5 Steps to Assuring the Success of Your Branding Program

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A Good Brand: Cause or Effect?

Perhaps it’s a result of living in the Northwest for the last 20 years that I am periodically afflicted by the “salmon complex” – the uncontrollable impulse to swim against the current, despite obstacles. And so it is, I find myself in such a stream with regard to the growing pandemonium toward B2B branding programs. It’s not that I don’t believe that “Brand” has value, in fact, just the opposite. Brand has enormous value. It’s just that brand power is the effect, not the cause of B2B market success – and the strategic research proves it.

I have had the opportunity to observe a wide range of branding initiatives at B2B companies. At opposite ends of the spectrum, two come to mind. The first was a simple logo redesign for a small private company. The other, a million-dollar comprehensive branding initiative for a mid-market public firm. Neither initiative seemed to have any visible impact on the firm’s earnings.

After those initiatives had been in place a while, I asked the executives of each company whether they thought their branding program was a success. The answer, in each case, was an unequivocal “No”.

Not too long ago I gave a talk on market strategy to MBA students at a prestigious local university. At the end of the talk, one of the students approached me and expressed amazement and disbelief. How could I possibly give a detailed talk on market strategy without mentioning the importance of branding? He was agitated and animated, his arms waving about as he skittered around in front of me, like a drop of water on a hot skillet. It was as if I had missed stating the importance of water to agriculture.

 

So, why all the hysteria and stampede around branding?

Even though branding programs often fail to move the needle – their popularity remains ubiquitous. There are a number of reasons for this:

  • It feels good: A new brand. A refreshed tag line. A fantastic logo. A clean, well-constructed website. Looking at these products of a branding program makes you feel good. Customers can quickly see the highly visible outcomes. Executives smile at the wondrous accomplishment, reinforced by the adulation of their peers telling them how snappy it all looks.
  • The majority of the creative energy needed can be subcontracted to, and accomplished by, outside folks – minimally increasing anyone’s internal workload
  • Marketing and sales teams are hounding their management to spend money on branding
  • Branding gives the marketing team something concrete to focus their energy on – something on which to build a whole marketing communications program
  • Websites need to be constantly refreshed anyway – and a rebranding typically does that in a big way
  • There’s little downside risk, except for the money spent
  • Everybody’s doing it, and
  • Everybody’s selling it

Now, please don’t get me wrong. I sincerely appreciate the value of a good brand image in attracting customers – but a brand (the image, interpretation and meaning of your name, tag line and logo) is an effect not a cause, of success. What impact would the Apple logo have if Steve Jobs hadn’t first amazed the world with a steady stream of mind-blowing, innovative products?

What your company and its products and services mean to their target markets, i.e. the customer experience surrounding your value proposition, must have already been delivered and validated in the marketplace before a brand can be meaningfully established.

 

Strategic Marketing Research and RPQL

The voluminous PIMS* database and research from the Strategic Planning Institute, conclude that the customer’s perception of a product’s quality relative to its competitors, is the prime driver of financial success. This is called RPQL – Relative Perceived Quality Leadership. The research concludes that financial success is the outcome of achieving RPQL – and brand power is also a result of RPQL – not the other way around.

Quality means more than just “it won’t break”. It means that the product or service experience meets customer expectations – consistently delivering on its promises. And, delivering a relative perceived quality leadership experience takes consistent organizational rigor and discipline. No matter the logo! The customer must experience RPQL first hand, and then the synaptic connection can be made to the brand name and logo.

 

Achieving the Branding Impact You Intend: 5 Steps

  • Develop, deliver and confirm a meaningful value proposition experience first:

The Law of Value Exchange states, “The source of all economic value in your company originates from a customer’s willingness to exchange their cash for what, in their perception, delivers greater economic, physical, emotional or political value in return.”

  • Assure that your value proposition targets a market with substantial momentum and potential:

The world’s best boat, sporting the flashiest logo and most clever tag line goes nowhere in a river that is devoid of water. And remember, a brand has different meanings to different markets. Focus your investment and energy developing a meaningful RPQL experience in a meaningful growth market.

  • Don’t muddle corporate and product branding:

Smaller companies with petite marketing budgets often try to create one brand for the whole firm. But they may be serving multiple market segments with different products delivering different value propositions. In such a situation, it might better to focus branding budgets on specific products, vis-à-vis branding the whole firm. For example, the GM (General Motors) brand has been badly damaged recently by a torrent of recalls, however one brand RPQL experience (Corvette) remains solid.

  • Understand what your firm means to your best customers:

I asked new and returning clients why they buy from QMP. I was surprised; it really wasn’t what I thought. When I repeatedly heard the same reply, I immediately changed the corporate logo to reflect that perceived value and experience. Here is the QMP logo.

qmp-logo-RGB-1200px

Yup. Our clients told us they engage with QMP because they gain invaluable insight because we challenge them to think.

  • Align your brand:

Alignment does not mean just marketing materials, fonts and messaging. It means your whole damned company. From employee recruiting, to training, to product design, values, culture and customer service. All components must be aligned to reinforce the customer RPQL experience – which is your brand. When you invest in that kind of brand discipline, your brand promise will be delivered.

*****

*PIMS stands for the Profit Impact of Market Strategy, a data base initiated by GE in the 1960’s to study the connection between strategy and profit. It is now maintained by the Strategic Planning Institute. It has tracked more than 500 key metrics of thousands of companies since the 60’s.

For more information on branding success contact Jerry Vieira at The QMP Group 503.318.2696 or Jerry@qmpassociates.com

The Black and White (and grey?) of Consulting Ethics

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When practicing consultants join the Institute of Management Consultants (IMC) and enthusiastically embark upon the journey to achieve Management Consulting Certification (CMC®), even the most experienced and confident consultants, with many years of professional and consulting experience under their belts, can temporarily stumble on the path.  Given the myriad of requirements needed to achieve certification and the intellectual ability of the typical experienced consultant, it is somewhat surprising to find that the place on the path that they commonly stumble is, remarkably, in one the two required certification exams – the Ethics exam.

It is a not uncommon, and personally embarrassing. surprise for a senior experienced consultant to discover that his/her presumed unwavering and reliable ethical compass may not point true north at all times and under all circumstances. But, rest assured, they do recover quickly, adjust their understanding, and pass.

The exam result is a wakeup call.  The good news is, that with a little bit of additional learning, coaching from IMC colleagues and deeper understanding, the potential for real-life ethical operator error is avoided and true north becomes easier to identify.

 

A Brief Background of CMC® Certification:

The Certified Management Consultant™ (CMC®) certification is awarded to those select consultants (only 10,000 worldwide) who have met global standards for practice competence, ethics, and results.

To put that 10,000 number in perspective, recent research done by one of our local Northwest Chapter Board members revealed roughly 8,000 professionals who designate themselves as consultants just in the greater Portland, OR area.  If extrapolated, and adding in the number of organizations such as accounting firms, law firms, IT firms, engineering firms and the like, (who in reality are many times acting as advisory consultants), the number skyrockets. This leads to the likely conclusion that, in all likelihood, less than 1% of consultants worldwide are actually Certified in the practice of Consulting.

The IMC Certification process, which culminates with the bestowing of CMC® (Certified Management Consultant) designation to a member is, undoubtedly, a rigorous process.  It is, nonetheless, eminently achievable by those willing to dedicate the time, study and effort required.  The good news is that, unlike my college fraternity, there is no physical hazing or need to stand barefoot in the snow with beer poured on your head.  (Or was that just a bad dream?)

But back to the point.  The CMC® rigor is intellectual, requiring the compilation and proof of:

–     Experience: reinforced by client recommendations, professional expertise and stature, thought leadership, case studies and testimonials

–     Practice Competency – in managing client engagements, client relationships and your business practice disciplines

–     Understanding: proven by the requirement to pass two written exams – one covering a Core Body of Knowledge and the other IMC Ethics, and

–     An Oral Defense: of your petition for certification before a 3-person panel of senior Certified CMC’s

 

What are IMC Ethics and what creates the challenges?

The IMC Code of Ethics can be found on the IMC organizational website at http://www.imcusa.org/default.asp?page=ETHICSCODE .  They won’t be repeated here.

But reading them and understanding their applicability under real life business circumstances are two different things.  It’s in the real life application that the challenges are created and the scenarios presented in the exam truly challenge the taker.

The challenges of IMC-level ethics in real life can be illustrated in the points below.

 

  1. Sometimes they demand we sublimate our personal self-interest

Most client-related ethical circumstances consultants come in contact with present us a pretty clear black and white set of ethical decisions – and some actually bring us the opportunity to do our job better.  For example: If we are an environmental consultant hired to verify the chemical levels of our client’s factory effluent the ethics are clear.  If the effluent is noncompliant we tell the client – with no regard for whether they will like what they hear or whether they will want to rehire us.

