Friday, June 27, 2008
Wednesday, June 25, 2008
In both cases, the core business probably represents an opportunity for additional success if properly managed. But there seems to be something about human nature that draws people away from what they do best and toward something that appears to be more glamorous or more intriguing.
We believe it is important to pay special attention to the core business...what it is you do best...and grow that business to higher levels of success. Business newspapers and journals are full of stories about companies that get outside their core business and fail miserably. And in many cases the core business suffers because resources are drawn away from it.
We think that too many decisions to diversify outside of the core business or strategic outgrowth of the core business are ego-driven. Making diversification decisions to feed someone's ego is simply irresponsible.
Before thinking about moving beyond the core business, ask yourself why you are even considering such a move. Can you grow your core business in a profitable, significant manner? Are you doing a good job with your core business in terms of operating efficiency, customer service, margins, promotion and quality of personnel? If there is room for improvement, concentrate and focus on making those improvements. Your objective should be to maximize the value of the business. Making the core business strong in terms of operations and customer satisfaction and loyalty will enhance value significantly. If you divert resources away from the core business by buying another business or diversifying through product or service development, the core business will not get the attention needed to enhance its value.
In short, focus on doing what you do best. And then try to do it better. However, none of this is to say that diversification is necessarily bad. It can be a very positive step for a business. But the point of this brief is to point out that the core business, assuming it has adequate potential, must have a lot of attention paid to it. A new venture can be undertaken as long as adequate resources and expertise are available for both the core business and the new one.
Tuesday, June 24, 2008
Monday, June 23, 2008
What TQM, CQI, reengineering and other process improvement programs advocate is an increase in efficiency through the systematic study and improvement of critical business processes. But what we have found is that many companies approach these programs incorrectly by:
1) selecting unimportant or lower priority processes to study
2) getting bogged down in the analysis rather than focusing on results.
What is a process? Webster's Dictionary defines a process as a "method of doing something will all the steps involved". Businesses are made up of a number of processes, each with varying degrees of complexity in terms of the number of steps involved. These processes are used to carry out functions and activities. For example, something as simple as paying bills or more complex manufacturing or distribution processes are all necessary to keep a business running. How efficient these processes are can have a major impact on customer satisfaction, employee morale and productivity and profitability.
Before proceeding, an organization should inventory all of its important business processes. Once the inventory is completed, the list of processes should be prioritized in terms of their relative importance to the overall success of the company. We believe that the most important processes are generally those that impact customers most directly and most heavily. After the list of processes has been prioritized, begin with the most important process. Select a refinement team of roughly 3 to 7 people. The team should consist of people with and without intimate knowledge of the process. Selecting people without intimate knowledge is important because they can provide a more objective, distant perspective. It is often difficult for those closely involved in a process to "see the forest from the trees". They are often too close to it to be objective or they have such a vested interest in it that they will fight change.
Once the team is in place, have an initial meeting to provide a brief overview of the process and to collectively list the steps (flow chart) the process in question. Have someone record the steps involved in the proper order. That individual will be responsible for preparing a draft of the flow chart and distributing it to each member of the team within a day or two of the initial meeting. Schedule a second meeting that should take place within about a week or so. In the meantime, the team should be individually looking at each and every step of the process and evaluating whether that step is:
2) necessary at all.
In the second meeting, the group will begin discussing each step of the process. Each member of the team should provide input as to whether that step is correct and necessary or whether it should be modifed (and how) or eliminated completely. The group should reach consensus on each step. Once each of the steps has been evaluated in this manner, a new flow chart should be prepared for the group to review. A final evaluation should take place to ensure that the process will, indeed, do what it is intended and that it has in fact been made more efficient.
With this approach, processes can be quickly and easily enhanced to become more efficient and less cumbersome. While most processes can be refined in this manner, there could be a few processes that are very complex that will require more extensive analysis and measurement. But we believe that over-analyzing simple processes simply ties up people resources and provides little incremental advantage over the method described above.
Friday, June 20, 2008
Let's look at an example to clarify our point. Suppose the average face-to-face call lasts 15 minutes. And the average travel time between accounts is 30 minutes. We'll use an 8 hour day even though we believe an 8 hour day falls far short of acceptable in the sales game. Let's assume that on this day the full 8 hours is devoted to either travel or actual sales calls. We'll further assume that the rep is at the first prospect's doorstep at the beginning of the 8 hour period. In this 8 hour day, the rep would be able to make roughly 16 sales calls.
We know that sales is an imperfect art form and making 16 calls in this example is undoubtedly a stretch. We know that the rep will need to return phone calls and follow up on and resolve problems that might occur. These will consume some of the day which will further reduce the actual number of calls that get made. So let's say that on a good day the rep can make 10 calls.
