Posts Tagged strategic business management
Every major technology company client we have worked with during the last 5 years has asked one question – how can we sell to the Small and Medium (SMB) customer segments? This increased interest in the SMB market place is born of self interest.
- For every enterprise client (revenue >$2B), there are 144 potential customers with revenues <$250M
- In the US, alone, manufacturing firms with <1000 employees generated close to $1 trillion in revenue in 2009 – down significantly from 2007 but still substantial.
Multiple business data research firms have documented the fact that SMB firms spend a larger percentage of their revenue on technology but spend more carefully. Our research finds that as a group they –
- Value technology solutions not technology tools
- Suspect that existing technology solutions do not address their specific business challenges
- On the surface, face the same challenges as enterprise customers. However when examined more closely, SMB challenges are more compelling and require different solutions
- Trust their peers more than technology professionals
- Are lagging adopters
- Buy when they feel a “direct relationship” to the vendor –
Feel the vendor is invested in them!
Technology vendors who want to have a successful Go-to-Market strategy need an approach that is specific to the SMB market segment they want to penetrate. This begins with a solid understanding of the market segment – issues and opportunities, total market size, competition, cross industry alliances and existing suppliers, etc.. Next, a great Go-to-market-Strategy is only as good as it’s implementation plan —
- A tailored product offering and the value proposition
- A multi-channel marketing strategy
- A multi-channel sales strategy
- An effective executive to executive communication plan
- A best-in-class post-sale customer service and technical support capability
- A strong set of ROI measures
- A set of well-defined plan milestones
- An extra dose of patience to sustain a longer selling cycle
Technology vendors who master the differences in selling to the enterprise and the SMB market space have a great opportunity to increase their own market share and to improve their Bottom Line by developing a new and loyal customer base.
@Cordi and Associates
All Rights Reserved 3/2010
Our research proves that an effective WIN/LOSS ANALYSIS process IS the 21st century “CANARY IN THE COAL MINE”
Want to know how your business plan is working? Our experience shows that competing effectively in a fast-paced global economy requires a disciplined win/loss analysis process that takes into consideration every aspect of sales effectiveness. Win/loss analysis should be conducted at least quarterly and in the current economic uncertainty preferably on a monthly basis. Sales, Marketing and Operational Management should examine all aspects of the Go-to-Market process.
- Measuring the health of the sales pipeline
- Calculating the return on marketing investment
- Segmenting customers and then targeting specific customer segments
- Discovering early indicators of shifting demands – product-based or market-based.
- Managing and sharing internal sales best practices
- Conducting a forensic transaction analysis on so-called “big deals” after their close.
By comparing the results of the win/loss analysis to the revenue plan management can quickly determine whether they are on track to meet or exceed their plan or need to make adjustments to that plan immediately –
- Increasing or slowing manufacturing to meet product demand
- Speeding or slowing new product introduction
- Expanding or revamping advertising
- Adjusting sales personnel etc..
An effective win/loss process is an essential tool in the quest to maintain focus on Bottom-Line Excellence even in the most challenging of economic conditions – just as the 19th and 20th century coal miner was warned by the canary of unseen danger below — .
@copyright Cordi and Associates
ALL RIGHTS RESERVED 3/2010
I received an e-mail from Aberdeen Research today that claimed 73% of companies responding to an earlier survey expressed “a need to improve operating expenses as a top priority.” Operational efficiency is subject to many definitions and in the Aberdeen case it is an argument for tools over technique. My definition is a little different.
My definition of operational excellence is the technique of maximizing profit by optimizing the cost of doing business in any economic circumstance. Excellence does not just happen; it is the result of advanced planning and timely execution.
Companies that are going to be successful in this more precarious and opaque national and global economy will be those that have a good Go-to-Market Strategic Plan supported by a set of solid tactical plans geared to optimize efficiency in any economic circumstance. The tactical plans must be based on the probable and the possible and the unthinkable business scenarios – all in support of the Strategic Plan.
Operational excellence is a product of good scenario design, and tactical implementation. The final question management must ask before accepting a tactical plan is “does the company have the focused business processes and the enabling tools to quickly identify the changing economic conditions (early indicators) and respond urgently”? If the answer is “no”, the remediation begins with determining if the answer “no” is a fault of the tactical plan or the result of sub-optimal business operating practices or enabling tools ?
Bottom Line Excellence is the result of focusing on continuous re-examination of strategic assumptions and the nimbleness to adjust to changing assumptions.
Joyce Stoer Cordi
All Rights Reserved 2/18/2010
During this serious recession the business news is driven by stories of job losses, forced mergers and bankruptcies. The question that must be asked is whether these events were inevitable or are the result of management failures?
I would argue that these events were not inevitable. They happened because executives focused on doing whatever was necessary to “make the quarter (revenue)” without considering that these decisions could have mid-term and long-term consequences. High tech companies, auto manufacturers and major banks and insurance companies currently under duress based their most important decisions on a common, but flawed, assumption: they could grow their way out of the consequences of bad short-term business decisions. When a business assumes inevitable growth, it forgets that both history and gravity tell us a different truth.
In the technology industry, Sun realized too late that hardware was no longer a differentiator – especially when associated with proprietary operating systems. Sun never made the total commitment to JAVA and its other software products – turning itself a cheap acquisition target for Oracle.
GM did not misinterpret consumer sentiment toward larger vehicles over the last decade. For proof, one needs to look no further than the SUVs offered by every major import vehicle manufacturer after the success of the Chevy Tahoe. The GM mistake was to build that consumer sentiment into their revenue strategy and fixed operating costs. Their competitors were more realistic in their model mix and their (business) operating model. Toyota has both its hybrid Prius and its SUV Pilot – but neither model is encumbered by high labor costs, expensive retiree benefits or out-dated factories.
Neither Sun nor GM’s failure was inevitable. If the assumptions underlying short-term strategic and operational decisions had been tested against potential consequences developed in mid / long-term scenarios – the outcome for either (or both) would have been different. The short-term plan would have been modified to incorporate mitigation strategies for mid / long-term impacts resulting in a corporate renovation over time rather than an urgent restructuring.
Businesses that take the extra 10% time to plan their present and their future in tandem will continuously renew themselves – and, by so doing, insure their survival in lean times and their prosperity in good times.
@Cordi and Associates Inc. All Rights Reserved