Finding Your Critical Numbers

Business Planning Tools

As a Business Coach, I have created and reviewed hundreds of annual business plans. I find many companies do a poor job of creating their business plans, which seriously diminishes their growth in revenue and profits. On the surface, these plans look like they have the right ingredients for success. However, a closer look shows that the leaders inadvertently led themselves astray. They then lose valuable time and energy, creating a profit leak.
As a certified Gazelles Coach, I help clients implement the concepts found in Scaling Up by Verne Harnish. The “One-Page Strategic Plan” is a key tool that everyone looks forward to using in our annual planning process. Whether your company uses this business planning tool or something else, the issues you must consider are the same. Only the presentation of the business plan is different.

Critical Numbers in Business

At the bottom of each of the “priorities” columns of the One-Page Plan is the “Critical Number” section. I have found that selecting the Critical Number may be the single most important decision in the planning process. The Critical Number is a key performance indicator that you have identified as the essential leading indicator for any given planning period.
Whether you are planning the year, the quarter, or your personal priorities, it is essential to pick the one or two Critical Numbers that must be achieved to drive all of the other desired outcomes. If you are not sure which Critical Numbers to select, you’ll find some clues by asking yourself questions like:

  • What is the key weakness in our business model?
  • What is the biggest weakness in our operations?
  • What is causing us not to gain customers?
  • What is causing us to lose customers?
  • What is causing our cost structure to be out of line with that of our competition?

The most common business number clients want to use is revenue. However, this is not a good choice for a “Critical Number.” If growth is an issue, you need to go deeper and find the leading indicator at the root of that problem. For example, are you not able to generate enough leads? Do you generate enough quality leads?

Example of a Critical Number

A great example of failing to identify the correct Critical Number is with a technology company that recently ran into trouble. This company had been mildly successful for years, achieved moderate revenue growth, and had great profit margins. But, this company always experienced inconsistent performance in its sales team. Revenue had always depended on a yearly home-run sale. There was no predictability in the sales performance. However, the company recently found that sales were more challenging and customers now preferred the products of competitors. After deep consideration, the company found it did not meet its number-one brand promise.
I had challenged this client a few years ago to put more specific measures around their brand promises. They had failed to do so, and this was now coming back to haunt them. In this case, believe it or not, their most important promise was that their product could do what it was supposed to do. My client failed to “get it right.” So we developed a way to measure the “% of known issues unsolved” within their technology. That became their Critical Number.

Does Your Business Need a Second Critical Number?

Once you find your Critical Number for your business, ask the question, “If we focus too much on this Critical Number, what could go wrong in the company?” If the answer is nothing, then you only need that one Critical Number. However, if you find focusing on that number hurts other areas of business, you’ll want to balance the first Critical Number with a second one. This will prevent you from unintentionally injuring your progress. In the case above, the company had a cash concern. They responded by focusing the sales team on closing a minimum number of quarterly transactions. They broke that number into 20 qualified leads that were already in the pipeline and needed to be accelerated in the sales cycle.
As with all plans, we recommend that there be no more than five annual initiatives. Once you have your Critical Numbers, you can determine what the most important initiatives are to undertake. A good rule of thumb is for three or four of those five annual initiatives to focus on addressing your critical number(s). If it does not take at least two or three, you have probably not challenged yourself enough in finding the right critical business number or are not focusing on the right annual priorities.

Improve Business Growth

As an executive business coach, I can provide you with practical business solutions to accelerate your business growth. Once you have completed your business plan, ask the following two questions to determine whether or not your job is done:

  1. Have you identified the one or two Critical Numbers that will improve next year’s results, and what is the measure that tells you that you’ve succeeded?
  2. If you complete your annual initiatives, how confident are you that you will have achieved number 1?

To learn how to improve your growth potential, contact Activate Group for a FREE consultation or by giving us a call at 305.722.7213.

How Do You Find Your Purpose?

