1- 330-413-8552 Mark@NoSmokeAndMirrors.com

Product launch

Fix a $75 Billion Sales Problem: Product Launch

 

 

 

 

Why are we consistently missing our ROI targets for new product and market launches? Why can’t salespeople help us launch into new markets? Why can’t salespeople sell new products? These are just a few of the questions I have heard over the last 30+ years. Yes you heard me correctly this sales problem of new product and new market launch has been around a long time. I wanted to help solve this common sales problem so I called the top expert in product launch: David Daniels and he agreed to an interview. David and I worked together in the past and he has helped many companies like HP, VMware, Dell, Schneider Electric, and Optum, and NetApp: I was particularly interested in how product launch techniques in the fast-pace technology world could apply to manufacturing companies.

 

Hi Dave, let’s start by getting an idea of how big the problem of launching products is in general.

 

Hi Mark, I like to look at the problem as quantitatively as possibly. Unfortunately, there isn’t any single organization tracking the impact of failed product launches. I did some research and extrapolated a financial impact.

 

Clayton Christensen from Harvard estimates there are 30,000 new products introduced each year. He also estimates there is an 80% failure rate of those new products. I’ve seen these numbers thrown around and I can’t confirm their accuracy, but I trust the work of Clayton Christensen.

 

The failure rates seem high to me too. Is there any more data available?

 

As a matter of fact, there is. There are estimates that the average cost to introduce a new product is $5 million. That includes the cost to design, build, and launch it. Another group, the Product Development and Management Association (PDMA), has more conservative numbers. They estimate the failure rate of product launches to be between 35% and 49%. These failure rates seem more rational, and they break it down by industry.

 

Assuming 30,000 new products, a 50% failure rate, and $5 million to introduce a new product we can do some basic math to find how much failed product launches cost organizations worldwide…

 

30,000 x .50 x 5,000,000 = $75 billion sales problem

 

$75 billion sales problem. That’s huge. Let’s say I’m off by 50%. That’s still an $37.5 billion problem.

 

Wow that is a huge problem negatively impacting sales and ultimately the bottom line.

 

Exactly. But I want to point out that the definition of “fail” isn’t consistently defined. There aren’t 30,000 complete flops every year (as in selling zero products). There are 30,000 new products that don’t achieve their business objectives and ROI targets. Selling a few products to a few customers can be worse than not selling any at all.

 

Why is that David?

 

It looks attractive at first, but when you look at the long-term cost to support customers, the numbers can get ugly. Many companies double-down too. They want to believe they have the right product, at the right time, and continue to throw money down the drain.

 

In the world of software it seems companies can absorb failed product launch. For manufactures the cost is very real. How would you apply your technology experience to the manufacturing world?

 

You’re right. Software companies don’t have inventory. The variable cost to deliver the next product to a customer is nearly zero. The stakes are much higher for manufacturers who have to inventory raw materials, design, build molds, manufacture the product, inventory products, and ship them. The work to identify a market need has to be every bit as rigorous for manufacturers as it is in tech.

 

What advice from the technology world would to give to CEOs in manufacturing companies?

 

First, the world of technology functions around disruption. It’s able to do that much more nimbly than manufacturers. From a technology perspective many innovations from manufacturers would be viewed as incremental improvements by comparison. But the stakes are just as high.

 

The key to successfully launching a new product (or launching an existing product into a new market) is to quantify, quantify, quantify. The level of work is commensurate with the level of risk you’re willing to accept. If the cost of a launch failure can easily be absorbed, less quantification is needed. If the cost of a launch failure is high, more quantification is needed.

 

What, exactly, do you mean by ‘quantify’?

 

I mean to really understand what you’re about to get into and have a good idea of the barriers to success. Here are some questions you should ask your team:

 

How many potential customers are there for the new product?

 

Who are the buyers involved in making a purchase decision?

 

Do we have access to those buyers?

 

Will those buyers trust us? Will we need to build our credibility?

 

Do we have expertise in this market segment?

 

Those are great questions! I have seen over the years many companies launch before doing the market work, I even coined a term for it: ”Mullet Marketing”. Teams spend way too little time in the front in marketing research ,building sales tools, and training their sakes managers and sales teams but once the product is launched, it’s all hands-on deck to figure out why we are not hitting our launch ROI targets. Its as if you are wiring a house with the power on and getting zapped all the time.When your team has not completed the strategic upfront marketing work, as a salesperson the new launch feels like we are pushing mud uphill. I can’t tell you how many times my teams were told to ” just make it happen“.

 

Yes, I remember when you wrote that article about “Mullet Marketing” it resonated with a number of people in my community. What you are describing is unfortunately happening right now at a number of companies. They launched a new product or service, had very high expectations for sales and ultimately the impact it would have on their bottom line, and their launch was not successful. This is when a number of companies bring me in to help. After their sales teams have been ‘Zapped” a few times as you put it, new product , new market launches are in real danger of missing their ROI’S.

