experiences, knowledge, expertise, and opinions lead to a variety of perspectives – and that fosters creativity. A best practice in team building is to find people whose strengths help cover your weaknesses.
So, perspective and expectations determine where you begin, and not where you will end. The benefit of having a better starting point is that you should be in a much better position to win. The best part is that you can teach yourself to become better at identifying different perspectives. You may find that it is much easier to understand the big picture of whatever problem you are facing with that new skill.
From time-to-time, we are all faced with situations that we know will suck. Avoidance may be an option but usually isn’t the best option. The military has a saying, “Embrace the Suck,” that essentially boils down to “just deal with it.” Focusing on “the gain” (rather than “the suck”), identifying the small wins along the way, and visualizing success is part of the process that I have personally found helpful to maintaining a positive attitude and an open mind. This simple process helps maintain the balance of optimism with realism, and most importantly creates high expectations.
So, what are your thoughts? Do you want to lead or follow? There is nothing wrong with following, especially when you are contributing to the success of the team. Perspective and Expectations are two tools that can help in any role.
Originally posted on LinkedIn.com/in/chipn
Recently I read that the U.S. is experiencing a significant jump in unemployment claims. Much of that is understandable given the recent decline in many businesses, concerns about how long this crisis may last, and the need to protect ongoing viability by business owners and executives. But, in the near future business activity will resume and it will very important that businesses have maintained a pipeline of business and retained the qualified staff to deliver its products and services.
Now could be the ideal time to challenge your team to focus on improving your business. Look at business processes and identify:
- What works well today? Are you able to identify what makes it work so well? Simplicity, automation, and lack of friction are typical attributes of effective and efficient systems and processes that have a positive impact on any business.
- What could be improved and why? Specific examples and real data will help quantify the impact and support the prioritization of follow-on activities.
- What is missing today?
- Good ideas have likely been raised in the past so why not revisit them?
- What are competitors or businesses in other segments doing that could be helpful?
- Brainstorm and consider something completely new that could help your business.
- Start a list, describe the need and benefits, provide specific examples, and then estimate the potential impact and time to value for each idea.
- Take the ideas having the greatest promise and estimate the cost, people/skills needed, other dependencies for each to see how they stack up.
Something else to consider is the creation or updating of Business Continuity Plans. Now is a perfect time – while everything is fresh in the minds of your team. Not only will this help for the future, but there could also be several useful ideas for the coming weeks.
For example, do you have documentation that is sufficient for someone who is not an expert in your business to be able to take over with a relatively small ramp-up time? How will you maintain quality and control of those processes? Are your plans stored in a repository that is accessible yet secure outside of your organization? Do you have the processes and tools in place to collect documentation and feedback on things that did not work as documented or could be improved? Are your Risk Management plans and mitigation procedures up-to-date and adequate?
Investing in your business during this time of slowdown could have many benefits, including maintaining good employee morale, enhancing employee and customer loyalty, retaining employees and the expertise and skills they have, and increasing sustainability and long-term growth potential.
This was originally posted on LinkedIn.com/in/chipn
When I had my own company our focus was on providing the absolute best services in a few niche areas. Our goal was to succeed in the spaces that were important yet underserved. We identified those areas, validated the need, evaluated the competition and our competitive positioning, determined the market potential, and then made an informed decision based on that data.
But, this was not a plan for winning. It was a roadmap to places that we could win, but nothing more.What would our strategy be? What specific problems would we solve? How would we create awareness around the potential impact of those problems? And, how would we position ourselves as being the best candidates to address those business needs? In short, what was our real purpose or raison d’etre?
Recognizing that void led to a couple of powerful revelations –
1. It is great to have a goal of being the best at something, but don’t use that as an excuse to procrastinate. Learning and improving is an iterative process, so that goal by itself was not good enough.
2. Adopting an “Attitude of Better” turned out to be a game-changer. We set our focus on continuous improvement and winning. We became customer-obsessed, driven to provide a better service and better results for each and every customer. We gauged our success by customer satisfaction, repeat engagements, and referrals.
3. But, it wasn’t until we adopted an intentional Growth Mindset that our business really started to evolve and improve.
· We leveraged each and every win to help us find and create the next win.
· Our team was constantly pushing each other to raise the bar of knowledge, expertise, and performance.
· Just as important was what occurred next. They became a safety net for each other. Failure for one meant failure for all and nobody wanted that. They became a high-performance team.