If yours is like many organizations, you and your competitors are trying to serve a similar purpose to your respective clients. That is true if you look only at the surface. It is how you see the challenge of purpose that counts. Most times I find leaders trapped in a box. That box revolves around existing products and services and does not consider the problems and challenges of people they want to serve.

By finding your organization’s unique purpose, you can move with the changing needs of your customers and evolve your products and services. Too often business leaders are trying to force the external world to buy what they want to sell. What they fail to consider is whether what they want to sell is a real need, and whether there is already too much supply solving that need. If the need is already well served or over served, then pumping more supply into the market without identifying and addressing a new critical need for their buyers will surely result in a painful journey for them and their colleagues.

5 Lenses of Purpose

When working with leaders to assist in their strategic planning session, we work on defining purpose. A common challenge is to help the leadership team find and articulate their purpose. You may wonder how purpose is discovered. I believe you can find your purpose by looking through 5 lenses:

  1. Disrupt an Industry – Airbnb changed the lodging industry forever. They made a very cost-effective and easy way for anyone to list their space and to book unique accommodations anywhere in the world. By doing so they made traveling more affordable and accessible for many people.
  2. Uncommon Service – Provide service at a level that goes beyond your competition in a way that is essential to your target customer. The traditional companies I think of are Ritz-Carlton and Nordstrom. In a less traditional sense, think of Amazon, where you know you can go to their website and find almost anything, 24/7, at the lowest possible prices and have it delivered to your doorstep, in many cases the same day as you ordered it. And all of it done with a few keystrokes. Most vendors on their side will allow you send your purchase back for free if you are not satisfied. The challenge with service is that it is like an escalator that is always going down. Once you have delivered something considered extraordinary the first time, it becomes standard the next time. So you have to keep trying to improve your service levels every year to stay on top.
  3. Change the World – We have so many large societal and natural problems that you can address as a for-profit or not-for-profit. I am proud Board Member and Red Jacket Society Member at City Year, where we believe education has the power to help every child reach his or her potential. We recognize that children in high-poverty communities have external obstacles that can interfere with their ability to both get to school and be ready and able to learn. City Year helps with these challenges. On the for-profit side you have entrepreneurial mavericks like Elon Musk, who is trying to prove through Tesla Motors that electric cars could be better than gasoline-powered cars. The impact of such an innovation will have profound impact on issues like global warming and use of natural resources like fossil fuels.
  4. Excellence – There are always ways to change the features of products — increasing their speed, beauty, functionality, etc. No company is going to get it right with every product, but Apple, Samsung, Ikea, Dyson and 3M are companies that have produced products that have really stood out from their competitors in specific categories.
  5. Information and Communication – Technology has caused this category of purpose to explode over the last 10 years. Dominant in this conversation is Google, but you also have to consider Facebook, WeChat, WhatsApp, and the myriad of others that allow people to share information, find anything or anyone, share knowledge, discover and communicate.

I recommend that you look through these five lenses and determine which of the five you are really passionate about. Then ask “what purpose can we serve within that lens” within an industry or across industries that is not being served to the level that you believe it could or should be served. The key is to think big! Consider your purpose to be a pursuit rather than a destination. It will be a mantra that you and your organization will need to constantly improve and perfect.

Head over to our business coaching page or call Howard Shore for a FREE consultation at 305.722.7213 to see how an executive business coach can help you run a more effective business or become a more effective leader.

Do You Have a Follow Through Problem With Your Business Work?

Follow Through in Business

If you are like most leaders, you more than likely have a follow-through problem. You may not realize it, and it is costing you revenue growth and profit margin. As a business coach, I have had the benefit of observing business leaders of many high-growth companies. While many of these companies are on Fortune magazine’s list of fastest-growing companies year after year, they could be growing faster and could definitely more profitably. From the long-view, these are highly successful people and organizations. As you begin to look closer, you find that (like all high performers) they have opportunities for improvement. This article discusses the issues that commonly cause follow-through problems in an organization.