 

I wish they would bring me in much earlier, before the millions and millions are spent on launch assets. I have a Launch Diagnostic Process I have used for over 20 years and I can tell you before a launch what is needed to assure the launch meets the ROI targets.

 

Obviously that’s what so many companies pay you to fix: product launch sales, launch into new markets. Can you share maybe some high level steps in your process?

 

Yes, I have a Launch Process I have refined over the years and I have taught for over 20 years. From a 45,000 ft view it looks like this:

 

First and foremost: Have you defined the goals of the launch and do you have a way to track progress toward the goals? Our initial reaction is to focus only on a sales number but there are many supporting metrics that lead to a sale. If you don’t have a defined goal how do you know you will get there? This is what I ask first. I usually get blank stares.

 

For example, if the launch goal is to get $100 million in sales, I want to know WHEN we will hit the goal. If it’s open-ended there’s not much sense of urgency except from the sales team. I also want to know what it will take to reach the goal. What resources are needed? How long is the sales cycle? What is the expected close rate? How deep of a pipeline is needed?

 

Next, I assess the risk of one of 7 launch choices a company will make:

  • Launch a new product into a familiar market (medium risk)
  • Launch a new product into a new (unfamiliar) market (high risk)
  • Launch a new product into a new product category (highest risk)
  • Launch a version of an existing product into a familiar market (low risk)
  • Launch a version of an existing product into a new (unfamiliar) market (medium risk)
  • Launch a complement into a familiar market (low risk)
  • Launch a complement into a new (unfamiliar) market (medium risk)

 

By ‘complement’ I mean a product or service that adds to or enhances an existing offering.

 

You would think that the decision of which path to take would be made BEFORE the product was designed, but I’ve seen too many times where that isn’t the case.

 

Next, I look for an understanding of the problem a potential buyer actually has. In particular, I want to see if the company has actually quantified the impact of the problem and to whom. It’s easy to rationalize internally that a problem exists. It always exists on a PowerPoint slide. I want to know if the problem has been quantified and there’s data from the market to support it.

 

There are more steps below 45,000 feet, but the three steps above should be enough for any executive to get uncomfortable if they don’t have answers to those questions.

 

What is the current reality? What have you learned so far?

 

What did you plan to happen? What has actually happened?

 

What is the Delta? The launch sales gap?

 

What unresolved market problem does your new product or service solve?

 

Who has those problems?

 

Do they have budget to solve those problems?

 

Are they willing to use their budget to solve those problems?

 

What is your value proposition?

 

Is that proposition resonating with your targeted customers? Why, Why not?

 

Conduct voice of the customer work.

 

Write a Launch Plan that achieves ROI expectations.

 

Work with Marketing to create the sales tools to support launch.

 

Train sales managers about and when to use these sales tools.

 

Train sales team about and when to use these sales tools.

 

Constantly listen to your target customers and use an Agile process to adjust and refine.

 

Thank you David for helping us quantify how big a problem new product and new market launches are. As you shared you have over 30 years experience in the tech market. I am confident your product and new market launch process will have a huge impact with manufacturing companies. The market I have served is the manufacturing market and what I have seen is new product launch and new market launch is a much larger problem due to sunk costs that you indicated earlier. I believe the $5 million estimate is conservative in the manufacturing world when we consider tooling, equipment, time of engineers, inventory, building sales assests, sales training and the possible brand damage when a launch goes bad.

 

If someone is reading this and wants to connect with you, learn more about your services, how can they reach you?

 

My web site is : BrainKraft.com (with a ‘K’)

My email is : daviddaniels @ brainkraft dot com

My contact phone is : 205-677-8120

If your readers want to read more of my advice and experience with strategic product launches that drive a positive impact to your bottom line they can subscribe to my blog :

BrainKraft.com/blog

 

Thank you David for your thought leadership in Strategic New Product, New Market Launch.

 

David also has excellent short video trainings that can be found here.

 

 

 

Fix Sales Problems: Do You Understand What Your buyers Value Most?

 

In my last post I discussed the need to quantify the value the buyer experiences to increase your sales. In a typical sale the buyer has three options; the buyer buys, the buyer buys but not from you, or they do nothing. Market leading companies make it their job to understand their buyers’ problems and what they value most. When you clearly understand the market and problems to be solved creating a value proposition that instantly resonates with buyers is easy.

What is the buyers’ cost of doing nothing?

What do your buyers value most?

Let’s say you sell products that prevent people from stealing products on display in retail stores.

