Tag Archives: Plan

How Do You Choose The Right Strategic Partner? Five Guidelines

Situation: A rapidly growing company is expanding in both its primary market and into new verticals. A number of companies are interested in strategic partnerships. How do you select the right partner in the right space? How do you choose the right strategic partner?

Advice from the CEOs:

  • At the end of the day it’s about a connection with the partnership which extends across both organizations. Look for cultural synergy with the other company. Do your and their managers and employees “click” or are they oil and water? This is a gut assessment.
  • Is the quality of people in both companies complimentary? Is there similar drive for quality and attention to detail? Will technical integration be smooth? Are systems complimentary? At a minimum on both sides need to possess the right skills so that these factors won’t hinder the project. Are sales and marketing approaches compatible? Will teams be able to work together?
  • You need to have strategic commitment across both organizations. Partnerships don’t work if there is only alignment at the top. Executives can’t shove a new opportunity down the throats of those who report to them. There must be excitement about the opportunity across both sides of the partnership. There must be complimentary competencies, capabilities and commitment. Is there a clear understanding of the goals and objectives required to succeed? Reward structures and incentives must be aligned down through the two parties. Conflicts will lead to struggles.
  • There must be a strategic alignment between the two organizations so that both see the partnership as complementing their broader strategic plans. There must be a fundamental strategic win-win. The venture must be seen by each party as core to their business, plans and results. If this isn’t present, the collaboration can collapse when a better opportunity that comes along.
  • Look for some gauge that the partnership is as important to the other party as it is to you. What other partners do they have? Is the size of the opportunity enough so that you are assured of their ongoing attention?

Thanks to Jim Soss of Red Aril for his contribution to this article.  

[like]

How Do You Evolve from Doer to Leader? Four Thoughts

Situation: A company has grown largely through the determination and energy of the founding CEO who is still the principal business development resource. The CEO wants to move from day-to-day focus to a leadership role and to focus on planning for the future. How have others evolved in their leadership roles? How do you evolve from doer to leader?

Advice from the CEOs:

  • Start by developing and managing an organizational chart for the business. Create the organizational chart initially by role and responsibility. Match existing people to the roles. Individuals may fill more than one role, but be sure that the individuals are suited to the roles to which they are assigned.
  • Give ownership of areas of responsibility to others. Make it clear for each area of responsibility that the individual assigned is now in charge. Match projects or assignments with individuals’ abilities and available time. Establish quarterly or annual performance objectives WITH as opposed to FOR each individual – objectives that support company objectives. See that people are rewarded for their results – both soft and monetary rewards – as appropriate to the responsibility held by each.
  • While continuing as the lead of business development, hand off new clients to others as soon as you get them on-board. Let others take on the customer nurturing and maintenance roles. Establish a plan to replace yourself in this role.
  • The EMyth Revisited by Michael Gerber provides a soup to nuts recipe for moving from doer to leader of a company. Everything starts with your organizational chart.

 [like]

What are the Three Clarities that Every Start-up Needs? Three Points

Situation: Starting a new venture is a daunting task. You must determine market need and land your first few key customers on a tight timeline and budget. What are the most important areas of focus for the start-up CEO? What are the three clarities that every start-up needs?

  • The answer lies in the Three Clarities.
  • Clarity #1 – Deep Knowledge of Customer Pain Points. Your eventual success is not about the technology – it’s your ability to understand and address the needs of your customer. Research and talk to potential customers. Ask them about their pain and problems. What makes their job or lives difficult? Learning these facts takes time, patience, persistent questioning, and open listening both for what they are saying and what they are not saying. Once you have a clear idea about their need and can succinctly define it, you must determine whether your capabilities can address the customer’s need. Avoid talking about your product or solution until you clearly understand the customer’s need.
  • Clarity #2 – Understanding the Purchasing Behavior. Once you have identified your target customer, their need and your ability to meet that need, you must understand their current purchase behavior. Have they ever bought from a startup before? What happened when they did? Are they happy or unsatisfied? Where are the gaps in satisfaction? Particularly for a start-up without established credibility, it is critical to identify those purchasers who will take the risk to buy from a new company. From what you find, determine how you will frame a personal relationship with the likely buyer – how you will frame both your solution and the buying experience. Build a psychographic of the buyer so that you can quickly determine likely customer candidates.
  • Clarity #3 – Understanding the Decision-Maker’s Sense of Urgency. Who makes the purchase decision? In B2B sales is it the CEO or someone further down the organizational chart? Who approves the purchase budget? Why now? Do they have their ”hair on fire” so a decision must be made now? The essential question is: what are the alternatives to not having your solution?