The Common Issues that Cause Follow Through Problems in an Organization:

  • The decision-making process
  • Leadership
  • How often final decisions are being changed
  • Leading by consensus
  • Not understanding all aspects of the decision and outcome before making a final decision
  • Not including all decision-makers within the decision-making discussion at the same time
  • Not finishing discussions or making a final decision

Lack of Follow Through in the Workplace

Lack of follow-through in the workplace could be due to how frequently “final” decisions are being changed. When a decision is made, it should be made based on certain assumptions, directed by key questions that were answered using facts. Once you have made a solid business decision, you should only change that decision if new facts invalidate the answer to your original questions or you find that you missed a critical question that could be catastrophic to the final outcome. However, this should be an exception –not the rule. In many organizations, final decision changes are all too common; and not because there was any evidence that the original decision would cause a catastrophic change in outcomes. As a result, the organization loses a lot of time and money failing to follow-through on solid decisions in a timely manner and rethinking the same decisions over and over again.

The Importance of Follow Through in Leadership

Are you trying to lead by consensus? I find that leaders often change their decisions because they want consensus; believing that consensus is necessary in order to have commitment to the decisions that are made. In order to gain commitment, it is necessary to permit everyone to be heard and to allow for healthy debate. Once this is done, you should have the commitment you need. Immediate consensus should be less common than you think, and when you get it, beware. It means that you probably have a bunch of “yes” people in the room, or you have failed to actively engage everyone in the discussion. It is a mark of a strong team when there are diverse opinions on important business topics. The most senior leaders need to be able to elicit these different opinions, listen to everyone’s position, and then make a decision. The rest of the leaders have to be strong enough to accept that their views will not always be accepted as the right way to go. Even if you are right and the team goes in a different direction, that is just how things go.

Understanding The Decision THOROUGHLY Before Making a Commitment

Do you ever find that a decision is made and a few days later everything changes? Worse yet, weeks later things change again. Business leaders will blame this on entrepreneurship and the nature of business. However, when this occurs often and you take a closer look at the issue, it is almost always a leadership decision-making problem. When you watch how decisions are made, you will see that most people-leaders are also problem-solvers. They look for the first problem they can solve, and off they go. This may work with little business issues and problems, but it does not work with the bigger ones that cause the most harm. Before embarking on a new project or deciding to invest in that new system, there are few questions that need to be answered that I find are often overlooked:

  • What factors are the key assumptions that will be used to make our decision?
  • What questions need to be answered in order understand each assumption?
  • Are we going to say yes regardless of what we learn?
  • What information is needed to answer these questions?
  • How fast do we need to make our decision, and what are the consequences of waiting?
  • What is this decision’s priority versus all the other important decisions that need to be made?

Follow Through and Commitment Issues in The Organization

Are you allowing side discussions? This is another follow-through and commitment killer. It is critical that all decision-makers and influencers are in the room at the time of the presentation. Otherwise your project is going to start, stop, and reshape as the others eventually join in on the discussion at hand. Doing things this way will lose a lot of valuable time, and you also run the risk of losing trust within the organization. It is important to have everyone together so that everyone feels heard and can respond to each other’s positions. Some of your team leaders are masters at being passive-aggressive. They have found it advantageous to get you alone because they know that no one else can challenge their positions. They prefer not to be challenged, and they think of themselves as above everyone else. This needs to be stopped.

Improve Follow Through by Finishing Discussions and Making a final decision

There are some leaders that do not let things end. You need to see a discussion through to its end and make a decision. This is a real problem in many organizations. When you have a habit of decisions not being final, it makes it very hard for people to charge ahead with action plans. They have no confidence in you. Once you have shown a tendency to vacillate on decisions, you are branded. Your team is going to wait to see if it really sticks. This means valuable execution time is lost because your people do not trust you.

