by Elizabeth Hines | Oct 17, 2012 | Blog
During the fall quarter, most companies start focusing on how they will close their year (in terms of revenue and gross profit) as well as beginning the process of updating their sales (revenue) targets for the following year. It’s also the time that management drops the “stretch-goals” bomb or what one mentor of mine used to like to call “BHAG” sales target (Big-Hairy-Audacious-Goal). Although I am in favor of pushing the limits of my team, these stretch-goal methodologies rarely work as designed and because they are structured as “win big or lose big”, in most cases have a real demotivating effect on your teams and organization. Focusing on these four areas will lead you to better results, more consistent targeting, and a team that is motivated for the long run.
- Once you have abandoned your stretch goal mentality, look at the current state of your business and define your desired sales/revenue outcome based on this knowledge. Yes, this is much harder than saying, “my boss says to grow by 30%”, but the deep understanding of you current state will lead your organization stop focusing on the numbers to achieve and start focusing on the process of achievement. This is the hardest and most detailed step.
- Once you have established the current state and desired outcome; break up these revenue/sales numbers and the process to get them into small chunks. By doing this, you establish a pattern of smaller wins / process goal attainment. In the end, you will have developed a culture of winning and/or adjustment instead of an “all or nothing” mentality.
- Now build in a system that rewards superior behavior and discourages falling short. I am not talking out of both sides of my mouth here and this is why. You will still have the over-achievers….they need to feel fairly treated for being better than average. You will have folks who fall short…they need redirection and course correction (maybe even managed out of the business). Remembering that since these are “small chunks” your team never gets too far behind before a correction can occur and your top performers are still treated as stars.
- Lastly, develop a culture of “adjustment”, both up and down. Most teams are used to a big target at the beginning of the year that never adjusts….you win or you lose….and so does your company. I think we all know the reality is that in the current economic environment, it’s not that simple. Having the ability to adjust as your “knowledge of the current state” becomes definite allows you to throttle up when you can and down when you have to.
One word of caution, if you try this approach you need to commit all the way. A half attempt at this would be disastrous. You need to commit to change in order to change your culture and to get the results that you want. One last thing, if you are like me, you are now saying to yourself, “that’s all well and good, but my external stakeholders (lenders, principles, shareholders, managers, etc.) aren’t sympathetic to this type of curved lined forecasting”. I get that too. The answer is simple. Once have your current state defined and your desired outcomes articulated, take a conservative approach to this forecast and decide whether it is good enough for your external stakeholders. If it is, you have your worst case scenario that should only be effected by upside surprises. If it’s not, no hoping or praying for you to achieve your stretch goals is going to make it any prettier in the long run. Make the strategic adjustments now and be better off at the end of the year.
by Elizabeth Hines | Sep 5, 2012 | Blog
The closing of the democratic and republican national conventions these last weeks mark the beginning of the final push of this presidential election season. More than likely, the primary election issues that will be on everyone’s mind are the economy, employment, the debt, and healthcare. These topics as well as other important issues will be heavily debated in the coming weeks. During these debates, the twenty-four hour news cycle will remind us of the red state vs. blue state position as well as the all-important “toss-up” states and their reaction to the candidates’ remarks on these important issues. Piggy-backing on this theme, I thought it would be interesting to compare the red, blue, and toss-up state positioning to the e-waste debate and current e-waste regulations. Although what we found is not earth-shattering or inconsistent to our intuition on how e-waste regulation aligns with the red/blue state mapping, it does represent a thematic approach to how these states think about and act on broader issues with similar themes.
Before we dive into the data, here are a couple of caveats. This information should not be taken to suggest any particular political statement or alignment. It should also not be thought of as a statistical prognostication of how any state will vote their electoral or “swing” their votes. What this information presents is a comparison of current e-waste regulations and policies, by state, compared to the blue, red, and toss-up state mapping as indicated by CNN (http://www.cnn.com/ELECTION/2012/electoral-map.html). I would also like to give credit to my summer intern, Robert Leighton, who did all the heavy lifting on this in terms of research and data comparison.
