Wayne Wilson on Companies in Transition

Brain streaming

You’ve probably participated in brainstorming at one time or another – one of those strategic offsite retreat exercises where you try to solve a problem by coming up with as many potential solution ideas as possible in a short amount of time. No analysis or commenting on each other's ideas is allowed. That’s for the staff/management team to crank through back at HQ after the session is over.

But have you tried "brain streaming"? No, this does not involve hard-wired video streaming directly into your brain, although someone, somewhere is probably working on an app for that.

I am blessed / cursed (depending on your point of view) in being an external thinker. External thinkers do their best thinking while interacting with others. Few deep thoughts occur in the solitude of your office. But connect with someone else in a mutually stimulating discussion of a challenging topic and it’s like sticking your finger in an electrical socket. Your brain goes into overdrive; it’s been zapped.

Brain streaming is most exciting in a pitch or sales meeting when you find yourself connecting with the personal across the table and the ideas begin to flow about how they could benefit from your product or service. (What did I do with that order form?!)

But brain streaming is probably most effective in the context of a finely tuned management team where several senior members are external thinkers. (Internal thinkers don’t need a team – they get their ideas directly from the cosmos.) When this group bears down to tackle an issue, it’s like everyone just grabbed onto a hot electrical wire – the kind you can’t turn loose of until someone turns off the juice. (It’s a fantastic endorphin rush without all that sweaty exercise.)

If you are an external thinker and your teammates are not, a consigliore will do just fine. In a prior life, I had a close adviser who tended to be more of an internal thinker, but he was very good. When I wanted to develop an idea, I would call him in, shut the door, and work the whiteboard for an hour or so. I would sketch out the ideas / options. He would comment, elaborate or push back.

The beauty of this approach was that he (like all good advisers) had no agenda other than helping me develop the idea/issue at hand. Nor was he invested in any of the options. His was a pure intellect; he was only interested in what would work.

Brain streaming is not for the faint of heart (figuratively or literally), but try it. You might like it.

Stacking the (slide) deck

Business development projects are built on PowerPoint, right? Well yes, and no, unless you want to kill the deal before you start. Let me explain.

The Goods –

• PowerPoint helps you organize, re-organize and refine your pitch.
• PowerPoint forces you to be parsimonious with your words (if you expect anyone to be able to read them).
• PowerPoint creates a nice handout / leave behind – I prefer two slides per page, readable while reducing the paper poundage.
• I also like to send the slide deck in advance of the meeting – some people actually read them! More time for conversation and less time for sitting in a circle while reading the slides.

The Bads –

• When under pressure / on deadline, the technology will defeat you every time; take handouts for everyone.
• Too much pressure to put more stuff on each slide or, worse yet, increase the number of slides. 20 slides should be the max – at two minutes per page if you actually present them formally, that’s 40 MINUTES!
• If you can’t cover your idea in 20 minutes or less, think about going back to the drawing board before your prospect sends you involuntarily.

The truly Ugly –

• Contrary to popular belief, PowerPoint will not, and cannot, close the deal for you. Only you can connect with your prospect, communicate your value proposition, answer their objections and close the sale.
• The profit is in the preparation, not in the presentation. In numerous recent pitch meetings, I have yet to complete even an informal presentation of “the slide deck.” Every meeting has turned into a whirling, spinning conversation about the value proposition and how it can help the prospect get to where they want to go. [1] That should be your objective – to engage your prospect in a fruitful conversation. The slides are props and nothing more.
• If you cannot tell your story without a slide deck, the slide deck will not save you. I have watched people practically drooling (not salivating) when forced to sit through a very smart person reading his/her slides.

Now if I can just find that cord for my projector…

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[1] This outcome presumes that you are speaking with a qualified prospect to whom you have been properly introduced.

Spinning up the fly wheel

I am currently involved in a new business development project – you know the kind: Constant wheel spinning trying to get traction while at the same time sucking all of the oxygen out of your life.

And there are good days and bad days. Good days when you feel euphoric and bad days when you just want to stick your head under a faucet. This week has finally seen two good days in a row where pitch meetings with potential partners went very well. (They will sign up officially, won’t they?) I can feel the wheels occasionally grabbing hold a bit even if they are still spinning a lot.

And then you have one of those kindred spirit encounters that really put a glow on the end of a long week. I had one of those yesterday.

A brief chance meeting turned into a quick lunch and three hours later we were still sitting at the window table of this little café delving into the who, what, how, and when of a significant potential business initiative tangentially related to the biz dev project.

The new initiative may or may not click, and it may or may not leverage the biz dev project, but it was one of those exhilarating intellectual moments when you feel yourself connecting with someone, whom you have previously known only casually, on multiple levels at the same time with ideas flowing rapidly between you as the energy and excitement about the prospects build.

Now if I good just gen up a day like that every week or so…

Invest During Hard Times

-         Craig Barrett, former Intel CEO

Owner/CEOs often find it difficult to invest during difficult economic times. And yet, it is the investments made now which will drive revenue growth when the current economic recession ends. The challenge is to reduce spending while preserving or increasing investment. What’s the difference?

Investments support or drive increases in revenues and profitability. Spending is the cash disbursed for everything else which does not meet the investment definition. Like politicians, spending sponsors will argue vociferously that their particular program / budget / personnel are necessary investments and are absolutely essential for the health and even the survival of the enterprise. It is simply not true.

