Tag Archives: Grow

How Do You Make Sales “Farmers” More like “Hunters”? Three Approaches

Situation: A CEO finds that his sales team are relationship managers who are excellent at growing business in existing customers, but not as skilled at either developing new business opportunities with current customers or bringing in new customers. In sales parlance, they are more like “farmers” than “hunters”. To meet revenue goals, the company needs additional business. How do you make sales “farmers” more like “hunters”?
Advice from the CEOs:
• When working with the team be sure to considering what’s in it for them, not what’s in it for you. Communicate with and coach them so that they are inspired to try and adopt new behavior that will help them in their jobs.
• Create a low pressure script for your relationship managers. Build this around easy questions that they can ask both current and prospective clients:
 How are we doing?
 What are your most pressing needs?
 What more could we do for you?
 Can you see other ways that our services could benefit you?
 We have a new offering. May I tell you about it?
 Do you know other companies that can utilize our product or service?
• For training, pair the relationship managers in teams of their choosing. Have them rehearse and coach each other. As they learn or develop new techniques, have them coach the rest of the team.

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How Do You Align Cash Flow with Growth? Eight Points

Situation: A Company is growing faster than its cash flow allows. This concerns the CEO because this growth involves promising technologies and products critical to the company’s future. What can the company do to improve current and new cash availability? How do you align cash flow with growth?

Advice from the CEOs:

  • Every growing company has experienced this problem and solved it; so can this company.
  • Grow more selectively. Review the available opportunities and select the most promising and profitable for focus. Restrict progress on less promising options for available time.
  • Search the Internet for books and resources that on this topic. For example, try “101 Techniques to Manage Cash While you Grow”.
  • There are experts, consultants and “Rent-a-CFOs” who specialize in this. Work with trusted contacts and/or search the Internet to identify appropriate resources who are familiar with the company’s industry and market.
  • Explain the situation and challenge to your vendors. Ask for opportunities to extend payments and “borrow” from them.
  • Explain the situation to customers and ask for better payments terms.
  • Borrow from an aggressive bank, factor payables, and/or find additional lending sources that offer attractive payment terms.
  • Be aware of and watch out for pitfalls that may cause serious problems. For example, an extended market contraction can leave the company stretched for cash.

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How Do You Move from Informal to Formal Processes? Five Keys

Situation: A company is growing its sales capabilities and adding staff. The CEO wants to improve the company’s ability to generate new business. To date they have relied on informal channels to generate referrals. How do move from informal to formal processes?

Advice from the CEOs:

  • Establish as standard practice that all personnel ask for referrals in normal communications with:
    • Clients
    • Sales associates of partner firms
    • Individuals who are trusted advisors of potential clients – lawyers, CPAs, financial advisors.
  • Different groups – CPAs, lawyers, financial advisors, etc. – have different interests and potential fears about making referrals. In conversations with individuals from each group, ask why they make referrals, how they are serving their own clients, and what potentially concerns them the most about making a referral.
    • Once this data has been collected, develop proof statements for each audience that address their needs and concerns. These may be different between different audiences.
  • Do the same with new clients, as they become clients. Ask why they chose your firm, and what most appealed to them about the firm. Make this part of the initial client services interview. Collect this data and create proof statements about company performance that will appeal to other potential clients.
    • Note that the responses from brand new clients may be significantly different from those of clients who have been with the company for a year or more. The latter group knows the company, and this will color their vision. Responses of new clients will be more germane to the needs of prospects.
  • Create a system to track frequency of contact with key referral sources. This system will identify, among other things:
    • Contact name, contact information
    • Contact history (contacts to the individual by the firm)
    • Referrals received from the contact
  • After contacting an individual who has been referred, always communicate promptly back to the referrer that the company has made the contact and the results. Always say thanks. Provide the referrer comfort that they will not be shut out.

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Is It Better to Develop Internal Resources or Hire? Four Views

Situation: A key employee will be leaving for at least 5-6 months on maternity leave. This individual is a top performer, and will be welcomed back following maternity leave should she wish to return. However, her absence will leave the company short of resources. Is it better to develop internal resources during her absence or hire a new resource?

Advice from the CEOs:

  • The company’s HR strategy should complement its strategic plan as well as the CEO’s feel for market conditions.
    • If the strategy for the next year is to grow, then plan accordingly and commit to either bringing on someone new or to aggressively growing the talent already within the firm.
    • If the strategy is to hedge bets due to lack of clarity as to where the market is headed, then plan accordingly and act more conservatively.
  • Assess the availability of resources within the company.
    • Are there internal candidates who can fill the gap created by this employee’s leave? If so, then start training and developing these resources. They will be valuable as the company grows.
    • What is the company’s current workload vs. the capacity of current staff? If there is any excess capacity that can fill the gap, short-term, then use this as an opportunity to develop this excess capacity.
  • If the company has excess capacity, and is unsure about market movement six months out, develop internal capacity first.
    • This provides both additional flexibility and time to assess signs of market movement before making an investment in additional talent.
    • Plan to revisit the situation in 3 months and make another decision.
  • Keep a close eye on the market for developments, and have rapid action back-up strategies in place to respond to market conditions.