Thanks to Naeem Xafar of Blitzerrmobile.com for his contribution to this article.

[like]

How Do You Maintain The Focus on Your Plan? Five Suggestions

Situation: A company has both an annual and a 5-year plan. These are discussed both in company meetings and in 1-on-1s with managers. The CEO fears that she’s starting to sound like a broken record. How do you maintain the focus on your plan?

Advice from the CEOs:

  • Break the 1-year plan into quarterly objectives. Don’t just divide annual objectives by four. Vary objectives for each quarter so that the total sums to the annual plan.
  • Create a series of milestones to guide the plan. Celebrate the achievement of each milestone. This helps to maintain momentum and keeps everyone engaged.
  • Establish metrics to assess progress against both the milestones and the plan. These will enable you to evaluate progress against the overall plan and the degree to which you are ahead of or behind the plan. It will also help to evaluate whether underperformance is a matter of externalities or a flaw in the plan itself. If there is a flaw, fix it as soon as you find it.
  • Evaluate your “worst case” scenario so that you know the implications. This enables you to compare current performance against “worst case.”
  • In his book “Good to Great,” Jim Collins found that an important difference between G2G and non-G2G companies was the ability of the G2G companies to maintain faith and to slowly build momentum regardless of the apparent obstacles faced. This allowed good companies to establish the momentum that eventually made them great. Non-G2G companies continually changed direction and never built sustainable momentum.

[like]

How Do You Rebuild Company Morale? Six Suggestions

Situation: A CEO has regular lunches with staff to foster communications and sharing of information. In recent months, few employees have been attending these lunches. Also, she has noticed a negative tone beginning to pervade the office, though the situation seems to improve when the CEO is present. How would you address this situation? How do you rebuild company morale?

Advice from the CEOs:

  • The immediate priority is to correctly diagnose the problem. Is this a question of the CEO’s energy or the team’s awareness of plans for the company? Or is there something else going on of which the CEO is unaware?
  • Meet with employees. Have open and frank discussions with them about the future of the company.
  • Meet with the most valuable employees first. Share hopes and vision for the business. Express appreciation for their contributions and discuss plans for their continued growth. Next, ask open-ended questions about the company and seek their input on how to improve it. Listen to what they have to say.
  • Next are borderline employees. Again, share the vision and appreciate their past and current contributions, but be honest about expectations for performance. Then ask the same open-ended questions that you asked the first group and listen.
  • For underperforming employees, again appreciate past and current contributions, but be clear that unless they substantially improve performance, future employment isn’t guaranteed. Ask the same open-ended questions that you asked the other groups and listen.
  • Be patient. Don’t try to develop all the answers immediately. Listen and learn what drives employees – particularly keepers. Involve them in developing programs to drive the future.

[like]

How Do You Get Doer/Sellers to Sell? Four Recommendations

Situation: A company has a geographical sales and service organization. Much of the sales effort comes from the consulting reputation of the managing director of each geographical unit, but he directors’ core values usually favor consulting over meeting sales plans. How do we get these directors to meet sales goals? How do you get doer/sellers to sell?

Advice from the CEOs:

  • One company shared their experience turning around a consulting organization with no sales culture. This was a 5-year process. It started with a leader who sells successfully and teaches by example. As the company made the transition, they selected new hires for sales skills to complement their consulting skills. This facilitated their transition to a strong sales culture.
  • Another CEO pointed out that you need to commit to build a sales culture. Moving to an account manager team versus an engineering/professional team is a big shift. It took time and patience. Hire effective sales people to jump-start the process. Most of the successful seller/doers will be new hires. Revise the reward and recognition structure around the new sales objectives. Make rainmakers the best paid people. This will bring others out of the woodwork.
  • A third CEO recommended biasing sales compensation for doer/sellers toward variable compensation. Allow successful individuals to make over $200K per year. Consider a 3-year phase-in by not increasing base pay through raises. More than make up the difference in available variable pay. This will give directors more incentive to hit their sales numbers
  • This is a difficult change in both sales leadership and culture. It may require significant changes in leadership within the company.