If you’re having issues with following through in your business or organization, call Howard Shore for a FREE consultation at 305.722.7213 to see how an executive business coach can help you run a more effective business or become a more effective leader.

How Strong Is Your Leadership and Management Team?

When evaluating your company’s ability to grow and to really scale itself, there is one question you must first ask yourself. How strong is your leadership and management team? Depending on your size, you may only have one level of management. As you grow, there will be multiple management levels to monitor. No matter the number of levels in place at this moment, your ability to grow will be dependent on leadership and management strength. Would your competition be jealous of your leadership and management team?

Leadership From the Bottom to the Top

“A fish stinks from head to tail.” Too often I hear the management team complaining that their company would be so much better if they had better people. If this problem is occurring in your company, start scrutinizing leadership. If you have the wrong team, you likely have problems at the top. The problem at the bottom will not be fixed until you fix the problem at the top.

EVALUATING MANAGEMENT

Do you have the right people in the right seats? “The right people” refers to company culture. Does each of your leaders and managers exemplify your company’s core values? If not, they are creating the wrong standard of behavior for the rest of the team and will infect your business culture.

“The right seats” refers to performance. Does the person you have chosen to perform in a leadership or management position produce the outcomes required of that position? In many cases, leadership is not held to the performance standards required of lower-level employees. If I were to ask you which top 2 to 3 key performance indicators are used for each leader on your team as standards for good and bad performance, would I get the same answer from you and each subordinate? If not, how do you know you have the right people in the right seats? How do you know whether any part of your organization is suffering because its leader is underperforming?

Are They A Strong Team?

Here is where things are usually the most difficult. Do you find it hard to get people with different personalities, experiences, beliefs, and functional skills sets to work together? Do you find imbalance in how much of the leadership weight is being carried by various leaders? Do you find it strange that people who are supposed to be working together work at cross-purposes? It is frustrating how seemingly smart people can spend so much time putting out fires rather than addressing the issues that would prevent the fires in the first place. When I have met strong leaders this is what I find:

Characteristics of Strong Leaders and Managers:

  • People that never stop learning.
  • Smart and talented people who have humility.
  • Answer-seekers that ask a lot of questions.
  • Knowledge and experience combined to co-create.
  • Balance in contribution from team members in meetings.
  • All team members seek each other’s opinions on various issues.
  • Healthy conflict and debate on key issues.
  • Alignment on the priorities.
  • Decisions made and commitment from all team members.
  • Team members hold each other accountable.
  • They get the most important priorities done and consistently achieve their goals.

How to Improve the Leadership and Management Team

Understanding the necessary qualifications of a strong leader and building a strong management team takes experience and dedication to the employee. Sometimes an executive coach is needed to help increase the effectiveness of leadership and improve management skills. To learn more about how an executive coach can help your leadership and management team, call Howard Shore – one of the top executive coaches in the United States – for a FREE consultation at 305.722.7213 or contact Activate Group Inc. today!

Business Strategy and Delivering Unique Value Proposition

As I mentioned in my previous article, “Are You Ignoring a Bad Business Strategy?,” your business strategy is a determining factor in whether your sales “will” or “will not” grow faster than your competition’s. Two key questions you need to ask annually as part of your strategic planning discussion are:

  1. Does your business strategy encompass a clear value proposition that would be considered an “unusual offering” and is critical in your target client’s buying decision?
  2. Are you delivering on the promises embedded in that offering?

The answers to those questions may be the primary reasons your sales force is not achieving their quotas.

Unique Value Proposition

A key to the growth of your business is your ability to develop a business strategy that includes an unusual or unique value proposition, and becoming the best in the world at delivering on the promises in that value proposition. While every business owner recognizes the importance of “unusual offering” in helping a small business grow, many do not have one of their own. Many confuse “unusual offering” with marketing and positioning. A common mistake many owners make is to create their marketing before they really develop an “unusual offering.” Worse, some develop an “unusual offering” on paper that they cannot back up through operations. It should work in reverse. Once you develop and master your unusual offering, your target clients will easily choose you over your competition. Then you can create marketing campaigns that make it easy for people to notice you, and have salespeople that can convert the core clients as they walk into the sales process.

