Tag Archives: Process

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 Inform a Client about a Problem? Five Solutions

Situation: A company provides staff for a client. Overall the client has been pleased with the staff provided, and only a couple of individuals have had to be replaced. The client was recently presented with an individual that they seem to like; however, the company has since developed reservations about this candidate. How do you inform a client about a potential problem?

Advice from the CEOs:

  • Meet with this individual face to face or via video conference. During the interview, tactfully ask questions that will either disqualify the candidate or satisfy your concerns. Only continue to present this candidate to the client if you are thoroughly satisfied that they can meet the client’s needs and will represent you well.
  • Ask the client for their impression of the individual. If they do not express any concerns, then your own concerns may be overblown.
  • The client will require the candidate to be trained by them prior to fully bringing them on-board. This will provide another opportunity for the client to say yea or nay. If the individual completes training to the client’s satisfaction, then once again your concerns may not be justified.
  • In any communications with the client, take care to voice only concerns that you can substantiate. Otherwise, you might expose yourself to suit by the candidate.
  • Independent of this situation, adjust your selection process to require face to face or video conference interviews. This will prevent the recurrence of future situations like this one.

Do LEAN and Six-Sigma Work for Services? Three Thoughts

Situation: A professional service company is intrigued by LEAN and Six-Sigma approaches to increasing production efficiency and reducing costs. Most of the examples that they see of LEAN and Six-Sigma in action are in production or manufacturing settings. Do LEAN or Six-Sigma programs apply to processes in a professional services environment?

Advice from the CEOs:

  • LEAN and Six-Sigma are heads-down approaches to process improvement.  In a customized solution environment, standardization of processes has less pay-off. As an alternative, consider Agile Development and similar heads-up process solutions.
  • Agile Development is both a philosophy and a process. Steps to introducing Agile Development to a professional services environment include:
    • Identifying high risk areas of individual project plans,
    • Double resourcing high risk areas to increase the likelihood of fast, satisfactory solution outcomes,
    • Looking for collaborative synergies and scenarios,
    • Scheduling regular team meetings to enhance collaboration,
    • Working opportunistically rather than systematically to increase efficiency, and
    • Using project post-mortems to refine systems and processes.
  • One professional services company which has adopted Agile Development assigns Senior Engineers as outside consultants on projects. These individuals bring a more experienced perspective, and can identify more efficient ways to find solutions and produce a more cost effective and timely result.

How Do You Motivate Hourly Employees? Five Suggestions

Situation: A company pays employees based on skill level. Raises are given as an employee learns additional skills. In some cases, when they give an employee a raise, productivity drops. The company has tried other approaches including bonus systems and profit sharing but did not find these effective. How do you effectively motivate hourly employees?

Advice from the CEOs:

  • Before trying a new motivation scheme, find out what matters to your employees. It may not be either bonuses or profit sharing.
    • Develop and send out a questionnaire listing different factors – revenue sharing, bonuses, creativity, doing quality work – ask what matters to you? Get their feedback.
    • People work for respect – many studies have shown that as long as the payment offered is fair, salary is secondary.
  • Hire an advocate for your employees – a part-time HR person. An important role for this individual will be to determine what motivates employees, what they want from their jobs, and how improvements in both processes and the working environment can boost productivity.
  • What is the real issue: employee motivation, employee productivity or cost reduction?
    • If material waste is more expensive that labor – create metrics and rewards to reduce waste.
      • At companies that use the Toyota Production System employees receive points for process improvements. At the end of the year they receive a cash payout based on the points earned during the year.
      • Employees are rewarded publicly. The incentives are cash, recognition and respect. These companies find that recognition and respect trumps cash.
    • Depending upon your cost structure, it may be more productive to focus on scrap reduction. Bring in someone with experience who can find the sources of scrap. The effort will pay for itself rapidly.
  • During the hiring process, require educational attainment as evidence of the individual’s commitment.
    • Look for skills experience – machinist, etc. Match skills and experience to your needs. This will lead to faster learning curves and will help to reduce waste.

