Archive for February, 2013

Pilot, Perfect, Scale Up

Tuesday, February 26th, 2013

You have to change what you’re doing now in order to grow your company.Change what you're doing to grow your business

That’s unavoidable – and it means taking risks.

But some changes are less risky than others.

For example, how much risk do you take selling a well-proven product or service to new customers? And how does that compare to, for example, investing in a new promotional campaign?

Let’s talk about that promotional campaign for a moment because lots of business owners have had a bad experience with one.

The challenge is that you have to spend money getting someone to create a new message which will get your prospective customers to do something you want.

The risk lies in the fact that the business owner has to pay for the new message and for getting it out there before they know if it will have the desired result.

But this is not entirely true.

You don’t have to pay for a full promotional campaign before you know if it will work. At the very least you can narrow the odds of failure and limit your investment.

How? By following a process called “pilot, perfect, scale up”.

For example, you can test as many variations of the message as it takes, on a small group of customers, until they see and hear what you want them to see and hear. That’s the piloting part.

Then, instead of emailing the message to everyone, you first send it to part of your database and check they are getting the message and, if necessary, make further changes. That’s the perfecting part.

Only when you’ve done that do you scale up and launch the campaign to everyone.

The same technique can be used for developing (or adding) new products. Pilot them by testing the concept and then the prototype with a few potential customers. Use their feedback to modify and develop your original idea.

Then roll it out locally. If there are unforeseen problems, you can perfect the new product/service by either shipping them back or getting support people out to customers relatively quickly and inexpensively.

Scale up by going for a regional or national launch only after managing the risks by taking the first 2 steps.

You can apply this process to almost any change or risk you have to take to grow. For example, want to:

•    Grow your retail business? Get one outlet running profitably by perfecting the systems and documenting the processes there. Then transfer them to other, remote locations. (Not exactly my idea, see Michael Gerber’s “The E-Myth”.)
•    Add new markets? Do it in increments rather than by put everything on the line by overstretching.
•    Hire a consultant? Give them a small project and see how they do with that before giving them the big one.

This seems so simple, so fundamental you may wonder why I’m even writing about it.

It’s because we continue to see situations where “pilot, perfect and scale up” should have been used and wasn’t.


If you enjoyed this post you’ll also enjoy Cop Out Or Common Sense?

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Do You Have a Job or a Business?

Tuesday, February 19th, 2013

I don’t know who first asked that question, or when.Business owner's strategy determines job or business

I do know that there are lots of business owners who either have never heard it or who have heard it but choose not to think about it.

How do I know? Because we meet them and, if you think about it, so do you. In fact you may even be one.

How do you recognize them? They fit one of 2 groups.

The first is the “solopreneur”. A solopreneur is someone who starts a business but never grows it beyond the point of having only 1 employee – themselves. (If I seem a little nervous it’s because, a few years ago, I came uncomfortably close to being one.)

Some people do it deliberately. They’ve often had successful careers in large corporations with large teams reporting to them. They reach a point where they’ve had enough of managing people and playing politics and want to get back to just doing the work they love.

Others do it by omission. They want the rewards of building a larger company but either won’t take the financial risks or they share some of the characteristics of people I’ll talk about next.

The second group is people who can’t get out of their own way. Their companies have grown, but nothing can happen in the business without them. For example, only they;

• Know the key contacts in every customer and supplier.
• Can fix things if a customer is unhappy.
• Understand how products are produced/services delivered.
• Can conduct interviews “properly” and offer jobs to new hires.

As a result they work as close to 24 hours a day, 7 days a week as is humanly possible – for years.

And, despite what they tell you, they are not happy.

The irony is that, even when they collapse because of exhaustion, no one will buy their company because without them it doesn’t exist.

Andy Bailey, who is a reformed member of the second group, recently wrote an article about it. He describes the 4 steps he believes make the difference between building a business and having a job.

1. Define the company’s purpose (tip – begin with why the business was started) and hire people who buy into it. That will build a strong culture.
2. Replace the people with all the knowledge in their heads with systems and processes. This is what Michael Gerber talks about in “The E Myth”.
3. Create demand instead of always chasing sales. Consistently deliver quality products/services on time and build a reputation for the brand.
4. Create a strategic plan which produces results via prioritized action plans involving everyone.

These 4 steps are a neat précis of the advice in books like “Built To Sell” by John Warrilow. And they separate the owner from the company and a job from a business.

Why is that important? Because you can’t sell a job when you’re finished with it. But you can sell a company.

So which do you have – a job or a business?


If you enjoyed this post you’ll also enjoy 8 Things That Hinder Growth.

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Little Things Can Have a Big Impact

Tuesday, February 12th, 2013

Little things, it’s amazing how much difference they can make.

