Posts Taged process

The One Year, Thirty Minute Challenge :: Week Seven :: Growth :: Reframing

This week’s One Year, Thirty Minute Challenge makes us look at our organization through a different lens.

Many of you have probably seen this. Connect the four dots with two straight lines. The lines must touch but not cross.

If you’re stuck, it’s because you tried to keep the straight lines inside the box. That wasn’t one of the requirements.

When we ponder growing our organization, we typically plan incremental growth that we could handle within the framework we already employ – if we grew x% we could ask the office staff to work some overtime or we could hire another technician. I’m all in favor of incremental growth and that type of growth is always welcome. However, for this week’s One Year, Thirty Minute Challenge, I want you to think differently. I want you to ask the question, “What would it take for us to do 10X the business we are doing now?” The genesis for this week’s exercise (but not the exercise itself) comes from Larry Page at Google who asks his team to look for 10X opportunities.

So, here’s this week’s exercise.

Identify the changes to your lead generation activities that would be required to generate 10X the number of leads you have now – would it require entering new markets? A larger sales staff? Additional advertising platforms?

To get to 10X sales, what would it take to increase your closing rate? If you close 10% of all sales presentations, what would it take to close 20%? What additional information would the customer need? A more meaningful connection to your company’s message – your why? Access to existing client testimonials? A better understanding of your company’s value proposition?

To increase velocity of service delivery after a closed sale, what changes would you need to make to customer onboarding activities? Do you need to replace your paper-based order system with an automated system? Do you need to ramp up your after-sale communication so that customer expectations are clear and they know exactly how and when product or service delivery will begin and how it will look?

To handle 10X the business, how will your production infrastructure need to change? Will the existing process bear the weight of 10X the amount of business or does a new production infrastructure need to be built – one that is built from the ground-up with the ability to scale? Do you have suppliers that can deliver 10X raw materials on time and with the required quality or do you need to add suppliers or seek a new supplier? Do you need to find subcontractors that can supplement in-house production? Can they do it with the same quality and meet your time constraints? Can you invoice and collect from 10X the number of customers or do you need to provide new billing or financing options that will keep your 10X cash flow healthy?

To follow up with 10X customers, do you need a more robust CRM system that can manage increased customer communication, customize communication and deliver valuable information after the sale? Can the system deliver on-going useful information that will position your organization for more sales in the future?

Clearly this brief exercise can’t touch on every element that you might need to 10X your business, but that’s not the purpose. The purpose is to help you think differently about business growth. Most of the time, we approach business growth like riding a bicycle. To increase velocity, we intensify existing activity. We do the same thing we’ve always been doing – just more of it – i.e., we pedal faster and longer. This will work for a while, but at some point, we max out the load-carrying capacity and speed of the bicycle. To make our business grow, we need to swap the bicycle for a motorcycle or a delivery van – more speed, more capacity. We must change platforms.

The value of this week’s exercise will come when you identify the pieces of your organization that won’t scale. When you find irreparable platform deficiencies where no amount of “pedaling” will fix them and they must be replaced. When you find people-constrained activities that must be replaced with repeatable processes.

All of us would like 10X growth, but doing this exercise will position your organization for 2X, 4X or 5X growth on the way there and you’ll be building an organization that is more platform-driven, process-driven and policy-driven – and that’s good for everyone in the organization.

What Is It Exactly That You Do?

I have one of those jobs – Strategy Consultant. Even after following the advice of branding and messaging experts, what I do doesn’t seem to be crystal clear to the people I want to reach the most. Thankfully, I got some help recently from one of those very people. This potential client and I have talked several times – in person, on the phone and via email – but this interaction was like somebody flipped on the light in a dark room.

I sent this potential client a service offering I had just designed. I was proud of it and thought it was just the ticket for him and his organization. His response caught me off guard because, in our previous meetings, I thought I had done such a good job of explaining my value proposition. But his response made it obvious I had not.

In his response to my email, he told me that before he signed on the bottom line, he’d be interested in knowing what strategy I had in mind for his organization. Seems logical, right? I’m a strategy consultant so I should bring one with me into a consulting engagement. At that point, I knew I’d failed miserably in delivering the message.

The most rudimentary skill in strategy consulting is starting an engagement with an unbridled amount of curiosity. Add to that a pile of probing questions and a proven framework with which to conduct the strategic planning exercise.

A strategy consulting engagement at the outset is a discovery process – discovering the values, priorities, goals and dreams of the owners and managers, discovering the true, current state of the organization, discovering the current state of industry and unearthing every other piece of useful information you can find.

It’s only at that point we create what most business owners and manager consider “strategy”. With a clear picture of the organization’s current state and a clear vision of the desired future state, we can craft the roadmap to move the organization from current state to the future state – the strategy.

The component parts of the strategy, depending on what is learned during the process, could touch any number of disciplines in the organization. For example –

  • People – Are the right people in the organization? Are they equipped to do the work the company needs today and in the future? If not, what is the best way to make that happen? Are they being managed well? Are they being compensated correctly?
  • Operations – Does the organization operate efficiently – producing the maximum number of outputs with the minimum number of inputs? Does the quality of the products or services satisfy the customer, maximizing sales and minimizing or eliminating complaints? Does the supply chain obtain the appropriate materials from the highest performing vendors with the best pricing?
  • Marketing – Does the organization tell its story in a compelling way? Does the organization effectively target the best prospects and speak to them in ways are that are meaningful to them? Is the organization effective at identifying the jobs current and potential customers need to be done?
  • Technology – Does the organization employ technology that speeds delivery of products and services? Is the organization effectively managing the relationships with technology providers?