Having served this market back in the late 1990’s we asked a lot of questions and what we found back then was:

  • If a product is behind the counter because the retailer is concerned with theft, sales decrease 50% to over 75%
  • If a product is out ‘LIVE’ on the retail shelf without any mechanical security device or security tag you can expect over 50% theft
  • If product is behind a counter the overall customer buying experience is poor (this costs you a sale now, and more concerning with future purchases)

But that was old school…. check out this market leader in helping large retailers increase their sales!

InVue’s value proposition is focused and clear.

Their value proposition demonstrates they know their customers, their customers’ problems, and they have solved those problems completely.

“InVue develops and markets security products that enable retailers to openly display their high theft merchandise with confidence.”

They not only control theft, they help their customers increase sales as they share below.

“Displaying high value accessories next to hot selling smart phones and tablets will increase your accessory sales over 20%.”

This is a great example of a B2B company that took the time to do their market work and understand the buyers and the problems they want solved. When I speak at conferences I often have someone challenge me; “ I understand this knowing your buyers stuff when it comes to B2C products but I don’t see how it applies to B2B” My answer is it is absolutely critical to understand your buyers, the buying process they use and the criteria they must have to make a purchase. This is the case in B2B and B2C. B2B companies who do the market work prior to launch realize greater sales increases and higher profits.

 

How about your company?

 

Are you solving buyer problems?

 

What process does your team use to identify buyer problems?

 

How is your sales performing to plan this year?

 

The reason why some companies consistently achieve and surpass their sales and profit objectives is they understand their market, buyers and buying process.

Why Can’t Salespeople Sell New Products?

The CEO said…” Why can’t my salespeople sell new products” ? I hear this frustration from business leaders often. The assumption is the salespeople are not capable, but the reality is they can sell new products if they are provided a strong value proposition and sales tools that guide potential buyers through their buying journey. If your new product or service clearly provides four yes’s then it will not feel like pushing mud uphill during launch. However far too often new products are thrown over the wall from engineering and product management and sales are told …”just make it happen”.

The reality is you do not want your salespeople spending time figuring out how to sell the new product.

Salespeople follow the path of least resistance to revenue.

If your new product lacks a clear value proposition, sales tools designed for specific buyer personas, and a history of poorly launched products your launch may be doomed.

Equip your sales team to gain new product sales velocity by clearly understanding the problem you are solving for your buyers and the buying process and criteria they use to solve their problems.

How successful is your team with new product sales launch?

 

Does your new product offer a quick path to revenue or does it feel like pushing mud up hill for your sales team?

 

Can you afford to have your salespeople figuring out how to sell a new product while your core product sales suffer?

 

Are new product sales an Art or Science in your organization?

Attention Entrepreneurs; You Can’t “Manage Fruit Ripe"

 

 

 

They say that which makes us strong can also be our biggest weakness. Entrepreneurs are no exception to this rule as our driven, confident, and focused nature can often inhibit new product success. Entrepreneurs often have such confidence in their personal abilities based on past success they take shortcuts in launching new products and when sales fail to meet plan they believe they can “manage fruit ripe.”

“When it comes to new product sales; you can not manage fruit ripe”

 

After my last post I had a number of people reach out to me saying: “ Ok we get it, we should do research prior to launch …but what should we do if we are in a launch that is not hitting plan?” As I have shared in past posts…I have made a number of mistakes over the years.I have kicked off new products and then had to figure out how to make it work; “make it happen ” on the fly.  So I thought I would do a follow-up post and share what I said to those who contacted me directly.

Entrepreneurs who launch on gut and not market truth often start trying to “manage fruit ripe”. They are so tied to their  plan their failure to achieve goals has to be a sales problem. Based on my experience, over 90% of new product sales falling short of plan are not the result of “poor sales execution” but the result of not having good current data  and or understanding of your market, and is actually a marketing problem. Without current accurate market data one if not all of your four P’s of markting are probably wrong. Entreprenuers are smart people. If given good information they make decisions that grow businesses profitably. If given old or wrong market data one or more of your four P’s will be wrong.

As the owner, leader,you are the boss… so if you want to try to manage the fruit (sales) of your new products ripe… go for it. I have seen many try ( heck, I have tried) and I have yet to see this approach correct new product sales below plan and create sales velocity. 

If you find yourself in a launch based on gut and old or poor data, what should you do?

 

  1. Assess what you have learned ( experienced) during launch so far
  2. Conduct win loss interviews
  3. Identify common roadblocks to sales and bust through them with new sales tools
  4. List what you still need to know and assign priority and timelines
  5. Adjust your strategy based on the current market data you gather
  6. Test new strategies before you scale them
  7. Repeat what works
  8. keep asking questions, determine why customers are buying and not buying
  9. Challenge your four P’s of Marketing ( at least one is off)

 

( or put another way; get the data to answer the four yes’s …as quick as possible)

 

 

So how about you…have you launched a product without having four yes’s first?