  1. Sometimes they require courage

In the most extreme of cases, if test results are clear, their implications on health and safety real and expressed and recommendations for problem amelioration are not pursued, or if it is apparent that a request has been made to the consultant to falsify information or “lose” the data, these circumstances step way over the legal and ethical boundary. Then, there is the requirement to whistle blow.

Would you have that courage?

  1. Sometimes they demand we put relationships second

It is not uncommon that in the course of a consultation a professional employee of the client will ask you to help them find another job because they are unhappy where they are.  This is particularly sticky if you have developed a personal relationship with that employee – perhaps even in several previous client engagements with other companies.

The favor cannot be accommodated – particularly if it would be harmful to the client to lose that employee.  Rather than finding that individual a job, energies must be brought to bear on resolving the source of the dissatisfaction in a collaborative way with the employee and their manager.  Diplomacy is required for sure, but IMC ethics always require you to work in the best interest of the client first.  The requirement is to work to resolve the issue collaboratively. Not work behind the back of the client.

  1. Sometimes they require us to turn-down business

When a consultant develops a trusted-advisor relationship with a client, the client frequently seeks the consultant’s advice on a wider range of subjects than is the consultant’s specialty. IMC Ethics require a consultant not to accept an assignment that they know they are not qualified to service.

  1. Sometimes they require us to be Absolutely Honest and confront people – even consulting colleagues

Another demanding application of IMC ethical standards is the requirement that one consultant call another on unethical behavior.  The good ol’ boy practice of looking the other way does not apply. In the worse cases such ethical breaches are required to be reported to the national certifying organization.

  1. Sometimes they require consultation with other consultants

This is for the grey areas. I have, more than once, called upon my fellow IMC CMC®-certified colleagues to advise me on a situation bordering on an ethical dilemma. Fortunately, none of these situations involved life or limb, been on the edge of legal questions or dealt with vast sums of someone else’s money. 

So why did I need advice?  Because I wanted to be the best consultant I could be for my clients.

 

It’s all about the client.

People ask me frequently what the economic benefit is of IMC CMC® certification. Why pay even the modest extra membership fee? Why work for certification? Why go through the re-certification process every 3 years? Why bother?

My answer is always the same. The benefits are primarily in the CMC®’s ability to service their clients better – with better practice disciplines, improved ethical guidelines, a higher level of thought leadership, a higher level of service and professional proficiency, the ability to call upon highly qualified and experienced colleagues to assist in tough situations and a host of other client-centered reasons.

Is all that possible without a CMC® certification? Yes. But while Certification may appear difficult to achieve, it’s easier to walk a proven path with 10,000 other experienced, creative,certified travelers who continually improve that path, than forge your own through the woods.

 

*****

 

The Big Squeeze

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I commiserate with the owners of privately-held, small to mid-sized, business enterprises.  They’re getting a raw deal.

Consider this. That classification of business firms accounted for 64 percent of the net new jobs created between 1993 and 2011.  In creating jobs, small firms make an invaluable contribution to the well-being of, not only their employees and their families, but also their suppliers, and the communities they live in.

So why have we, as a nation, squeezed small business into a vice?  Why are we making it so hard for them to succeed, thrive and fulfill their purpose?

 

A Generational Impact Too

Amongst the ranks of small business owners are a good number of Baby Boomers whose dreams of a comfortable retirement have foundered on the reef of The Great Recession.  For years they worked hard, looking forward to a reasonable reward for their risk, a return on their financial investments and justification for the family sacrifices that were part and parcel of starting and running a small business.

The Baby-Boom owners I have spoken to also want to leave a legacy. They wish to pass on a vibrant firm that continues to provide employee and community value – beyond their own retirement.  And while the current state of economic affairs may be particularly hard on these BBBBs (Baby Boomer Business to Business) owners, the situation is largely the same for all owners – independent of age.

So, I stand with these men and women. We should appreciate them more – and give them a freakin’ break.

 

A break from what?

Small to midsize B2B business owners are currently trying to find the elbow room they need to achieve their goals. But they are gripped in a five-jawed vice – each jaw bringing its own unique and undeserved pressure from a completely different angle.

 

Jaw 1: The Economy

The economy is still underperforming.  A GDP growth projection of 2.7% for 2014 seems to be the best we can muster and low GDP growth has been chronic since 2009.  There is no coasting possible.  All progress must be self-generated by slogging through the economic swamp.  There is no tail wind and the swamp bed is mushy

The chart below shows the meager U.S. GDP growth from 2001 through 2013.

Year GDP Growth Historical and other mitigating events
2001 1.0% Bush 43 became President. Recession worsened by 9/11 attacks and War on Terror, but helped by Bush tax cuts. Fed started lowering rates.
2002 1.8% Bush calls for regime change in Iraq, creates Homeland Security.
2003 2.8% Unemployment at 6%. Fed lowered rate to 1%. Iraq War began.
2004 3.8% Fed started raising rates.
2005 3.4% Hurricane Katrina cost $250 billion in damage.
2006 2.7% Fed funds rate raised to 6.75%. Swine flu epidemic.
2007 1.8% Dow reached new high of 14,164.43. Inflation at 4.1%. Fed dropped rate 3 times, to 4.25%, to ease banking liquidity crisis. LIBOR rose to 5.6%.
2008 -0.3% Stock market crash of 2008 led to global financial crisisand $350 billion spent on bank bailout bill. Fed lowered rate 7 times to 0%.
2009 -2.8% Obama became President. Dow dropped to 6,594.44.Obama Stimulus Act spent $400 billion, reversed downward spiral.
2010 2.5% BP oil spill. Bush tax cuts extended. Obamacare and Dodd-Frank passed.
2011 1.8% Japan earthquake and Mississippi River floods. 10-year Treasury yield hit 200-year low. Iraq War ended.
2012 2.8% Presidential campaign and fiscal cliff created business uncertainty. Super storm Sandy hit East Coast. See U.S. Economy 2012
2013 1.9% Slow growth thanks to sequestration. Low nominal GDP growth thanks to low inflation.

 (Sources: Bureau of Economic Analysis and www.About.com for the historical notations and links)

The last year for which GDP growth exceeded 4% was 2000. Even our dual wars in Iraq and Afghanistan didn’t help much.  After fueling defense-related industries for the last 10 years, we are now watching that sector have to adjust to the ends of those conflicts – and simultaneously deal with sequestration.

And if these low growth figures weren’t enough, adding insecurity to the frustration of slow momentum these businesses continue to be susceptible to random bursting of economic “bubbles” – housing, mortgage-backed securities, banking regulation, stock prices, commodities and the occasional international crisis that threatens exports.

 

Jaw 2: Banks

In 1999 two key provisions of the 1933 Glass-Steagel Act were repealed leaving banks free to trade risky securities. Abetted by “bundling” and complicit rating agencies, they screwed up by investing too heavily in mortgages and mortgage based securities. The house of cards collapsed, the stock market crashed, financial institutions started to hemorrhage, retirement portfolios lost huge sums, and Congress was compelled to provide a $350 Billion bailout to keep the economic system functioning. The price to pay for the bailout? Bank regulations were tightened.

But, this crisis-based bailout gesture had the unintended side effect of turning the screws tighter on the most vulnerable of the banks’ commercial customers – small business owners.

Dodd-Frank attempted to fill the regulation vacuum.  But it still hasn’t come into full effect, and certainly hasn’t re-established the separation of commercial and investment banking. The banker-bonus drug is still too powerful to cut off cold turkey. The earth under the feet of banking is still quicksand and no one has, of yet, replaced the warning signs or chained off the path to that repeated trap.  Think about the repeated banking crises of 1890, 1927, the 1980s and 2008. It seems like small business is forced to go along for the ride.

Banks are tightening credit lines and covenants for small business, and often simply declining to lend – even when the business comes to the bank with purchase orders in hand needing cash to buy raw materials.  If you accuse the banks of being unreasonable, they blame the regulations and the regulators. The regulations may have been designed to avoid bubbles, but they didn’t prevent conspiratorial manipulation of the LIBOR rate or the potential to continue to risk banking crises from investment speculation. We still have banks too big to fail… and still have to catch them when they fall. No real accountability exists.

Feels like blackmail. No relief from the banking jaw any time soon for small business.

 

Jaw 3: Large Mega-Customers

Larger companies are in a merger and acquisition frenzy. This gives them more and more purchasing power – and their small-business suppliers less and less power. There is little negotiating in these relationships. Pricing must be bare bones. The information regarding manufacturing costs must be shared. Payables policy must be extended to 45 or 90 days. Small firms are basically financing their huge customers with these unreasonable payables policies. It’s brutal.

Jaw 4: The Government & Politics

Government and Politics are not the same thing – though, of course, they are co-dependent. Politics is the manipulation of power to achieve some legislative end, while government is the deployment and enforcement of that legislation.