How Do You Focus Managers on Process? Five Factors

Situation: A company has goals and objectives in place for the whole company. The challenge is that they need to focus top managers on effective processes and not just on their team’s objectives. In particular they want to increase focus on cross-functional processes. How do you focus managers on process?

Advice from the CEOs:

  • Start by identifying all critical processes. Once this is done, build an in-house system to track these.
    • Make contingency decisions dependent upon sticking with the processes.
    • Consistent follow-through is essential – talk through the blocks as they arise.
    • Don’t become a slave to your own system. Stay flexible and allow appropriate non-prescriptive behavior/solutions where it makes sense. This helps to feed creativity in the organization.
  • Be an advocate/cheerleader for the new culture. Employees need ongoing encouragement as they shift focus to the new regime.
  • Build an underlying culture to support your processes. This takes time and persistence.
  • If you are growing, as you hire new people, select new employees who fit the new culture. This helps to create lead models for the rest of the group.
  • By definition, growth means increasing infrastructure, which in turn means more restrictions and rules. Keep it fun. For example, create a wine penalty for missing deadlines.
    • If you’re late on your deliverable you have to contribute a good bottle of wine, with your name and the month that you were late on a tag attached to the bottle.
    • Contributed bottles of wine are shared at the company Christmas or holiday party.

How Do You Sell in an Uncertain Environment? Six Suggestions

Situation: A company’s customer base is experiencing market softness and uncertainty. Customers are tightening budgets and delaying purchase decisions. How do you boost sales in an uncertain environment?

Advice from the CEOs:

  • Offer incentives to prompt customers to buy now instead of waiting. Two potential options:
    • A limited time discount – Sign by <date> and save X%.
    • Pre-announce a price increase. Follow this with a promotion – buy now, before the price increase.
  • If you are selling a service, package your service options in smaller chunks while pricing them so as not to erode your margins.
  • Consider 30 day trials for $X, or discounted pricing for large or committed long term purchase contracts.
  • Examine your sales process. Are your sales people speaking to the right people? Try to move the sales process up a level if this gets you to the decision maker.
  • If some of your sales people are significantly outperforming others, give them incentives to share their sales techniques with other members of the sales team.
  • If the issue is sales productivity, leverage someone else’s sales team through a partnership. The partner incurs the sales cost while you focus on implementation.
    • Look for opportunities where a partner can sell your product on top of theirs to boost value of the overall offering and increase their own top line.

Do Balanced Scorecards Aid Decision-Making? Three Factors

Situation: A company is investigating Balanced Scorecards as a management tool.  They want to get the perspective of others who have used Balanced Scorecards on how these are used and where they are effective and ineffective. Do Balanced Scorecards aid decision-making?

Advice from the CEOs:

  • To make good decisions in times of uncertainty one needs readily available up-to-date information on the key drivers of the business. Balanced Scorecards answer four important questions:
    • How does the customer view us? (Customer metrics)
    • At what must we excel? (Key Performance Indicators and Internal Business Processes)
    • How do we continue to improve and create value? (Learning/Growth & HR metrics)
    • How do we look to our investors? (Financial metrics)
  • To effectively use Balanced Scorecards employees must be empowered to make necessary changes, and there must be an effective system for prioritizing efforts – so that when a company has multiple opportunities they can decide what to do first, second, and so on.
  • Empowering people to make a necessary change
    • To improve project estimating systems, identify those who are best at estimating project timelines and costs. Have them develop a template of their process, focusing on how they complete projects on schedule. Implement this template across your estimating function.
    • To improve project on-time completion, shift the development focus to calendar and, if necessary, narrow specs to hit the deadlines.
    • To focus scope of work issues, decide test procedures up-front then work on deliverables that will determine whether requirements have been met. From this, develop project assumptions and budgets. Create a template that focuses on internal best practices and clones these for other projects.
  • Queuing Systems & Priorities
    • Define the vision of success. Then drill down to what’s most important. Look at impact of different options on the organization and performance. Finally, force this issue – if we can only do three projects what will they be?