 

What did you experience ?

 

What corrective action did your team take?

 

Does it take longer to do research on the front end? Or fix roadblocks during launch?

Don’t Kick Your Salesperson’s ASS, …Help Them Find Their Number….

 

One of the easiest things a sales manager, (business leader) can do is resort to a; “boot on the throat”…” a throat to choke” ….and “Ass Kicking “mode. After all it takes very little effort, knowledge or skill to be a critic and a bully.

True leaders help train and motivate their teams.

 If your desire is to hit and surpass your sales objectives….Help your salespeople “find their number”.

I see it all the time, a new product launches or a new sales goal is distributed to a sales team and the key performance measurement: Sales to plan is not met. The easy route is to start “Ass Kicking”. You know …the weekly and by weekly conference call thrashings in front of their  peers. The sales update calls at 5pm on Fridays that last until 7pm. The “contemplation of your navel” market reports on why they can’t hit their sales numbers and their future action plan to change the results.

Yes this may drive some momentary, fear driven results, but this is not how you create sales velocity. In 99% of the cases I have been asked to help figure out why sales objectives were being missed it was not lazy salespeople who needed their butt’s kicked. A frequent cause was poor (or a total lack of) sales training. In these cases struggling salespeople are told to “stop making excuses and just make it happen, figure it out”. However the reality is the reason your team is missing numbers can be traced back to your understanding (yes you) of your market and buyers problems, buying criteria, and buying process.

Sales velocity is sales increases with direction and momentum and it is never driven by fear.

If your salespeople are struggling with sales, particularly new product sales and or new business sales my advice is to stop… the beatings as the morale is not improving and “help your salespeople find their number”. Their number is how many rejections they have to experience to have a win.

For example at one time in my career I ran business development for an ad firm. After tracking my calls I found my number was 18. If I made 18 calls I would get 2 appointments and from those two appoints I would close 1 new account. Instead of dreading the call process it became a game. Each rejection meant I was one step closer to a yes. Over time I also tried to improve that number.

A couple of funny things happen when you track how many rejections your team receives;

First, they make more calls. More calls mean more opportunities to win, more opportunities to start conversations.

Secondly, if your sales team has been properly trained on how to listen to buyers, determine their unresolved problems, and they understand the problems your product solves….you will have a number of net new potential clients dropping into your marketing funnel. Some of these accounts may not buy for 12-14 months, but if you compliment your calls with a lead nurturing campaign you have a high probability of closing them when their problems, (their pains) become unbearable.

As the leader you must listen to your team and look for diamonds as far as what is working and share it with your entire team. In addition you must look for common reasons sales do not occur and work with marketing to create sales tools for these common roadblocks in the flow of the sales process.

So do me (and your sales numbers) a favor …

Track number of rejections for each team member for 60 days. Gain an intimate knowledge of common reasons buyers are rejecting your salespeople.

 

Have your salespeople report on their number of rejections each week and you will see more net new sales and your marketing funnel will increase exponentially to help your future sales numbers.

Or go ahead and Kick Some Ass….it sure worked when you were a salesperson right? …Oh it didn’t? It actually made you feel like a number, and you lacked a loyalty to that manager and or company? Or you left that team, that idiot boss and now you lead the competitor’s sales team?  Interesting…did the ass kicking make you seem desperate to your accounts at the time and the deals you did close were below your targeted profit margin? Hmmm…so what makes you think “Ass kicking” makes your team feel any different?

Does your team track number of rejections?

 

Does each of your salespeople know their number?

 

Does your organization use those individual rejection numbers to identify team member who need training?

 

If you are in sales, do you know your number?

 

Do you find when the pressure is on salespeople chase new business differently? Are they making things up on their own? Making promises your product or service can never achieve?

You always have a choice.

You can “let the beatings continue until the sales and morale improves”….’let the Sh@t flow down hill…”or you can chose to lead your team. You can help them, motivate them to make more calls, and clearly understand your market, buyers, and have a record setting year.

Sales is a Science When You Have Strong Marketing….an Art When Your Marketing Sucks!

 

 

 

 

Is sales and “art” or a “science”? It depends….is your marketing strong, or does it suck?

In my last post: Is Sales an Art or a Science I shared how I opened a recent presentation to business owners and their senior leadership teams with a question;

Is Sales an Art or a Science?

 

The responses were pretty predictable;

Felt sales was a science: 30%

Felt sales was an Art: 60%

Felt sales was both an art and a science: 10%

This was interesting, however I heard the soft comment I was waiting for: “It Depends…on your industry, team’s training, product, price, availability of sales tools, your web site….” (Perfect! Now we are going to have a discussion!)

