Archive for 2015
We are no longer slinging guns and shooting at each other. We no longer ride horses at breakneck speed or sit on top of wagons with teams of horses pulling us, with just some straps of leather to control the them. Oh no! We have hundreds of horses power driving us at speeds the horses never attained and we may no longer have even the reins to control them.
Every company needs a long-range plan. For some, that might be just 3 years versus the annual operating plan. For others, it could be a 3-7 year plan. For large multinationals dealing in capital equipment, it could be 10 years. Even a startup needs to think in terms of 5-7 years, because that is a typical time frame for the angel investors to get a return on their investment through some sort of liquidity event such as an Initial Public Offering or a sale of the company to a strategic buyer. Whatever your time frame, it is definitely something more than a 1 year tactical plan. Think in terms of Strategic being an acronym. . . .
I’ve spent my career in the area of Business to Business (B2B). When a business is looking to buy something, they often look at the Total Cost of Ownership (TCO). This includes the purchase price, the installation cost, the costs to maintain. In the case of trucks, it heavily includes the resale value of the used truck in four to five years. In fact, most businesses have a process for capital purchases that includes special forms and various approvals. Lots of people review the purchase before a decision is made. In the personal purchase realm, things can be a bit more emotional than logical. I use the term “logemotion” that combines the three words . . .
Just as some people need a 12 Step Program to get them on the right path and keep them there, your business needs a regular program to keep it running at peak efficiency. Large corporations have a cadence to the year as they repeatedly review different parts of the company.
Your business is built around acquiring new customers and then making them repeat customers. It’s not just raw material in and finished product out. Think of your company as a conveyor line in a circle from a prospecting lead to a repeat customer.
Journalists ask six questions. Your company strategy should also succinctly answer the same 6 questions, but in a different order to encompass your vision, mission, strategy, objectives. It also needs to address accountability and WIIFM–What’s In It For Me.
When you get into your car to drive someplace, you rely on everything in the car working together to get you there safely in a reasonable time frame. But, you may run into external and internal problems that require you to adapt. How will you make decisions along the way? If you Align the 7 Forces working in and on your company with the one, overriding driving force of your company, you will accelerate in the right direction.
Nearly half the year has gone by now. It’s time to take stock of what has happened in the first half, adjust tactical plans for the second half and generally check the health of your business. When you visit a doctor, you will be asked a lot of questions to assess your health. Your business should not be so different. You have many key performance indicators, just as the body has key health metrics.
The price is right if your Value Improvement Proposition (VIP) compared to your price (your Value/Price ratio) is greater than 1. … Maybe, it will make them say, “WOW!” in a good way. On the other hand, I recently said, “WOW!” when buying a small replacement part for my wife’s car this week. … I was shocked by a multiplier of,
I was a cast away as a kid—the last one to be picked for the softball teams; the one who spent lots of time alone reading; great with focused concentration, but given to making statements that got me into trouble or hurt others. Guess what? I became an engineer. But, that’s not the end of the story. To advance in the business world, I had to learn to be social.