Now let's complicate this scenario by introducing events or activities that tend to waste a sales person's time. Here's a list of our top ten time killers:
1. Poor routing through a territory increasing the average travel time between accounts.
2. Making a face-to-face contact to answer a question or resolve a minor customer issue when a phone call would have sufficed.
3. Doing administrative (non-selling) tasks such as paperwork during prime selling time.
4. Calling on non-decison makers.
5. Calling on prospects who will never buy anything or simply can't afford to buy from you.
6. Making too many calls to the same account or prospect.
7. Finding every reason possible not to make sales calls by doing make-work activities that yield no real return.
8. Leaving at the start of normal business hours from home or the office to drive to the first call and/or driving home or back to the office before putting in a full day in the field.
9. Preparing proposals during prime selling time.
10. Spending too much time with any given customer or prospect.
If a sales person engages in any or all of these activities, the number of calls that can be made is further reduced. In extreme cases, the sales person is doing more of these activities than actual selling activities. In many cases, a sales person is often not even aware they are doing one or more of these things and are chewing up significant chunks of time in non-selling activities.
The sales manager must act as a role model and mentor to help the sales person more effectively manage his/her time. Sales people need to understand clearly that time really is money and that selling is, in most cases, a matter of relationship development and maximizing the number of quality contacts made. Without enough time devoted to actual sales activities, it is difficult to achieve either.
Thursday, June 19, 2008
Wednesday, June 18, 2008
But something happens in many businesses along the path to success (or failure). The people responsible for running the business begin to make their lives and others' lives difficult by adding levels of complexity that often don't need to exist. Most of this is a result of poor planning and implementation and a lack of adequate management skills.
In every facet of a business, it is wise to constantly think in terms of how things can be kept simple. Processes should be as simple as possible. When processes become unduly complex, communication breaks down, mistakes occur and customer service suffers. Communication should be kept very simple as well. The more words that are used in communicating, the greater the chance of miscommunicating. It is important to provide enough details to clearly communicate what it is you want to get across, but do so in a concise, straightforward manner.
When dealing with problems whether they are operational in nature or related to employees, avoid the tendency to make more out of the problem than is really there. In other words, stay away from making things appear worse than they are. Taking a "sky is falling" approach to problems simply encourages havoc and chaos that often clouds the ability to resolve the problem. It is important to stay calm, think rationally and positively and to remain optimistic. Work through the issues methodically and work toward a solution. Effective managers are adept at keeping their emotions in check and not allowing negativity to creep into their thinking.
Using common sense in resolving business issues is critical. Most business issues and challenges can be dealt with by using simple common sense and keeping things in the proper perspective. Managers who possess a high level of common sense tend to be more successful because they apply sound reasoning and logic to getting things done. Those who try to apply a lot of theory to getting things done often find it difficult to move beyond the theory and into practice. In other words they tend to get caught up in deriving complex models for getting things done when a relatively simple approach would suffice.
We often refer to blocking and tackling when it comes to business success. Blocking and tackling represents the fundamental business practices that must be in place to be successful. We also break businesses down into four fundamentally simple, but broad categories:
We believe that managers must deal with these four variables effectively to create a successful business and create value in the business. This approach also allows businesses to focus on four relatively straightforward areas and encourages simplicity in planning and management. Knowing that these four variables must be affected to be successful is a big first step in getting to a simple, logical approach to managing a business. Why? Because it brings focus to what needs to be dealt with.
Sure there are a number of sub-variables within each of these broader categories, but most businesses fail to compartmentalize their businesses in a way that makes sense. Management should look at these four variables and begin by asking these simple questions:
1) do we have the right people in the right jobs?
2) do we have the right strategies defined?
3) are our processes as simple and efficient as possible?
4) do we have a high morale, customer-driven culture?
In most organizations, the answer will be "no" to one or more of these questions if management is willing to be honest and objective in assessing the situation. A "no" answer is a call to action. A simple, but well defined plan of attack needs to be assembled to deal with deficiencies that might exist.
Maintaining simplicity in business whenever possible is important. Is your approach logical and based on common sense? Are your daily processes and procedures simple and efficient? If not, take a look at how you might simplify your business and, therefore, your life.
Monday, June 16, 2008
1.Remember that the foundation for a sound strategic plan is goals. They provide direction and focus and well as a basis for finding alternative ways of achieving them. Never lose sight of your goals.
2. Forget about "the way it's always been done"! Think about how things could be and/or should be. Get outside your comfort zone!
3. Practice creative thinking. Tell yourself that no idea is too crazy. Generate as many ideas as possible. As an example, take one of your products or services and list all of the possible ways it could be marketed remembering that anything goes. Force yourself to be creative and think "outside the box".