· We created standard processes and procedures to ensure consistency and maintain the highest levels of quality. This applied to everything we did – from working on a task to writing trip reports, status reports, and proposals. It also reduced our risks when we chose an outsourcing partner to help us take on more concurrent projects.
· Whenever possible we automated processes to maintain consistency while increasing efficiency, repeatability, scalability, and profitability.
· We measured and tracked everything, analyzed that data, captured lessons learned, and continuously worked on improving (and documenting) every aspect of the business.
· A byproduct of this approach was that we could offer leaner pricing based on accurate estimates having very small margins of error. Our pricing was competitive, we could fix price much of what we did, and our profit margins were very good. This allowed us to invest in further growth.
Our “attitude of better” also came across as confidence when selling to and working with new customers. Not only could we tell them stories of our success that included tangible metrics, most of our customers became references willing to talk about the value we added. Their stories included discussions about how much better things became as a result of our work.
Better became the foundation of what we did as well as the basis of those customer success stories.
Over the years I have helped both successful companies and start-ups improve and strengthen their Channel and Strategic Alliances programs. Those companies do a great job closing deals but usually have concerns about not generating or receiving enough new business leads. Or, they develop strong relationships with one or two vendors, only to find later that a key vendor has been sending deals to a competitor. You may not have experienced this yourself, but if you have please read on.
Most traditional channel models support Distributors, Resellers, OEMs, and ISVs. Business mainly flows upwards to the main vendor. If that vendor has popular and widely used products then business can be good because there is sufficient demand. But when that is not the case your sales pipeline usually suffers.
Doing something the same way as everyone else may not be a bad approach when there is enough business for everyone and your growth goals and aspirations are aligned with your competition.
Sales Channel business is usually not the main source of revenue for most companies, but it does have the potential to become the largest and most scalable revenue source for nearly any business. Just think about the money that is being left on the table by not adopting a growth mindset and executing a new and better strategy.
In the summer of 2016 I attended the “Sage Summit” in Chicago. It was impressive to see the Sage Group’s efforts to build, strengthen, and protect their community of Customers and Channel Partners. They made the effort to foster higher levels of collaboration between the various types of partners – implementation services, consulting and staff augmentation services, complementary product vendors, etc. They had created their own highly successful Business Ecosystem, which is an excellent proof point.
When designing a channel partner program my personal focus has always been on finding the balance between promoting and protecting the business of partners with helping ensure that the end customers have the best experience possible (and have some recourse when things do not work out as expected). There are a variety of methods I have used to accomplish those goals, but the missing component has always been the inclusion of a systematic approach to seed relationships between those partners and facilitate an even greater amount of business activity.
Nearly a year ago I began working with a management consultancy run by Robert Kim Wilson, which has a business vision based on his book, “They Will Be Giants.” I will provide links at the bottom of the post for this book and other relevant resources. Kim asserts that Entrepreneurs with a Purpose-Driven Business Ecosystem (PDBE) are more successful than those without one and provides examples to prove his point. Having experienced Kim’s own PDBE I see how purpose fosters trust and collaboration.
As I did more research I have found that, especially over the past two years, there has been a lot of focus placed on Business Ecosystems and Business Ecosystem Organizers (such as Sage in the earlier example). Those findings reinforced the PDBE approach, and external validation is always a good thing.
Just as important from my perspective is that this concept applies to businesses of any size, and it is especially helpful to small to midsize businesses. The fun part for me is exploring a specific business, analyzing what they do today, and quantifying the benefits of adopting this new strategy.
So, how does this new type of Business Ecosystem work?
- The Business Ecosystem Organizer expands the overall network, vets new “Business Ecopartners,” and provides a framework or infrastructure for the various Business Ecopartners to get to know one another, exchange ideas, and discuss opportunities.
- This can become an incredible source of sustainable revenue for companies willing to invest in the necessary components to grow and support their own Business Ecosystem.
- Business Ecopartners will have access to trusted resources that can augment existing business and take-on new, bigger projects by leveraging the available expertise.
- Suppose that you have products or services that work with commercial CRM (Customer Relationship Management), ERP (Enterprise Resource Planning), or SCM (Supply Chain Management).
- You have seen a growing demand for functionality that relies on highly specialized technologies like:
- Cryptocurrency support.
- Blockchain for both financial transactions and things like traceability in your supply chain or IoT data.
- AI (artificial intelligence), ML (machine learning) to detect patterns and anomalies – such as with fraud detection, Deep Learning/Neural Networks for image recognition or other complex pattern recognition.
- Graph databases to better understand a business and infer new ways to improve it.