Below you will find the blue, red, and toss up state alignment as indicated by CNN (http://www.cnn.com/ELECTION/2012/electoral-map.html)
| 20 Red
15 Blue
15 (Toss-up) |
|
|
Now let’s look at the Red/Blue state configuration in terms of e-waste regulation.
Total number of States with e-waste laws and/or regulations: 28
Republican
- 6 out of 28 states with e-waste laws/regulations are Republican
- Chances of being a Republican state and having an e-waste law is 12% (Calculated through conditional probability)
Democratic
- 13 out of 28 states with e-waste laws/regulations are
- Chances of being a Democratic state and having an e-waste law is 28% (Calculated through conditional probability)
Total number of States with no current e-waste laws or regulations: 22
Republican
- 14 states in total
- Of the 14, only 1 has a bill currently being proposed (Nebraska)
- Of 20 Republican states, 70% have no e-waste laws or regulations
Democratic
- 1 state in total (Delaware)
- Less than 7% (6.67%) of 15 Democratic states have no e-waste laws or regulations
Summary
- Strong correlation between having an e-waste law and being a Democratic (blue) state
- 3 states with no current rule or regulation have e-waste bills currently being discussed
- 2 Toss-up States (Colorado and Ohio)
- 1 Republican State (Nebraska)
- Toss-up states split between having e-waste laws or not (8 out of 15 have at least one)
As you may have guessed, if you live in a so-called ‘Blue” state, you tend to favor protective regulation such as e-waste laws; if you live in a “Red” state, not so much. And if you live in a “toss-up” state, well… it’s a toss-up.
by Elizabeth Hines | Jul 27, 2012 | Blog
It’s safe to say that the clients I engage with fall into two categories when it comes to business data; those that are drowning in it and those that ignore it altogether. The ones that are drowning in data know all the relevant facts that keep them out of trouble with their Boards or their senior executives, but struggle to tell you what really drives their business costs or profits. The ones that ignore the data are the savvy veterans that rely on their historical win / loss records in their business, but ask them to change course or innovate, and they are like fish out of water.
Chances are you’ll fall somewhere close to those two camps, and for some time, I did as well. It was then that I realized that tracking data for the sake of “tracking” was a waste of time for me and for my teams. However, there is data that should be relentlessly tracked and used in all of your decision processes. I call this data, “Decision-Quality”. This is the data you track that drives your business strategy and execution.
Decision Quality data goes beyond the traditional Profit / Loss packages that are churned out every quarter and disseminated to your business chieftains. Decision Quality Data sets are the building blocks and the levers of your business. Examples of Decision Quality Data are areas of your business that can be affected by the execution of your employees. Put simply, your sales employees may not be able to directly affect your finance treasury function, but working together with your finance team, they CAN effect cash flow by selling credit-worthy customers, cutting better financial deals, and when necessary, helping in the collection process. The same can be said of your purchasing professionals teaming with distribution leaders and finance team. This team can coordinate at the front line to cut costs and reduce inventory spend by developing inventory and financial metrics that matter to them and the company overall. By working in concert, they have the ability to solve the problems that arise and avoid pitfalls in real time instead of reacting when the quarterly metrics come out.
Quite frankly, if you are collecting and looking at data, but not taking action as the result of it, STOP. You won’t miss a thing and your team will thank you for saving them time to spend on more productive activities. Don’t fall into the data-cycle-trap dictated by data that is tracked on a calendar basis for the sake of tracking. Ask your teams what data they need to be effective, and simplify the way for them to get it in near real time. Once this type of data is in the hands of a cross functional team of front line managers, task them with the needed improvement and watch them make dramatic impacts in your overall business performance and customer experience, and in turn, your profits. The results will be better and more sustained than if you drove them with a mandate from the top because these managers live and breathe in the environment that created the data in the first place. Their cross functional nature and familiarity with the issues are a winning combination. Give them the data and the direction and watch your teams win.
by Elizabeth Hines | Jun 25, 2012 | Blog
It can happen to good companies as well as weak ones. Your organization makes a “relationship defining” mistake with a new customer or even worse, one of your best customers. How do you handle it?
