Tag Archives: Plan

Is It Time to Hire a Marketing Manager? Five Considerations

Situation: A small company has always used guerilla marketing as its marketing modus operandi – trade shows, etc. Their VP Sales recently left. They feel a need for a marketing plan and hired a company to assist them in understanding how they are perceived by their customers.  Should they continue to outsource, or is it preferable to bring marketing expertise in-house? Is it time to hire a marketing manager?

Advice from the CEOs:

  • How well do you understand your customer profiles? It is important to characterize, segment and understand your customers before you can understand your marketing.
    • What is the company size of your typical customer? Small companies don’t spend a lot on big trade shows, other than perhaps sending a couple of people as attendees. Event marketing may be a more effective way to reach small customers.
    • The company that you hired should be answering these questions for you.
  • Marketing is about creating an environment in which people are aware of you and find you versus your having to go out and find them. Social media have fundamentally changed the marketing challenge, emphasizing pull versus push marketing – commercials, ads, billboards, etc.
  • An important role of marketing is perception management so that when a lead or need arises, your company is a natural answer.
  • Whether or not you hire a person, you need a marketing plan. Once you have a plan, you need a marketing budget.
  • The company is now at 35+ employees. Fischer’s growth curve research indicates that at this size you need a professional in the marketing position – someone with experience who knows the ropes. This person could be inside or outside.

How Do You Create Values, Mission and Vision? Four Ideas

Situation: An early stage company wants to create core values, vision, mission, and a BHAG (Big Hairy Audacious Goal) to guide the company and inspire employees for the next five years. What are the most important aspects of this process? How have other companies done it? How do you create core values, mission and vision?

Advice from the CEOs:

  • As the founding CEO of an early stage company, define yourself first. What are your skill sets and talents? Start from the beginning: why did you start your company? What motivates you and what do you want to build or accomplish? What are you passionate about? What really turns you on? You are the individual who, in an early stage company, must inspire your employees. What inspires you and what has attracted your employees to the opportunity presented by your company?
  • Create your business plan around your dream. If creating something exciting and new or making money is important, how can you make creating something exciting or making money living your dream? If the most important factor is something else, how can you achieve this living your dream?
  • The US Government is desperate for export opportunities involving high tech products which will employ Americans. The opportunities are in new innovations, not commodities. For example, solar panels are high tech but they have become commodities at least in their current configurations. Look for something that is unique and new – for example software that helps to increase the efficiency and security of the grid.
  • Entrepreneurship is not about having a steady income. It’s about creating something new. If what you develop works, you will make money. However, if you want a steady income – go get a job.

Where Should You Focus – Eyeballs or Dollars? Six Thoughts

Situation: A company sells personalized content as well as a tool kit. The long-term plan is to monetize storage of personalized content. When they speak to venture capitalists, the VCs advise them to focus on just building their user base and not to worry about revenue.  What would you do? Where should you focus – eyeballs or dollars?

Advice from the CEOs:

  • Take advice from venture capitalists with a grain of salt. Remember that their game is to fund companies that they like incrementally, taking a greater share of ownership of the company with each increment in funding. The more you lack revenue, the more you’re dependent upon them.
  • Gain traction by offering free content with up-sell opportunities for premium access.
  • The give-away strategy is a great model to build your initial user audience. Consider micropayment options for special features, content storage, and so forth.
  • Going slow and steady may not be the right model for this space. Company growth for a web-based platform is different from the typical bootstrap model.
  • It’s hard to get good advice for viral marketing opportunities from CEOs who have bootstrapped their companies. Look for other input. Seek the advice of CEOs who have been successful in the viral online marketing space and learn as much as you can about their business models.
  • Gaming is another opportunity – premium or virtual world sales.

How Do You Raise Cash Short Term? Seven Suggestions

Situation: A CEO has identified a new business opportunity that looks promising but will require raising additional cash short term. What are good sources of short term cash, and what will simplify access to these resources? How do you raise cash short term?