[like]

How Do You Respond to a Tragedy at Work – Seven Suggestions

Situation: A long-standing employee of a company committed suicide away from work. Relatives of this individual work in the company. How can the CEO assure that assistance is available to help employees resolve their emotional shock? How do you respond to a tragedy at work?

Advice from the CEOs:

[Like]

How Do You Facilitate a Move to a New Space? Five Recommendations

Situation: A company has taken advantage of favorable lease rates to secure a larger space. How can they minimize work flow disruption during the move? How do you facilitate a move to a new space?

Advice from the CEOs:

  • Plan the move in detail: electrical, intranet and telephone needs; office space and facilities; design or production space and facilities. If you can’t move everything over a short period of time – like a 3-day weekend – consider moving in steps, a series of discrete moves over time, each with its own requirements and timetable.
  • If you carry inventory, pre-build inventory to see you through critical steps of the move. If you have a major customer with strict delivery deadlines, try to negotiate a delivery window during which you can conduct the move. Determine if there is seasonality to order delivery that makes a particular time of year more convenient to move critical operations. Custom work will require special planning.
  • If you plan to upgrade equipment, consider purchasing, installing and operating the new equipment in the new location instead of your existing location.
  • If you will be leasing the new facilities and possibly be even if you are purchasing the facility, ask the new lessor or seller to provide cash to: (1) finance delayed shipments at a price discount and (2) cover expenses of the move and outfitting the new location to your needs.
  • Consider converting to a wireless intranet and telephone system to avoid the expense of wiring the new facility. Look at plug and go options.

[Like]

How Do You Pay Sales Reps? Two Options

Situation: A CEO is considering two options to pay sales people – base/draw plus commission, or no base/draw and larger commission. What do other CEOs find most successful? How to you pay sales reps?

Advice from the CEOs:

  • Align the sales incentive plans to company objectives. Two examples were offered, one of an aligned system and one of a dysfunctional system:
  • The aligned system. Sales reps are 100% commission (plus expenses) with no caps on income. They are measured by two sets of metrics. To keep their jobs, they have to achieve a minimum of 85% of their revenue goal. Fall below this and the rep is out the door. However, commissions are calculated on the gross profit achieved on sales, and reps are provided with software to calculate GP and commission. This company is the most successful in its market.
  • The dysfunctional system. Sales reps are paid a base plus quarterly commissions calculated on achievement of revenue goals. The net result was that reps had no incentive to preserve gross margins. The result was constant conflict between sales and finance. The situation only started to improve as reps’ commissions were converted to a combination of revenue and margin.
  • The Key Issue: What is the role of the rep within the sale? Is the rep a door opener or a closer? What percentage of the close is attributable to the rep? In a complex or staged sale, allocate commissions based on contribution to the close. Reps who can’t close are not as valuable as those who can.

[Like]

How Do You Redefine the Top Executive’s Role in the Business? Four Points

Situation: The President of a family-owned business that has been in operation for over 30 years wishes to change her role by increasing delegation of responsibility and accountability within the business in preparation for her eventual retirement. Other family members in the business are happy with their current responsibilities and are resistant to taking on more responsibility. What advice does the group have for this member?
Advice from the CEOs:
• Given that you are preparing for retirement, it is important to let others know about your plans and your desire to increasingly hand off your responsibilities to others. Ideally, one or more of the others will express a desire to take on more leadership, particularly if it includes a boost in pay.
• It is important to clarify responsibilities and prioritize which ones you wish to hand off. Once this is done build and execute a hand-off plan.
• Transition current managers who are misplaced in their position to other roles. Work with them to identify alternate roles where their talents can better benefit the company. They may be aware of their current discomfort and welcome the opportunity to take on a different role more suited to their abilities.
• Focus on removing barriers to delegation that may be in place. For example, bring others into the discussion and review the projects that they are overseeing. Identify the challenges underlying those projects and ask for their suggestions on how to address these. Don’t provide the answers. Ask questions and push them to develop appropriate solutions.

[like]