Tag Archives: Complex

How Do You Manage Growth? Six Points

Situation: Many companies face challenges managing growth. Growth is a complex process involving strategy, staff and company culture. What guidance can the group give to help guide planning for growth? How do you manage growth?

Advice from the CEOs:

  • Think of growth in term of five major components of organization and growth: structural, cultural, facilities, documentation systems, and people.
  • Structural
    • Consider different ownership and profit sharing options. Look for options that fit the objectives of the company.
    • If you are looking at multi-location solutions, develop a structure that can be easily copied in new locations that are added but which is complementary to the home office structure.
  • Cultural
    • If the business is family-run and looking at moving to a non-family structure, look for options that will preserve the best aspects of the culture as it has developed.
    • Keep company values intact.
    • Focus on maintaining engagement and commitment.
  • Facilities
    • The transition from single-site to multiple-site is particularly traumatic. The jump from 2-sites to 3-sites is much easier because an effective model is already in place.
  • Documentation Systems
    • Growth can compel the company to adopt entirely new systems, especially when passing certain thresholds for government regulations (i.e. 50+ employees).
  • People
    • Hire and retain for the right mindset – consistent with company culture and structure.
    • Specialists can be a real asset for their particular talents, but they seldom have the view of the “big picture” that is required for a turbulent environment.
    • Compensation – align compensation with company culture and priorities.
    • “Ownership” may have to change from sole ownership to shared ownership in order to keep key talent engaged.
    • Add new skill sets to address needs but assure that these complement existing skill sets.

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How Do You Execute the Product and Market Timing Plan? Five Points

Situation: A company’s CEO is operating in a complex marketplace. Product pricing and consumer acceptance are issues. Consumer education about the product is an important part of the market plan. It may take a couple of years for the market to develop. How do you execute the product and market timing plan?

Advice from the CEOs:

  • Important issues are survival while the market develops and maintaining a unique technology advantage.
  • As a small player in a busy and rapidly evolving market, a critical element of the strategy will be to rapidly gain the attention of the people that Seth Godin has named the “sneezers” – those who have significant influence on their consumer and business peers and who can quickly help to create the momentum that will drive the company’s market position.
    • Examples: give the product to the key influencers at target companies.
    • Make it easy or free for the key influencers within your partner organizations to experience, love and spread the word about the product. Allow them to give a few free copies to friends.
  • To avoid becoming roadkill, fly under the radar.
    • Look for opportunities as they occur in this evolving market. They may come from many players.
    • Have a solid strategy in place to execute once an opportunity arises: What do you want to achieve? What is the timeline? How will you measure achievement?
    • Have multiple back-ups to the key partners that the company is currently courting.
  • Instead of looking for VC funding to fund the next round, why not secure the additional funding from the company’s original backer?
    • To earn this the company will have to demonstrate: interesting partnerships, traction in the marketplace, and assurance that an existing major player won’t squash the company.
  • A perceived barrier is that the product is not quite ready to deliver the experience that customers will expect.
    • What is “not quite ready”? Most successful products are not 100% ready on introduction. Look at Microsoft’s strategy. From their earliest products to the present, new versions are launched when they are 80-90% complete. They then respond quickly with updates based on customer feedback. Many other companies have done the same.
    • Historically, first to market has beaten later, more complete entrants.

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How Do You Recruit a VP of Sales & Marketing? Seven Thoughts

Situation: A company has grown to five times the size that that were when they hired their last Vice President of Sales & Marketing, and are looking for a new VP of Sales & Marketing. What is your advice as they embark on this search? How do you recruit a VP of Sales & Marketing?

Advice from the CEOs:

  • Think coach as opposed to star player. You are a much larger company, and at this phase of growth you need an individual with good marketing skills combined with sales management skills. You need a brand builder.
  • Recently, another CEO went through a similar process. His mistake was hiring a person with deep domain experience, when what they really needed was a person with process/methodology experience in complex sales. In your case, consider an individual from a larger company in your industry, or an allied industry. Somebody with knowledge of similar technical sales processes to your company with similar complexity and similar lead flows.
  • Skip head hunters. Based on your knowledge of good companies in your industry use LinkedIn to find who’s who. You can look at three pools of candidates – those that you can hire away from these companies, those who have worked there but are out of work, and early retirees who have found that they now need to go back to work.
  • Research current salary ranges in your industry and plan to be competitive, both base and bonus target.
    • As this individual will be a doer-manager make bonus qualification a combination of personal quota and team performance (overall new sales growth vs. existing projects).
  • While another CEO agrees that you don’t need a head hunter, find someone who can organize the process – review resumes, perform screening interviews, schedule higher level interviews, follow-ups, etc. – and who will work on an hourly basis.
  • Have a job application and be sure to ask for the following:
    • Criminal records,
    • Copies of last W-2s.
    • State on the application: falsehood is grounds for immediate termination.
    • Do or outsource formal background checks including verification of education and degrees.
  • Personally call references for your finalists. Ask these references who else knows this person and speak to them, as well.