So How Do You Create An Unusual Offering?

In order to get your business strategy right, your unusual offering may not need to be a dramatic change from your current offering. You may already have an unusual offering that you have not isolated. You want a good bundle or aggregation of products and services that help solve clients’ needs in a special way that totally fits their situation. You may have the same mix of elements as your competition, but you can combine them differently or decide to add or subtract items from your offering in untraditional ways. You should also consider what your potential clients’ options are when configuring your bundle.

Elements That Add Value To An Unusual Offering

Depending on your core client and the options available to them, you need to consider how the following elements add value to your unusual offering:

  • Price  What is their total cost today? Do they know what their total cost is? What would additional features, benefits, or services be worth to your prospect in terms of time, value to their clients, the growth of their business, reducing their stress, etc.? If you added new features, services, and benefits would they pay more for it, or would you just be increasing your cost of doing business?
  • Cost/Risk Reduction  How can you modify your offering in a way that can substantially reduce client costs? How can the design of your product or service reduce risk for your client?
  • Trends  What industry-wide trends are occurring technologically, economically, and environmentally that call for a new advancement in how your product or service is sold, delivered, distributed or marketed?
  • Performance  What performance enhancement to your product or service is most valuable to your client? Would your client pay more for this enhancement? Would you lose clients to a competitor that made the enhancement while you did not? Is this enhancement necessary to keep up with minimum expectations? At what point does the performance improvement no longer make a difference in the client’s buying patterns?
  • Customization  To what extent does customization to a product or service significantly enhance value?
  • Design  To what extent does design make a difference in the usability of your product or service? Can design make your product more appealing or usable?
  • Brand/Status  To what extent does brand or status influence the buyer?
  • Accessible  Is there a way that you can make your offering more accessible to your target client?

Activate Group Inc. helps business owners all throughout the United States create unique value propositions and perfect the way in which the value is delivered. We can maximize your team’s business strategy. Contact us for a free consultation to learn how Business Coaching can help your organization, or check out the testimonials page for stories from other leaders we have coached.

Are You Ignoring a Bad Business Strategy?

Are you ignoring a bad business strategy? Your business strategy is a determining factor in whether your sales “will” or “will not” grow faster than your competition’s. Does your business have an “unusual offering” that is critical in the buying decision of your target customer or not? Most businesses either have an “unusual offering” that their prospects don’t know about, or they don’t have one and are not facing it. Key components to a successful business strategy and your ability to grow sales are how well you understand your core customer, that you have an unusual offer for this customer, and that your strategy focuses on being best in the world at delivering that offer.

Great Sales People Cannot Erase a Bad Strategy

Are you evaluating how to grow your sales in the right way? When sales are not growing, it is usually the result of a bad business strategy. Most companies fail to recognize and address inadequate sales growth as a strategy issue. First sales management and the salespeople are blamed. This can go on for years. Salespeople come and go with no change in result! Next someone will decide it is a marketing problem. “We just need to do a better job of getting our name out there, learn to better leverage the internet to get leads, and everything will turn around.” When that fails, the economy becomes the culprit —too much competition, and so on. In most situations, the real dilemma is that leaders continue to ignore the fact that what they are offering the market is inadequate, and the marketplace has spoken.

Is a Bad Strategy Causing High Turnover?

Are you experiencing constant turnover in your sales force, followed by leadership complaining about how the salespeople keep failing? A bad business strategy results in sending good salespeople out to get slaughtered. In my experience, when you have a good strategy, even a bad salesperson can sell your product or service. When you have a good strategy salespeople line up at your door to work for you. Too often leaders are hoping and praying that hiring great salespeople will magically make a bad strategy disappear. So the real question is “what is the ‘unusual offering’ that the sales force can offer that will attract the customer segment you’ve defined as your prime target?” What is that offering that will get prospects to recognize you and say, “It is about time someone understands my needs. What forms of payment do you accept?”

