Wayne Wilson on Companies in Transition

Selling successfully without breaking the bank

Chris Thompson [1] had some great advice today for sales organizations facing budget cuts in a difficult economy. [2] The trick is to reduce costs without reducing the top line, and Chris’ recommendations make sense in good times and bad. Too often the sales organization is sacrosanct, but it should not be that way.

Here are Chris’ recommendations:

• Reduce travel – make the trip only when it will make the difference.

• Reduce mailings and “sending information” – just think of the saved trees (not to mention landfill space!)

• Reduce entertainment costs – wining & dining is not selling

• Trim back the promotions and contests – sooner or later, everything runs its course. Just make the new ideas less expensive.

• Ask your sales team for help – great advice for every department facing cost reductions

Spend your money on the things that will make a difference and hold the line on everything else. Most of it will not be missed.

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[1] Christopher Thompson is the founder of Catch 22 Solutions, a sales performance consulting company in Manchester, NH
[2] Sales team budget cuts not taboo, New Hampshire Sunday News, November 23, 2008, page D1

The Success Process – exactly what are you planning to do?

There are plans and there are plans. [1] There are great plans, which took months to develop and now sit on a shelf gathering dust. And there are once great plans now rendered irrelevant by changing circumstances. Ineffective plans come in all flavors, shapes, and sizes; the common denominator is that they will not help you reach your goals.

Effective plans should be:

• Targeted – directed toward accomplishing specific objectives
• Practical – the required actions can be accomplished with available resources
• Flexible – easily modified when circumstances change
• Short – capture only the essential actions, participants, resources and time frames

Rather than craft a rigid operating plan, develop a plan template, which can be continuously updated and modified on a periodic basis.

• An entrepreneur, launching a new service business, sketched out his business development plan in a notebook including 1) target customers and lead sources, 2) proposed services, methods and pricing, and 3) marketing messages, activities, and required materials. Each week, the entrepreneur logged his activities, tallied leads and results, and modified the plan as necessary.

• A telemarketing company facing rapidly expanding market demand for its products scrambled to expand its sales force. To capture the sales opportunity, the management team quickly 1) ramped up sales recruiting activities, 2) streamlined the basic sales training program, and 3) rented cheap additional call center space. Plans were reviewed and adjusted weekly as the market evolved.

A plan is only as good as the results it produces.

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[1] This is the second article in a series illustrating the principles of The Success Process.

The Success Process – Are you thinking accurately?

You’ve probably heard the old maxim that success breeds success. [1] And yet the world is full of what the music business calls one-hit wonders – artists who had one hit record and nary a second. Why is that? Some possibilities:

• Good timing – they were just lucky.
• They changed the formula and the new one didn’t work.
• They were not as good as they thought they were.
• The world changed and they did not.

Each possibility involves a failure to understand why they had been successful the first time. Desire, belief and optimism while essential to success must be tempered with accurate thinking.

• A wildly successful technology reseller failed to invest in the next round of growth (middle management and information systems) and rapidly fell behind new competitors.

• An investment banking company followed competitors into a new field without understanding the risks and almost collapsed.

• A custom software consultancy shifted into the software product business without understanding the investments required to support customer installations.

Accurate thinking requires that you know the truth – the good, the bad and the ugly – and act on the basis of that knowledge. Anything less is merely playing roulette.

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[1] This is the first article in a series illustrating the principles of The Success Process.

Strategy is about saying No

Strategy is about saying no according to noted consultant and former Harvard Business School professor, David Maister. [1] What does Maister mean?

You probably think of strategy as the list of means by which you intend to accomplish your business goals. But for every strategy you choose, numerous other options and opportunities are essentially foreclosed because:

• No one can focus on more than a few priorities at once.

• Resources are scarce and must be carefully allocated to key priorities

• Diversion and digression are the enemies of success

According to Maister, the real problem occurs when you don’t follow those rules:

• Choose strategies without giving adequate thought to the foregone options and your decisions may not be optimal.

• Changing strategies repeatedly will likely waste resources.

• Distraction is costly and your success depends on a laser focus on clear goals and well thought out strategies.

Just say no to everything else.

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[1] Maister’s most recent book is Strategy and the Fat Smoker: Doing What’s Obvious but Not Easy

Pay me now or pay me later

In a recent article, [1] John Zayac,[2] offered some pithy advice for owner/CEOs contemplating the eventual sale of their business.

• Build middle management. Buyers don’t want to purchase a business dependent on one or a few people.

• Commission an environmental assessment. If real estate will be involved in the deal, buyers will demand one whether you utilize toxic chemicals or not.

• Identify and document valuable intangible assets such as computer databases, contracts, copyrights, other intellectual property or proprietary technology.

• Convert financial statements to full accrual accounting, commission an audit and eliminate two more obstacles to a deal.

• Document in writing all policies, procedures, and processes so that the business could be run without you.

• Consider implementing employment agreements with non-disclosure and non-compete clauses for all key employees.

Zayac’s advice all falls in the category of pay me now or pay me later.

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[1] Advance Preparation, Mergers & Acquisitions: The Dealmaker’s Journal, November 2008, p. 79

[2] John Zayac is president of IBG Business Services