4. Analyze and process data and information in an unbiased manner. Good long-term strategies are developed around good information and sound logical reasoning. Take the time to gather good data/information, but don't get caught up in over-analyzing things!
5. Look outside the operating environment. Learn to look at customers and markets available to you. Get externally focused! Understand your markets.
6. Think in strategic terms rather than task-oriented terms. For example, suppose a goal is to grow revenues at an annual rate of 9%. This sets off all kinds of task-oriented thinking; staff needs, promotional materials, space planning, etc. Think more in terms of alternative strategies for growing the business, new ways to penetrate existing markets with a new product for example.
7. Become a thinker! Take time to sit back and clear your mind of details and just think. Think less about details and more about your goals and how to achieve them. Step back and think big picture on a regular basis. Find quiet time to do it. Thought can be the most productive form of work.
8. Generate as many ideas as possible. Quantity will often breed quality. Also, some ideas can come together to form very effective strategies.
Wednesday, June 11, 2008
Here are some tips for hiring good people:
-Be patient. Don't hurry the hiring process. We believe you are better off with a vacant position than having a marginal employee filling it.
-Develop a complete and accurate position description that details all aspects of the position.
-Develop what you feel is an ideal profile of the person that will fill the position.
-Utilize an employee assessment instrument in the hiring process. These tools are essential to uncovering a person's interests, ability and personality. The best instruments provide a profile of the individual against the ideal profile for the job.
-Spend a little extra time and money attracting as many quality candidates as possible. You will want to be able to select from as many good candidates as possible.
-Be prepared! Develop interview questions prior to any interviews. Focus on the desired traits and profile when developing interview questions. Design the questions to draw out traits and tendencies. Get at the past behavior of the candidate in the interview process. Have candidates explain situations they have dealt with in the past that are relevant to the job you are hiring for. -Put the candidates through a series of what if questions. These are situational in nature and force the candidate to think about what he/she would do in each situation.
-Once you have boiled the candidate field down to just a few people, bring the finalists back for a second round of interviews.
-Have several people interview the candidates. This allows for different perspectives and accounts for various biases.
-Examine your wage/salary and benefits structure. Are you at least competitive with the market? The best people will be attracted to the highest paying positions in most cases.
-Think long-term. Ask yourself if hiring the candidate is in the best interest of the organization. Remember that hiring marginal employees has a devastating short and long-term impact on a business.
Tuesday, June 10, 2008
We are excited to announce two upcoming enhancements to the ReviewSNAP™ performance management system. The first is the addition of a summary statistics module that will allow you to view basic statistics about each employee’s performance review history, each department’s performance review history and your overall company’s performance review history. The new statistics feature will allow you focus in on each specific competency you are utilizing to assess trends, identify persistent performance issues, and develop coaching and training programs based on patterns that may be emerging. This module is expected to be released by early July 2008.
ReviewSNAP360™ is a comprehensive multi-rater feedback system that will fully compliment and augment the ReviewSNAP™ system. This powerful solution will allow you to set up feedback sessions and use automated notification processes to alert those involved. And, just like ReviewSNAP™, it will include a full library of multi-rater competencies/performance factors.
Monday, June 9, 2008
Wednesday, June 4, 2008
How you deal with vendors, employees and customers all factor in to the reputation you develop. And all three of these constituent groups are critical to the success of any business. Too many companies don't understand the importance of developing and maintaining a solid reputation as a company that can be trusted, relied upon and that treats people fairly. The basic philosophy and culture of the organization will fuel the perceptions of employees, customers and vendors as well as the public at large.
We believe strongly that organizations have to manage their reputations. They do so from the top. Owners and top management must buy into a philosophy that has at its center honesty, fairness, responsiveness and consistency in how the organization deals with internal and external constituent groups.
Top management should strive to communicate clearly to all employees that they expect them to treat each other, vendors, customers and the public they come in contact with while representing the company in a manner that is consistent with the philosophy described above. When employees deviate from that philosophy, it is important to clarify for them those expectations and reinforce the fact that behaving in a manner inconsistent with the organization's philosophies is not an option. For employees who just can't buy into those philosophies, they will be better off finding an organization that better fits their own values and perspectives.
Since each employee has the opportunity to impact the reputation of the organization, all should receive appropriate training in dealing with people in routine and in potential conflict situations. When the reputation of an organization becomes too tarnished, it is either impossible or it takes a long period of time to shift negative perceptions that have been created.
The way an organization conducts business is critical to its long-term success. People want to do business with companies they feel good about. If there is any doubt in their minds, they are less likely to take a chance. Take time to assess what kind of reputation your organization has. Ask employees, customers, vendors and the general public what they think of your company. Use that input to improve upon your approach to doing business.