What is an “Unusual Offering”?

“Unusual offering” is most commonly referred to as a “unique value proposition” — how you differentiate your product and services from those offered by your competition. I’ve chosen the word “unusual” instead of “unique” for a reason. While the difference between “unusual” and “unique” is subtle, I find the standard for “unusual” is much more achievable for most businesses. Unique offerings are very difficult to create and almost impossible to sustain for very long. However, the best businesses have mastered consistency in unusual offerings. For example, everyone in the fast food industry knows they are supposed to deliver consistent quality in food, fast, and yet they don’t. McDonald’s has a better track record in terms of moving customers through lines than other fast food restaurants. When it comes to customer service Nordstrom has been able to set themselves apart from competitors who claim high-quality service as their differentiator.

Why Your “Unusual Offering” Needs to Change

It is important to understand that your unusual offering needs to change over time with the market. For example, FedEx used to focus its business differentiator on when you “positively have to have it tomorrow at 10:00.” This is no longer a business differentiator because all of the competition caught up, and now customers expect that level of service. Even the post office can consistently deliver on that promise.

In my next article I will discuss how to develop your unusual offering. If you want help with fixing a bad business, strategy please contact us for a free consultation to learn how Business Coaching can help your organization, or check out the testimonials page for stories from other leaders we have coached.

Business Strategy Based on Knowledge Instead of Belief

Is your business strategy based on knowledge instead of belief? If you are like most entrepreneurs, you are not collecting enough external data when making your business decisions – and it will cost you millions over your lifetime. It may even cost you your business.

“Why?” you might ask. The answer is that too often we make decisions based on “belief” instead of “knowledge.” There is a very important distinction between knowledge vs. belief.

Knowledge vs. Belief

Knowledge is indisputable “fact”. Belief is your opinion about what result any given course of action will produce, and much of what you believe about your business many times is wrong.

Are you acting on facts that are no longer valid, or on beliefs that you have held for a long period of time despite contrary evidence all around? In my experience as a business coach, you probably are. Worse, when people present you with facts, you may be doing everything you can to hold onto your erroneous beliefs by finding any random inconclusive data to support them.

Communicating With External Sources

I spend more than 100 days per year conducting planning sessions. I watch leaders make decisions without collecting data from customers, prospects, or past customers. Even when they have collected data, they are not looking at and analyzing that data. Many times they are looking only for data that supports their existing opinions. Often the data they collect does not help them with their decisions because there isn’t enough, or what they have is anecdotal or too generic.

Are you collecting information on a weekly basis about people that have chosen not to do business with you, people that are customers, and people that you want to have as customers to really analyze why you lost customers? You will notice I chose “people” and not businesses, clients, customers, or any other word. You do business with people. They have needs, wants, problems, concerns, opinions, challenges, biases, etc.

The world is constantly changing, so these factors are always shifting, thus causing the need to continually collect the information to keep your offering competitive and relevant. Failure to do so results in business strategy based on “belief” instead of “knowledge.”

Start Improving Your Business Strategy With Customers

The obvious place to start is with your customers. You are probably thinking, “I know my customers” because you do business with them every day. It is a common mistake to confuse a system for collecting information with daily exchanges. Without a systematic process you will fail!

In your daily exchanges, you are concerned with delivering your product or service, and the customer is focused on receiving it. At best, you get anecdotal information and only focus on problems and challenges. During daily exchanges, your front-line staff is not thinking about the company’s business strategy or worrying about what data you need for making future business decisions. In many cases, a staff member who receives what could be useful information may filter it or not report it at all.

