Each year I write some thoughts on my perspective around the economy. I am not an economist - so take this with a grain of salt. It is just an Iowa farmboy's opinion as to what lies ahead. As I look at 2011 and the next few years, there are some realities that underlay the current market conditions that are a bit troubling. I am not usually a pessimist by nature – I consider myself to be an optimist but over time have migrated to more of being a realist. And the reality is that here in the US, and worldwide for that matter, the issues that caused the economic meltdown have not been truly dealt with. A significant amount of money has been spent – billions here and there thrown at the surface issues – but underneath it all remains the root causes which have not been addressed. We have been somewhat effective in putting a Band-Aid on things but definitely not effective in truly solving the core issues.
As I talk with folks in the financial industry, I hear over and over how the more obvious and simpler issues have been or are being corrected. But everyone is quick to point out that there are a significant number of big rocks left on the path that will take several years to correct at best. There are still billions of dollars of bad loans being carried by banks that have not been addressed. There are billions of dollars of bad credit card personal debt that is currently just being ignored as to not upset the apple cart during this apparent recovery. While every part of me wants to believe we truly are in recovery mode, I can’t make that step, because the fundamentals have not been fixed. There must still come a day of reckoning. The only question in my mind is – will it be in 2011?
A lot depends on the way the new Congress approaches the issue. If they take the hard line approach – we have to stop the spending and fix the problem – correction will happen sooner than later. Should they continue the path of pushing the hard decisions to some future year – it could drag on a year or two giving us short term relief. I can’t predict legislators any better than I can outguess the weather in Iowa. So I am cautiously optimistic about the economy this year because I tend to believe they will not make any short term moves in 2011 to upset things. I do think 2012 will be a different story.
One industry I am rather familiar with is the agriculture sector. We have seen record grain prices and the result has been skyrocketing land values and input costs. For those who don’t recall history – the last time we saw these dynamics was back in the late 70’s and early 80’s – you may recall it being called the “Farm Crisis”. Many farmers lost all they had because of a significant drop in value of their crop inventory and land values. I see those days coming again for agriculture in the not too distant future. The reality is that the current pricing situation is not sustainable. And throw in the reality that no politician will ever be elected for having high food prices for the general consumer and something has to give. There will be a correction – I believe a very strong one – and it will happen in the next couple years. That will spill over to the general economy rather quickly which is just another reason why I see trouble ahead.
Please don’t take this as a doom and gloom message. That is not the intent. But it is my desire to balance the excitement that is being driven by the media around a recovery that is only skin deep. Be cautious, take advantage of all the goodness you can right now, but save for a rainy day because there are clouds in the sky. Conserve cash and make sure you are ready to go through some rough days in the not too distant future. As we say on the farm “make hay while the sun shines”. There are some very positive opportunities right now we should definitely pursue. But don’t get too far away from the barn because when the rain comes you will need to get inside and have a place of safety.
Showing posts with label growth. Show all posts
Showing posts with label growth. Show all posts
Saturday, January 8, 2011
Monday, December 27, 2010
Vendors Matter
This is the seventh blog post regarding the 10 Things I Accidentally Learned on the Path to Growth. There is little question that many folks in our industry seem to feel that the vendors are the enemy. Why - I am not exactly sure. But I can tell you without question that an attitude like that is 180 degrees the wrong way. Not only are vendors necessary and important - if you really want to grow - they are one of the most important factors I have seen and experienced.
So before you tune me out - listen a bit. Unless you are some super giant company - you do not have everything you need in order to serve your clients. Even Microsoft and HP use vendors - lots of them - to bring together things needed to serve their end clients. So what makes us as IT owners believe we are self sufficient and can run our business without any vendor relationships? I know the answer and it is in one word - stupidity! I know because I used to think that way a long time ago. I thought my job for the day was to beat vendors and distributors up on pricing and accuse them of trying to take my customers or take advantage of me through one of their programs somehow. Is that how you see your vendor relationships? Wrong approach - way wrong. Here are the facts as I have seen them over the years:
Vendors and Distributors exist to sell stuff
At the core of our attitude toward vendors is the failure to understand what they are in business for. Just like us - they exist to make a profit - and serve their customers. We tend to want to cut that first part out. If you want to succeed in this area - you have to understand that they are in business to sell things. And the way you embrace that is pretty obvious - you buy them. But not based on where you can find the lowest deal of the day or beat down the last penny of profit. You consolidate your purchasing and become a loyal buyer. Nothing says relationship like those two words. Get over finding the cheapest place to source products. Pick a distributor and a few key vendors and buy their products the same way from the same companies every day. I am often amazed at discussions where someone saved $10 a product by shopping. They wasted two hours of valuable time that could be used on productive work - but they got the best deal. Until they look a little more and find out that had they spend the whole day they could have saved $12. How ludicrous. We are in the value business. We sell our solutions and services based on value - not cost. We should buy the same way and quit worrying about getting every last dime out of someone. You will never grow or succeed as long as you are focused on spending your time here rather than building value for the customer.
Learn who your reps are and how they get paid
Relationships happen between two people. Every vendor has people resources that we can leverage to help drive our collective business. Your assignment is to find out who they are and build a relationship with them. It starts by buying as described in the previous paragraph. Most vendor reps are not crazy about working with companies that don't buy anything. But assuming you figure that one out and become a loyal partner - then it is time to begin the treasure hunt to find out where the people resources are. This takes determination and hard work - but is very much worth the effort. Once you build a relationship by consistently executing - you will find that these folks offer to bring resources to the table to help you grow. After all - they are paid on selling stuff. You need to ask that question and understand their compensation model - but inevitably it will have some component of sales in the mix. So find them and help them succeed. No one in their right mind won't partner with you to sell more if you are helping them earn more. This is key - building a win - win relationship. It is so powerful and I have seen significant results from learning to partner closely with vendor reps.
Participate in their programs
Vendors spend millions and millions of dollars on our behalf. The sad reality is that most of us don't take advantage of those investments. We don't like what they are offering for this reason or that - so we just ignore them. Bad decision. We need to not only understand what our key vendors are doing to support the channel - we need to participate in every possible way whether it is exactly how we would like it or not. It is their money after all. They are spending it on our behalf. We don't get to decide how. But they do care about our participation. They very much care about how involved we are in taking advantage of their investments. And they do keep score. Not getting much attention from your vendors? Begin by looking at your support and participation in their programs. More often than not you are getting what you deserve based on your committment.
Provide customer evidence
Vendors really love customer success stories. And in our IT channel two tier distribution model they have a difficult time getting those because we are in the middle. If you want to win some big points with both field reps and folks at corporate offices of your key vendors - capture and write success stories on how their technology delivered by you made a difference. That is like gold to reps and gives them some great evidence to bring back to their company. You can use it with your customers too - so it is something we should all be doing anyway. Just be sure to include your vendor reps and help them look good with their managers.
Get your team trained
It amazes me at how many partners complain about having to invest in training to get attention from vendors. Is it really that difficult to understand. It not only prepares us to actually sell their products as designed, to install them the best possible way, to succeed with their programs and use their references - but it also shows loyalty and our willingness to put skin in the game. Do I ever think some of the training is a little worthless? Yep. Do I think most training could be done better? Yep. Do we participate and get our people trained? Absolutely. Why? Because it shows that we are committed to the technology and company we are representing. It is part of learning how they intend to help us succeed. We need to bite the bullet and get our people trained, and then use what we learned to sell and implement more solutions.
Plan and be accountable to them
One of the most important things you can do to take vendor relationships to a whole different level is to truly plan together. Each year in the last quarter we hold our annual vendor planning session. We invite our top 4 or 5 vendor partners and our disty partner to the table - all at the same time - with our management team to strategize for the coming year. This has turned into one of the most important things we do to drive relationship with our vendors. It is a day and a half to two days focused on how we collectively grow each others business. There are competitors in the room - but we are clear that our approach to the market is solution selling and we sell products from a few vendors to build our solutions so they have to learn to play together in the sandbox. It opened some eyes the first time we did it. Some were pretty quiet and careful - but over the years it has become a true collaborative time and vendors leave knowing our collective approach. We also make committments to them, and they to us, that both sides are accountable for. We do quarterly reviews to make sure we are on track through the year. You have to be transparent and accountable if you truly want to make vendor relationships work.