Advice from the CEOs:

  • You must be the biggest critic of this opportunity. If it doesn’t fly to your critical eye, it will be hard to sell to others. As a reality check, ask yourself whether the opportunity is something on which you’d bet your house.
  • Build the new capability around a web distribution system that compliments your other capabilities. This broadens the appeal of the offer.
  • Generate an investment proforma and revenue stream. Most investors or debt financers will want to see this. You can position it as an immature business plan backed by your best estimate of the numbers.
  • You’ll need a business plan unless you’re lucky enough to find someone who believes that you can turn any opportunity into gold.
  • Presell subscriptions to target clients to prove the value of the offer – both to you and for investors.
  • Assure that any payments due from you go into an escrow account, to be released on a quarterly or other phased basis pending performance from the other parties within this deal.
  • This is not a venture capital story. Angel investors will seek a lower return for lower risk than VCs. Set some milestones for the Angels that will help them to see that you are monitoring their risk.

What Process Do Use to Add a New Sales Person? Five Thoughts

Situation: A CEO wants to add a key person in sales. For a long time most sales have been handled by a long-term employee with a strong sales background in the company’s market, often working closely with the CEO. This sales person is nearing retirement. What process do you use to add a new sales person?

Advice from the CEOs:

  • Involve non-sales personnel in the interview process. These individuals are important to your company culture, and will necessarily be working with the sales person. They may bring insights to the interview process that you do not see. In addition, involving them in the selection process will smooth the on-boarding process of your eventual hire.
  • Work with current staff to create a 90-day on-boarding plan for the new person. This helps in two ways: it identifies important characteristics that you will want to see in a good candidate, and it provides an on-boarding road map that will help the new hire to succeed.
  • Consider going one step further and have current personnel identify and pre-qualify candidates for you.
  • Use creative as well as traditional methods to identify potential candidates. In the process, make sure that you are not misrepresenting your situation or creating legal or ethical problems.
  • Have your options in place when you are ready to move on a particular candidate.

How Do You Set Expectations for an Employee? Six Suggestions

Situation: A company hired an employee one year ago. The employee is competent but slow. Even after a year on the job, other employees with similar skills and experience are able to complete the same job three times faster. What is the best way to handle this? How do you set expectations for an employee?

Advice from the CEOs:

  • The most important principle governing situations like this is clarity of communications. You must clearly express your expectations, and you must assure that the employee clearly understands your expectations.
  • Assure that expectations are clearly expressed. This means what you expect in terms of performance, and firm timelines for achieving minimum requirements. You also must assure that the employee understands the consequences for failing to meet minimum requirements. The best assurance is written confirmation that the employee understands what is expected.
  • Don’t be vague or nice about your expectations, performance requirements or the consequences for failing to meet minimum requirements. This risks sending the wrong message to the employee.
  • Put the employee on a performance improvement plan to meet minimum job requirements. Monitor and document for 30-60 days and then handle according to how the employee responds.
  • If the individual can’t meet the objective, but has potential value to the company, offer the person an appropriate position at the level that the new position pays.
  • Have a second person in the room when you deliver the message. If you determine that you have to terminate the employee and the employee elects to sue, this will help your case in a judicial action.

How Do You Manage Multiple Products and Segments? Five Ideas

Situation: A company was launched on a single product with variations. Their R&D team has now developed several additional products which they are planning to launch. This will involve new product names and new customer segments. Having not done this before, the CEO seeks advice on managing multiple products, brands and market segments. How do you manage multiple products and segments?

Advice from the CEOs:

  • The most important element is the plan – write it carefully and build from a solid base.
  • When working with multiple products or market segments, match your segment strategy for each segment to your product strategy for that segment.
    • Build a grid that shows all products and all segments where you wish to sell them. In each cell, determine both the decision maker(s) and their top purchasing priorities. This will help you to build your Product/Segment strategy and optimize resource allocation while increasing sales and marketing effectiveness.
    • It may also help you to fire problem customers who cost you money and attention and reallocate these resources to more promising opportunities.
  • Analyze the customer’s decision-making process for each product and segment. Make sure that your marketing and sales effort makes sense within their decision process and focus on what is workable.
  • When introducing a new product or idea, focus first on smaller segments and test the fit of your product or idea. This is low risk if you fail, and you can leverage what you have learned if you win.
  • Build a one-page strategic plan that covers your full company strategy. Each department compliments the company strategy with its own departmental strategy to support the company strategy.