Collecting Unfiltered Information From Your Customers

Collecting unfiltered information from your customers should be a priority for every company. This is usually easier than you think, and the only reason it has not happened is that you have not made it a key priority. Benefits you can expect:

  1. Identify reasons to charge existing customers more for existing products and services.
  2. Identify new products and services to offer.
  3. Increase retention of customers that you did not know were at risk.
  4. Turn existing customers into a referral engine.
  5. Strategize based on knowledge instead of belief.

Customer Feedback

A great historical example of how this can work for you is when IBM had its top 200 managers talk to 5 customers and employees every week and review the information every Friday. This was an incredibly simple way to collect live market data weekly and then share it with key leaders in IBM. It helped increase sales, overcome customer roadblocks, and also added energy to the teams.

Questions to Ask Customers

We recommend you and each leader on the leadership team have at least one conversation each week with a key customer. We have found these four questions will provide you will a wealth of information:

  1. How are you doing?
  2. What’s going on in your industry?
  3. What do you hear about our competition?
  4. How are we doing?
  5. (Bonus Question… when appropriate) Do you know of anyone else that would like to be as happy as you are?

Need help improving your business strategy?

We can maximize your team’s business strategy. Contact us for a FREE consultation to learn how Business Coaching can help your organization.

Setting Deadlines for Your Team

Setting deadlines is the most painful and underappreciated part of delegating a task. Too many leaders give employees tasks without setting a deadline or asking what else they have on their “to do” list. This is a motivation killer. You must keep in mind that even though the task you are assigning is of great importance, your employees have their tasks too.

Do You Ever Say No?

Most people are trained to never say “no.” They have been wired to say “yes,” even when they know they already have too much on their plate. Often times, the delegator already knows this, but chooses to take the position of “not my problem.” In the long run, this can destroy trust and respect for the delegator and decrease employee morale, organizational productivity, and profitability.

How to Properly Delegate

When you delegate a task, you must sit with the person you are delegating to and make sure that realistic deadlines are being created. It is your job as the delegator to help your people be successful and not set them up for failure. If you are delegating to someone who has a history of over-committing, it is important to help reconcile commitments to make sure that the most important things get done first. Always make it clear that you are aware they have other tasks so want to make sure they are available to meet your deadline. Also always make sure the deadline is a realistic one. After all, when your employees succeed you succeed!

Call Howard Shore for a FREE consultation at 305.722.7213 to see how an executive business coach can help you run a more effective business or become a more effective leader.

Start Sales Planning for 2013

When the calendar turns to a new year, many salespeople suddenly feel like their troubles are behind them, and “this year” is going to be a lot better. While I think it is great to be optimistic, I also think that there are no real solid economic trends that clearly indicate that 2013 will be a much more prosperous year. To believe that your sales plan rests on a new economic high tide is a recipe for failure. Top salespeople know that the best way to get back on track is to develop a plan of attack that creates more precision around the strategies and tactics needed to reach performance targets. Most of them develop a plan that focuses on the three key revenue-generating buckets: winning new business from new clients; further penetrating high-potential existing accounts; and retaining as many billing clients as possible.

Each of these three elements has different challenges and requires different approaches. Even the very simple task of segmenting your overall target so that you know how much revenue you need to do in each of these buckets is something most salespeople never get around to doing. This first step will give you better insight into where your biggest challenge will be and where you need to spend most of your time. But doing this is not enough.

Now you need to clearly think through the 3-5 most important things you need to do in each category. For example, one of the most important things you may need to do to generate new business from brand-new clients is to develop a plan to target companies in the industries in which you and your company have a successful track record. Growing revenue in high-potential accounts may take some creativity on your part to gain access to more buying influences in the client company. And in order to retain your existing clients you may need to design a solid quarterly business review program that gives you the venue to review all of the great things you have done for them.

The point is that each of these key revenue components requires precise thinking and specific actions. This kind of clarity leads to more effective management of your business and improved discussions with management around resources and overall sales performance.

The next time you hear your salespeople talk about the difficulties of reaching their target, challenge them by making them speak more specifically about the revenue buckets and the strategies and tactics that support each of them.