In the last 10 years, our leaders saw fit to commit two trillion dollars on two wars, and another trillion dollars on tax breaks. Think about it. What could three trillion dollars have meant to infrastructure spending during the Great Recession? How many of those construction workers furloughed when the housing bubble burst might have been absorbed by infrastructure projects – railroads, highways, bridges, water systems?

Politics and government has conceived, designed and currently maintain the road we, as small business owners, must travel. Politics is the R&D group that can invent better, or more difficult, ways to help us travel that road by either removing the bumps and pot holes in our paths, straightening the curves and loops that delay us, widening the thoroughfare so more of us can get to where we wish to go and/or inventing better transportation machines.

Is there anyone reading this that thinks that in our current political environment, our congressmen are likely to collaborate and accomplish any of those goals? Let’s not hold our breath.

 

Jaw 5: The Clock

Baby Boomers are not getting any younger. That repetitive, faint clicking sound they hear is not the machinery in their factories – it’s the clocks on their walls.

 

What does it all mean?

In the bigger picture, as we continue to make life difficult for the most productive of our people, other nations of the world are blowing by us in quality of life, health outcomes, education, innovation, public transportation, high speed internet access and infrastructure.

Michael Porter, Harvard Business school professor and well-known business author, has developed and done research on a worldwide comparative model for Social Progress, as measured by a Social Progress Index. The United States ranks 16th in the world overall.

It just seems another example of us being are our own worst enemy.

The irony is that, in general, no matter your political leaning we usually agree on the outcomes we’d like to see; a higher GDP, a lower unemployment, healthier citizens, higher educated citizens and a higher quality of life.

Clearly, crunching one of the main contributors to those beneficial outcomes, the small business, is not the answer.

*****

Copyright 2014 The QMP Group, Inc.   All Rights Reserved

For more information about working with the QMP Group, call us 503.318.2696 of through our use our Contact Us page.

Reaching the CEO

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Here is a reprint of a recent interview Jerry did with Kevin Price, author, publisher and radio host for the “Price of Business”.  Kevin is a syndicated columnist, both writing for the Huffington Post and appearing on Fox News. The interview explored professional approaches to reaching the CEO of small to midsized firms.

 

Price: Tell me about your firm (number of employees, location, type of companies you work with, etc.).

The QMP Group, Inc. is a Portland-OR-based management consulting firm whose mission it is to help small to mid-size, Business-to Business firms increase their market valuation. We accomplish this by helping them adopt the rigor and disciplines of the QMP (Quality Marketing Process) methodology. That methodology is embodied in our  Marketing & Sales Engine model. We install, repair, replace, align or supercharge whichever of the gears need attention.MarketingandSalesEngine

While The QMP Group itself operates periodically with only one or two employees, we service a wide range of our clients’ needs through close collaboration with highly qualified and experienced consultants of other complementary specialties: Finance, Organizational Development, IT, Operations, Supply Chain Management and Manufacturing.

Price: Tell us your story about reaching C-Level executives to do business?

I started reaching C-Level executives through Thought Leadership, that is, sharing my insights on market strategy through public speaking and writing for business journals. Basically, I was driven to passionately share my beliefs on the subject of the overriding importance or market strategy. I believed then, as I do now, that there is no more important management function than formulating a good market strategy, for the well-being of all stakeholders in a firm: the employees and their families, owners, shareholders, suppliers, customers and the community in which the business resides.

In the early days of my consulting practice I would give a talk at venues where CEOs convened to hear about specific topics of interest. I would give my talk and folks would walk up to me afterward, hand me a business card, and say, “That’s real interesting stuff. I think it might be able to help us. Please give me a call to arrange a time to get together and talk.”

Those introductions led to client engagements. Engagements led to client successes, and successes led to CEO-to-CEO referrals. QMP’s business is still largely maintained through talks and referrals.

One more point about talks. I call talks “Networking from the front of the room”. How else can you get 20 to 80 CEOs and Executives to give you their undivided attention for 45 minutes (with 15 minutes for questions afterwards). Not only that, whoever is sponsoring the venue does all the prep work: food, invitations, scheduling, room set up, etc. There is no more efficient way to reach Executives and CEOs en masse.

Of course, we are not talking about a 45-minute sales pitch here. There is no quicker way to destroy your reputation and credibility as a Thought Leader than trying the hard sell in a talk about insightful business practice. We are talking about a sincere exchange of insights that will help the listener.

Price: Do you know of other examples of businesses being creative in this endeavor?

Let me answer with a story. Several years ago our local chapter of the Institute of Management Consultants convened a members-only working session for the purpose of sharing our personal stories about what we attributed out personal consulting success to. Most of us in the chapter work with the CEOs or high level execs in our client firms.

Naively, I thought that all would say the same thing that I said, namely Thought Leadership – leading to CEO-to-CEO or advisor-to-CEO referrals.

As we went around the room giving each member a chance to tell their own story, I was amazed at the variety of “secret ingredients” of success in reaching CEO’s. Some said their personal network, some said referrals, some said their coaches driving them, some said, believe it or not, cold-calling! Being an engineer I became fixated with finding what could possibly be the common thread in such a diverse set of paths-to-success – and here’s the conclusion I arrived at.

In each case, what the consultant was really saying is, “This is what has worked for me, because this is who I am – naturally.” The individual who said networking is well known in the organization for having and staying connected to a personal and professional network that rivals God’s. The individual that said cold-calling teaches sales and cold-calling techniques for a living.

What I am saying here is that, a person’s path to connecting with a CEO inevitably follows the path of, and leverages, who they naturally are. It builds on what their natural affinity is and how they have channeled it.

A final note on this point: Once you have made your first CEO contacts and built first level successes – the referral machine (CEO-to-CEO or advisor-to-CEO referrals) takes over a fair share of the burden of CEO introductions.

Price: What lessons, if any, do you derive from these stories?

Great Question! Find out who you really are. Discover the thread in your life that is constant, and I believe you will find that it has consistently driven your past successes. Find it then extrapolate it. If that all sounds too esoteric, talk about it with a personal or business coach about your search for the thread. Strengths Finders (the book and the self-assessment) are very helpful. Here’s a link http://strengths.gallup.com/default.aspx.

Remember, your first CEO success can create a flywheel of CEO referrals. So give it all you’ve got. Leave nothing on the field.

Price: Tell us why it is important to for you to pitch to the CEO.

The owner of a privately-held firm is typically its CEO. The firm’s market value is connected directly to that owner’s wallet and net worth – and that individual’s personal wealth (short and long term), and the future of his or her family, are tied to market valuation of the business. Decisions about how to invest to increase that valuation are exclusively the realm of the CEO.

In addition, we are typically executing business process and organizational transformations in our engagements. These process changes have broader and longer term implications on employees, customers and owners, than say, paving the parking lot. The CEO must be involved and actively participate.

Price: What are some unique things you have done to get the attention of CEOs?

CEO’s trust their peers and their advisors. As a consultant, a CEO is not likely to quickly trust you, because they don’t know you. So, getting to CEO’s usually requires a bank shot of trust. A referral from a CEO’s advisor or respected peer is that bank shot of trust.

In turn, for a referral to be made to a CEO by an advisor or peer, that advisor or peer needs to: a) trust you and, b) believe in your expertise, either through personal experience or reputation.

Consultants accomplish this transfer of trust by either; a) demonstrating a track record of success that the CEO’s peer or advisor has witnessed firsthand, or b) building their reputation as substantive Thought Leaders, i.e. speaking and writing on topics germane to the CEO’s circumstance. Those written opinions, talks and successes need to be insightful and substantive.

Your track record and reputation as a Thought Leader, in the minds of a CEOs peer or advisor, is your CEO magnetism.

Price: Tell us about the type of companies with which you like to do business.

We prefer to do business with firms with CEO leaders that are,

1) open-minded,

2) decisive,

3) foster a company culture of accountability and expectations and

4) actively participate in the business.

Formulating an improved market strategy takes knowledge, expertise, analysis and creativity, but more importantly, execution takes real leadership. So, I guess, I am saying the type of leader is more important than the type of company.

Price: What suggestions do you have for others trying to reach CEOs.

Become a Thought Leader. Write, blog and speak to CEOs and CEO advisors.

Build Your Trusted-Advisor Referral Network: Research into how ideas and innovations diffuse into a market place indicates that intra-market network communications (peer-to-peer, or trusted-advisor-to-peer communication) is 13 times more effective in the spread of that idea than mass communications.

Make sure your network knows how to recognize clients you can help:… and, don’t be shy to ask for referrals

Treasure, Preserve, Respect and Thank that Network: Stay in communication, acknowledge and appreciate former clients, advisers and referrers.

Always Act in the Best Interest of Clients: Trusted advisors are trusted because they are transparent and the CEO believes that they are acting in his best interest. Sublimate your needs to the client’s best interest in all that you do. That reputation will me your badge of behavioral honor.