- Knowledge Graph/Semantic databases to assist with Transfer Learning and deeper understanding.
- It would not be practical or cost-effective for most businesses to build these practices in-house so partnering becomes very attractive to your company.
- This type of business can also be very attractive to a Business Ecopartner because someone else is handling sales, billings, account management, etc.
- Other Business Ecopartners could leverage your products or services for their projects and engagements, thus becoming another source of revenue.
- By leveraging this network your business can essentially compete on imagination and innovation – something that could become a huge source of differentiation from your competition.
Value realized from this New Business Ecosystem model:
- These new sources of business and talent can become a real competitive advantages for your business.
- This becomes the source for Sales Amplification because your business is extending its reach and expanding its growth potential – directly and indirectly.
- The weighted (based on capabilities, capacity, responsiveness, and Ecopartner feedback) Business Ecopartner network model could lead to exponential business growth over time – and that is a winning strategy for any business.
It is interesting to see people in Sales and Marketing still focusing on features, performance, cost, and even value without creating linkage to what that means to a company from a business perspective. Once you understand what you are really selling it is possible to connect with prospects in a meaningful way that can help you both determine the potential fit.
Sales Qualification is essential for both efficiency and effectiveness. Effectiveness is all about results, and efficiency is all about achieving those results with the least amount of time and effort. This doesn’t mean that we are looking for a lazy approach to find a win. Rather, it is about identifying repeatable patterns of doing something that circumvents unnecessary activities, time spent, and associated costs. Being good at qualification doesn’t mean that you will be good at closing, but it is tough to become a good closer without having the number of “at-bats” that good qualification leads to.
The way to help yourself understand what you are selling is to view things from your prospect’s perspective. What struggles are they likely facing? Where are the greatest opportunities for their type of business? What is the difference between your prospect company and its main competition? This analysis requires a general understanding of the vertical and more specific understanding of the prospect company and 2-3 of their main competitors.
Now that you have identified an area where you believe there is a good fit the next step is to develop your target list for that profile. Much of the information you need can be found in Corporate filings (10-K and 10-Q filings for public companies, and Form 5500 filings for companies with a 401(k) plan – especially useful for private companies), websites like Owler.com and SimilarSiteSearch.com, and from social media sites like LinkedIn.com and Facebook.com). Then search for people in areas that are most likely affected and look for titles that are likely Stakeholders or Decision Makers.
The next item to focus on is messaging. Below are a few examples from my career –
- Analytics & Big Data – The focus here is often on data volume, the currency of the data, speed of queries, cost, maintenance, and downtime. Those things become important later in the sales discussion, but initially, companies want to know what problems your product or solution will solve.
- Some of my fastest deals sold because I demonstrated ways to make better decisions faster and/or identify problems before they were had the chance to become major problems. Avoiding problems and unplanned outages were key parts of the messaging.
- In one case I was able to close a significant deal in less than three months by focusing on how a company could provide five years of transactional data for their customers to use to make purchasing decisions in less time than it took the current system to analyze six months of data. Their sales increased after implementing the revised system. Helping their customers make better buying decisions faster was the winning message.
- Embedded Products – While many companies focus on APIs, features, or cost per unit, I would focus on how the product I was selling made things better and easier for Customer Support and Customer Satisfaction. Things like stability, lack of maintenance required, data integrity, performance over time, messaging when something abnormal or concerning was observed, etc.
- I sold a $1.1 million deal in less than two months to a medical device company by focusing on the life of those devices often being 10-15 years and how their customers need to be assured that the results will be the same from machine-to-machine, even if one of those machines is much newer than the rest of the machines. Consistency over time was the winning message here.
- After being approached by a Defense Contractor for a relational database product for a new Flight Simulator system I changed the discussion to the complexity of flight control systems, the need to correlate 30+ operational systems in real-time, and the importance of taking a verbal command and translating it to specific commands for each system. That led to the sale of a NoSQL product that was ideally suited for this complex environment. The idea of letting our software handle the really complex work helped win this deal.
- Consulting Services – This is not contracting or body shop services (commodities), but true Business and Technical Consulting services that were high visibility and high impact. In these cases expertise, experience, and having a track record of success in different but demanding scenarios provided confidence. Often these were multi-phase engagements to first prove our value before making a large commitment.