Then they asked me…what did I think? Art or science? I said “yes” as sales is often both. I find where sales falls in the spectrum with art on one end and science on the other depends on the organizations competency in marketing.

Marketing? Yes, because the fundamental job of marketing is to have an intimate understanding of your market, its buyer’s problems, and how they set out to solve those problems. Competent marketing teams clearly understand the buying process, cycle and criteria. They create tools to help buyers buy.

Market Leaders

If you have a strong competency in marketing, you know your market, and its problems that need to be solved. You know the buyers; you have clearly stated buyer persona’s and you understand the buying process. Your message is clear and does not require a translator (salesperson) to help buyers understand the problems your products or services solve.

Market leaders have such a clear understanding of the buying process their sales is more of a science. The art in the sale for market leaders is the salesperson’s ability to ask open-ended questions and apply proven sales tools for the right step of the buying process that keeps the conversation moving to a sale.

In market leading organizations, sales are 80% science and 20% art.

Unfortunately less than 10% of organizations would be considered Market leaders. Those that are, dominate their markets.

 

 

Market losers

 

If your team lacks a competency in marketing you will experience it for yourself on sales calls. Your team plays; “ feature and benefit BINGO” in hopes they rattle off all your features and benefits and at some point your buyer yells “BINGO” as they put the pieces together with the problem they have, and they understand how they “think” you solve this problem.

Market losers really do not know the problems their products solve for their buyers, the buying process, or buying criteria. In most cases their products were built from the inside out and marketing was tasked with “creating the need” for their products…losers!

Market losers launch products and believe they can “manage by objectives” and meet their goals by managing key performance indicators created without any knowledge of their market.

Market losers  have high turnover as they replace those who fail to hit goal, and skilled team members leave to join market driven teams.

Market losers have websites that talk about their company, years in business, and they prepare the feature and benefit BINGO card for their buyers and salespeople.

For market losers 80% of sales is an “art”.

The CEO and CFO of market losing companies go crazy because there is a lack of predictability, and they can not “manage” their way to market leadership. In this model your salespeople need to disregard what marketing does provide, and listen to their buyers, understand buyer problems, and create their own sales tools that discuss how their product or service solves those problems.

The danger in this model is sales may be promising things your product does not do, and the message varies by salesperson and thus is not repeatable.

From my experience, I would say about 50% of the companies out there are Market losers.

They build products because they can and not because they should. They are sales driven or bottom line driven. They have high turnover and ironically the salespeople they are letting go today won awards for sales performance two years ago….so what changed?

From my experience 40% of companies are somewhere in between but striving to improve.

They often launch a product that becomes very successful and then have a series of launches that fail. As they grow, the leaders who knew the market are now “managing the business” and lose touch with the market and its problems. They forget it was their understanding of market problems that caused their success and often fall into the trap that they think it was their personal brilliance and or hut spa.

As I closed the discussion I asked everyone in the room to do two things in the next seven days….

  1. Go out and meet with your customers and ask questions about their business and the problems they are facing, and how they try to solve those problems

.

  1. Look in your top salesperson’s trunk of their car and or lap top and see the tools they are using

The good news is everyone can become a market leading organization and realize higher than market average profits, lower turnover and increased shareholder equity. When you clearly understand your market and buyers, and create sales tools to help buyers move through their buying process, you create a win-win-win.

So what kind of organization do you work for? Market leader? Market Loser? Or someplace in between? Why?

 

Start-up’s….Like Wiring a House With The Power On…and getting zapped

The start-up phase is often one of the most difficult phases for entrepreneur as they often try to gain market knowledge while trying to meet sales goals. You know you should gather market data, but you often have limited cash, you are the chief cook and bottle washer, and you need to make sales to fund your future growth.

Start-up leaders need a strong emotional intelligence as many days you feel like you are; wiring a house with the power on and you keep getting emotionally zapped.

 

A number of years ago my wife was redesigning our upstairs bathroom and asked I change the electrical outlets from a cream color to a solid white. So we turned the lights on in the bathroom and I went to the fuse box and flipped switches until the bathroom light went out. I started to remove the outlet and saw a small spark. I thought to myself…”That’s odd as I know the electric power was off…” (My perceived truth) so I continued removing the old outlet. Zap! Next thing I knew I received a shock that sent me up against the wall and I fell into the bathtub. I latter found a new truth…the lights were on a separate circuit than the outlets so I was trying to change the outlet with the power on.