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How Many Direct Reports is Too Many? Five Thoughts

Situation: A young company has been growing rapidly but hasn’t been growing its infrastructure to support its growth. The CEO now has fifteen direct reports. Things are getting hectic and the CEO wonders whether it’s time to make a change. How many direct reports is too many?

Advice from the CEOs:

  • It is generally accepted that the largest number of direct reports that an individual can successfully manage is ten. Beyond this and even at this number, if the reports require significant supervision it is difficult to meet the needs of the individuals and to effectively direct their multiple activities.
  • The maximum number of individuals that you can manage depends upon what you are managing.
    • If the individuals are very independent, then perhaps ten can be managed.
    • If the individuals require any significant levels of supervision and/or training, the number goes down rapidly.
  • This is both a challenge and an opportunity. The challenge is determining the right number of reports for the CEO to manage. The benefit is the opportunity to start building a management team.
  • The benefit will be that by adding managers reporting to the CEO, there is the opportunity to train individuals who can take on additional managerial responsibilities in the future. As the company continues to expand this will become critical to future growth.
  • Another benefit is the ability to divide responsibilities among the teams.
    • For example, one team becomes the sales team, a second the Client Services team, and a third becomes the back-office operations team.
    • As the company expands, there is the opportunity to add additional subgroups to the sales and client service teams. simultaneously serviced by the existing back-office operations team.

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How Do You Add a New Capability? Four Approaches

Situation: A CEO reports that customers frequently ask whether the company can deliver a service that isn’t current in their portfolio of capabilities. In a substantial number of cases, the ability to offer this service is a key factor in their choice of vendors. The company’s experience with outside consultants offering this capacity has been disappointing. How do you add a new capability?

Advice from the CEOs:

  • Reevaluate the company’s needs and assess whether these can be better meet by bringing this capability in-house, or by restructuring how the company works with contractors. Determine whether the latter is just a negotiation and contract / payment problem.
  • Take a closer look at how the company contracts and creates incentives for outside contractors. Do they have performance objectives written into their contracts that reward them for meeting contract commitments? Can they earn bonuses for beating contract deadlines or exceeding design requirements? Are there penalties them for missing key deadlines?
    • Is it clear whether contractors are missing deadlines because of the “creative process,” because they don’t use their time efficiently, or because they have other commitments that take precedence at the company’s expense?
    • If the answer is either of the two latter situations, then contract adjustments may work. Similarly, if they have an incentive to be more creative faster to meet a bonus deadline a contract adjustment could also work to the company’s benefit.
    • Another option in working with independents is to make it clear that the company is generous, but if the contractor does not meet deadlines, they go to the bottom of the list for future opportunities.
  • An option is to hire one specialist and challenge them to grow a practice within the company. This may mean that they have to do all tasks early on, but the potential win will be the opportunity to grow a significant business and hire a team to do the lower-level work under their direction.
  • Another option – bring on a creative problem solver with appropriate experience who can support the existing team, but who will have more flexibility than a pure specialist.

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How Do You Handle a Difficult Employee? Five Observations

Situation: A CEO is pondering how to handle a difficult employee. This individual has brought in good business but is never satisfied with his level of pay – though he is highly paid. While he is good at bringing in new accounts, he doesn’t make the effort to grow them over time. How do you handle a difficult employee?

Advice from the CEOs:

  • It is necessary to establish a mutual understanding with the employee that no matter the level of pay, the employee will think that it is too little. This reframes the discussion because it establishes that there is no win by paying the individual more. The unspoken part is “why bother?”
    • Given this reality, the maximum level of pay for the employee is $X.
    • Note that there is no negotiating power until once this is said it is acceptable to let the employee walk away.
  • The CEO feels indebted to this individual because he has brought the company many new accounts. He is a good hunter. But the task now is not to hunt but to cultivate and grow the opportunities that that the company has in hand.
    • The issue is that this individual doesn’t build relationships that will grow business in his accounts.
    • He has done well for the company. The company has rewarded him handsomely. However, now a different talent is needed.
  • What’s the best alternative for action, and how is this communicated to the staff?
    • Do not lay this individual off – terminate him for cause.
    • This individual has repeatedly been asked to act as a team member, but he has steadfastly refused to do this.
    • His attitude, while good for his own efforts, is bad for the company and is clearly counter to the desired culture.
    • He is better off in a situation that aligns with his talents and style.
  • Terminating this individual for cause sends a critical message to the rest of the company – culture is important. You are determined to establish a healthy culture even it if means eliminating your best performer.
    • To those who ask, answer that this individual was treated fairly. Clear expectations were established, and ample opportunity was given to be a part of the culture that you are establishing.
    • Ultimately, the culture that you seek to establish – one that is good for the whole team, not just for star performers – was not right for this individual.
  • Use this situation to relaunch a campaign to build a company culture of collaboration and best practice development between teams. With the elimination of this individual there may be new enthusiasm around this initiative.