- In a bid against two well-established competitors, we won a deal with a large Petroleum company that was nearly $500K. The proposal included information that we uncovered about the system and use case and later verified with the prospect, a section on our people and some past projects, and then a high-level project plan with firm-fixed pricing. We won the bid and I later found out that our cost was $50K higher than the largest competitor and more than $100K more than the other competitor. The customer told me that, “Your proposal demonstrated the understanding of who we are and what we need, and that confidence provided the justification to select your company and pay a premium to have the job done right the first time.”
- My first million-dollar deal was in the 1990s and was with a company that we demonstrated our ability to solve problems. They knew they needed assistance but were not exactly sure where. I created a “Pool of Days” concept that provided flexibility in the work performed (task, deliverables, and scheduling) but had minimum monthly burn rates and an expiration date to protect my company. This led to many other deals of this nature with other companies. Flexibility and the ability to accommodate changing needs without introducing significant risk or additional cost was the winning messaging here.
As you see from these examples the common theme is helping companies solve their specific business problems. Even in cases where technology was central to that message the focus was always on better results for that prospect and their customers. Value is important but the results matter even more for most purchasing decisions.
Nobody wants to be responsible for taking a chance on a new vendor and be responsible for a high-profile failure. Helping instill confidence early on makes a huge difference and following-through to successful implementation results in happy customers who become great customers and provide important referrals.
It all starts by selling what you know you can do from a business perspective for your Prospects to make their lives easier and business better, rather than selling what you know you have from a technical perspective.
A while back I wrote a post titled, “To Measure is to Know.”
The other side of the coin is that what you measure defines how people behave. This is an often forgotten aspect of Business Intelligence, Compensation Plans, Performance reviews, and other key areas in business. While many people view this topic as “common sense,” based on the numerous incentive plans that you run across as a consultant, as well as compensation plans that you submit as a Manager, that is not the case.
Is it a bad thing to have people respond by focusing on specific aspects of their job that they are being measured on? That is a tough question. This simple answer is, “sometimes.” This is ultimately the desired outcome of implementing specific KPIs (key performance indicators) and MBOs (Management by Objectives), but it doesn’t always work. Let’s dig into this a bit deeper.
One prime example is something seemingly easy yet often anything but – Compensation Plans. When properly implemented these plans drive organic business growth through increased sales, revenue, and profits (three related items that should be measured). This can also drive steady cash flow by constantly closing within certain periods (usually months or quarters) and focusing on models that create the desired revenue stream (e.g., perpetual license sales versus subscription license sales). What could be better than that?
Successful salespeople focus on the areas of their comp plan where they have the greatest opportunity to make money. Presumably they are selling the products or services that you want them to based on that plan. MBO goals can be incorporated into plans as a way to drive towards positive outcomes that are important to the business, such as bringing-on new reference accounts. Those are forward looking goals that increase future (as opposed to immediate) revenue. In a perfect world, with perfect comp plans, all of these business goals are codified and supported by motivational financial incentives.
Some of the most successful salespeople are the ones that primarily care only about themselves. They are in the game for one reason – to make money. Give them a plan that is well constructed and allows them to win and they will do so in a predictable manner. Paying large commission checks should be a goal for every business because with properly constructed compensation plans that means their own business is prospering. It needs to be a win-win setup.
But, give a salesperson a plan that is poorly constructed and they will likely find the ways to personally win with deals that are inconsistent with company growth goals (e.g., paying commission based on deal size, but not factoring in profitability and discounts). Even worse, give them a plan that doesn’t provide a chance to win and the results will be uncertain at best.
Just as most tasks tend to expand to use all time available, salespeople tend to book most of their deals at the end of whatever period is being used. With quarterly cycles most of the business tends to book in the final week or two of the quarter – something that is not ideal from a cash flow perspective. Using shorter monthly periods may increase business overhead, but the potential to significantly increase business from salespeople working harder for that immediate benefit will likely be a very worthwhile tradeoff.
What about motiving Services teams? What I did with my company was to provide quarterly bonuses based on overall company profitability and each individual’s contribution to our success that quarter. Most of our projects used task oriented billing where we billed 50% up-front and 50% at the time of the final deliverables. You needed to both start and complete a task within a quarter to maximize your personal financial contribution, so there was plenty of incentive to deliver and quickly move to the next task. As long as quality remains high this is a good thing.
We also factored-in salary costs (i.e., if you make more than you should be bringing-in more value to the company), the cost of re-work, and non-financial items that were beneficial to the company. For example, writing a white paper, giving a presentation, helping others, or even providing formal documentation on lessons learned added business value and would be rewarded. Everyone was motivated to deliver quality work products in a timely manner, help each other, and do things that promoted growth of the company. The company prospered and my team made good money making that happen. Another win-win scenario.