How Do You Eliminate a Them-Us Cultural Divide? Six Thoughts

Situation: A company acquired an office in a new geography at no cost – just a commitment to keep the office going. The immediate challenge is transferring the previous owner’s client base to the new owner’s service. The people in the distant location are OK, but it will take coaching for them to deliver the new owner’s level of service. However, these people are proud and resistant to change. How do you eliminate a them-us cultural divide?

Advice from the CEOs:

  • Involve the person who facilitated the acquisition in the integration process. Get his opinion of what is needed.
  • Your prime commitment is to the client base and past practices that built the client base. Maintain or surpass this level of service.  As long as the team meets this level of performance, they are serving your objectives.
    • You and the key manager of the newly acquired office should meet with their most important clients. Help the manager convert those clients for you.
  • Your other implied commitment is to the manager and employees that you inherited through this deal. Educate them on your approach – “we will do all that we can to create success for our clients.” Connect with the manager, understand how this person serves clients, and coach the individual.
  • Be fair – the fairest method of managing is a meritocracy.
  • Manage by results, not process – if the core values between the two sites are similar, allow for cultural differences in local practice.
  • If all this doesn’t work and you want for “them” to become “us” you will have to have someone from the home office move to the distant office and manage it.

How Do You Improve Planning and Execution? Three Factors

Situation: A company wants to develop a better planning and execution process. Historically they have been poor at meeting goals and objectives. What are the most important factors that improve planning and execution in your company?

Advice from the CEOs:

  • Take the advice of Jack Stack in his book The Great Game of Business. When building a plan, do it as a company-wide exercise.
    • Make sure that all of your departments are involved, each has direct input into the development of its own goals, and each understands that they are fully accountable for the achievement of their own goals.
    • Also do this in open session, and assure that each department has the input of other departments whose activities are critical to the completion of each goal.
    • This assures that different departments are working in alignment and not against each other.
    • Finally, make the process interactive and add some fun so that everyone is engaged.
  • Milestones and meetings are critical. Each department develops quarterly goals to support the plan, and department heads meet bi-weekly to monitor progress and prevent conflicts. Revisit the plan on a quarterly or semi-annual basis to adapt as necessary.
  • Focus the plan on one-year performance – with quarterly objectives – but forecast financials and broad metrics out 3 years to assure that the 1-year plan supports long-term objectives.

How Do You Mature an Ad Hoc Sales Effort? Four Factors

Situation: A company’s sales process is currently ad hoc with a 20% close rate and an unpredictable pipeline. The CEO wants to develop an organized sales effort. How do you mature from an ad hoc to an organized sales effort?

Advice from the CEOs:

  • Use the same discipline that you use to develop and bring new products to market to develop and engineer an organized sales effort. Start with a clean slate. Develop a full business plan and process to support your sales. Set projections and milestones, assign responsibility and accountability, and hold regular meetings to monitor progress and adjust your tactics.
  • Utilize the company’s knowledge of the market and your customer base to better understand your sales efforts to date. For example:
    • Look at your sales history, and look at the cases where you have closed business. Are there commonalities or patterns among clients with whom you have won new business?
    • Similarly, look for patterns in situations where you did not close new business.
    • Look for a sweet spot which characterizes business deals that you’ve won. If you find that in past efforts there is a segment where your close rate is higher – perhaps among clients of a particular size or in a particular industry – hire a sales executive who has a history of success in this segment of the market. This will improve your close rate and provide a base from which you can expand your sales efforts in a planned and orderly way.
  • Determine your most important market differentiation – what makes you special – and validate this with current and past customers. Make sure that your differentiation is as important to clients as it is to you. If it isn’t find out why clients chose you rather and your competition.
  • Is your sales process reactive or proactive? Until you truly understand your market, it is reactive. Once you understand where your sales efforts are most effective, improve your knowledge of this segment of the market and focus both your sales and marketing efforts here to boost your results.