Document your Successes: Measure and record the indicators of your success – and assure they can be validated by references from that engagement

 

*******

Diagnosing Stalled Sales

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Just Ignoring or Pushing Through the Pain is Not the Answer 

As an entrepreneurial CEO or owner of a small or start-up company, you probably don’t have the economic safety net to tolerate long term losses or less than adequate speed and growth in the adoption of your new products.  You also may not feel you have the time or cash to stop everything, pull the team together, and completely re-visit your base assumptions and offering design. This is where panic sets in. What do you do?

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Typically, if you ask your marketing, sales and engineering team what should be done, they will come to you with a laundry list of quick fixes: requests for price reductions, funding approval for new marketing initiatives or even more complex and higher performance product features which, they claim, are certain to turn around the problem. As CEO how do you know what to bet on? How do you know if you’re throwing good investment dollars after bad? How do you avoid having to seek out more funding and perhaps dilute ownership?

A number of years ago, I was asked to assess the viability of a new product that was struggling to gain traction in the marketplace. The CEO of this high-tech, pre-IPO firm wanted to know whether the product line could be saved. Sales were almost non-existent – profits negative. There was no breakthrough in sight.

The product manager of this line was convinced that if the psychological price barrier of $1,000 could be broken, customers would flock. The current selling price was $1,100. In the meantime, while price reductions were being considered (not seriously), the product manager was spending his time and budget setting up new distributors around the country, building promotional materials, stocking shelves with minimum quantities, training sales reps on how to demo the product and, in general, “flogging” (his word, not mine) and constantly “badgering” (my word)  the distributors to produce more sales.

Two weeks of field investigation revealed a strategic opportunity to re-focus the market strategy.  Twenty four months after that refocus:

–          the selling price had increased from a $1,100 to more than $4,000. (Yes, it went up, not down!)

–          the largest single customer order went from $20,000 to more than a $1,000,000

–          the number of customers (hospitals) grew from 2 to more than 150

–          the product-line, and the people, were saved

–          the story added to the attractiveness of the IPO

And all this was accomplished while spending less in marketing, not more.

 

How was this accomplished?

This turnaround was made possible by discovering what, up to that time, was an ignored sector of the current customer base, where the product’s value proposition was significantly greater than for other customers.  The business was then refocused on that smaller, yet more lucrative, group of customers. Focus allowed a reduced marketing budget. The result was greatly accelerated adoption, revenue growth and profitability.

Peter Drucker in his book, “Innovation and Entrepreneurship” calls this, leveraging “the unexpected success”. It’s accomplished by digging through the customer lists, examining the motivations of a customer that bought (that you didn’t expect to buy), and discovering that the value proposition they received was well beyond both what you imagined and/or what other customers receive. If you then discover that there are a lot more customers out there like that one, with the same problem to solve, you have a great place to begin your refocus efforts.

There are basically two phases to these kinds of turnarounds. The first is a high level diagnostic exercise and the second is a process for assessing and selecting a lucrative alternative target market.

 

Phase I: The Diagnostic Exercise:

In this phase we encourage a simple hierarchy of 5 diagnostic questions to start.

Question 1:  Does The Target Market Have Momentum?

A dead man in a canoe will make forward progress if the stream is flowing fast – and a strong current makes up for a lot of inefficiencies in rowing, and can even compensate for inexperienced rowers rowing backward.  Momentum covers a lot of sins. Inherent market momentum arises from fundamentals in the marketplace – demographics, economics or regulations.

Question 2: Is the Economic Value Proposition Valid?

In B2B, both new and mature products must provide meaningful and calculable economic value from the perspective of the customer. Customers buy for their reasons, not yours – and even though you may be convinced that your product’s value proposition is universally meaningful, it does not mean your customers see it the same way. And not all customers in all markets receive that value to the same degree. So it’s important to get your team to honestly validate the economic value proposition through visits to target market customers in specific and different market segments.

Question 3: Is the Competitive Position strong?

The fundamental value proposition may be provided equally by any number of competitive offerings or alternatives in the market place. Unless target market customers can easily see your competitive advantage and recognize it as meaningful to them – you will not be able to break through the competitive noise.

Question 4: How effective is the channel in Communicating both the Value Proposition and Competitive Differentiation to the target market?

If you want a quick way to assess this, simply ask any of the team (marketing, sales, or engineering or channel partners) to calculate the economic value proposition (benefit) of the product or service offering to a typical target customer. Ask them to do it on the spot… back of the envelope. I am continually amazed how major product development and marketing initiatives are embarked upon without the slightest consideration to this critical success factor.

It is the natural instinct of marketing teams to spend a lot of money at this level and they typically believe that a magic combination of branding, promotion, websites, trade shows, collateral, promotions et al will somehow turn around a troubled product line. If there is any indication of a fundamental problem in the three primary diagnostic levels that come before this one – spending on level four will be fruitless.

We’ll take the canoe-and-stream metaphor one step further. A dead man in a canoe floating down a stream with strong momentum will actually make more progress than a live man in another canoe rowing backwards.  So not only do you need a solid market to support a valid economic value proposition, and a competitive advantage to communicate, you have to have people trained in how to communicate it… and do it well.

Question 5: Can You Consistently Deliver the Value Proposition?

Production and quality problems may be the cause of stalled success, but we rarely find that we have to go this low in the diagnostic hierarchy before we find the real cause of a market adoption problem.

 

Phase II: Evaluating and Selecting a More Lucrative Target Market

In each of the major turnarounds we have experienced in the last 10 years, the real key was not so much the lack of a meaningful economic value proposition, but rather a lack of focus on the segments of the market that would receive the highest economic, emotional or physical value from using the product.

All economic value transfer to your company starts with a customer believing that there is sufficient reason (economic, emotional or physical) to write a check to buy your offering. Different market segments will perceive and receive different levels of benefit from the same product. Markets with the highest value received will yield the highest selling prices.

The 12 basic evaluation criteria for assessing and selecting the most lucrative markets to focus on:

 1. Market Momentum: By this we mean the degree to which the market has fundamental demographic, economic or regulatory factors driving its primary demand. Here’s a caution: many firms and marketing teams get seduced by this factor alone – mesmerized by the lure of big numbers. Even large companies fall prey to this lure. But remember, the largest markets always attract the largest and highest number of competitors. Most of the time, it’s a better strategy to focus on a secondary market. It usually less competitive, less risky, less painful and penetration is quicker.

2. A Common Compelling and Significant Problem: It’s common that if one customer in a market segment has a problem, many others, to varying degrees, will be facing the same problem. If the economic benefit of solving that problem is significant, it’s likely that the willingness to pay a premium for solving it will be present.

3. Economic Benefit to the Customer: Calculate the economic benefit for a typical customer in each market segment. The likelihood is that you’ll get the highest selling prices in those segments where the economic benefit-received by the customer is the highest.

4. Financial Wherewithal of the Customer: Do potential customers in this market have the flexibility to buy and capture funding should the economic value proposition be significant? For example, the University market segment is typically characterized by hand-to-mouth funding availability and long research approval cycles.

5. Profitability of the Transaction: This factor assesses whether transactions in this market segment can be inherently profitable. Factors affecting profitability might be geographic, customization required and willingness to pay for economic value received.

6. Match of Company Assets and Capabilities: The annals of failure are replete with stories about companies who were seduced into attempting to penetrate large emerging markets for which their basic capabilities, assets, culture and structure were mismatched.

7. Accessibility: To what extent are the market, the channel and the key decisions makers readily accessible to your channel and sales process? You can’t communicate a value proposition to someone you can’t get to.

8. Lots of Unfilled or Under-Satisfied Sockets: A socket is a potential customer with the problem and the possibility of receiving economic benefit form solving it. Customers may have one or multiple “sockets”. In assessing market attractiveness we want lots of sockets – most of them still unfilled – or filled with a less-than-satisfactory solution.

9. A Well-Established, Vibrant Intra-Market Network: Studies of the diffusion of innovation reveal that the communication through the intra-market network is 13 times more significant in the adoption of an innovation than mass media.

10. Level of Competitive Turmoil: This factor gets rated opposite to the others. If there is a lot of competitive turmoil, rate this low. If not much, rate it high.

11. Experience and Reputation Match: If the market you are assessing already knows who you are, and your value proposition is consistent with whom you are, your brand name and your differentiators – then you can give this segment a high rating. This is the factor that many marketing people believe that “Branding Programs” can fix. But even the best branding program can’t make up for a poor economic value proposition or poor market momentum – and branding programs are typically very expensive

12: The Availability of a Relative Perceived Quality Leadership (RPQL) Position:Research from the Strategic Planning Institute, concludes that the single most significant factor affecting a business unit’s performance is the quality of its offerings relative to its competitors. The degree to which an RPQL-position available, unclaimed, or vulnerable (if someone already owns it), is a key factor in the selection of a segment on which to refocus.