There are lots of ways to engage vendors. Here are a few ideas we have utilized:
•Marketing Development Funds (MDF) - come in a variety of shapes and sizes
•Technology adoption programs
•Rapid deployment programs
•Beta programs
•Case studies – video and print
•Advisory councils
•Technical and sales training
•On site visits where we have corporate folks in our office to see what really happens
The bottom line
If you want to truly grow your company - you have to get this area right. I have seen NO company of any size do it alone. There always is a very strong and deep strategy to leverage vendors as part of the growth. You just aren't going to get there if you don't embrace them. They truly are a great resource and ally if you build deep relationships. It is work. It takes time. But it is very much worth it. Get after it and don't listen to the majority who will never figure this out. Go deep and find out just how far great vendor relationships can take you on your path of growth!
So before you tune me out - listen a bit. Unless you are some super giant company - you do not have everything you need in order to serve your clients. Even Microsoft and HP use vendors - lots of them - to bring together things needed to serve their end clients. So what makes us as IT owners believe we are self sufficient and can run our business without any vendor relationships? I know the answer and it is in one word - stupidity! I know because I used to think that way a long time ago. I thought my job for the day was to beat vendors and distributors up on pricing and accuse them of trying to take my customers or take advantage of me through one of their programs somehow. Is that how you see your vendor relationships? Wrong approach - way wrong. Here are the facts as I have seen them over the years:
Vendors and Distributors exist to sell stuff
At the core of our attitude toward vendors is the failure to understand what they are in business for. Just like us - they exist to make a profit - and serve their customers. We tend to want to cut that first part out. If you want to succeed in this area - you have to understand that they are in business to sell things. And the way you embrace that is pretty obvious - you buy them. But not based on where you can find the lowest deal of the day or beat down the last penny of profit. You consolidate your purchasing and become a loyal buyer. Nothing says relationship like those two words. Get over finding the cheapest place to source products. Pick a distributor and a few key vendors and buy their products the same way from the same companies every day. I am often amazed at discussions where someone saved $10 a product by shopping. They wasted two hours of valuable time that could be used on productive work - but they got the best deal. Until they look a little more and find out that had they spend the whole day they could have saved $12. How ludicrous. We are in the value business. We sell our solutions and services based on value - not cost. We should buy the same way and quit worrying about getting every last dime out of someone. You will never grow or succeed as long as you are focused on spending your time here rather than building value for the customer.
Learn who your reps are and how they get paid
Relationships happen between two people. Every vendor has people resources that we can leverage to help drive our collective business. Your assignment is to find out who they are and build a relationship with them. It starts by buying as described in the previous paragraph. Most vendor reps are not crazy about working with companies that don't buy anything. But assuming you figure that one out and become a loyal partner - then it is time to begin the treasure hunt to find out where the people resources are. This takes determination and hard work - but is very much worth the effort. Once you build a relationship by consistently executing - you will find that these folks offer to bring resources to the table to help you grow. After all - they are paid on selling stuff. You need to ask that question and understand their compensation model - but inevitably it will have some component of sales in the mix. So find them and help them succeed. No one in their right mind won't partner with you to sell more if you are helping them earn more. This is key - building a win - win relationship. It is so powerful and I have seen significant results from learning to partner closely with vendor reps.
Participate in their programs
Vendors spend millions and millions of dollars on our behalf. The sad reality is that most of us don't take advantage of those investments. We don't like what they are offering for this reason or that - so we just ignore them. Bad decision. We need to not only understand what our key vendors are doing to support the channel - we need to participate in every possible way whether it is exactly how we would like it or not. It is their money after all. They are spending it on our behalf. We don't get to decide how. But they do care about our participation. They very much care about how involved we are in taking advantage of their investments. And they do keep score. Not getting much attention from your vendors? Begin by looking at your support and participation in their programs. More often than not you are getting what you deserve based on your committment.
Provide customer evidence
Vendors really love customer success stories. And in our IT channel two tier distribution model they have a difficult time getting those because we are in the middle. If you want to win some big points with both field reps and folks at corporate offices of your key vendors - capture and write success stories on how their technology delivered by you made a difference. That is like gold to reps and gives them some great evidence to bring back to their company. You can use it with your customers too - so it is something we should all be doing anyway. Just be sure to include your vendor reps and help them look good with their managers.
Get your team trained
It amazes me at how many partners complain about having to invest in training to get attention from vendors. Is it really that difficult to understand. It not only prepares us to actually sell their products as designed, to install them the best possible way, to succeed with their programs and use their references - but it also shows loyalty and our willingness to put skin in the game. Do I ever think some of the training is a little worthless? Yep. Do I think most training could be done better? Yep. Do we participate and get our people trained? Absolutely. Why? Because it shows that we are committed to the technology and company we are representing. It is part of learning how they intend to help us succeed. We need to bite the bullet and get our people trained, and then use what we learned to sell and implement more solutions.
Plan and be accountable to them
One of the most important things you can do to take vendor relationships to a whole different level is to truly plan together. Each year in the last quarter we hold our annual vendor planning session. We invite our top 4 or 5 vendor partners and our disty partner to the table - all at the same time - with our management team to strategize for the coming year. This has turned into one of the most important things we do to drive relationship with our vendors. It is a day and a half to two days focused on how we collectively grow each others business. There are competitors in the room - but we are clear that our approach to the market is solution selling and we sell products from a few vendors to build our solutions so they have to learn to play together in the sandbox. It opened some eyes the first time we did it. Some were pretty quiet and careful - but over the years it has become a true collaborative time and vendors leave knowing our collective approach. We also make committments to them, and they to us, that both sides are accountable for. We do quarterly reviews to make sure we are on track through the year. You have to be transparent and accountable if you truly want to make vendor relationships work.
There are lots of ways to engage vendors. Here are a few ideas we have utilized:
•Marketing Development Funds (MDF) - come in a variety of shapes and sizes
•Technology adoption programs
•Rapid deployment programs
•Beta programs
•Case studies – video and print
•Advisory councils
•Technical and sales training
•On site visits where we have corporate folks in our office to see what really happens
The bottom line
If you want to truly grow your company - you have to get this area right. I have seen NO company of any size do it alone. There always is a very strong and deep strategy to leverage vendors as part of the growth. You just aren't going to get there if you don't embrace them. They truly are a great resource and ally if you build deep relationships. It is work. It takes time. But it is very much worth it. Get after it and don't listen to the majority who will never figure this out. Go deep and find out just how far great vendor relationships can take you on your path of growth!
Sunday, December 19, 2010
Sales Matter
This is the sixth blog post regarding the 10 Things I Accidentally Learned on the Path to Growth. There is little question that many small business owners really dislike the whole sales process or anything that is related to it - particularly in the IT industry. But sales is not a four letter word - well it is - but it isn't a bad one. And there is little question that sales really do matter. That could be the understatement of the century actually.
Why is there such an aversion to sales by so many IT firms? Well for many of us, we came up to leading our company via the technical side of the business. We were engineers that were good at what we did and then decided to hire a few more like us and form a company. That works for a while but soon we hit the wall because we don't sell - we can fix anything under the sun - but we don't sell. I use don't rather than can't here intentionally. Anyone can sell - maybe not equally well - but it isn't that IT owners can't sell - it is because they almost despise the idea and certainly the notion of what being a salesperson is all about. Time to get over it!
Nothing happens until something gets sold. Let me say it again - nothing happens until something gets sold. OK - I have admitted it in public. We need to sell if we want to have a business. And sales is not a matter of luck. It happens when we build a sales process and system that makes sales happen regularly. We have to make the investment to put the right system and tools in place to make it happen. It can't be a hope and a prayer. That is not a sales strategy. Sales happen when we build the right foundation, hire the right people and execute the plan consistently. It really is not magic - it just takes consistent hard work doing the right things every day.
Most sales people fail because of a lack of support and management. It is common in the IT small business space to have a revolving door of sales people. We hire a person, let them flounder around on their own for 3-4 months and then fire them because they haven't sold much or anything at all. We blame them. Here is a newsflash - they likely are NOT the problem. You are. We set most new sales hires up for failure. We don't give them the right tools. We don't have a system in place. We don't manage or support them. We wish them well and sit back waiting to count the money. It just doesn't work like that. Owner attitude and support will make or break the sales engine in any company. Take a good look in the mirror and you will likely find the problem with your sales people.