In a well-executed strategic planning exercise, we will –

  • Organize and quantify what the principals know intuitively. We’ll nail down those things that they know exist. They’ll know how many, how often, which ones and more importantly, how they impact the long-term health of your organization.
  • Discover what they don’t know or reverse errant perceptions – Sometimes, the things they think they know intuitively aren’t true at all. A good strategic planning methodology accurately assesses the real truth about what’s going on with employees, vendors, customers and shareholders.
  • Focus the attention of the owners and executive team on a relatively small set of levers that need to be pulled to make larger, investment-grade moves that propel the organization forward – outpacing competitors and protecting against new entrants.
  • Marshall the resources of everyone in the company towards one or two specific strategic objectives – The end game of the exercise is to identify one or two things that transform the organization. The exercise might uncover four or five or ten things that need attention, but organizations can’t change ten things at a time – just one or two. A good strategic planning exercise will identify the one or two highest impact items and create a roadmap for executing those items – pushing down the implementation through the entire organization. When those are done, the organization can move on to the next item or two.

 

There’s more to the “what is it exactly that you do” question, but that’s a good start. It’s a joy to me to work with owners and managers to help them dig deep into their organizations, gain new insights into their business and watch them set a course that means success for them and meaningful work for those on their team.

If I’ve still not answered the question, let me know. If you’re overflowing with kudos for this extremely clear explanation, I look forward to that feedback too.

Is a Strategic Plan Really Necessary?

You’re making money, customers are buying your products or services and your employees seem happy? Do you really need a strategic plan?  Isn’t strategic planning for big companies with lots of money and lots of employees?  Or maybe for companies that are struggling?  If things are going great, why mess with it?

Read the ten statements below, answer TRUE or FALSE, and we’ll chat at the end.

 

I know exactly what I want the business to look like 1 year, 3 years and 5 years from now.

  • I don’t mean you want to be making more money, I mean –
    • you have a clear picture of new product and service offerings
    • you’ve identified new markets or new target clients for growth
    • you have a plan for hiring and/or developing employees that can get you where you want to go
    • you’re already putting together the production, service and technical infrastructure to support the new products and market
    • you know how you’re going to finance your plans

 

When my leadership team meets, we talk regularly about long term plans.

  • Current operational problems are extraordinarily demanding and will consume all your time.  It’s good and right to talk about and solve them, but to borrow from Jim Collins, this is a perfect time for the “genius of the and”.  To remain viable in the long-term, we must effectively manage the organization today AND successfully position it for tomorrow.

 

The employees in my organization share my passion for the business.

  • You’re the boss, no one will care more than you – right?  You might be surprised.  Social scientists assure us that engaged, empowered employees will go far beyond just punching the clock.  Clear, concise communication and commitment to an overarching purpose are the starting place.

 

I know where we are vulnerable to competition.

  • A correct assessment of the competitive environment is much more than examining the companies that do the exact same thing you do for the exact same set of customers.  It also involves examining companies that compete for the same disposable dollars.  It involves surveying replacements for your good or service.

 

My employees know what success looks like in our business.

  • This might seem apparent, but unless you’ve assembled an easy-to-understand scorecard with hard and soft metrics, employees with very narrow job responsibilities might not know if the enterprise at large is succeeding or failing.

 

If I was gone tomorrow, the business would continue to function.

  • At the risk of sounding harsh, if the organization can’t run without you, you’ve built a cult, not a business.  Skilled execution of a strategic plan will force you systematize the business, building it around principle instead of personality.

 

I have a steady stream of new clients coming into the business and they are the clients I want.

  • New revenue streams, both from new products and from new customers are the lifeblood of any organization.  But as organizations mature and are better able to identify and serve the customers to whom they deliver the greatest value surplus, they can narrow their focus.  This focus allows them to build relationships with customers who are willing to not only grow the relationship, but also act as an advocate for the brand.

 

I have a process for identifying changes in the organization that would allow us to deliver our product better, faster or cheaper.

  • The inward-looking part of a strategic planning exercise focuses on the component parts of the value creation process.  How does the organization transform inputs into desirable outputs deriving the greatest amount of utility from the resources available?  The strategic planning process is about challenging the status quo, asking probing questions about procurement, people, processes, money and more.

 

I have a reliable feedback mechanism for customer sentiment.

  • Sam Walton observed that customers have the ability to fire everyone in the company from the CEO down.  That being the case, it’s critical to understand their perception of your products, people and processes.  A reliable feedback loop is the lifeline to these important stakeholders.

 

I have a plan of action to break and rebuild my business model to keep it fresh and safe from new, innovative entrants.

  • If you’re making money and satisfying an important customer demand, there are competitors who would love to take those customers and their money away from you.  If they can satisfy those demands better or more economically, your business is in jeopardy.  With an existing business relationship, you have an enormous advantage.  However, an unwillingness to innovate or even re-invent your business, product or service can be a shortcut to irrelevance.

 

If you answered FALSE to any of these, I believe you should very seriously contemplate a strategic planning exercise. It’s incredibly easy to cling to the status quo and not deliberately create and execute a plan to build a healthier organization going forward.

Convinced and ready to go or still have some questions?  Either way is fine.  Click here to schedule a free, no-obligation thirty-minute conversation with me.  I look forward to learning about you and your business.