 

Conclusions and Recommendations:

If you happen to find yourself in a situation of a stalled product line or business – our experience tells us that the last thing you need to do is spend more on marketing. In general, a business refocus is a much quicker and less expensive road to success.

A quick assessment of the customers that have already bought usually reveals those for whom the value proposition is significantly higher. Assessing the attractiveness of the market segment that they represent can reveal your opportunity to break out to success.

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Learn more about strategically improving low sales performance here, call us at 503.318.2696, email to qmp1@qmpassociates.com or connect through our Contact Us page

The Six Common Sales Myths

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Over our 20+  years of working with sales teams in a wide diversity of industries, we have seen and noted Six Common Sales Myths, each of which hinders success. They are explained in a series of articles published in our QMP Insights Blog. The article titles and links are listed below. Simply click the title link to open and read each.  

 

Dispelling these myths can quickly improve the productivity of your sales team. 

Be forewarned, however. Some of these concepts might be controversial or run counter to the established sales culture within your firm. So, handle them with care.

Myth #1 – “A Sales Person’s Job is Just to Sell, Sell, Sell“

Myth #2 – “You’ve Lost to an Inferior Offering“

Myth #3 – “Sales is all About Relationships” 

Myth #4 – “It’s a Price-Driven Market“

 Myth #5 – “Closing Techniques are Effective“

 Myth #6 – “The Biggest Accounts are the Best Targets 

Click here to read the complete Six Common Sales Myths Series.

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For information on the QMP Sales Process Improvements and Sales Training Programs call us at 503.318.2696, email to qmp1@qmpassociates.com or visit our Contact Us page and tell us of your challenges. We’re here to help.

A Consultancy Collaboration Model

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Collaboration—An  Essential Ingredient for Growth

It is quite common for members of professional groups or associations to look to one another for collegial support, the sharing of best practices and referrals. These interactions are just a few of the myriad of benefits. 

 

But for the most part these interactions are transactional and stand-alone. The interaction happens while each consultant goes about his or her own business.  There may be a referral fee exchanged—or perhaps a professional services fee for assistance with a practice challenge such as a web site, IT problem or personal coaching need.

While these interactions are undoubtedly valuable, they rarely result in the kind of fundamental structural change to a practice that enables significant revenue growth.  Achieving growth in a practice by increasing the size of   client engagements, almost always requires discovering ways to add both capacity and capability—in other words, additional consultants with complementary specialties.

A successful venture into multi-consultant engagements requires a strong collaboration model. In this white-paper we offer our shared experiences and a four-part model.

The Model:  The Four Circles of Consultant  Collaboration 

The Four Circle model is based on two premises. First, for a collaboration model to work, it must provide value to all stakeholders, clients and collaborators—clients first.  Secondly, an effective collaboration model must be congruent with the individual collaborators’ success models.  In this article we will focus on the first premise.  

The model depicted in Figure A posits a framework for a long lasting collaborative arrangement that will support continued practice and client growth.  The model creates long-term synergy.  It does not come together for a single engagement and then dissolve.

The four components are: a) Trust, b) Business Development, c) Thought Leadership and d) Project Execution. See the figure below

 

Collaboration_Model

Trust:  The Foundation

Mutual trust means an explicit commitment to a common code of ethics and values. This is essential.  For us, as management consultants, there is no better starting point than the Institute of Management Consultants (IMC) Code of Ethics.

Our experience is compiled in a Ten Point Trust Checklist and will supplement that  “gut-feeling” concerning a potential collaborator.  The checklist helps to determine whether you invite this person to work with you and to meet your most valued client based upon a more meaningful and objective criteria than “He or she seems nice”. You owe your client meaningful due diligence when selecting collaborators.

For each item on the checklist, one should ask, “To what degree does this potential collaborator demonstrate…”

Ten Point Trust Checklist

1. Competence: client results, track record, testimonials, project management, case studies, industry expertise, academic accomplishment, thought leadership

2. Primacy of the Client: priorities and value to client; has the best interest of the client at heart at all times

3. Intra-Collaborator Communication: open and honest, tool savvy

4. Collaboration: track record of other successful collaborative projects

5. Discipline: process and project management

6. Documentation: reliable tools and methodologies

7. Client Communication: strong  verbal, written and people skills

8. Financial/Business Acumen: linking all activities to the economic benefit of the client

9.  Commitment: accountable and dependable

10. Integrity

There are two important trust links that must be solid.  The first is between you and your collaborators and the second is between the collaborator and the client.

Regarding interpersonal collaborator trust: trust does not typically happen overnight.  Nor does trust grow without continually building and reinforcing the points on the checklist.  Remember, it takes years to build trust— only seconds to destroy it. 

Regarding client trust: your client is depending on you to select only the best collaborator to work on his or her project.  By using the Ten Point Trust Checklist you can clearly articulate why you are making the recommendation you are.

Business Development: Also Known As Making Rain

Anyone desiring a successful practice needs to know how to capture new business. Collaborative projects where one or more of the collaborators simply burn-off project backlog landed by others, do not build effective long-lasting collaborations.  Each member of the collaborative team should be actively working to increase the visibility of the group and increase the probability of landing new opportunities.  Leaving the rainmaking to everyone else does not build a long term collaborative   relationship or trust. No free rides.

Business development is something we as consultants need to do everyday.  The challenge is that most of us are trying to balance our time between   execution, administration and selling. We typically spend more time in the delivery mode (where we actually use our expertise and do what we enjoy) than in developing new business relationships and opportunities.

Several years ago, Jerry brought on (hired) a collaborator with expertise in organizational management to assist in a two-year corporate turnaround project.  It was explicit; collaboration would require business development—not  simply execution. After 6 months it was apparent this individual could not, did not want to, and avoided at all costs, engaging in new business development activities. Yet, he was very good at what he did. The client loved him.

The solution: he became available to the client for full-time employment. That deal consummated, he was happier, the client was delighted and Jerry was free to begin work with a new  collaborator with a business development gene.

Thought Leadership: A Thoughtleading Frame of Mind

It is generally accepted in the consulting ranks that thoughtleading—      publishing, speaking on topics related to original thought, research, individual intellectual capital and work experience demonstrate competence and expertise.  If each collaborator in a group is actively engaged in thoughtleading activities such as these, the probability of additional opportunity for collaboration is more likely.  A thoughtleading frame of mind can generate greater market exposure and perceived expertise for the group.

Collaborating consultants have a dual responsibility; to their own practice and to their collaborative team to publish and speak.  This illustrates the concept of  “congruency” mentioned in our second premise.

In productive collaborations, published works and joint presentations as well as shared success stories, help build credibility.

A good example of collaborative thought leading synergy is the book “Absolute Honesty” by Bob Phillips and Larry Johnson.  These two individuals, with completely different expertise, worked together to develop a product that is useful to both individual practices. Bob is an Organizational  Development specialist and Larry is a  motivational speaker. Bob developed the “Straight Talk” workshop which was generated from the book, as a   major component of his practice and Larry uses the book’s concepts and principles as a major component of his keynotes.

When Larry asked Bob to collaborate on a book, the common ground for both was honesty and integrity in the workplace.  The basis for their collaborative efforts was their personal value system of relating to clients and others with a high standard of integrity and respect.

One can see the “Trust”, “Thought Leadership” and “Business Development” parts of our four circle model at work in this example.

Project Execution

The ultimate determination of success in a collaborative engagement is  “delivery” to the client.  There must be clear expectations; before, during and after the work is completed.

In a recent collaborative engagement with multiple people, projects and deadlines, Diane found using a project management worksheet was the best tool for managing deliverables.  Remember the Gantt chart?  Collaborators must discuss in detail and reach consensus on each of the deliverables to avoid jeopardizing the project or a negative impact to the client.  Open and honest communication is essential.  We suggest five categories around which to achieve collaborative clarity. 

Deliverables:  The first rule of deliverables—be clear and specific.  Be very, very clear and specific.  The   second rule—never agree to pay a   collaborating consultant an hourly fee in a fixed price contract.  While it may sound obvious, we won’t mention which   author fell prey to this. 

Deliverables should be clearly defined, specific and easily identifiable. Here’s a specific example: train 25 sales   people in 5 specific locations nationwide.  Here’s a non-specific and vague example: improve the productivity of the sales force.  And here’s an example that has the potential for trouble:     improve the sales force productivity by 30% in the next year.  While this last example is specific, it may be difficult to achieve because it is out of the consultant’s span of control. Whether   defining deliverables as a standalone consultant, or in a collaborative arrangement, task ownership and       expected results must be clear.

Milestones and Checkpoints:  If your client proposal does not reference a timeline for deliverables, you may want to consider one. Project management software and templates are plentiful.  However, a well-designed Excel spreadsheet may be sufficient for  planning, scheduling and monitoring   a project.