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How Do You Foster Channel Development? Three Topics

Situation: A company has grown successfully designing and producing products for larger companies. In the process they have enhanced their own reputation in the industry. The CEO wants to boost growth by designing and marketing their own products. This will require the development of new marketing channels. How do you foster channel development?

Advice from the CEOs:

  • What are the initial steps?
    • Hire a commissioned salesperson with deep experience and contacts in in the company’s industry. This individual’s objective will be to seek new business opportunities.
    • Have top management, including the CEO, take a sales course – for example Dale Carnegie Sales Training.
  • What are the company’s objectives as it seeks to grow?
    • To feed the company’s ability to develop, produce, and sell their own proprietary products.
    • To create the capacity for the company to grow without relying on the efforts and success of current customers.
    • To develop pride in building a solid and lasting company that makes important contributions to technology.
    • To increase profitability and company value to benefit owners and shareholders.
  • What can be done right now, as the early steps are put into place?
    • Find ways to include pictures of company’s products in all company collateral – whether the company’s own or products developed and produced for others.
    • This may mean creating a small variation to an easily recognized existing product – without the customer’s logo – so that it becomes clear that the company is the source of these ideas and products without voiding existing agreements with key customers.

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How Do You Motivate a High-potential Individual? Five Points

Situation: A CEO has a high-potential manager who heads a remote office of the company. This individual seems most comfortable with hands-on work, but the CEO believes that she has the talent to grow into a superb manager with broader responsibility within the company. How do you motivate a high-potential individual?

Advice from the CEOs:

  • The key is the motivation and ambition of the individual. Without this the individual will not make a successful move in the direction that is sought. Understand and respect her goals and interests.
    • Two books by William Ury may help: Getting to Yes and Getting Past No.
    • The potential danger is the Peter Principle – that the individual will get promoted to their level of incompetence.
  • Does this individual have a talented subordinate who could take on additional responsibility – to back-fill for her as she takes on new responsibilities?
    • The process of training an individual like this will become an important growth exercise for her as a manager.
  • If the individual agrees that she wants more responsibility, look for a mentor for her, or hire a trainer to work with her to facilitate the process.
  • If she is amenable to the move that the CEO envisions, establish written SMART objectives to guide her development and assumption of new responsibilities. This will give her a road map to success.
    • SMART Objectives – Specific Measurable Attainable Relevant and Time-bound
  • If she prefers her current track and responsibilities to the vision that the CEO has for her, the CEO may want to develop her subordinate to fill the desired role.
    • There are many cases in which a talented subordinate has surpassed not just one but many of their supervisors.

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How Do You Pursue a Market Expansion Opportunity? Three Points

Situation: A CEO is considering expanding market reach to include an additional specialty niche in the market currently served. He sees the opportunity to diversify the current offering, to make significant money, and to grow the company. The principal challenge is finding a person to build this capacity. How do you pursue a market expansion opportunity?

Advice from the CEOs:

  • Without a leader to build the new capacity, an individual who already knows both the technology and the market, it will be difficult to build the new capability.
    • Bring in a heavy hitter with a proven track record in the market to develop the new capability. Someone who can build a team to offer the same quality / delivery package that has been the source of the company’s success.
  • Once this individual has been identified and is onboard, gather top management and develop clarity on the company and its values – why the company is in its current as well as the new business and what the company does for itself and its clients.
    • From this exercise develop or update the values statement and a vision / mission statement.
    • Consider hiring a consultant with proven experience in the market to help develop the value statement, mission, and some of the strategic and planning capacity that the company has not yet developed on its own.
    • Communicate these openly and reinforce them frequently with staff. This will help them understand the company culture as well as the vision for the company. It will also help them to understand the decisions made to guide the company.
  • Is there another firm – or an independent consultant – with proven expertise in in the new field to work with the company on the proposals that are being submitted for the new market?
    • This will help to evaluate the market and to get a taste of what is involved in this work before making a major investment to support the new capability.
    • It will also speed the development of expertise to address the new opportunity. If it goes well, the company can consider either a deeper joint venture, hiring the consultant, developing its own capability with internal resources, or a combination of these options.
    • In the short term, this will impact cost and margin but will substantially reduce risk.

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