When we do find that super human who is able to defy the odds of our lack of support and systems and actually sell something - it only lasts for a while. That is because without marketing support - every sales person will eventually run out of opportunities and people they know to sell to. It is our job to create leads for our sales people to follow up on. That is called marketing. It is hard work. It costs lots of money. It is somewhat luck - often more magic than science from my experience. But without marketing support - without aircover and other supporting tools to help drive leads and open doors - even a veteran sales person with many years of success will stub their toe. It is necessary to spend money on marketing to have consistent sales performance.
The pendulum is rapidly swinging toward sales. I see some major changes that are already in motion and will change the landscape as we know it for IT for many years to come. The cloud will force us to become sales organizations. You can resist, hide you head in the sand, and wake up one day wondering what has happened to your customer base. Or you can accept the fact that change is coming and make some changes. Some of these changes have been in motion for a while. Others are more a result of the current market and the move toward the cloud. But no matter the reason - they are coming. Here are some observations:
•From technical to sales focus
•From answering the phone to creating demand
•From selling products to selling solutions
•From T&E to flat rate services
•From on premise to the cloud
No longer will the company with the most technical genius necessarily win. I predict that those with most mature sales approach will actually come out on top. This new reality is that the IT business is moving toward a transactional relationship and those who can sell will win in that landscape. The reality is that companies must become sales organizations. We have to deal with these realities:
•Sales people are not the enemy
•It requires new thinking and management
•It requires new compensation models
Along with that we must become marketing organizations:
•Referrals are great but go only so far
•Most companies have just continued to sell new solutions to their current base
•We must become lead generators for the sales team
• Lead generation is not the vendors responsibility
Here is the reality as I see it. If you don’t embrace sales, growth will be stagnant and you will be frustrated. That is - if you survive. There will be plenty of companies that fail completely because they refuse to adopt the notion of becoming sales organizations. You don't have to like it - but it does work better if you do. You do have to do it and the time to begin is immediately. You can't afford to wait on this one. Begin now to learn to sell. Put the right systems in place. Hire someone and invest in them. Manage them closely and carefully. And begin to see the results - the sooner you begin - the sooner you will reap some of the goodness that comes with selling something. Remember - nothing happens until you sell something. Get after that today!
Why is there such an aversion to sales by so many IT firms? Well for many of us, we came up to leading our company via the technical side of the business. We were engineers that were good at what we did and then decided to hire a few more like us and form a company. That works for a while but soon we hit the wall because we don't sell - we can fix anything under the sun - but we don't sell. I use don't rather than can't here intentionally. Anyone can sell - maybe not equally well - but it isn't that IT owners can't sell - it is because they almost despise the idea and certainly the notion of what being a salesperson is all about. Time to get over it!
Nothing happens until something gets sold. Let me say it again - nothing happens until something gets sold. OK - I have admitted it in public. We need to sell if we want to have a business. And sales is not a matter of luck. It happens when we build a sales process and system that makes sales happen regularly. We have to make the investment to put the right system and tools in place to make it happen. It can't be a hope and a prayer. That is not a sales strategy. Sales happen when we build the right foundation, hire the right people and execute the plan consistently. It really is not magic - it just takes consistent hard work doing the right things every day.
Most sales people fail because of a lack of support and management. It is common in the IT small business space to have a revolving door of sales people. We hire a person, let them flounder around on their own for 3-4 months and then fire them because they haven't sold much or anything at all. We blame them. Here is a newsflash - they likely are NOT the problem. You are. We set most new sales hires up for failure. We don't give them the right tools. We don't have a system in place. We don't manage or support them. We wish them well and sit back waiting to count the money. It just doesn't work like that. Owner attitude and support will make or break the sales engine in any company. Take a good look in the mirror and you will likely find the problem with your sales people.
When we do find that super human who is able to defy the odds of our lack of support and systems and actually sell something - it only lasts for a while. That is because without marketing support - every sales person will eventually run out of opportunities and people they know to sell to. It is our job to create leads for our sales people to follow up on. That is called marketing. It is hard work. It costs lots of money. It is somewhat luck - often more magic than science from my experience. But without marketing support - without aircover and other supporting tools to help drive leads and open doors - even a veteran sales person with many years of success will stub their toe. It is necessary to spend money on marketing to have consistent sales performance.
The pendulum is rapidly swinging toward sales. I see some major changes that are already in motion and will change the landscape as we know it for IT for many years to come. The cloud will force us to become sales organizations. You can resist, hide you head in the sand, and wake up one day wondering what has happened to your customer base. Or you can accept the fact that change is coming and make some changes. Some of these changes have been in motion for a while. Others are more a result of the current market and the move toward the cloud. But no matter the reason - they are coming. Here are some observations:
•From technical to sales focus
•From answering the phone to creating demand
•From selling products to selling solutions
•From T&E to flat rate services
•From on premise to the cloud
No longer will the company with the most technical genius necessarily win. I predict that those with most mature sales approach will actually come out on top. This new reality is that the IT business is moving toward a transactional relationship and those who can sell will win in that landscape. The reality is that companies must become sales organizations. We have to deal with these realities:
•Sales people are not the enemy
•It requires new thinking and management
•It requires new compensation models
Along with that we must become marketing organizations:
•Referrals are great but go only so far
•Most companies have just continued to sell new solutions to their current base
•We must become lead generators for the sales team
• Lead generation is not the vendors responsibility
Here is the reality as I see it. If you don’t embrace sales, growth will be stagnant and you will be frustrated. That is - if you survive. There will be plenty of companies that fail completely because they refuse to adopt the notion of becoming sales organizations. You don't have to like it - but it does work better if you do. You do have to do it and the time to begin is immediately. You can't afford to wait on this one. Begin now to learn to sell. Put the right systems in place. Hire someone and invest in them. Manage them closely and carefully. And begin to see the results - the sooner you begin - the sooner you will reap some of the goodness that comes with selling something. Remember - nothing happens until you sell something. Get after that today!
Sunday, December 12, 2010
Growth is Hard Work
This is the fifth blog post regarding the 10 Things I Accidentally Learned on the Path to Growth. There is little question that many small business owners really don’t understand just how difficult the growth process really is. The common misconception is that if you show up every day and work hard – it just happens. That has not been my experience. There are many steps along the path to growing a business, and it must be done intentionally and executed continually to keep moving forward.
It all starts with you. You started your business because you wanted to be your own boss. You wanted to call the shots. There is a likelihood that you worked for someone else and decided you could do it better. But when you make the decision to grow – it can’t be about you anymore. Growth means you have to involve others – inside and outside your company. And that is the first step. You have to hire someone.
I remember those days well. It was a scary proposition. All of a sudden I was responsible for payroll which meant we had to be generating revenue. I sort of convinced myself it was ok to work some of the time and not pay myself – after all it was my company. But when you bring on that first employee they typically don’t quite see it that way. They come to work with the expectation they will get a paycheck and they should. So we have to know how we will generate enough revenue and keep them busy so we can pay them.
This is usually when the first lesson of growth occurs. It isn’t a straight line up. We have steps – take a few forward and then one backward. It looks something like this for many:
Seldom do companies grow with the green line – just up and to the right continually with no hiccups. Nor do companies maintain their situation like the red line – stagnant without change. I am a believer that if you are not growing – you are shrinking because I seldom if ever see a company just stay the same. But growth is a series of ups and downs and that is normal. It isn’t a mistake – and there isn’t anything wrong with you when it happens – it is the reality of how growth occurs.
There are a half dozen key stages I see in the growth cycle. The following chart shows some of them and areas where they may show up in your growth pattern.
You won’t necessarily experience all of these in the same order or at the same level as the chart describes, but as you grow your IT firm you are likely to experience all of them along the way.
That takes us to the second step – which is the need to become a sales organization. To be totally honest – this is the one where many companies get hung up. It may happen with 2-3 employees or you may make it to 7-8, but at some point sales will be your blocker to growth. Why? Nothing happens until someone sells something. I will go into much more detail on sales in a future blog post. It is essential, so embrace it and accept the fact it has to happen if you want to grow.
This is the first of what I consider to be the five key areas to growth:
1. Become a sales organization
2. Learn how to market
3. Put in place and execute process
4. Develop leadership
5. Understand the power of strategic relationships
My experience is that if you understand and work through these key blockers – you will grow and grow significantly. But each one can plateau you for years or for life. You can’t skip any step – the order may change – but all are essential to continually growing your company.
