Situation: A CEO is concerned that her company is not as efficient or effective as it could be. Of the key activities where the company is focused, few have any obvious connection to the customer or the customers’ needs. How do you focus on doing things right?

Advice from the CEOs:

• Create a set of cost graphs to parallel the company’s revenue graphs. If these are put side by side, does it indicate that the company is doing some things that add relatively low value and profit? What happens if resources are shifted away from less valuable activity?
• Concentrate resources on doing one profitable thing well. Become best in class at this one thing. This may both increase the value of the firm and help to focus future development.
• Bring in a senior level marketing research person or marketing manager with marketing research experience to determine what the customer wants, how should the company compete, and what current customers may be willing to pay for its software.
• Strengthen the primary product – it represents 90% of sales. This is where the company has the best understanding of both its customers and the market. Look at what it takes to become enterprise wide with the company’s largest customers. Expand vertical capabilities and build $1 million accounts to $5 million a year.
• The company already has a diverse group of clients, many of whom are huge.
  • How deep is the company in each of these clients? It may be easier and less expensive from a sales standpoint to go deeper into these clients than to bring on new clients.
  • Look for ways to make current $1 million clients $5 million clients by selling what the company currently sell to more of their divisions and locations.
  • The key to executing this strategy is to listen closely to what clients’ needs are and adjust or customize the offering to better meet their needs.
• Focus on solutions and reduce the cost of solution implementation. Consider becoming more vertical in one key implementation and become the best at that.
• Create a relevant framework for the company’s strategy. For what purpose is it necessary to do the right thing? If the purpose is to exit in 2 to 3 years, this yields a very different strategy than if the objective to dominate the company’s market in a 5 to10 year period.

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