On a recent client engagement where we were retained to increase sales force effectiveness, we got to see firsthand our client company reaction to an operational mistake in one of their after-market spare parts service engagements. It wasn’t pretty. Once the service break came to light, their first reaction was to go into “denial-mode” as they disputed the customer claim. After that didn’t work, they moved on to “shirk-mode” where they cited other factors that may have caused them to miss their service obligations. Lastly they entered “apology-mode” where they went overboard apologizing profusely instead of solving the problem in the first place. At that point, it got pretty ugly with their longstanding client.
What could they have done differently to remedy the situation and save the customer relationship? Here’s what I like to see my clients do and the advice I give them. It’s a pretty simple 3 step formula that everyone in your organization should follow when there is a service disconnect of any proportion.
- Get to the heart of the matter immediately. Don’t look for back doors or contributors to help share the blame. If you make a mistake, own it outright and clearly. Don’t be wishy-washy. Be strong in your admission and stronger in your statements of reparation. Then move to step 2.
- Contain and problem solve. Putting your company’s energy here instead of trying to distance yourself from the problem will not only limit the damage, it will show your customer that your organization has core values and that your intent is to limit your customer’s exposure and then fix the service break. You don’t need to be super-heroes here, be focused, listen and act decisively. Then move to step 3
- After the smoke has cleared and tempers have subsided, reaffirm your company’s commitment to your customer and reiterate the steps you took to solve the problem in the short term as well as the steps you will put in place to insure that the issue will not reoccur. Do it in writing. Conversations fade as well as memories. Everyone will remember the pain of the service issue, make sure they remember the short term and longer term solution. One note of caution here; this is not the time to be patting yourself on the back. You screwed up, but you made it right for the long term. That’s why your customer chose you in the first place. Reaffirm your commitments to your customer and do it in writing.
Customers don’t like mistakes, and they have a bigger dislike for mistakes that come with a lack of ownership and path to resolution. Follow these simple steps above and keep more customers for the long term.
by Elizabeth Hines | May 31, 2012 | Blog
I read an interesting article in the Harvard Business Review that was written by Jody Greenestone Miller and Matt Miller titled The Rise of the Supertemp. The article does a really nice job of positively exposing and exploring the growing numbers and interest in what they term “the free agent nation”, a/k/a “The Supertemps”. Supertemps are top managers and professionals with real world experience from top corporations who have chosen to pursue project based careers independent from any firm. The authors go on to say that these Supertemps are being relied on more and more by companies to handle mission critical work that in the past would have had to be performed by permanent staff (read costly) or expensive outside firms (also read costly).
The author’s opinion is that these so-called Supertemps are growing in numbers and will eventually change how business works. In the article it was noted that a 2011 McKinsey study found that 58% of US companies expect to use more temporary employment at all levels of their organization and that 16 million Americans are working in this fashion today. We at Fronetics feel so strongly about this trend that we created a service offering tailored to these Supertemps and the companies that need their services. We call it Fronetics Interim Retained Management Service or F.I.R.M.S. .We like to think of it as a “management as a service” offering. Although the concept has been around for some time in the ranks of the production or hourly employee base, it is just reaching critical mass in the management and executive ranks.
If you think about it, the reasons behind growth in Supertemps are really simple. For the companies using the Supertemp, they get a high quality, experienced, and focused resource when they need it for exactly how long they need it for, at a fraction of the cost of a full time hire or an expensive outside firm. Not to mention, the time lag involved with getting a full time hire up to speed. For the Supertemp, they get to work on exciting and quality projects at superior organizations. The work is intense for a specific period of time (or outcome) and then it ends. The Supertemp gets to see the fruits of their labor, gets paid similarly (or in some cases better) than traditional full time options, and then gets to re-charge when the work is complete. And with the growing advances in technology, the Supertemps can be located anywhere and have access anytime. It really makes perfect sense for both parties. And this so-called trend is not going to go away. As companies continually need to “do more with less”, high quality expertise will get balanced against cost and time to market. When this happens, the “Supertemp” option will win that battle every time. In the near-term, it’s in the best interest of corporations and their hiring executives to start developing relationships directly with Supertemps or with intermediaries that represent them. At Fronetics, we are building our relationship base and deploying these Supertemps now and expect to see this “management as a service” offering continue to grow in the future.