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How Can You Reduce Costs By Consolidating Services? Four Suggestions

Situation: A small company wants to reduce costs by consolidating accounting and operational communications between remote divisions, with home office coordination. Can you more effectively reduce costs by consolidating services or is it better to set up parallel but complimentary accounting and operational communications in each division?

Advice from the CEOs:

  • There are a number of things that need to be considered, including:
    • Whether the existing legacy system is off the shelf with modifications or was custom designed for your operation.
    • Does the current system meet your needs, and do operators understand it? Is operational understanding diffuse or can only one or two people operate it?
  • How similar are the divisions in terms of product, customers and operations?
    • Do divisions serve distinct, non-overlapping customers with different product lines?
    • Are there important operational differences, for example are some divisions union, and others non-union?
    • On an ongoing basis, except for accounting, do divisions function as complimentary or distinctly separate businesses?
    • How complex are the product and pricing offerings? Could you consider a simple solution like QuickBooks or are there are complexities to your business model and accounting that the off-the shelf or web-based systems can’t address?
    • How much historical data from your current system is needed to support ongoing and future operations?
  • The simplest solution may be to run your current system off of a server, with multiple nodes connected to the system – a direct connection at your home office, and point-to-point lines connecting your remote offices. This will solve both your data transfer and communications needs.
    • Hire a computer consultant to set this up and assist you in establishing a link. It will cost some money, but will save you time and money in the long-run.
  • If you decide to change your accounting system, do so at the end of your current fiscal year. Trying to change accounting systems in the midst of a fiscal year creates an accounting nightmare for a small business.

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How Has Sales Evolved In The Last Four Years?

Interview with Michael Griego, CEO, MXL Partners

Situation: Sales technique is constantly evolving. Based on research completed by the Sales Executive Council, this evolution has accelerated since 2008. The implications for selecting, training and retaining top sales reps are significant. How has sales evolved in the last four years?

Advice from Michael Griego:

  • A 2009 study by the Sales Executive Council (SEC) – Replicating the New High Performer– studied 6,000 international sales representatives from 90 companies comparing top sales performers with core sales reps across 44 attributes.
    • The study found that Challenger sales reps represented the largest cohort (39%) of the most successful sales reps, followed by Lone Wolf (25%), Hard Worker (17%), Reaction Problem Solver (12%), and Relationship Builder (7%) sales reps.
    • The Challenger sales rep is best suited for a complex sales environment, while the Hard Worker is best for less complex enterprise sales or sales of off-the shelf products.
  • Identify the characteristics required for your sale. In addition, identify the mix of sales people currently on your team – from young, eager people just out of school to seasoned vets who can be realigned to current methodologies.
  • Selection should focus on the prior experience of the candidate. What have they have sold in the past? Ask for details of sales situations. How do they usually open a sales conversation? How did they adjust their sales pitch to different audiences? Were they hunters or farmers? Top talent reps can deftly go both ways.
  • Training involves reinforcing sales fundamentals plus the modern application of provocative consultative selling where salespeople provide true insight and challenge customers well beyond feature/function/benefit selling.
    • SEC study results indicate that if you are involved in a complex sale you need to identify the challenges, acknowledge what is happening in your client’s market and the challenges that they face, quantify the implications, and position potential solutions for exploration; all of this occurs BEFORE you start selling your specific solution.
  • Retaining the best sales reps fundamentally takes good sales management.
    • Pay special attention to top performers, while attending to all your reps and treating them fairly.
    • Challenge them to be better in areas that will enhance their success.
    • Recognition is a great motivator. Make them an internal mentoring resource for the rest of the team.
    • Identify your core (average) players and train them to act like your top players.
    • If you do these things they won’t be attracted to the shiny objects dangled by head hunters.

You can contact Michael Griego at [email protected].

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