Realize that your business should serve you – not the other way around. If the business controls your life – you have a job. You probably left a job to start your business so don’t just trade one for the other. Dreams should be coming true. You should have more freedom – not less. It has to function without your presence – if you are required to make it work – you have a job with a different title on it. It should be predictable in meeting your goals and needs. It should not require you – or the 4 P’s from you:
· Your presence
· Your personality
· Your problem solving
· Your persperation
As you build your sales organization you begin to feel like you are losing control. Not everything goes through you anymore. You have to trust others. It is a huge step. But if everything flows through you – then you are the bottleneck to growth and not only will you restrict that – you restrict profit potential as well. You cannot be the center of your company forever. The only way you escape the problem is to keep growing and putting others in places you once were responsible. That is called delegation – not something many entrepreneurs are comfortable with – because no one does it quite like we do. But we have to get over that and let others do the work.
So you have began to build a sales team and hired a sales person or two. They are selling and then hit the wall. They run out of people they know and places to call on. That is when marketing has to kick in. Marketing is key to keeping a sales team productive. They don’t manufacture sales – they close leads and turn them into sales. Many small business owners make the mistake of thinking that just hiring a sales person fixes all the sales issues. In fact it just creates more needs. They have to be closely managed and there has to be a consistent lead generation system to keep them productive. They can’t just make this stuff up. It has to be fed to them so they can do what they do – go build relationships and close deals. That is what we hire them to do so now we have to equip them with the tools they need for success.
Next comes the need for some sanity in the midst of chaos. Many companies go for years without any process, procedures or policies in place. And then as they have some success and grow – things quickly get out of control because you can’t scale without processes. So in the teens for number of employees you have to get things written down and folks trained to follow them. It is hard work. We never have time for it. And changing behavior to follow is a difficult task because we are upsetting their world. Why do we need this all of a sudden? It is far easier to do this step early with few employees than wait for the chaos to require it. But most of us don’t make the time until it is mission critical. And that is driven as we grow to a certain point. Take it from me – it is far easier to write a process for two than for twelve. Do it early – do it well – and set the example to follow them.
After some more growth and success we begin to run into a leadership void. We typically expect our people to learn by osmosis and just being around us. Unfortunately it doesn’t quite work that way from my experience. So we have to make investments and train folks on leadership. That is essential as we will need to grow practices around key technologies, vertical markets or opportunities. Many companies don’t have nearly the leadership they need to continue growing. It is a sad reality. It happens because we have been too cheap to invest and too busy to notice than no one else is really stepping up to lead. This costs money and takes time – intentional and significant time – which far too many small business owners never take. We seldom invest in our own skill building let alone that of others. But if we want to keep growing we have to build leadership and a team that can help make that happen.
At some point along the curve we grow past our ability to drive continued growth on our own. That is when the value of strategic relationships kicks in gear. I find it happens somewhere past 50 employees and it becomes essential to learn to leverage the investment other partners in the ecosystem are making. We need to use their marketing, lead generations, services and tools to help to continue drive the business. But it is all about building and maintaining strong relationships. It won’t happen accidentally and I find this one area to be a key blocker for many companies that are trying to grow. More on this topic in a future blog post as well.
Growth has many steps. They don’t all move upward and to the right. It is hard work and requires determination, dedication and a very big desire. But you can grow if you truly want to and commit to it. We have experienced it even on the farm in Iowa where our business is operated. It isn’t magic – it is hard work and execution day after day to work toward a strategic objective. Plan for growth and then execute to achieve it. Realize it means change often along the way. But you can achieve it if you want to!
It all starts with you. You started your business because you wanted to be your own boss. You wanted to call the shots. There is a likelihood that you worked for someone else and decided you could do it better. But when you make the decision to grow – it can’t be about you anymore. Growth means you have to involve others – inside and outside your company. And that is the first step. You have to hire someone.
I remember those days well. It was a scary proposition. All of a sudden I was responsible for payroll which meant we had to be generating revenue. I sort of convinced myself it was ok to work some of the time and not pay myself – after all it was my company. But when you bring on that first employee they typically don’t quite see it that way. They come to work with the expectation they will get a paycheck and they should. So we have to know how we will generate enough revenue and keep them busy so we can pay them.
This is usually when the first lesson of growth occurs. It isn’t a straight line up. We have steps – take a few forward and then one backward. It looks something like this for many:
Seldom do companies grow with the green line – just up and to the right continually with no hiccups. Nor do companies maintain their situation like the red line – stagnant without change. I am a believer that if you are not growing – you are shrinking because I seldom if ever see a company just stay the same. But growth is a series of ups and downs and that is normal. It isn’t a mistake – and there isn’t anything wrong with you when it happens – it is the reality of how growth occurs.There are a half dozen key stages I see in the growth cycle. The following chart shows some of them and areas where they may show up in your growth pattern.
You won’t necessarily experience all of these in the same order or at the same level as the chart describes, but as you grow your IT firm you are likely to experience all of them along the way.That takes us to the second step – which is the need to become a sales organization. To be totally honest – this is the one where many companies get hung up. It may happen with 2-3 employees or you may make it to 7-8, but at some point sales will be your blocker to growth. Why? Nothing happens until someone sells something. I will go into much more detail on sales in a future blog post. It is essential, so embrace it and accept the fact it has to happen if you want to grow.
This is the first of what I consider to be the five key areas to growth:
1. Become a sales organization
2. Learn how to market
3. Put in place and execute process
4. Develop leadership
5. Understand the power of strategic relationships
My experience is that if you understand and work through these key blockers – you will grow and grow significantly. But each one can plateau you for years or for life. You can’t skip any step – the order may change – but all are essential to continually growing your company.
Realize that your business should serve you – not the other way around. If the business controls your life – you have a job. You probably left a job to start your business so don’t just trade one for the other. Dreams should be coming true. You should have more freedom – not less. It has to function without your presence – if you are required to make it work – you have a job with a different title on it. It should be predictable in meeting your goals and needs. It should not require you – or the 4 P’s from you:
· Your presence
· Your personality
· Your problem solving
· Your persperation
As you build your sales organization you begin to feel like you are losing control. Not everything goes through you anymore. You have to trust others. It is a huge step. But if everything flows through you – then you are the bottleneck to growth and not only will you restrict that – you restrict profit potential as well. You cannot be the center of your company forever. The only way you escape the problem is to keep growing and putting others in places you once were responsible. That is called delegation – not something many entrepreneurs are comfortable with – because no one does it quite like we do. But we have to get over that and let others do the work.
So you have began to build a sales team and hired a sales person or two. They are selling and then hit the wall. They run out of people they know and places to call on. That is when marketing has to kick in. Marketing is key to keeping a sales team productive. They don’t manufacture sales – they close leads and turn them into sales. Many small business owners make the mistake of thinking that just hiring a sales person fixes all the sales issues. In fact it just creates more needs. They have to be closely managed and there has to be a consistent lead generation system to keep them productive. They can’t just make this stuff up. It has to be fed to them so they can do what they do – go build relationships and close deals. That is what we hire them to do so now we have to equip them with the tools they need for success.
Next comes the need for some sanity in the midst of chaos. Many companies go for years without any process, procedures or policies in place. And then as they have some success and grow – things quickly get out of control because you can’t scale without processes. So in the teens for number of employees you have to get things written down and folks trained to follow them. It is hard work. We never have time for it. And changing behavior to follow is a difficult task because we are upsetting their world. Why do we need this all of a sudden? It is far easier to do this step early with few employees than wait for the chaos to require it. But most of us don’t make the time until it is mission critical. And that is driven as we grow to a certain point. Take it from me – it is far easier to write a process for two than for twelve. Do it early – do it well – and set the example to follow them.
After some more growth and success we begin to run into a leadership void. We typically expect our people to learn by osmosis and just being around us. Unfortunately it doesn’t quite work that way from my experience. So we have to make investments and train folks on leadership. That is essential as we will need to grow practices around key technologies, vertical markets or opportunities. Many companies don’t have nearly the leadership they need to continue growing. It is a sad reality. It happens because we have been too cheap to invest and too busy to notice than no one else is really stepping up to lead. This costs money and takes time – intentional and significant time – which far too many small business owners never take. We seldom invest in our own skill building let alone that of others. But if we want to keep growing we have to build leadership and a team that can help make that happen.