One of the most exhilarating as well as frustrating things you can do is launch a start-up company. Like I discussed in a previous post you feel like a plate spinner with more to-do’s than hours in a day. I go on to discuss how we can’t let the most important plates drop. I have discussed in earlier blogs how 2/3 of start-ups fail within 18 months. The main reasons we are all aware of for start-up failure include;

  • run out of cash
  • lack of a market driven plan
  • if you have a plan, your sales expectation is too high, too soon
  • if you have a plan, you have an unrealistic understanding of the buying process and cycle
  • trying to sell the need for a product you launched because you could and not because you should
  • market is not large enough
  • customers do not want to pay to solve the problem you solve
  • stress

 

Assuming your product and or service solves an unmet need, and you have a large enough market who are willing to pay you to solve their problem, the real danger for entrepreneurs is getting zapped by stress during the start-up season of your business..

To keep you from getting emotionally zapped from stress during the often hectic start-up phase, there are five key Biblical lessons I learned from a sermon recently.

1. Don’t wear yourself out – build the discipline to determine what is important, urgent, and focus on what is :urgent and important

2. Don’t shut out others – the reality is you can’t do it alone. Now more than ever you need your network, family, and friends

3. Don’t just focus on Negatives – that’s what market losers do. Keep your eyes on the prize and look for bright lights of opportunity as you launch.

4. Focus on your physical and Spiritual health – far too often those mounting to-do’s make us drop or delay other key areas of our lives. If necessary put time on your calendar for your fitness and faith.

5. Anxiety and fear are the product of looking back or too far into the future , focus on what is in front of you now, and leverage what you have. The quickest way to stop creatively solving roadblocks is to become fearful.

 

 

What about you? Have you experienced stress during the start-up phase?
What advice do you recommend to entrepreneurs in the start-up phase of their business?
What zapped you most in your start-up?

Rip Off the Band Aide(s) and Position Your Business For Growth in 2010

What are you aware of that is broken in your business? You know that area, person, process, perhaps website that is not producing? It’s that area that you know you need to address, but you have tabled for now as you focus on bigger fish to fry. If you can’t admit perhaps it’s” broke”,(like a number of those who ask for my help)  let me ask you another way: What is that area that you know is just not right, but you slapped a band aide on to “get through until the business comes back to normal again”?

The reality is you will never see your business like it was unless you identify the areas that are roadblocks or worst yet broken ,and fix them.

I remember when my children were very young and when the would fall down playing and scrape a knee or elbow they did not want me to clean the minor scratch or put some medicine on it….they wanted a band aide. Band aides are magical in that once the problem is out of site they were miraculously healed. Tear filled faces became filled with smiles and the desire to get back to the play that resulted in the injury in the first place.

The difficulty came at night, before their bath when we had to remove that band aide. Back in the day, in an effort insure they did not fall off,…band aides were once glued   your skin and the removal of them caused some pain and or irritation. So what do you do? Do you slowly pull the band aide off? No, what you learned to do was to rip the band aide off quickly. Yes there is a momentary pain, but not nearly as long as trying to slowly remove it. Once the band aide is removed you can assess the true nature of the injury, clean it, and apply medicine to insure it heals and does not become infected.

As I work with a variety of companies in a number of industries I uncover band aides in a variety of areas; broken processes, people who are not adding value and should have been dealt with long ago, people in the wrong roles, websites that scare customers away instead of begin a discussion, antiquated costing systems, poor marketing, the use of old selling practices, …and the list goes on.

What I find is most leaders are aware of the problems, but quickly mentally ranked them, they performed a triage and determined what needed to be addressed immediately, soon, or something we can slap a band aide on and deal with it when the business gets back to normal. There is also some who seem to hope and pray they just go away.

The reality is you may never see the days you consider normal again.
If today is the new normal , what would you do differently moving forward?

The recommendation I give to my clients is to; reset their understanding of the market and their business. In that process we will identify band aides that were slapped on areas that needed repaired and now have become infected. The only way to determine if those broken areas miraculously healed themselves, or if they became infected and may be costing you business, is to rip them off quickly, and rip them off now.

Over the next series of posts I plan to share the process I have used to help businesses; launch new products, launch into new markets, grow in existing marketing, and rebound when they were faced with rapidly decreasing sales, profits, and market share. My commit to you is they are practical and you may even scratch your head and say “well it can’t be that easy”…the reality is; yes, it is.

I am not sure what caused it, or when it occurred , but leaders at some point decided problems were complex and therefore required complex solutions that none of us could execute if we had to … if the truth be told. The reality is when you boil problems down to their true essence there are no new problems. The problem may on the surface look or feel new, but in reality it has existed before. Identifying problems and the road blocks standing in the way of your team’s success and solving them is what we are paid to do.

