Wayne Wilson on Companies in Transition

Planning for Profitable Growth – How do you make it all happen?

The final key to profitable growth is execution – making it all happen.[i] According to an old saying, inspiration (figuring out what to do) is 5% of success, and execution (doing the work) is the remaining 95%. To those two, I would add leadership and teamwork.

Effective business plan execution requires that the owner/CEO:

1. Engage the entire organization in the campaign,
2. Lead from the front, and
3. Hold everyone accountable for goals and actions plans.

Here are a few examples:

• A large data storage company is renowned for its get it done, make the numbers sales culture. No one from the CEO to the local sales reps lets up until the goal is achieved. Consequently, the company has grown into a multi-billion dollar enterprise.

• The owner of a mid-range computer systems dealer personally led the company’s sales team, weighing in with key customers and vendors to ensure that deals got done. The sales team functioned with the focus and frenzy of a brokerage house trading desk. The ultimate prize was the sale of the company to a larger dealer for over $24 million.

• The top sales representative for a large distributor was completely dedicated to her customers 24 hours a day, seven days a week. No customer problem was too small: calls were handled quickly, proposals rendered creatively, and nothing was left to chance when coordinating the work of other departments. As a result, her team generated many millions of dollars in sales, which were a multiple of the next highest producer.

In business as in football, nothing else matters if you cannot push the ball over the goal line.

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[i] This is the seventh and final article in a series illustrating techniques used in planning for profitable growth.

Planning for Profitable Growth - How will your people know what to do?

Once you have defined your mission, vision, strategies, goals and action plans, an integrated communications plan becomes the glue binding everything together.[i] Bringing your entire organization into the process allows everyone to share in the responsibility for your success.

A well-designed communications plan can be simple or complex depending on the needs of your organization. The plan should:

1. Include everyone in the organization 
2. Assign someone responsibility for each group, department or constituency
3. Identify the themes, concerns and likely questions to be addressed
4. Define the methods to be used (letters, emails, meetings, etc) and time lines

Here are a few examples:

• An information technology services company used email announcements, followed by a company-wide meeting to announce a new strategic direction and related management re-organization. The themes from that meeting were re-emphasized in subsequent departmental gatherings.

• As a chief operating officer, I used regular open forum appearances before departmental gatherings to answer employee and managerial questions about the company’s performance, strategy and direction. The Q&A format is a great way to get feedback while focusing directly on associates’ concerns.

• A medical devices company used an external public relations consultant to choreograph internal and external communications for a major merger announcement. The internal action plan addressed management organization, strategy, and other personnel-related matters necessary to keep associates focused on customers.

Constant communication improves your ability to work as one team.

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[i] This is the sixth article in a series illustrating techniques used in planning for profitable growth.

Planning for Profitable Growth – How do you organize the work?

Driving profitable growth requires continuous, concerted effort on the part of everyone in your organization. And everyone must share in the responsibility to ensure that all necessary tasks are carried out.[i] New initiatives especially require focused effort. Action plans can provide that focus.

Action plans should:

1. Identify specific objectives to be accomplished 
2. Identify the person(s) responsible for each objective 
3. Set target dates for achievement
4. Define required activities and resources

Here are a few examples:

• A technology reseller identified its top five vendor relationships, assigned a senior manager as the key person responsible for each relationship, and then developed separate action plans to grow their business with each vendor. The vendor targets included sales and profitability goals, which were shared with and reconciled to the vendors’ own targets.

• A professional services firm decided to expand its practice in several specific industries. The firm appointed national practice leaders to lead strategic marketing groups composed of existing senior practitioners in each industry. Each group developed an action plan identifying prospective clients, preparing maps of existing relationships and likely business needs for each target client, and launching communication and relationship building activities (seminars, newsletters, etc.) which would highlight the firm’s ability to help solve the target clients’ problems.

• A life sciences company needed to upgrade the talent pool from which new associates were being hired. The company developed an action plan to hire two top tier graduates from each of several area business schools. The head of human resources owned the overall plan with another senior manager assigned to each school. The action plan addressed faculty relationship building, company advantages, time lines and required resources.

Action Plans become the paths leading to your success.

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[i] This is the fifth article in a series illustrating techniques used in planning for profitable growth.

Planning for Profitable Growth – What will your success look like?

Goal setting and measurement provide accountability for your mission and vision. Goals help you to visualize what your success will look like as well as providing signposts along the way.[i]

The best goals are:

1. Relevant to your mission and vision
2. Achievable with effort
3. Measurable

Here are a few examples:

• A retail distributor energized its management team by setting and pursuing goals to match the quarterly and annual sales growth rates of its largest competitor. Achievement of the goals led to a successful initial public offering (IPO) of the company’s stock.

• An information technology professional services company expanded its market share by establishing specific sales goals for a new product line supported with resource allocations and targeted bonus plans.

• The vice president of a distribution center reduced lost time accidents and improved labor productivity by setting specific targets for improvement and reinforcing them with group incentive bonus opportunities. As targets were reached, the staff celebrated with progress meetings at which bonus payments were distributed.

Goals are like torches in the dark – they light the way.

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[i] This is the fourth article in a series illustrating techniques used in planning for profitable growth.

Planning for Profitable Growth – What is Your Path to Success?

Once you know where you are and where you want to go, you can get down to the business of trip planning. In business planning language, we call trip planning developing a strategy.[i] A business strategy is nothing more than the broad plan of action by which you expect to accomplish your goals.

To be effective, a strategy must:

1. Be relevant to your goals – executing the strategy should move you toward your goals.
2. Be affordable and executable with current or available resources – a great strategy that your business cannot execute is worthless.
3. Be defensible – if competitors can quickly copy or otherwise trump your strategy, you will not likely make much headway.

Here are a few strategy success stories:

• A technology reseller implemented a rapid delivery strategy by moving its distribution center to the operations hub of its principal shipper. While competitors eventually copied the strategy, the company was the first and only overnight delivery supplier for several years.

• A professional services firm became the premier provider of merger & acquisition services to several early private equity firms by dedicating a team of specialists to each of a few key clients. Whether there was a deal in process or not, each team was assigned solely to its client. When a deal arose, the dedicated team marshaled the necessary resources from throughout the firm to turn on a dime and deliver its services in rapid fashion.

• A medical devices company gained a dominant two-thirds market share for a diagnostic test by developing a best in class product, which virtually displaced existing competitors and limited the success of new entrants to the market.

First, find the path and then move out quickly to seize the advantage.

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[i] This is the third article in a series illustrating techniques used in planning for profitable growth.

Planning for Profitable Growth – Who are you and What are you trying to accomplish?

Rather than mission and vision, let’s talk about what you want to be when you grow up.[i] The key questions to consider here are:

 

1. What does or can your business do to make a difference in the lives or success of your customers?
2. What will your success look like if you can satisfy those customers needs and wants?

Here are a few examples.

• A technology reseller had grown by selling boxes and billing hours. But hardware margins alone no longer supported the business and billing hours required hiring more expensive staff. The new strategy involved delivering integrated technology solutions. Customers were crying for help and customized solutions effectively reduced competition.

• A professional services firm had long relied on delivering compliance services but increasing price competition was eroding margins. The firm shifted its marketing and service delivery focus to helping clients solve pressing operational problems resulting in more relationship driven new work at higher rates with little or no competition.

• A regional architectural services firm narrowed its focus to designing and building health care facilities and became the go to specialist in its market, thereby accelerating its revenue growth and improving its profitability while limiting its exposure to the more volatile commercial office market.

Mission drives the business. Vision lights the way.

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[i] This is the second article in a series illustrating techniques used in planning for profitable growth.