At some point along the curve we grow past our ability to drive continued growth on our own. That is when the value of strategic relationships kicks in gear. I find it happens somewhere past 50 employees and it becomes essential to learn to leverage the investment other partners in the ecosystem are making. We need to use their marketing, lead generations, services and tools to help to continue drive the business. But it is all about building and maintaining strong relationships. It won’t happen accidentally and I find this one area to be a key blocker for many companies that are trying to grow. More on this topic in a future blog post as well.
Growth has many steps. They don’t all move upward and to the right. It is hard work and requires determination, dedication and a very big desire. But you can grow if you truly want to and commit to it. We have experienced it even on the farm in Iowa where our business is operated. It isn’t magic – it is hard work and execution day after day to work toward a strategic objective. Plan for growth and then execute to achieve it. Realize it means change often along the way. But you can achieve it if you want to!
Sunday, December 5, 2010
Cash Matters
This is the fourth blog post regarding the 10 Things I Accidentally Learned on the Path to Growth and is a topic many of us as small business owners don’t deal with well at all. After 25 years in this business, it has become more apparent than ever that access to cash is a key to success. I hear and see so many small businesses strapped by a lack of cash resources. They may even be doing well from a sales perspective, but because of poor cash management they have totally limited their options and ultimately stymied their ability to grow. Cash is king and we must never forget that reality.
A strong balance sheet goes a long way during tough times
One of the common mistakes I see owners make is to rob their companies of all the cash they accumulate as profits during the year. That assumes that they are generating a profit, but for any company to survive that has to be one of the outcomes of doing business. But removing all the cash leaves the company vulnerable in the event of tough economic conditions, or even a temporary downturn. That is particularly true if you don’t have a bank credit line in place. There are varying opinions on how much equity to leave in a business – but my advice is to be conservative and leave as much in as you possibly can. Now if you have to take all you earn just to survive each year – you really don’t have a business – just a job that is meeting your basic needs. A true business will generate cash and I suggest you leave as much as possible inside the company until you need it – for an M&A or tough times.
Risk is part of the equation
Spending cash on growing the business is risky. There are no guarantees from my experience. You can make some bets that are more likely to succeed than others, but there is an element of risk in every growth decision. So if you can’t afford to lose the cash you are spending – don’t do it. I have lost money when I thought it was a sure thing, and had success when I expected less than stellar results. If you can’t stomach the risk – don’t spend the cash. But you won’t grow if you don’t take calculated risk. It is part of the equation. And some people just don’t deal with it well at all. Know your risk tolerance, and that of your spouse, before you go too far.
Profit is not bad – you are not taking advantage of your customer
I struggled with this reality for a very long time. My focus was on providing the maximum value as long as I didn’t lose too much money doing it. Profit was almost a bad word. Could I cut the price another point or two so they get a really good deal. Here is the reality – a failure in your business is not in the best interest of your customer. If you ask them if they prefer to save a few dollars and buy from you driving you out of business, or pay a little more to have a stable business partner, they will take the latter every time. No one wants to have to change IT providers because they saved a few bucks. Profit has to be part of the equation. In fact – you should start there – with the amount of profit dollars you want or need to clear and work backward to determine sales, margin and expense lines on your P&L to make sure you end up making money.
Profit should not be a mistake
Too often we just take the leftovers when it comes to profit. It is more of a hope and prayer than a strategy and planned outcome. That is the wrong way to run your company. You need to plan for it, expect it, and make sure you achieve it. When you do it should be celebrated through rewarding your team with some of the bounty. Profit doesn’t happen by accident. It requires planning and focus to achieve it every year!
Paying tax is a good thing
If you had told me 10 years ago I would write a blog with this sub heading I would have called you crazy. I ran my company for a long time with a goal of zero tax liability. Just break even so I didn’t have to pay the government any taxes. Now don’t get me wrong – I hate paying tax – but I have come to appreciate the fact that only profitable and growing companies are in a position to pay tax. And if you want to grow – continually producing a P&L with no profit is a limiting factor. Bankers are not crazy about lending money to non-profitable companies. There is no leverage to be had with zero as the result of a year’s work. We have to be wise in how we manage our income, but tax is not an evil thing. We need to make money which means we will pay taxes. That is just as reliable as the fact that we will all die someday.
Bankers are your friend
So many partners think of bankers as an adversarial relationship. I often hear the comment that “the bank won’t loan me any money when I need it”. That is exactly true. They are not looking for companies that are barely holding on by a thread and in need of a cash infusion. Banks loan money to companies that have a track record showing they will be able to pay them back. They aren’t looking for long shots or hopeful returns. You have to build a relationship and a track record if you want to borrow money for growth. Invest the time – build the relationship – give them access to your plans and numbers. They are critical for growth.
Here are some other ideas around getting cash in order.
• Conserve cash – don’t spend it all
• Get your bank credit lines expanded
• Update your vendor and distributor credit lines
• Clean up your financial house
• Evaluate your staff and trim unnecessary
• Evaluate all expenses and make cost cuts
• Talk with your team so they understand why taking care of cash and profits matter to them
• Create profit sharing options to drive the team to join the chase to generate cash
Cash does matter greatly if you want to grow. In fact, I will boldly say you won’t grow without it. Some are able to have some short term success without generating regular profits and cash – but it is unsustainable and won’t scale. The more you want to grow – the more cash you will need. And the sad reality is that many don’t learn that lesson until they need it for a deal or some other great opportunity and have to pass because they don’t have any. It isn’t rocket science. Cash matters – and it doesn’t come accidentally. Plan to generate cash and then manage it well. It is a critical growth factor – cash is truly king!
A strong balance sheet goes a long way during tough times
One of the common mistakes I see owners make is to rob their companies of all the cash they accumulate as profits during the year. That assumes that they are generating a profit, but for any company to survive that has to be one of the outcomes of doing business. But removing all the cash leaves the company vulnerable in the event of tough economic conditions, or even a temporary downturn. That is particularly true if you don’t have a bank credit line in place. There are varying opinions on how much equity to leave in a business – but my advice is to be conservative and leave as much in as you possibly can. Now if you have to take all you earn just to survive each year – you really don’t have a business – just a job that is meeting your basic needs. A true business will generate cash and I suggest you leave as much as possible inside the company until you need it – for an M&A or tough times.
Risk is part of the equation
Spending cash on growing the business is risky. There are no guarantees from my experience. You can make some bets that are more likely to succeed than others, but there is an element of risk in every growth decision. So if you can’t afford to lose the cash you are spending – don’t do it. I have lost money when I thought it was a sure thing, and had success when I expected less than stellar results. If you can’t stomach the risk – don’t spend the cash. But you won’t grow if you don’t take calculated risk. It is part of the equation. And some people just don’t deal with it well at all. Know your risk tolerance, and that of your spouse, before you go too far.
Profit is not bad – you are not taking advantage of your customer
I struggled with this reality for a very long time. My focus was on providing the maximum value as long as I didn’t lose too much money doing it. Profit was almost a bad word. Could I cut the price another point or two so they get a really good deal. Here is the reality – a failure in your business is not in the best interest of your customer. If you ask them if they prefer to save a few dollars and buy from you driving you out of business, or pay a little more to have a stable business partner, they will take the latter every time. No one wants to have to change IT providers because they saved a few bucks. Profit has to be part of the equation. In fact – you should start there – with the amount of profit dollars you want or need to clear and work backward to determine sales, margin and expense lines on your P&L to make sure you end up making money.
Profit should not be a mistake
Too often we just take the leftovers when it comes to profit. It is more of a hope and prayer than a strategy and planned outcome. That is the wrong way to run your company. You need to plan for it, expect it, and make sure you achieve it. When you do it should be celebrated through rewarding your team with some of the bounty. Profit doesn’t happen by accident. It requires planning and focus to achieve it every year!
Paying tax is a good thing
If you had told me 10 years ago I would write a blog with this sub heading I would have called you crazy. I ran my company for a long time with a goal of zero tax liability. Just break even so I didn’t have to pay the government any taxes. Now don’t get me wrong – I hate paying tax – but I have come to appreciate the fact that only profitable and growing companies are in a position to pay tax. And if you want to grow – continually producing a P&L with no profit is a limiting factor. Bankers are not crazy about lending money to non-profitable companies. There is no leverage to be had with zero as the result of a year’s work. We have to be wise in how we manage our income, but tax is not an evil thing. We need to make money which means we will pay taxes. That is just as reliable as the fact that we will all die someday.