How about your business…when I ask the question; what is broke and you know you need to fix it but it will be painful? …do you think about?
Are you sure the band aide you slapped on it long ago is working? How can you be sure?
Are you sure underneath that band aide you don’t have a festering infection that may spread throughout the body of your business? ( and worst spread to your customers)
Did you just address an area by “Ripping off the Band Aide”? If so please share what your learned.
Technorati Tags: grow your business profitably in 2010,profitable growth,strategic plan,problem solving,rip off the band aide,identify road blocks,what is broken in your business,sales,profit,growth

Top 20 Entrepreneurial Best Practices to Make Sure 2010 is a Profitable Year

 

When I wrote my EBook: 50 Ugly Truths About Owning and Running Your Own Business…and 5 reasons why you should do it anyway I was responding to a number of misperceptions I was hearing from entrepreneurs.

Historically, at any given time six out of ten US adults is thinking about starting their own business. A number of new entrepreneurs are emerging that  I refer to as “necessity-preneurs “who were downsized and can not find new employment, are deciding to launch their own businesses as they want a much more active role in the security of their careers. The last group are cashing in their 401k and or borrowing from friends or family to buy an existing business and in a short amount of time realize they really just bought a job and they are quickly running out of cash.

One thing I have learned over the past 25 years of identifying roadblocks impeding businesses profitable growth is there really is not any new creations in terms of problems and strategies to grow a profitable business. Peter Drucker simplified it even further; there are only two considerations; innovation or marketing.

Just as I shared 12 mentor moments that I have used personally over the years to help businesses grow profitably, I have the Top 20 entrepreneur best practices that I have observed and lived over the years.

#1 “More” Sales or “Create Sales Velocity”?

#2 Dismiss or Distribute “Yafo’s” quickly …

#3; If Sales are Scary, You Can NOT Afford to NOT get Creative..

#4 Remember “The Law of the Locker Room”… it truly is a small world after all

#5 Tailor Questions for your buyers that Illustrate your Expertise and Prepare you to Serve their Needs

#6 Learn To Cut Bait …early

#7 You are Not Your Market

# 8 When Sales Get Rough…Look for Diamonds

#9 Don’t Let the Two Most Important Plates Drop

#10 “How” you “CHASE” New Business Matters….Do you want pepperoni with that new checking account?

#11 Follow the leader is a dangerous game, particularly when you follow Hippos…

#12 An “Idea” is not a product…and it’s definitely not a business

#13 Hire Strategic Partners… Not “Marketing Tools”

#14 Customers will Stiff you…But Don’t Let Them Burn you…

#15 Beware of “Smores”…Social Media Whores

#16 “Make a Wish” come true with Focused Passion

#17 intentionally reward the customer behaviors you desire …

#18 You will Receive Your Best Tips To Grow Your Company From Prospects Who Do Not Buy From You…

#19 Interview those who Exit and identify Roadblocks to Achieving Your Strategic Objectives…

#20 Exercise Your Power of Choice in Choosing Your Role on the Team…If Your Gift is Being a Duck….Be a Duck!

 

The above are by no means an all inclusive list of every entrepreneur best practice but they are some of my favorites. The post that seemed to resonate the most and create the greatest number of discussions was the difference between creating “more” sales versus “creating sales velocity” ( entrepreneur best practice #1).

 

 

How about you….do you have an Entrepreneurial Best Practice you use regularly and would like to share?

 

 

Of the above which best practice(s) resonate most with you?

 

 

Which of the above do most entrepreneurs struggle the most with based on your observations?

 

 

Is there a Key best practice not identified? (If so please add to the discussion)

 

 

As we move into 2010 which of the above Best practices do you feel will resonate most? Why?

 

Thanks for hanging with me  in this series of posts and I want to particularly thank those who have reached out to me personally to discuss this series of posts. As I have discussed, I enjoy helping entrepreneurs realize profitable growth and the strategies discussed are not new. One of my goals in blogging is to help business owners who may not be able to afford outside help at this time and I hope this blog adds value.

If you are wired to take on the 50 Ugly truths of starting and owning your own business and you have intentionally chosen to do it anyway I hope the above best practices were of value to you and your team.

Entrepreneurs will lead our country to economic recovery and I am proud to serve this innovative group of passionate problem solvers along with my other clients.

Technorati Tags: Entrepreneur best practices,entrepreneur,sales velocity,profitable growth,marketing,sales,sales and marketing alignment,execution velocity,market leader,market loser,road map,flight plan,market problems,solve market problems

Entrepreneur Best Practices: #20 Exercise Your Power of Choice in Choosing Your Role on the Team…If Your Gift is Being a Duck….Be a Duck!

As the entrepreneurial leader you have natural gifts. Market leading entrepreneurs understand a key principle; you have the power of choice…chose to exercise your power of choice in choosing the role you will play on YOUR team. Market losers focus on what they are not, and try to become experts in all the areas of business and thus dilute their personal giftedness and ultimately their contribution to the team’s bottom line. Market leaders know what they know as well as what they don’t know.