The timeline identifies various milestones, checkpoints and dependencies of the project.  It communicates to the client when the work should be completed.   It also helps both client and consultant in scheduling resources, staff, etc. and staying focused on priorities.

Fee Structure:  Building a fair revenue sharing model is key to avoiding many issues. If not addressed prior to the launch of a client engagement, a poorly planned fee structure can lead to a quick, one-project, bitter ending to what could have been a potentially great collaborative team.

Table 1 suggests a useful Financial Split Model.

 Collaboration_Split 

Intellectual Property (IP):     Assure that ownership of any IP created in preparation for, during and/or after project completion is clearly defined.  Typically, IP agreements are written to cover inventions or techniques that may result from project execution. The basic issue is who owns what and under what conditions.

For example, IP related to the project itself (software developed, designs, tools) typically reverts to the client as work-for-hire outcomes. If a new “tool” is consultancy-practice-related, ownership will revert to the managing consultancy practice as long as specifically understood by the client and collaborators.  The tool, from that point on, is owned by the collaborator under whose business entity the project is being executed.

Whatever the circumstance, clarity between all parties is critical.P.S. The last 1% is set aside for the post-execution celebration.

Data Retention:  Every step along the way, documents and electronic communication must be managed.  It is vital that data created, collected and presented,  be retained and maintained.  Data and filing systems (paper  and electronic) should be easily accessible and well organized. If you or the client need a document during the project or post-project, records should be easy to retrieve.

In one case, the owner of a large firm expressed concern over the value of a major two-year transformation program.  The consultant volunteered a comprehensive project audit.  Because all project work had been well documented (proposals, work product, deliverables, communications, etc.) the audit turned a stern-faced confrontation to a delighted client experience and supplemental work. 

Conclusion

When problems arise in a collaboration, it is usually because details, deliverables, expectations, ownership, fees and accountabilities were not clarified, agreed to, documented and/or signed.

In addition to the contractual specifics of individual projects, it is imperative that collaborators understand and work within a mutually agreed upon and understood framework—a framework that extends beyond a single project to one that creates a long term business relationship. 

We have proposed a four-circle collaboration model with crucial and   distinct parts: Trust, Business Development, Thought Leadership and Project Execution. Understanding and  operating within this framework     creates the greatest congruency and synergy for all concerned.  

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About the authors:

Diane Gibson, is President and Founder of DMG Consultancy, Ltd. an organizational development and change management     consulting firm serving clients in Idaho, Washington and Oregon.

Bob Phillips, is a Principal with RW &  Associates, Inc. an organizational development consultancy headquartered in Bend, OR specializing in cultural ethics. Bob is co-author of “Absolute Honesty”, now in its 10th printing, and the book’s companion  “Straight Talk” workshop.

Jerry Vieira, CMC  is President and   Founder of The QMP Group, Inc., a Portland, OR. based management consulting firm that assists clients in growing the market value of their businesses through market strategy and marketing & sales organizational transformations.

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Click for information about QMP’s Consultancy Navigator Program. Learn how to start and grow your consulting practice and get the coaching you need to make it happen quickly.

The Key Components of a Thorough Marketing & Sales Audit

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The word audit can strike fear into the heart of almost any person or organization that is its target. “Audit” conjures up images of someone in a position of authority digging through paperwork and records looking for evidence of malfeasance, mistakes, incompetence or non-compliance.

However, when a business performs an audit on their marketing and sales function, they typically just want to answer two basic questions:

  1. What can we do to improve our sales results?
  2. What can we do to improve our marketing and sales ROI?

At its purest intent a marketing and sales functional audit should not conducted to uncover incompetence, to fix blame or to penalize, but rather to discover opportunities to make both marketing and sales more effective. If the motivation of an audit is solely to find a scapegoat or assign blame, the problem is not in the firm’s marketing and sales function, but rather in its culture and leadership.

Step 1: A Quick Starting Point – The Self-Audit

We, at QMP use an 8 dimension, quick 50-question self-audit or self-assessment approach to determine whether there is need for deeper investigation. The output is a simple spider graph which illustrates the impressions that the executive team has of its marketing and sales organizational capabilities and effectiveness.

Figure 1

 

 

Copyright The QMP Group, Inc. 2012 All Rights Reserved

The shape of this figure provides a general idea of where performance gaps are perceived to exist. However, this is a chart which reflects executive impressions and personal observations – not a formal, detailed analysis of processes and capabilities. If the chart reveals high capabilities, but sales performance is actually poor, there is strong misperception among the executive team. But if both the chart output and the firm’s performance are satisfactory, the need for a detailed audit is probably not compelling.

(Click here to request this free self-assessment tool)

Step 2: The Detailed Audit:

If a detailed audit is indicated, the model in Figure 2 provides a framework for conducting that audit. Each of the 8 dimensions of the spider graph will be evaluated within that model.

Figure 2

he Marketing & Sales Engine™

Copyright The QMP Group, Inc 2002 All Rights Reserved

All gears must turn efficiently and together for optimum revenue generation. If any gear is broken or stuck, the engine stalls – and it can only turn as fast as its slowest gear. If a marketing and sales audit is going to identify opportunities for breakthrough or discover where things are malfunctioning, an audit must assess the systemic working of all the gears – even the little ones. One must even include in the audit the oil in the oil pan – which we call Performance Excellence, or the Culture of the firm. A healthy corporate culture can grease, or an unhealthy corporate culture grind to a halt, the firm’s marketing and sales engine.

Auditing the Gold Gear: Market Strategy:

“Even the best soldier becomes a casualty when engaged in unwise battle strategy.”

Audits of Market Strategy often lead to the greatest sales breakthroughs. It is common that a strategy audit reveals a lack of market focus. And though it may seem counter-intuitive to consider narrowing rather than expanding one’s market range, a redeployment of resources to a more tightly-defined, more economically lucrative market segment, almost always results in accelerated growth and less cost.

In one case, prior to a strategy analysis, a rather smug marketing and sales executive said, boasting “I don’t care who buys them (his products) or for what reason. All I care is that they buy a lot.” His attitude reflected itself in the highly unfocused efforts of his sales team. This manager did not expect significant impact, nor did he believe much would be revealed, from a strategy audit. In actuality, the audit triggered a strategic market re-focus which triggered strong double-digit growth for a handful of years while enabling price premiums along the way.

Opportunities for sales breakthroughs are available by looking into other aspects of the firm’s strategy as well, not just its strategic focus. Breakthroughs can be found in analysis of the channel-to-market, pricing policy and the alignment (or rather misalignment) of all the components of the strategy together.

Auditing the Blue Gear: New Business Development

The Business Development gear comprises what most people consider to be classic, tactical marketing. It includes the firm’s e-commerce process, web presence, advertising, sales tool kit, lead generation process, print collateral, trade shows, branding, press relations, publicity and social media. Contrary to the intuition of many – more emphasis on this gear is not always better. Conflicts arise when the strategic intent is to focus while the tactical marketing team is hell bent on “getting our name out there” to as many people as possible.

A Business Development audit can reveal such things as: a) misaligned messages and focus, b) opportunities for shifting resources from expensive promotional efforts (trade shows, advertising) to more effective and less expensive targeted publicity and press relations, or c) a poorly conceived sales tool kit.

One of the most common gaps in a firm’s Business Development program is the lack of a “Thought Leadership” program. In general, thought leadership is the process of building a highly visible industry presence and reputation for your firm and your people, as industry experts. When people look for a solution, they often seek out the experts first – most of the time these days, with an internet search. Thought Leadership is typically the role of technical specialists, marketing spokespeople or senior executives of your firm – the people with enough technical or industry knowledge to be considered experts. “Thought Leadership” involves public speaking, writing and publishing articles, writing blogs, participating in industry association panels, conferences and committees and even involvement in community issues. That activity is heavily reflected in internet presence.

Auditing the Red Gear: Sales Process Disciplines

Within the sales function, the audit checklist is long. Here’s a sampling:

  • the reality, quality and current value of the sales pipeline
  • the usefulness of the sales tool kit
  • the relevance, effectiveness and currency of the sales training program
  • overall sales process effectiveness
  • the discipline of providing, and quality of, market intelligence feedback
  • the sales person’s understanding of the value proposition, differentiation and ideal customer profile, particularly for new products
  • the alignment of the compensation plan to the strategy

Something as simple as re-establishing focus on the Ideal Customer Profile can achieve rapid and significant results. While running a mini-audit, one of our clients discovered their sales people did not have a clear idea of the types of opportunities they should be pursuing. Sales sent in everything they dug up for a bid, swamping the quote department.