Bankers are your friend
So many partners think of bankers as an adversarial relationship. I often hear the comment that “the bank won’t loan me any money when I need it”. That is exactly true. They are not looking for companies that are barely holding on by a thread and in need of a cash infusion. Banks loan money to companies that have a track record showing they will be able to pay them back. They aren’t looking for long shots or hopeful returns. You have to build a relationship and a track record if you want to borrow money for growth. Invest the time – build the relationship – give them access to your plans and numbers. They are critical for growth.
Here are some other ideas around getting cash in order.
• Conserve cash – don’t spend it all
• Get your bank credit lines expanded
• Update your vendor and distributor credit lines
• Clean up your financial house
• Evaluate your staff and trim unnecessary
• Evaluate all expenses and make cost cuts
• Talk with your team so they understand why taking care of cash and profits matter to them
• Create profit sharing options to drive the team to join the chase to generate cash
Cash does matter greatly if you want to grow. In fact, I will boldly say you won’t grow without it. Some are able to have some short term success without generating regular profits and cash – but it is unsustainable and won’t scale. The more you want to grow – the more cash you will need. And the sad reality is that many don’t learn that lesson until they need it for a deal or some other great opportunity and have to pass because they don’t have any. It isn’t rocket science. Cash matters – and it doesn’t come accidentally. Plan to generate cash and then manage it well. It is a critical growth factor – cash is truly king!
Wednesday, November 24, 2010
Faith in the Workplace - A Guest Post
At Networking Results, faith is as integral a part of the company as IT itself.
By Steve Moreau
If your faith is genuine, and it helps guide your professional and personal decisions, how could you not introduce faith into this thing that consumes so much of our lives? Our entire management team is Christian and we make no apology for it. We believe that we have been entrusted with a company that provides the support for many employee families, customers, partners, and vendors, so it should be run in a way that will maximize success.
Success is more than the bottom line, although that’s how we measure our success. But we also measure success based on the lives of our employees—both personal and professional. On the professional side, we want to provide opportunities for training and the ability to be in a position where they can shine, which manifests itself in job satisfaction. This is how we live out our faith in what we do.
But we realize that there is more to a person than just his or her professional self, and from my experience, most everyone has some sort of spiritual belief, and we are not ashamed to have created an atmosphere in which it is safe to talk about it. When we bring in food, we take time and say a prayer before we eat, for example, and employees feel comfortable asking if we would remember them or someone they know in our prayers. In those instances we don’t then gather everyone and say a prayer, although there have been a few times in management meetings when we get word that someone has been in an accident, and we will immediately take some time and pray for a safe recovery.
To us that’s extending our human compassion. We are working with individuals and in relationships, and in the end, even though we are a technology company, we’re more of a relationship company.
We have no formal process, and we are not in people’s faces about spirituality. Our actions and the way we live our lives scream a whole lot louder than anything we could say. For us, faithfulness comes from living out what we believe and allowing other people to exercise their faith as well, without any pressure to do anything they are not comfortable with.
There has not been a case when we have felt a need to restrain anyone in the company from talking about faith. What I do try to encourage, as I mentioned, is rather than just talking about it, let’s live it. Our actions will show what we believe. But if you are living it, you might as well have the option of talking about it as well, so we certainly don’t want to discourage that.
Still, we are a regular bunch of people who have lots of good times together. But there are guiding principles we follow, and those tend to align with traditional Judeo-Christian precepts of integrity, justice, fairness, and stewardship, by which we mean looking out for what has been entrusted to us.
Even from the owner’s standpoint, is this his business? Well, it is as far as ownership is concerned, but it has also been entrusted to him. There is a purpose in everything, and at this point in time, God has entrusted us with the employees in the company and our customers and partners, and we have to make sure we’re doing the right thing by all of them. We have to be accountable and compassionate. These are all straight out of the Bible.
There is such a big concern with trying to be politically correct in this world that we lose some of the compassion of trying to be a good person. If I really believed what was in the Bible and yet was not able to offer compassion to others, then I would be pretty shallow. This has been a tough economy, with lots of people out of work, and our faith helps us deal with it. Our belief is that God knows much better than any of us and he’s going to see us through it.
People find themselves in some difficult circumstances, with some very difficult challenges. Life is messy, but there is hope out there; there is hope that this isn’t all there is.
Thanks to Steve Moreau for sharing this post. It really defines NetRes and many other companies in the small business field. Problem is, too many don't have the backbone to let their faith show. We hide things and want to "fit in" rather than be the light we are called to be. Kudo's to Jeff, Steve and their team in Texas for all they are doing to be salt and light!
By Steve Moreau
If your faith is genuine, and it helps guide your professional and personal decisions, how could you not introduce faith into this thing that consumes so much of our lives? Our entire management team is Christian and we make no apology for it. We believe that we have been entrusted with a company that provides the support for many employee families, customers, partners, and vendors, so it should be run in a way that will maximize success.
Success is more than the bottom line, although that’s how we measure our success. But we also measure success based on the lives of our employees—both personal and professional. On the professional side, we want to provide opportunities for training and the ability to be in a position where they can shine, which manifests itself in job satisfaction. This is how we live out our faith in what we do.
But we realize that there is more to a person than just his or her professional self, and from my experience, most everyone has some sort of spiritual belief, and we are not ashamed to have created an atmosphere in which it is safe to talk about it. When we bring in food, we take time and say a prayer before we eat, for example, and employees feel comfortable asking if we would remember them or someone they know in our prayers. In those instances we don’t then gather everyone and say a prayer, although there have been a few times in management meetings when we get word that someone has been in an accident, and we will immediately take some time and pray for a safe recovery.
To us that’s extending our human compassion. We are working with individuals and in relationships, and in the end, even though we are a technology company, we’re more of a relationship company.
We have no formal process, and we are not in people’s faces about spirituality. Our actions and the way we live our lives scream a whole lot louder than anything we could say. For us, faithfulness comes from living out what we believe and allowing other people to exercise their faith as well, without any pressure to do anything they are not comfortable with.
There has not been a case when we have felt a need to restrain anyone in the company from talking about faith. What I do try to encourage, as I mentioned, is rather than just talking about it, let’s live it. Our actions will show what we believe. But if you are living it, you might as well have the option of talking about it as well, so we certainly don’t want to discourage that.
Still, we are a regular bunch of people who have lots of good times together. But there are guiding principles we follow, and those tend to align with traditional Judeo-Christian precepts of integrity, justice, fairness, and stewardship, by which we mean looking out for what has been entrusted to us.
Even from the owner’s standpoint, is this his business? Well, it is as far as ownership is concerned, but it has also been entrusted to him. There is a purpose in everything, and at this point in time, God has entrusted us with the employees in the company and our customers and partners, and we have to make sure we’re doing the right thing by all of them. We have to be accountable and compassionate. These are all straight out of the Bible.
There is such a big concern with trying to be politically correct in this world that we lose some of the compassion of trying to be a good person. If I really believed what was in the Bible and yet was not able to offer compassion to others, then I would be pretty shallow. This has been a tough economy, with lots of people out of work, and our faith helps us deal with it. Our belief is that God knows much better than any of us and he’s going to see us through it.
People find themselves in some difficult circumstances, with some very difficult challenges. Life is messy, but there is hope out there; there is hope that this isn’t all there is.
Thanks to Steve Moreau for sharing this post. It really defines NetRes and many other companies in the small business field. Problem is, too many don't have the backbone to let their faith show. We hide things and want to "fit in" rather than be the light we are called to be. Kudo's to Jeff, Steve and their team in Texas for all they are doing to be salt and light!
Thursday, October 29, 2009
Key Steps Along the Path to Growth
I am presenting a breakout session in Orlando on Friday afternoon that focuses on the key decisions that business owners need to make along their journey to grow their company. For most, I see five major areas that tend to be the "big rocks" that need a lot of work and are hard to overcome. We will focus on those areas and try to identify important considerations that company leaders need to work through in order to leave the plateau that so many end up stuck on as they hit the wall with these things. Here is my list of the major hurdles to overcome:
1. Transitioning into a sales organization. Hiring your first sales person is a challenge. Managing sales people is an adventure. Running a sales organization is mind numbing.