Louis Partenza is a sales and business consultant and partner of Activate Group Inc, based in Miami, Florida. Activate Group brings science to the art of selling. We help you develop the strategy, implement a practical process and build sales skills to rise to the top of your game, hit your numbers and make quota. We help sales organizations drive revenue, predictability, operational efficiency and superior performance. Learn more about how we can help.

How do you find your “Blue Ocean”?

More importantly, what is a Blue Ocean? That is the main focus of our upcoming strategic planning workshop called Keys to Forming an Awesome Strategy Workshop on Feb. 2. In it, we examine some of the principles from the book Blue Ocean Strategy by W. Chan Kim and Renee Mauborgne. In order to teach students how to build a business strategy that works, we look at how to dissect the various differentiating aspects of a service or product and create a refreshed strategic model around it.

Think about the different dimensions of your business. What decisions can you make about your product or service that will help you break boundaries? What choices do you have in terms of positioning your company in the marketplace?

This workshop gives you the model you need to reposition and strategize for exponential growth and success using some of the tactics of Blue Ocean Strategy, Good to Great (by Jim Collins), and our years of business strategy consultation experience.

This strategic planning workshop will help you answer:

  • What is the purpose of your business in one word?
  • What is your one-sentence strategy?
  • What is your brand promise?
  • What is your one main target audience?
  • What is your “big hairy audacious goal?”
  • What can you be great at?
  • What is your “X Factor?”
  • What is your ‘Profit per X’?
  • How does culture affect your business strategy and success?
  • How do you attract and hire the best talent?

Hurry! Spots are for our strategic planning working are limited so REGISTER TODAY.

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential. To learn more about how an executive coach, management consultant, leadership training, or business coach can help your team, please visit his website at activategroupinc.com or contact Howard Shore at (305) 722-7216 or email him.

Setting Examples Helps Employees Care About the Bottom Line?

As a leader in your company you are the foundation of the company culture. Like many business leaders, you may be struggling with how to build a sense of fiscal responsibility within your team. It’s a challenging thing to try to get entry-level employees to care as much about the bottom line as you do. The number one way to get employees on board with penny-pinching?

Set the example.

Spending money is a responsibility. And it is public, whether you want to believe it or not. When you spend the company’s money, employees make mental notes. If you are spending money frivolously, employees will get the impression that the company is rolling in dough. And when they see company leaders spending money left and right on non-essentials, they usually believe it’s okay for them to do the same.

I’ve seen CEO’s spend thousands on employee outings, perks for management, personal trips and entertainment, gadgets, etc. Not only do employees see this as a sign of prosperity and therefore excess, but also they see it as selfishness and favoritism. Giving certain employees (like yourself) valuable perks and excluding others is favoritism and a huge demotivator for the rest, which equates to less work effort overall.

By not controlling your company spending you are sending two very bad messages to employees:

  1. Spend money carelessly because I do.
  2. Only special employees get perks…and you aren’t one of them.

Double whammy on your bottom line.

The good news is that setting a good fiscal example is pretty easy. All it takes is discipline and prudence. Here are three easy tips for controlling your spending:

  1. Set an annual client entertainment budget. When it runs out, that’s it.
  2. Set an annual employee recognition budget. This could be spent on things like an Employee of the Month program and/or annual team party. Again, when it’s gone it’s gone until the next fiscal year.
  3. Instead of handing out individual perks to management or “favorite” employees without context, hold some kind of internal performance contest and reward the winners. Prizes should come out of the employee recognition budget.
  4. Never pay for personal perks or entertainment out of company coffers. As the company founder/leader you many feel entitled to reward yourself, but resist it because the message this sends is: “I worked hard and deserve a personal perk on the company dime.” You don’t want your employees thinking that way, do you?

Have you ever rewarded yourself on the company dime?

About the Author

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please visit his website at activategroupinc.com or contact Howard Shore at (305) 722-7216 or email him.