Special thanks to John Maver of Maver Management Group for his contribution to this discussion.

How Do You Expand Your Business Model? Seven Recommendations

Situation: To date, a company has performed a single set of services focused on collection and delivery of a stream of raw data to its clients. The CEO wants to add a consulting service based on the expertise that the company has developed over the years. The CEO seeks input on both how to position this new service, and how to organize it, either within or separately from the current business. How do you expand your business model?

Advice from the CEOs:

  • Consulting services can be offered at a premium to current services because the company will be offering analysis and recommendations for a solution, instead of just raw data. Intelligence is more valuable than raw data.
  • Offer the consulting service on a project rather than an hourly basis. For example, price a project at $10k for the consulting package instead of $200/hour for data collection and reporting.
  • To add weight to the consulting offering, provide final reports and recommendations as a professional, written document supplemented by a presentation.
  • Test the concept and early options for the consulting service with existing clients.
  • Create a new division for the consulting service so the customer sees it as an additional option and value that the company provides. This will change both the branding and image of the business.
  • To increase the opportunity for success, develop a full business plan for the consulting model.
  • Focus on the new consulting business with the same discipline as the current data business.

How Do Business Prospects Look for 2015-16? Six Observations

Situation: A CEO is planning for 2015-16. While the economy seems to be picking up, there are clouds on the horizon. Do you believe the positive indicators? How do business prospects look for 2015-16?

Advice from the CEOs:

  • Company A: Based on our pipeline we should be recruiting heavily. However we are being conservative and are only adding personnel selectively.
  • Company B: We expect 2015 to be modestly better than the last few years. Engineering saw a turnaround this summer; however we need to see signs that this early economic cycle work spreads more broadly to the rest of the economy.
  • Company C: Some of our development work looks like a spike due to delayed projects. This may not be sustainable.
  • Company D: Weakness in Europe and the recent announcement that Japan has entered another recession give us caution about international prospects.
  • Increasing numbers of Baby-Boomers are retiring. However, some statistics suggest that 60% of retired boomers will be living on Social Security, meaning that they will struggle to make ends meet. This could create a negative shift in consumer spending.
  • The current stock market rally is based on the higher profitability of large public companies. This has come about as a result of two factors: recessionary cutbacks and easy money from the Federal Reserve. What we may be seeing is a Fed–funded bubble. There is a question of its sustainability.
  • Implications for business:
    • For companies doing business internationally – the lower dollar helps.
    • Cautious additions to employment/investment.
    • Need to deal with inflation if the recovery accelerates.
    • If and when the recovery accelerates, employee retention may become a challenge.

How Do You Coordinate Sales and Marketing Plans? Four Points

Situation: A small company uses a sales plan, but not a marketing plan. The CEO wants to know about marketing plans, and how they are different from sales plans. Most importantly, if a company has both, how do you coordinate sales and marketing plans?

Advice from the CEOs:

  • Sales and Marketing Plans are two aspects of the annual planning and revenue forecasting process. The difference between the two is focus – strategy versus implementation.
  • The Marketing Plan is strategic. It defines and quantifies the market that the company addresses, and also what markets the company does not address. It identifies the key attributes of the company’s market and products or services, and sets the broad direction as well as the high level objectives for the planning period – usually one year. It also covers both current products and product additions or extensions. The focus of the Marketing Plan is one-to-many.
  • In contrast, the Sales Plan is focuses on execution of the Marketing Plan. Ideally, the sales team takes the Marketing Plan and sets individual and team sales objectives that will meet the revenue objectives set in the Marketing Plan. The focus of the Sales Plan one-to-one – what each sales representative, and each division of the sales team (unit, district, region, country, and so forth) commits to sell during the coming year.
  • To coordinate the Marketing and Sales Plans, it is best to draft the Marketing Plan before asking the sales team to draft their Sales Plan. It helps the two teams to coordinate their projections for the coming year and allows the sales team to project sales based on changes to the product mix included in the Marketing Plan.