2. Supporting your sales team with quality and consistent marketing. Once you actually find a good sales person and build a team, there has to be a system to keep the pipe full of opportunities and prospects for these guys to chase.
3. Building process and actually executing them. It really is the 3 P's - process, policy and procedure. You can't grow without a consistent plan in place on how your business will operate day after day to do the right things right every day.
4. Developing a bench of leadership. This is necessary in a lot of areas, but once you reach a certain point there is not nearly enough "you" to go around. When you grow to the point of needing to build practices - you need leaders. When you begin to hand off responsibility for areas of the business - you need leaders. Your management team needs to be built with - you guessed it - leaders.
5. Building strategic relationships. This is THE single MOST important differentiator I see between technology companies today. Most seem to believe that the vendors and distributors are the enemy. The reality is, I know of no successful growing company who takes that approach. Sure you can grow to a point all on your own, but the fast growth and sustainable companies understand this in spades. It is their secret weapon. It is the competive advantage in the marketplace. Relationships are the thing that separate the men from the boys.
There is a lot more we will cover, but this gives a general overview of what I have observed are the key factors for most technology company leaders to get under their control. Are you successful in these areas? If so, I want to meet you because you are exactly the kind of company we would love to get into HTG. If not, I want to meet you too because you need to be involved in HTG to learn from your peers how to overcome these obstacles. Either way, I hope to see you at 3PM on Friday in the Scribe room!
1. Transitioning into a sales organization. Hiring your first sales person is a challenge. Managing sales people is an adventure. Running a sales organization is mind numbing.
2. Supporting your sales team with quality and consistent marketing. Once you actually find a good sales person and build a team, there has to be a system to keep the pipe full of opportunities and prospects for these guys to chase.
3. Building process and actually executing them. It really is the 3 P's - process, policy and procedure. You can't grow without a consistent plan in place on how your business will operate day after day to do the right things right every day.
4. Developing a bench of leadership. This is necessary in a lot of areas, but once you reach a certain point there is not nearly enough "you" to go around. When you grow to the point of needing to build practices - you need leaders. When you begin to hand off responsibility for areas of the business - you need leaders. Your management team needs to be built with - you guessed it - leaders.
5. Building strategic relationships. This is THE single MOST important differentiator I see between technology companies today. Most seem to believe that the vendors and distributors are the enemy. The reality is, I know of no successful growing company who takes that approach. Sure you can grow to a point all on your own, but the fast growth and sustainable companies understand this in spades. It is their secret weapon. It is the competive advantage in the marketplace. Relationships are the thing that separate the men from the boys.
There is a lot more we will cover, but this gives a general overview of what I have observed are the key factors for most technology company leaders to get under their control. Are you successful in these areas? If so, I want to meet you because you are exactly the kind of company we would love to get into HTG. If not, I want to meet you too because you need to be involved in HTG to learn from your peers how to overcome these obstacles. Either way, I hope to see you at 3PM on Friday in the Scribe room!
Wednesday, October 21, 2009
Some Thoughts and Follow Up
On Monday of this week, Zenith Infotech, one of our key partners at HTS, released a video they produced on HTS and my life called "A Day in the Life of Arlin Sorensen". It was broadcast on MSPtv. Produced by CommCentric Solutions, it really does a great job of capturing the essence of what we do at HTS and HTG. If you missed it and have any interest in checking out the recording you can find it at:
http://w.on24.com/r.htm?e=166400&s=1&k=5E5A9DA343FF1E010F60B700EBAD2E0D
Also this week, another article was released called "Passing the Torch" in the RCP November issue. I believe this topic is one of the most important things we need to be talking about in the channel today. How we effectively pass leadership to the next set of leaders in an organization is so vital to a smooth and seamless transition. Things will change, and there needs to be a lot of thought and preparation done to make sure that happens well. You can read the article at:
http://rcpmag.com/Articles/2009/11/01/Passing-the-Torch.aspx?Page=2
I will be sharing two presentations in Orlando at the ConnectWise Summit the first week of November on this topic as well as growth. Thursday afternoon my topic will be on "Making the Handoff" which will focus on options for exit and leadership transistion
On Friday afternoon, my breakout will focus on "Steps Along the Way" which will identify key areas of decision in the growth cycle of a business. There are so many blockers and plateaus that have to be overcome in order to keep a company growing. We will identify and talk about how to work through those things during this session.
I look forward to seeing many of you at HTG Q4 in Orlando, and at the ConnectWise Summit there as well.
http://w.on24.com/r.htm?e=166400&s=1&k=5E5A9DA343FF1E010F60B700EBAD2E0D
Also this week, another article was released called "Passing the Torch" in the RCP November issue. I believe this topic is one of the most important things we need to be talking about in the channel today. How we effectively pass leadership to the next set of leaders in an organization is so vital to a smooth and seamless transition. Things will change, and there needs to be a lot of thought and preparation done to make sure that happens well. You can read the article at:
http://rcpmag.com/Articles/2009/11/01/Passing-the-Torch.aspx?Page=2
I will be sharing two presentations in Orlando at the ConnectWise Summit the first week of November on this topic as well as growth. Thursday afternoon my topic will be on "Making the Handoff" which will focus on options for exit and leadership transistion
On Friday afternoon, my breakout will focus on "Steps Along the Way" which will identify key areas of decision in the growth cycle of a business. There are so many blockers and plateaus that have to be overcome in order to keep a company growing. We will identify and talk about how to work through those things during this session.
I look forward to seeing many of you at HTG Q4 in Orlando, and at the ConnectWise Summit there as well.
Sunday, April 26, 2009
HTG Q2 in the Books
HTG Q2 2009 has come to an end. What a week we had in Dallas at the Omni. It was an amazing week in every way. The energy level was unbelievable. People were engaged and focused. It was like no other event I have had the privilege of being part of. And I heard that from dozens of vendors as they gave me feedback on their time with us last week. The group meetings were very strong from all reports. Some of you couldn’t get enough of each other starting early on Sunday or working late into the evenings. That is so good to see. When groups are committed to going above and beyond for one another, we are on a very good path. I know there were a number of company deep dives and mini SWOT interactions that will make a difference in the weeks ahead. Hopefully you remember when you get back into the routine and the chaos of the day that the key to making HTG work is to continually build relationships. This isn’t a week every quarter kind of deal. You need to reach out to your fellow group members weekly or even daily if that is what is needed. You are accountable to each other – not for the 48 hours you are in your peer groups – but 24/7/365. Accountability doesn’t turn off and on. It is always on. We need to stay very focused on that. Without accountability I know how you all are – you are just like me. You do what you want when you get around to it. Don’t try telling me any differently – it is the nature of an entrepreneur. So we need to keep the peer pressure on and continue to drive each other to execution. That is what Peer Power is all about.
Back on the farm we have been working hard to get HTG to the next level on the back end. Sue and Nancy have been entering all the information into Quickbooks Pro 2009 as we move off the HTS accounting platform and out onto our own as HTG. Some big changes as we spread our wings and leave the HTS nest. ConnectWise has given HTG three licenses to use in managing our membership and vendor relationships, so that is beginning to take shape as well. HP, SonicWALL and Microsoft have provided HTG hardware and the needed licensing to allow us to spin up the new SharePoint MOSS portal that we are all enjoying and will be the communication platform for our future. Vlad Mazek of OwnWebNow is hosting for us at his Dallas based data center. There has been a lot of activity as we have spun HTG off as a separate organization and are beginning to build a sustainable program for the future.
The advisory board of Dan Hay (finance), Brad Schow (membership), Stuart Crawford (press and media), Lyf Wildenberg (Communication and platform) and Scott Scrogin (Administration) have been doing a great job helping us through the transition. Ken Shetler (contractor managing vendors) along with myself, Nancy, Mary and Sue have been focused on driving revenue and putting a sustainable program in place so HTG will last into the future. There is much to celebrate and be excited about for the future.