Our Pastor at church has started a series on how we have a role to play in adding value based on the spiritual gifts we were born with coupled with those skills we developed over our life time. This message resonated with me both personally as well as made me think about a meeting last week.

When I meet with business owners and leaders the first thing I do is perform a triage of sorts. I ask a number of questions. I identify first if this is someone and a business I want to help. For example, I was asked to meet with a local entrepreneur about two years ago and when I discovered he wanted my help launching a smokeless cigarette that could help more consumers get addicted to nicotine and caffeine,..I chose to pass.

 

Secondly is the problem this business experiencing one I can solve? If not I refer them to one of my trusted network partners. I have a number of questions I use to identify what is and is not happening in the organization. Often the owner’s inability to answer some of my questions are answers in and of themselves. One area I need to focus on early is the owner’s objectives and motivations. Once I understand the true goals I can serve their team and provide the maximum value in the shortest time.

One of my questions that consistently creates a “pause” with entrepreneurial leaders is;

What are your dreams, your goals for this business and what do you personally want to do, and where do your gifts add the most value? ( not what you like to do…but what are you good at?)

 

What is often the case the entrepreneur started their business based on their personal gifts and seeing how their gifts can solve a particular market problem. They launch and realize success. Their desire to serve the market grows into a business and things begin to change. They start hiring team members, dealing with vendors, promoting the business, funding the business….and as time passes they move into a role of running versus doing their business. The shame is they focus so much energy on areas they are not naturally gifted in and they end up moving farther and farther away from their personal giftedness. When this occurs the owners stress increases, she feels like she is being pulled in 100 directions and nothing is getting done. The joy they once experienced when they first launched their business is gone…and now their business has become a job and no longer is a passionate quest.

I often shock business owners and leaders in this first meeting when I say;

There is a big difference between “making” widgets, and “running “a business that makes widgets…where are your gifts best used?

 

We are all uniquely wired with blessings we are to use to serve others. As that business consulting expert Jimmy Buffet shares…

“A blessing can become a curse if you keep it to yourself”

 

Our Pastor shared a story Sunday that I have heard before but this time resonated in a new way. It seems at the time of creation all the animals got together and decided they needed to focus on specific gifts as a group ; running, swimming, climbing and flying.

So the duck was an excellent swimmer but struggled with running. Not wanting to let the other animals down, he decided to focus on becoming a better runner. He trained to run faster and in the process got marginally better but tore the webbing in his feet. When he returned to the water he found he could not swim with the same expertise and speed he once had.

The rabbit was an amazing runner, but had difficulty swimming. So he focused on improving his swimming. In the process of doing so the muscles that made him a swift runner atrophied and when he tried to run, he could not run as fast as he once ran.

The squirrel was an amazing climber, but no matter how hard he tried he as not good at flying. After multiple attempts that ended in crashing to the forest floor he permanently injured his legs and this hampered his ability to climb with the same speed and efficiency he once had.

The eagle was amazing and the best at flying high above the earth and then quickly swooping down to capture her prey. He could catch the currents and seemly soar and dive without effort, but he was not efficient as a climber. He worked tirelessly to be a more effective climber, but in the process his wings became weak and he could not catch the updrafts he once could and could no longer soar to the heights he once exclusively owned.

Market leaders understand their gifts and use their gifts to serve their internal and external customers.

 

Market losers spend time trying to perfect areas that are not within their natural giftedness and ultimately reduce the value they provide their team and their market.

 

How about you…do you know your natural gifts and are you using them?

 

Are you in a role on your team that uses your gifts?

 

What should we do if we are in a role that does not use our natural giftedness?

 

As a business leader, entrepreneurial owner do you feel comfortable returning to your giftedness and hiring someone to run your business that is gifted in growing businesses?…why or why not?

 

 

I am not saying don’t learn about the other skills that can add value to your business. What I am saying is stay focused on serving your team and your market with your gifts. As the leader you will want to become aware of other skills , but do not try to become an expert in these areas as it will only dilute your gift’s contribution to the bottom line

 

I find one of the quickest ways to help businesses grow is to identify the various team members’ gifts, starting with  the leader and or owner, and making sure the role they play on the team is in alignment with their gifts. What is often he case is I give the owner a pink slip in running the business and I help find someone skilled at running businesses so the founder can return to their gift. They often express a sense of ….”am I allowed to do this…or is it OK for me to have fun again? “and my answer is always Yes! ( after all it is still your business)

If you are a duck…be a duck! You will swim much faster than those other ducks that are spending hours of frustration trying to become faster runners. While they dilute their gift you will remain focused on adding the maximum value by exercising your gifts.

 

Technorati Tags: Entrepreneur Best Practices,entrepreneur,Spiritual Gifts,know what you know,leverage your strengths,leadership,outsource non core competencies
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