Finding funds for investment requires reducing large amounts of spending. Most managers are tempted to start with the free coffee in the employees’ lounge and the travel budget. There is often not enough money here to make a difference. Instead, challenge programs, markets, product lines, customer concentrations, and significant research and development programs.

Can the particular program or activity make a difference in the trajectory of the business and if successful will it be big enough to matter? The chief decision maker must be brutal in choosing among all of the good ideas. Only the very best should be funded; everything else must be jettisoned. The future of your business depends on it.

Applying ‘The Only Three Questions That Count’

I have been reading Ken Fisher’s The Only Three Questions That Count: Investing by Knowing What Others Don’t. Ken’s focus and business is managing stock portfolios at Fisher Investments but his questions and methods can also be applied to running a business.

Here are Ken’s three questions:

Question 1 - What do you believe that is actually false?

This one really set me back because it can be applied to everything you do. Life, investing and business are filled with myths. You think you know what your customers want, but have you asked them? You think you know what your competitors are up to, but have you gone into the market to see? You suspect that some of your employees are not happy working for you, but have you tried to find out why?

Question 2 - What can you fathom that others find unfathomable?

This is classic specialist, niche marketing for business owner/CEOs. How can you own a particular market segment? What products or services could address an unmet need? Or meet that need better, quicker, or cheaper? What knowledge, organizational, facility, design or production investments need to be made to position your company uniquely in that market?

Question 3 - What the heck is my brain doing to blindside me now?

This question could be summed up as “we see what we expect to see and we are simply blind to what we do not expect to see.” Each of us have pre-conceived notions or screens that filter the information we receive from our environment. Problems arise when the information we expect to see is incorrect or irrelevant to our situation, or worse, the information we filter out (are blind to) is warning us of impending disaster!

Business success is partly about the ability to challenge and vet what we see and hear. We might do well to start by challenging ourselves first.

Marc Andreessen on Innovation

Innovation is alive and well!

In a recent appearance on PBS' Charlie Rose, Marc Andreessen, Netscape co-founder and Internet pioneer, talks about the waves of technological innovation washing through today's world and what we might expect in the future. Enjoy the show!

Are you failing the fundamentals?

David Carr writing in today’s New York Times [1] reminds us of the core fundamentals of successful personal finance:

• Have a diversified portfolio,
• Don’t buy more house than you can afford,
• Don’t take on more debt than you can support, and
• Don’t trade on margin.

These same fundamentals apply to running a business successfully:

1. Sizing a proper portfolio – all businesses need a portfolio of products or services to avoid over dependence on any one offering or customer. The trick is to build out your portfolio without straying far from your core expertise or markets.
2. Trees don't grow to the sky – pursuing rapid growth for its own sake has caused great difficulty for many companies. Focus instead on affordable, sustainable, profitable growth.
3. Debt is a double-edged sword – match funding fixed assets with debt is generally okay as long as you don’t violate #2. On the other hand, paying operating expenses with borrowed money is like buying breakfast at McDonald’s with a credit card.
4. Trading on margin is asking for trouble – too many businesses have been bought with borrowed money that cannot be supported by the acquired businesses. Trading on margin is like sky diving without a parachute: the ride is beautiful but the sudden stop will likely kill you.

Stick to the fundamentals and live to work another day.

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[1] This Just in: The Market Is Still Dead at http://www.nytimes.com/2009/02/16/business/media/16carr.html

Planning is also about revenue

The revenue line is the most critical line in any business plan or forecast, and yet too many business plans focus excruciating detail on costs and expenses at the expense of product, sales, and marketing plans. While turnaround situations clearly require initial attention to cash and liquidity, the real difficulties often center on revenue issues such as:

• Declining sales
• Competitor pressures
• Inadequate sales and marketing programs

Here are some important questions to consider:

1. Are your markets stable, declining, or growing?
2. Are competitors beating you with better value propositions, lower costs, or irrational pricing?
3. How do your programs and sales execution stack up in the market?

You are driving in the dark with your lights off if you do not have clear revenue plans based on factual market-based analyses. And that can lead to some unpleasant consequences.

Maintaining a sense of urgency (while keeping your head down)

We are now into the second week of the New Year and this week’s stock market turmoil and reports of job losses seem to indicate that market and economic volatility will be with us for some time to come.

Owner/CEOs face difficult and competing challenges:

• How to develop and maintain a sense of urgency throughout their organizations, while

• Minimizing their exposure to all of the economic slings and arrows flying about them.

Urgency is absolutely critical. If you don’t already have it, get some quickly! I have experienced and observed numerous instances of business turmoil where quicker action would have reduced the pain and costs of business downturns. The economic environment is not likely to improve any time soon – get on with whatever actions you already know you need to take.

Many business owners are starting to feel like entrepreneurs again in the sense that bootstrapping is once again becoming the necessary path to sustaining and building a business. Easy credit and easy sales are a thing of the past.

Welcome to the future.

Solving problems successfully

Guest author Dean Rieck over at Copyblogger recently offered an excellent process for problem solving, which could be applied to solving a variety of business and other problems.

Dean suggests the following 11-step process:

1. Define your problem.
2. Gather information.
3. Talk to people.
4. Add order to your information.
5. Brainstorm lots of ideas.
6. Look for something to change.
7. Find a ready solution.
8. Forget about your problem for a while.
9. Evaluate your ideas and keep only the best.
10. Dissect your ideas to find flaws.
11. Act on the best ideas.

The key to this approach is using a structured process. With 2009 posing a larger than normal set of problems for owner/CEOs, a little more process could be a good thing.

Read Dean’s complete article.