Is how a business owner, or other member of a leadership team, talks to employees, team members, important? Could a simple, little thing like that have an impact on whether or not a company will reach its goals, get results?Certain behaviours can have an adverse and costly impact on the success of a company

Sara and I were kicking that around last week. Here’s how the thinking went.

Let’s assume that when companies realize that an employee isn’t going to work out they let the employee go.

Logically then, the remaining employees are there because the company has confidence – even trust – in them.

Looking at it another way, why would a leadership team, in a free market for labour, employ anyone they don’t have confidence in or trust?

So, assuming the business owner and her/his management team are surrounded by people they trust, why would they talk “at” them? Or worse, talk down to them?

What do we mean by talking “at” someone? For example, person A is talking to person B but not listening to anything person B is saying. And I’m pretty confident that most people reading this know what being talked down to is like.

Do these behaviours have an impact on results? Absolutely.

The persons B eventually become tired of being treated this way and leave. Turnover has all sorts of costs associated with it and can disrupt a company’s ability to perform at maximum effectiveness.

But turnover isn’t the worst thing that can happen. If a business owner or member of the leadership team doesn’t let an employee participate in a dialogue they risk not hearing feedback or an idea that may be better than anything else up to that point.

Would an employee be capable of coming up with such an idea? Probably, remember they’re there because the owner and management team had confidence, if not trust, in them. And, if you’re still not convinced, just watch an episode of Undercover Boss to see this in action.

So why isn’t the world like this?

Because human nature gets in the way. For example, while the owner may develop confidence and trust in person D, another member of the leadership team just may not; when people are under pressure because the company’s growing too slowly – or too quickly – it’s easier just to tell people what to do. It’s sad but true.

But it’s also expensive.

If you enjoyed this post you’ll also enjoy The People Pipeline

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5 Great Planning Tips

Tuesday, February 5th, 2013

It’s always gratifying to hear a third party make exactly the same point you’ve been making – particularly if you’ve never met them.

It’s even better if they’ve been successful or have a higher profile than you do. That makes it satisfying as well.

By now you know where I’m going with this. Yes, that has happened to me a couple of times recently.5 great planning tips that will bring results

A few days ago I was reading a blog post which started “The key to effective leadership is to have a picture in your head and communicate that inspiration to your team…”

That is exactly what we get the business owners and management teams we work with to do. The first part of our process is to have them build a picture of what their company will look like in 3 years.

I want to share the rest of Jason Beans’ post because he gives really good, practical advice. But I differ from him on a couple of concepts so let me make those clear up front.

Jason talks about creating a plan, a document. We talk about planning, a process. He looks out 5 years. We stop at 3 years because I believe that’s as far into the future as you can make realistic, useful assumptions in our fast changing world.

That said, I think Jason’s 5 tips are great. So here they are:

1.    Write or speak in the present tense. Instead of saying “In 3 years we will….” say “We are…” Sounds a little hokey but try it. You will be surprised at how good it makes you feel. And it’s a little like the visualization top class athletes do before they begin their game or competition.

2.    Be specific about the outcome. We focus business owners and their teams on specific aspects of their company and tell them to describe them in as much detail as they would use for a picture of one of the happiest events of their lives. Jason has a nice twist. He suggests using analogies, e.g. “We are likened to……..the innovation of Google, the performance of a BMW and the security of a Volvo.”

3.    Stay General on How. He provides a great lesson for entrepreneurs. You don’t have to tell your team how to turn the plan into results. They will do that for you. First of all, they will surprise you with the great ideas they come up with. And, secondly, while working out the “how” they will buy-in to the outcome and become committed to making the process successful.

4.    Inspire. I mentioned we tell business owners and their teams to build a picture of the company in 3 years’ time. Before starting them off, we ask them close their eyes and picture one of the happiest times of their lives. We use this analogy for 2 reasons. We recall happy times in great detail. And “seeing” them again triggers strong emotion in us. We want that level of detail and that passion at work when they describe the company in 3 years. Jason describes other techniques for inspiring people. It doesn’t matter which you use. Inspiring people matters.

5.    Be Bold. Set a lofty, yet attainable, target. Aim for leadership in your market or industry – don’t settle for being one of the herd. Despite my comment earlier, if a business owner gives his/her team a glimpse of his/her vision of the company in 10 or more years it can provide context for the planning exercise.

Jason finishes off by talking about communicating the plan. We believe good, clear, frequent communication is critical to turning the plan into results and, therefore, a vital part of the process.

If you want to read Jason’s full post you can find it at 5 Steps to Creating Your Best 5-Year Plan.

If you enjoyed this post you’ll also enjoy Have You Ever Seen A Business Plan That Worked?

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