But as with all things, change happens and sometimes people struggle to adapt. There have been some bumps in the road as we have moved toward our HTG 2.0 vision. A bit of execution was lacking on the staff side, and a bit of inflexibility on the part of some members has made the last few months challenging on some days. With over 270 companies involved now in both our programs, and at least that many ideas and personalities, I recognize that we cannot make every person happy all the time. Some are driven by money, some schedule, some personal wishes, some just want it their way. I wish we could meet each and every wish and expectation, but we cannot. So the thing I want to encourage you to remember is this: HTG is not about you. Those are some famous words that come from a bestselling book about a different topic, but they are related to our mission with HTG as well. HTG is about community and not any single member. It is about making an impact in each member’s business, leadership and life. That happens in different ways and at a different speed for each, but make no mistake about it, we are focused on driving change. We will be a disruptive change in your business and life. For some that is uncomfortable. To you I apologize in advance but want you to know the pursuit will continue. HTG will continue to grow and evolve, and our HTG 3.0 strategy will take us to another level once we get it completely defined. Just this week I read a manuscript for a new book coming out in May. It is a business parable and had some very wise ideas to share. Here are a few key nuggets:
1. Pursuing perfection requires that we be willing to be uncomfortable. If you are always striving to get better, then you are always growing. You have to embrace discomfort as part of your growth process.
2. Those who want to be average and good like to be comfortable. But you are either getting better or getting worse – there is no standing still.
3. 5% of our life is made up of performance, but 95% is spent preparing, practicing and waiting to perform. We have to be disciplined in the 95%.
4. To succeed we need to focus on improving each day. We have to take necessary action steps to get better each day, week, month and year.
5. Ask yourself each day – what do I need to do today to create the success and outcomes I desire?
Many people ask why we have to change. The individual peer groups are the core of HTG, and always will be for that matter, but the reality of growth is beginning to hit those which have been together the longest. Call it a plateau, hitting the wall, struggling to continue providing value – the game has to change if we are going to continue to be relevant in the businesses we serve. HTG has to penetrate to a different level with more managers in these organizations. Those at the top can only create so much change before they need to bring up another set of leaders to drive things deeper into the organization. It has to happen or HTG will die. I know those still in the dating and honeymoon periods think it is crazy to change what they feel is working just fine. But things won’t be fine forever without change. That is the crux of the matter. We must continue to increase the value HTG brings, we much continue to drive value to our members, we must continue to grow and become more or what has been will cease to be. It is that simple. All organizations change over time. They either find ways to remain vibrant and relevant, or they are relegated to a corner and become a piece of history. We are not willing to let that happen. Of course that means that there will be some whining and gnashing of teeth. It would be much easier to just let it run it’s course and avoid all the change. Change is always a lot more work than status quo. But I won’t let something which I know can continue to make a significant impact in the businesses and lives of our memberships ride off into the sunset. We will change. Each member will need to determine if the value they receive is worth the cost. Some may choose to opt out and move on. But my challenge is to focus on what we can become and not on what we have been. HTG is not about the past, it is absolutely about the future and that is very bright. I look forward to continuing to drive change into HTG so we can grow together as we take everyone to new heights and a new level of performance and life!
Back on the farm we have been working hard to get HTG to the next level on the back end. Sue and Nancy have been entering all the information into Quickbooks Pro 2009 as we move off the HTS accounting platform and out onto our own as HTG. Some big changes as we spread our wings and leave the HTS nest. ConnectWise has given HTG three licenses to use in managing our membership and vendor relationships, so that is beginning to take shape as well. HP, SonicWALL and Microsoft have provided HTG hardware and the needed licensing to allow us to spin up the new SharePoint MOSS portal that we are all enjoying and will be the communication platform for our future. Vlad Mazek of OwnWebNow is hosting for us at his Dallas based data center. There has been a lot of activity as we have spun HTG off as a separate organization and are beginning to build a sustainable program for the future.
The advisory board of Dan Hay (finance), Brad Schow (membership), Stuart Crawford (press and media), Lyf Wildenberg (Communication and platform) and Scott Scrogin (Administration) have been doing a great job helping us through the transition. Ken Shetler (contractor managing vendors) along with myself, Nancy, Mary and Sue have been focused on driving revenue and putting a sustainable program in place so HTG will last into the future. There is much to celebrate and be excited about for the future.
But as with all things, change happens and sometimes people struggle to adapt. There have been some bumps in the road as we have moved toward our HTG 2.0 vision. A bit of execution was lacking on the staff side, and a bit of inflexibility on the part of some members has made the last few months challenging on some days. With over 270 companies involved now in both our programs, and at least that many ideas and personalities, I recognize that we cannot make every person happy all the time. Some are driven by money, some schedule, some personal wishes, some just want it their way. I wish we could meet each and every wish and expectation, but we cannot. So the thing I want to encourage you to remember is this: HTG is not about you. Those are some famous words that come from a bestselling book about a different topic, but they are related to our mission with HTG as well. HTG is about community and not any single member. It is about making an impact in each member’s business, leadership and life. That happens in different ways and at a different speed for each, but make no mistake about it, we are focused on driving change. We will be a disruptive change in your business and life. For some that is uncomfortable. To you I apologize in advance but want you to know the pursuit will continue. HTG will continue to grow and evolve, and our HTG 3.0 strategy will take us to another level once we get it completely defined. Just this week I read a manuscript for a new book coming out in May. It is a business parable and had some very wise ideas to share. Here are a few key nuggets:
1. Pursuing perfection requires that we be willing to be uncomfortable. If you are always striving to get better, then you are always growing. You have to embrace discomfort as part of your growth process.
2. Those who want to be average and good like to be comfortable. But you are either getting better or getting worse – there is no standing still.
3. 5% of our life is made up of performance, but 95% is spent preparing, practicing and waiting to perform. We have to be disciplined in the 95%.
4. To succeed we need to focus on improving each day. We have to take necessary action steps to get better each day, week, month and year.
5. Ask yourself each day – what do I need to do today to create the success and outcomes I desire?
Many people ask why we have to change. The individual peer groups are the core of HTG, and always will be for that matter, but the reality of growth is beginning to hit those which have been together the longest. Call it a plateau, hitting the wall, struggling to continue providing value – the game has to change if we are going to continue to be relevant in the businesses we serve. HTG has to penetrate to a different level with more managers in these organizations. Those at the top can only create so much change before they need to bring up another set of leaders to drive things deeper into the organization. It has to happen or HTG will die. I know those still in the dating and honeymoon periods think it is crazy to change what they feel is working just fine. But things won’t be fine forever without change. That is the crux of the matter. We must continue to increase the value HTG brings, we much continue to drive value to our members, we must continue to grow and become more or what has been will cease to be. It is that simple. All organizations change over time. They either find ways to remain vibrant and relevant, or they are relegated to a corner and become a piece of history. We are not willing to let that happen. Of course that means that there will be some whining and gnashing of teeth. It would be much easier to just let it run it’s course and avoid all the change. Change is always a lot more work than status quo. But I won’t let something which I know can continue to make a significant impact in the businesses and lives of our memberships ride off into the sunset. We will change. Each member will need to determine if the value they receive is worth the cost. Some may choose to opt out and move on. But my challenge is to focus on what we can become and not on what we have been. HTG is not about the past, it is absolutely about the future and that is very bright. I look forward to continuing to drive change into HTG so we can grow together as we take everyone to new heights and a new level of performance and life!
Sunday, December 23, 2007
Have you wondered about your future
Paul Dippell from Service Leadership has released a new tool free at http://www.service-leadership.com/businessmodelexplorer.htm. The tool is described like this:
The purpose of the Service Leadership Index™ Business Model Explorer™ is to allow you to quickly see the profitability and stock valuation results of growing your business in ways that you choose. As you plan for 2008 and beyond, you can use this tool to immediately see the cash flow and current market M&A value of the alternatives you are considering.
I played with it some and it can give you some insight into growth and the impact from shifting from product to services. Of course it is just some overall guidance but worth a look. There is a professional version you can purchase for a fee that allows you to save things and share it between staff etc.
Worth the time to download and use - especially for the price. Check it out.
The purpose of the Service Leadership Index™ Business Model Explorer™ is to allow you to quickly see the profitability and stock valuation results of growing your business in ways that you choose. As you plan for 2008 and beyond, you can use this tool to immediately see the cash flow and current market M&A value of the alternatives you are considering.
I played with it some and it can give you some insight into growth and the impact from shifting from product to services. Of course it is just some overall guidance but worth a look. There is a professional version you can purchase for a fee that allows you to save things and share it between staff etc.
Worth the time to download and use - especially for the price. Check it out.
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