We took the client through a focus exercise and profiled the ideal opportunity. It took only a couple of hours to formulate. Within 9 months of this re-focus, their win rate had increased by more than 15% while the number of quotes generated decreased by nearly 33%. They won more of the right kinds of profitable opportunities. It was that simple. Less waste. More success. No blame.

Low-to-no-cost adjustments to issues discovered in an audit are common and can significantly increase sales productivity.

For example, research has shown that 35% to 50% of the customer opportunities in a sales person’s pipeline will never reach a “buy” decision. These are costly, unproductive investments of sales and support resource that have ended up in the “No Decision” bucket.

The likelihood of an opportunity ending in a “No-Decision” is inversely proportional to the degree of the “Compelling Need” a customer feels about solving their business problem. If a customer is not faced with a compelling need to fix their problem they will not buy any solution – yours or your competitor’s. A quick audit of the sales opportunities in the “No Decision” bucket brings cold reality to bear on the need to do a better job of qualifying customers.

Auditing the Soil: Performance Excellence, aka the Culture:

Think of a company’s culture as its soil. At its best, it is nutrient rich and encourages growth. Think of strategy as the seed. Even a genetically perfect seed will not grow in nutrient starved soil. On the other hand, a genetically inferior seed, planted in nutrient rich soil, will at least yield some crop. Culture is everything.

The nutrients in a firm’s culture are its values and its behavioral norms. In our experience, the best cultures exhibit the following characteristics:

  • the setting of clear expectations
  • individual and organization accountability
  • clarity of ownership of initiatives and results
  • measurements and metrics
  • rewards and consequences tied to performance
  • honesty and openness in communications
  • periodic progress checkpoints (at minimum, monthly)
  • a sense of urgency to deal with barriers and challenges to progress
  • teamwork
  • a creative problem-solving orientation focused on solutions not blame

 In our engine model the culture is the oil in the oil plan pan in which the gears move. The culture lubricates and sustains a healthy engine. Without oil the engine seizes up. Without a solid culture of performance excellence, your business seizes up.

Conclusion:

A marketing and sales audit is simply a periodic analysis of what’s working and what’s not. It is a discipline that requires digging into the marketing and sales process to look for opportunities, barriers, bottlenecks and trends. We know from experience, that initiating an audit and analysis, with the discovery of root cause as its objective can spark sales breakthroughs and improve marketing & sales ROI.

A Final Note: A Marketing & Sales Organizational Self-Assessment is not the same as a Marketing & Sales Audit

A Self-Assessment is an organized compilation and scoring of your perceptions about the capabilities of your marketing and sales organization and processes. An Audit is a validation or invalidation of those perceptions from a deep dive into weaknesses and root causes of performance gaps. Self-Assessments record perceptions. Audits discover reality.

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Copyright 2010 The QMP Group, Inc. All Rights Reserved

Learn more about what kinds of growth opportunities a QMP Marketing and Sales Effectiveness Audit can reveal. Or, request a free QMP Marketing and Sales Organizational Capabilities Self-Assessment through our Contact Us Page. We’re here to help.

PinPoint Change: Reducing the Frustration of Slow Process Improvement

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What is Pin-Point change?

Pin-Point change is a simplified, three-step approach for affecting high-leverage, rapid business process improvement.

A pinpoint change comprises; 1) the identification of the single most critical and ineffective business process preventing the firm from achieving its objectives, 2) the identification of the specific process change needed, and 3) focusing, laser-like executive attention and decision-making on the few key people in the organization that must quickly change their behaviors to fix those ineffective processes. This does not necessarily mean removing or replacing them – unless, of course, they simply cannot or refuse to quickly learn and adjust behaviors.iStock_000005918667XSmall

What’s different about this approach to change is that to achieve the most rapid positive result, change is only required of a few strategically positioned people in the organization that are key links in the ineffective process – not the whole organization. Focus permits rapid change. Once the success of the change is proven, the rest of the organization typically falls in line, encouraged by both the initial success and the management intensity applied to the execution of the change. As a result all organizational change is faster.

 

An example:

The sales manager of a small, innovative health care products firm was convinced that the fastest road to sales growth was quickly setting up as many distributors as possible. He had charged his independent reps with the task of finding those distributors and directed the whole customer service team to respond quickly in setting up these new distributors when they called – credit checks, registration, setting them up in the system, getting them sales materials and servicing their other needs.

The number of distributors exploded – rapidly jumping into the hundreds. The customer service folks were overwhelmed servicing distributor requests, responding to inquiries and processing extremely small orders. In spite of this intense effort, sales results, as measured by sales per distributor, were poor.

The channel strategy and channel management process was broken – running wildly, un-steered and developing no traction.

Reversing this strategy by creating a single, national master distributor to which to send smaller distributors and distributor wannabe’s allowed the sales and customer service team to focus on the most important larger distributors, large end-user sales, lucrative growing market segments and most profitable products. After the channel strategy and process change, customer service productivity improved and revenue quickly turned upwards.

Changing the mind of just one person in this critical distributor management process was the key. The sales manager had to be convinced that his direction, process and behavior needed to change.

The ineffective process was channel strategy. The single person that needed to change behavior was the sales manager. One process, one behavioral change and one strategically positioned individual made the difference between success and failure.

 

The “Drive-Train” of any business:

A drive-train is the series of mechanical parts of an automobile that actually make it move. It starts with the engine, which in turn is connected to the transmission, which in turn is connected to the drive shaft, which in turn is connected to the read-end differential, which in turn is connected to the wheels through the rear axle. All this energy transfer goes on, beneath the visibility of the driver. All the parts of the drive train have to work together for the car to move. If any one of those segments of the drive train breaks, the car can’t move. The energy produced by the engine is lost before it gets to the wheels.

In most business units, the drive-train is the sequence of processes and people that makes the business run. In small to mid-size businesses, process-specific drive-trains typically operate two levels below the visibility of the business owner or executive in charge – yet these people-process drive-trains are the connections through which most business activity takes place.

The majority of day-to-day activity goes on beneath the awareness and visibility of executives. That’s actually good news – for the most part. It means the executive can get the flu on Sunday, stay home for the week, play golf on the weekend and return to work on Monday and notice the business hasn’t collapsed. The bad news is that processes in this chain, when broken or inefficient, continually produce weak or bad results. The executive sees less than optimum results in her business dashboard, but doesn’t know where the process is broken. It’s like the driver of a car, not understanding, when she presses down harder on the accelerator, why the car doesn’t seem to be move any faster.

 

A Typical Business Drive Train:

A typical business drive train might look like this. A sales person finds an opportunity. That sales person links to the inside sales and/or estimating team that produces a quote. That part of the drive-train, in turn, connects with the order entry people, who, once the customer decides to order, accepts the order and enters it into “the system”. The system then informs the production planner, the materials person, purchasing and the final link, operations – which in-turn builds and delivers that order. Then the “system” takes over and spits out an invoice. When the invoice is paid, accounts receivable enters the receipt into the “system” and deposits the check in the bank.

Each step is a mini-segment of the larger business process. But, because these drive-train links are more-or-less serial, one persistently ineffective segment will continually plague and corrupt the whole business.

In a small to mid-size business, at its most fundamental level, each drive-train segment comprises, the combination of a basic process and a key person.

 

Fast Change – Rapid Improvement:

The fastest three-step route to positive change comprises 1) the rapid identification of the inefficient or broken process in the business drive-train, 2) the identification of the specific process change needed and 3) the focus of management attention on the one individual through which behavioral change will be crucial.

I am continually amazed at how effective “the one process-one change-one individual” approach to improvement can be.

The steps of PinPoint change are straightforward:

1. Discover the broken process,

2. Identify the behavioral change needed,

3. Find the key individual whose behavior must be the first to change

 

One final consideration:

The one person that is critical to initiating all rapid behavioral change in a small-to-mid-size firm is the executive in charge. The speed of a drive-train change is only as fast as the decision on the part of the executive-in-charge to direct that change. A much higher probability of success exists, when the executive in charge, knowing what process is broken and what change is required, quickly identifies the key individual in the process and clearly communicates the expectation of what needs to be adjusted. An uncompromising insistence on the three-step approach is essential. Executive indecisiveness can hold it all back.

My advice to executives: Do not let the discomfort of insisting and confronting the need for behavioral change of a few key people in a critical drive train process jeopardize the well-being of all other employees and stakeholders.

It’s that fundamental.

Copyright The QMP Group, Inc. 2013    All Rights Reserved

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Click here to learn more about Marketing & Sales Organizational Tranformations led by Jerry Vieira and The QMP Group

The 8 Client Personality Types

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Aristotle, (though some attribute it to Mary Poppins), is purported to have said, “Well begun, is half done”. We’ll stipulate that neither Ari or Mary were talking to a group of consultants, or consultative sales folks, but consultant types quickly learn that early preparation can make a big difference in their ability to achieve a client success.