This approach worked very well for me, and was continually validated over the course of several years. It also fostered innovation, because the team was always looking for ways to increase their value and earn more money. Many tools, processes and procedures came out of what would otherwise be routine engagements. Those tools and procedures increased efficiency, consistency, and quality. They also made it easier to on-board new employees and to incorporate an outsourced team for larger projects.
Mistakes with comp plans can be costly – due to excessive payouts and/or because they are not generating the expected results. Back testing is one form of validation as you build a plan. Short-term incentive programs are another. Remember, without some risk there is usually little reward, so accept the fact that some risk must be taken to find the point where the optimal behavior is fostered and then make plan adjustments accordingly.
It can be challenging and time consuming to identify the right things to measure, the proper number of things (measuring too many or too few will likely fall short of goals), and provide the incentives that will motivate people to do what you want or need. But, if you want your business to grow and be healthy it is something that needs to be done well.
This type of work isn’t rocket science, and therefore is well within everyone’s reach.
Having great ideas that are not understood or validated is pointless, just as being great at “filling in the gaps” to do amazing things does not accomplish much if what you are building achieves little towards your goals. This post is about Dreaming Big, and then turning those dreams into actionable plans.
Let me preface this post by stating that both are important, and both are complementary roles. But, when you don’t recognize the difference between the two it becomes much harder to successfully execute and realize value/gain a competitive advantage.
The visionary person has great ideas but doesn’t always create plans or follow-through on developing the idea. There are many reasons why this happens (distractions, new interests, frustration, lack of time), so it is good to be aware of that as this type of person can benefit by being paired with someone who is willing and able to understand a new idea or approach, and then take the next steps to flesh out a high-level plan to present that idea and potential benefits to key stakeholders.
The insightful person sees the potential in an idea, helps others to understand the benefits and gain their support, and often creates and executes a plan to prototype and validate the idea – killing it off early if the anticipated goals are unachievable. They document, learn from these experiences, and become more and more proficient with validation of the idea or approach and quantification of the potential benefits.
Neither of these types of people are affected by loss aversion bias.
I find it amazing how frequently you hear someone referred to as being Visionary, only to see that the person in question was able to eliminate some of the noise and “see further down the road” than most people. While this is a valuable skill to have, it is more akin to analytics and science than art. Insight usually comes from focus, understanding, intelligence, and being open minded. Those qualities are important in both business and personal settings.
On the other hand, someone who is truly visionary looks beyond what is already illuminated and can therefore be detected or analyzed. It’s like a game of chess where the visionary person is thinking six or seven moves ahead. They are connecting the dots for the various future possibilities while their competitor is still thinking about their next move.
The interesting thing is that this can be very frustrating situation for everyone.
- The person with the good idea may become frustrated because they feel that they are misunderstood or ignored.
- The people around that visionary person become frustrated, wondering why that person isn’t able to focus on what is important or why they fail to see / understand the big picture.
- Those visionary ideas and suggestions are often viewed as tangential or even irrelevant. It is only over time that the others understand what the visionary person was trying to show them – often after a competitor has started to execute on the idea.
- The insightful person that wants to make a difference can feel constrained in environments that are static and offer little opportunity for change and improvement.
Both Insightful and Visionary people feel that they are being strategic. Both are focused on doing the right thing. Both have similar goals. That’s what is truly ironic. They may view each other as the competition, rather than seeing the potential of collaborating.
This is where a strong management team can have a positive impact by fostering a culture of innovation and placing these people together to work towards a common goal. Providing a small amount of time and resources to explore an idea can lead to amazing outcomes. When I had my consulting company I sometimes joked, “What would Google do?”
The insightful person may see a payback on their ideas much sooner than the visionary person, and I believe that is due to their focus on what is already in front of them. It may be a year or more before what the visionary person has described shifts to the mainstream and into the realm of insight – hopefully before it reaches the realm of common sense (or worse yet, is completely passed by).
My recommendation is that people create a system to gather ideas, along with a description of what the purpose, goals, and advantages of those ideas are. Foster creative behavior by rewarding people for participation, whether or not the ideas are used. Then, review those ideas on a regular basis. With any luck you will find some good ideas – some insightful and possibly some even visionary.
Look for commonalities and trends to identify the people who are able to cut through the noise or see beyond the periphery, and the areas having the greatest potential for innovation. This approach will help drive your business to the next level.
You never know where the next good idea will come from. Supporting efforts like these provide opportunities to grow – people, products, and profits.