Beginning well requires quickly determining whether all the key ingredients of a “complete” success even exist. These ingredients include; 1) a client executive that has the personality to affect organizational change, 2) the potential of a major economic benefit for the client, 3) a style match of the consultant to the culture of the client organization and 4) solid gains beyond just your fee, for you, the consultant.

The Executive Personality Factor:

Early in their careers consultants learn that project success is rarely generated solely from their own catalytic, outside-in efforts. Every success needs internal collaboration with a client executive to affect change, assure Facial expressionsexecution and sustain the economic benefit of a project beyond the engagement.

Recognizing the critical role the lead executive plays in client success, we conducted an analysis of the last ten years of QMP engagements. We wanted to discover the earliest predictors of success from personality-reads on the lead executive. Why did we do this? Because, not all engagements are “complete” successes, and we recognized that achieving a complete success significantly multiplied the economic benefits for both us and our clients.

That analysis brought us to this conclusion:

“The personality type of the highest client executive involved in a specific consulting engagement, not simply his title or position, is the best predictor of an engagement’s ultimate success and the longevity of economic benefit received by both the client and the consultancy practice”

In your career, you may have participated in any of the myriad of commonly practiced personality profiling exercises. Myers-Briggs may have awarded you the distinction of an ENTJ or ISFP. Another test may have designated you a color personality, such as an Orange, or in the DISC profiling system, labeled you an “S”.

While self-knowledge is valuable, it’s not likely you will be able to ask your clients to subject themselves to a battery of personality tests before you provide them a proposal or start an assignment. So the problem remains. How can one identify client types and predict success from the earliest discussions? How can one know when to stay and when to run?

Sorting through hundreds of transactions resulted in our Approach-to-Business (ATB) scale for classifying executives. Admittedly, it wasn’t the most scientific of studies. We don’t have a research psychologist on staff. We simply sorted and grouped like-client individuals, named the groups and then regrouped by project success.

The grouping resulted in eight categories. Only three of the types seemed to have the key success gene, which we identified as the ability and courage to drive change.

So that this last point is not lost, it deserves mentioning again. The key factor in the successful types is their ability to manage and execute organizational change. In our experience, all types will say they are prepared to affect change but only three types actually do.

It’s Not the Title, It’s the Type

It is common to hear among consultants that “executive buy-in” is essential for engagement success. Our data refuted the generality of that claim. We restate it this way, “buy-in from executives at the right level and of the right ATB types is essential for success”. To truly be valuable in generating success, executives must be both the right ATB type and high enough in the organization to marshal resources and get attention when needed.

We have tested our ATB classification with consultants from around the country. They almost universally and immediately, recognize their own current and prospective clients among the types – as well as their project and proposal successes and failures. Once the patterns of these ATB personality types are recognized, one can adjust tactics, refocus resources appropriately and save an enormous amount of time while increasing the probability of “complete” success.

The 8 Client ATB Personality Types:

STUMPs: STUck in the Mud People will never change, they will never buy. They have a limited point of view and don’t move very far from it. Even if you are convinced, beyond any doubt, that they need your help and could reap enormous benefit, it is irrelevant. They are simply disinclined to buy professional services. Don’t try to convince or educate them, because they really don’t care. Politely walk away. Don’t persist. Unsolicited proposals will simply frustrate you, while bemusing them. It’s futile.

Takers: Takers know how to take. They take great notes, your time, your materials, your ideas, your concepts, and turn them into their own. They use your materials surreptitiously, under the radar. Credit or compensation for your ideas? What ideas?

Imagine having your third meeting with a client who appears to be interested, has taken a lot of notes but little or no action. Now, imagine the time and frustration you could have saved had you known from the outset that this potential client was a Taker. These prospects are experts at appropriating concepts and ideas, often asking during preliminary discussions if they can have copies of some of your key documents “to review with their people”. Don’t go there.

Opportunists: Opportunists want to purchase the minimum, bare bones package of services. Their hope is that purchasing the minimum will generate great results. Their expectation is first class results for the “economy” investment. Follow-through to success is rare, since they don’t have the expertise required to execute. Quite often the Opportunist will start many small projects. They will lose interest quickly if results are not immediate or if it seems like too much effort.

Boss-Made-Me-Do-Its: BMMDI’s (pronounced “Bim-Me-Dees”) are the political hangers-on of the corporate world. They provide lip service and public support for an improvement initiative but usually have little sincere enthusiasm—particularly if the consulting assignment has the likelihood of revealing and correcting weaknesses in their own department or function. They will engage, but only long enough to satisfy the boss. If the boss’ attention goes elsewhere, the engagement will die on the vine – as will success.

BMMDI’s have no personal commitment or belief. They may even engage in “lipotage” – public lip service, followed by indifference, or worse, sabotage. (The word “lipotage” was coined by my colleague Bob Phillips and co-author Larry Johnson in their book “Absolute Honesty” published by AMACOM Press).

A particularly hopeless combination is a BMMDI with an Opportunist boss.

Terribly Troubled: TT’s really need help and are willing to invest in serious solutions. Their level of pain is high, as is their motivation to fix the problem. They may research alternatives, but will make a decision quickly. They are typically in a rush to get started and consequently may miss some alternatives – but they will move forward. Spend quality time with these prospects to ensure they understand what will be done (deliverables), what’s required for success (commitment) and how you will fix the problem (approach).

Frustrated Drivers: FD’s can be very intense and quick in studying alternatives. Many times these are executives that inherited a family business or took over after a long oppressive or “old-fashioned” leader – perhaps a StuMP.

They have been waiting a long time for the opportunity to straighten things out. Their drive and motivation is high. They usually understand the weak points, the resources and commitment needed and, upon decision, will drive for quick, visible results.

Establishing well-defined goals, benchmarks, checkpoints and progress measurements will help FDs satiate their sense of urgency. Communicate frequently, clearly and succinctly. Emphasize speed, drive for quick traction and show results.

Sincerely Growth-Oriented (SGO): SGOs are there for the long term. These are clients that readily recognize they have issues and challenges, and demonstrate a sincere and strong desire to improve. An ideal type of client, they understand performance excellence and are motivated by it. They thrive on achieving goals and are constantly improving basic business processes. They are the best-of-the-best clients, intellectually, emotionally and financially. If you consistently provide high value to them in your engagements, SGOs will remain loyal for a long time and continue to award you new projects and referrals.

Dreamers: Imagine Don Quixote, the idealist and self-imagined white-knight savior. Dreamers are lofty in their vision and motivation, perhaps even charismatic, yet impulsive and occasionally misdirected. They are typically challenged at getting organizational buy-in and support, based on a history of failed past initiatives. Their grandiose visions of the corporate future are rarely realized. They talk enthusiastically but show little interest in getting deeply involved in the details of execution .

According to our research, Terribly Troubled (TT’s), Frustrated Drivers (FD’s) and Sincerely Growth Oriented (SGO’s) generate the most meaningful successes by an order of magnitude, in terms of the highest long-term value for all concerned.

But wait! Good ATB genes are required, but not sufficient.

ATB considerations create opportunities for complete success only if the three other raw ingredients exist as well.

Ingredient #1: Strong Economic Benefit:

Business-to-business executives buy consulting services because of a basic belief that the money invested in those services will return significantly greater economic value than the cost. If there isn’t a meaningful economic benefit to be achieved for the client, com “complete” success may end up a ‘Pyrrhic” success.

Ingredient #2: Consultant Style, Capabilities and Personality

These ingredients must Blend with the Client’s Culture: Clients want a consultant whose expertise is well-matched to their specific needs. Furthermore, the ideal client relationship must be based on mutual trust and open communication. But even with these factors covered, execution remains the biggest challenge, because the people in the organization must change the way they do things.

The ability to affect change is enhanced with good communication – and communication is most effective when the consultant’s personality and style match the personality, style and culture of the client organization.

Ingredient #3: Wins for the consultant:

Beyond the economic payoff, other rewards await a complete success: case studies, new tools and techniques, raw material for articles, referrals, follow-on business and new networking connections. If you are going to invest the next six months in a major client engagement, it’s better to find one of that holds the promise of the multiple rewards of a “complete” success.

Personality to Profit

A consistent challenge in selling consulting services to a new client is getting an audience at the right executive level. It is a coup. But when the actual discussion starts, it is common to get so focused on the problem at hand that one can easily forget to look for all the key ingredients of success.

We started this article with a quote from Aristotle, so it’s only fitting to end with a quote from the great American philosopher, Yogi Berra. Berra is purported to have said, “You can observe a lot, just by watching”. Let me add this, “..but you must remember to observe.”

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Learn more about the QMP process for reading people and creating winning sales strategies in our one-day Sales Skills and Process Training Workshop, 60/90 minute on-line Sales Webinars or, for consultants, our Consultancy Navigator program.  If you have special need let us know of them through our Contact Us page, or call us at 503.318.2696.