"ValuExecBlog" - 5 new articles
Don't tell me the problem!There is always a right way and a wrong way of doing things. Take the case of Estee Lauder for example. Recently, they announced their four-year strategic plan and outlined a set of performance goals for fiscal 2010 through to fiscal year 2013. In line with their plan however, they announced that they would be retrenching approximately 2,000 employees or 6% of their workforce. The company also outlined the geographies where they expected growth to come from over the strategic period (60% of sales would come from outside the USA); the operating margins they will achieve by fiscal 2013 (12% to 13%) showing a step-change improvement annually starting from a low fiscal base in 2009. In addition, the company provided a time frame for turning around under-performing brands (between 18-24 months) and the time frame for realigning their organization structure in keeping with the changing growth dynamics of the various geographies. They indicated that they would improve productivity and reduce the complexity that was hindering the execution of strategy. Furthermore, the company will invest $50 million to fuel market share growth, a better understanding of their consumers' needs and research and development for future product pipeline. Now take the case of Pacific Brands which owns the 'Bonds' clothing range which is an icon in Australia. Recently they announced that they would be moving their manufacturing facilities off-shore to China. This would entail a loss of 1,800 jobs - 200 less than the number at Estee Lauder; but two days after making that announcement, it was revealed that their CEO (Pacific Brands CEO) recently had a $1 million salary increase and was now being paid in the region of $2 million / year. Now, here's the thing. Two different companies with two different approaches to the market. Both cutting their workforce by +/- 2,000 and, I would guess, both CEOs probably earning around about the same salary. Yet, one company leaves you with a warm feeling of confidence whilst the other leaves you feeling ever-so-slightly angry. One company communicated very clearly their strategic plan and even though they provided the bad news about letting so many people go, they also provided a solution and the good news that they will be investing for future growth which, one would hope would create future jobs. The other company communicated only the bad news which I am sure was an inevitable strategic decision and which their senior managers had given a lot of thought to - but they provided no solution, no 'hope' for the future, nor any indication that they had a strategy for the future. The result, you are left feeling that those people lost their jobs so that the company could some how fund the CEO's salary ( I know this isn't the case, but perception is reality). Once, a long time ago, I had to cut 10% of my workforce. It must rate as the most difficult and gut-wrenching thing that I have ever had to do. Even though it was painful for all involved, the employees could see the pain that I was going through. They might not have like the cuts, but they supported me because they could see my pain. It is difficult for employees to empathize with a CEO who announces job cuts and then a salary increase for herself of $1 million. So, the take out is this - in today's climate, we have to step out from under the cloak of fear that has clouded our thinking in the past with regard to providing too much information to the public that may be used by our competitors. We have to clearly communicate our strategic direction over the next 4 years. It is not enough to say that because revenues and profits are falling, people will lose their jobs. We need to show that we have a plan that accommodates the present climate but also outlines clearly what our plans are for future growth. We need to communicate our key metrics and the time frames that we will measure ourselves against. We need to take a leaf out of Estee Lauder and show that we really do know what we are doing. We need to bring 'hope'. As the old saying goes - Don't tell me the problem, just tell me the solution. ian 'Making the Number'Ever so often you come across a business book that makes you sit up and pay attention to what is written between the covers. Ever so often, you come across a business book that makes you realize that you have in your hands a treasure chest of pure unadulterated value. 'Making the Number: How to use Sales Benchmarking to Drive Performance' by Greg Alexander, Aaron Bartels and Mike Drapeau (Penguin Group; October 2008) is one such book. If ever there was a time for companies to embrace Sales Benchmarking, that time is now because of its 'ability to increase profits and positively impact each business function within the organization.' There are 3 tests that I give to business books: first, 'does the technique being espoused by the author add value?' Secondly, 'will the technique stand the test of time or is it nothing more than a fad?' And finally, 'does the author(s) provide sufficient information to allow the reader to convert theory into practice from the information supplied in the book?' Sadly, many books fail in one of these 3 tests which then leads to a second barrage of questions that ultimately determine whether I embrace the technique in the future or not. But, not so with 'Making the Number.' First, there is no doubt in my mind that companies that embrace Sales Benchmarking will see positive impacts to their revenues, their profits and their shareholder value. Secondly, we are today seeing that those companies that have embraced 'best-practices benchmarking' and 'world-class status' are surviving in today's business climate and are in fact making profits whereas those that have embraced mediocrity have fallen on their sword. Finally, the authors provide a five step action plan to guide you through implementing Sales Benchmarking (not that you won't require a little help along the way). If that is not enough, the authors have included actual case studies for your reference. But, I did say at the outset that the book is a treasure chest of value. Because of the very nature of Sales Benchmarking, the book will take you through 2 valuable concepts. The first is the concept of 'The Formula for Sales Success' and the second is the 'Sales Management Maturity Model Scale'. The understanding of both concepts is extremely important in the execution of strategy whether or not you undertake Sales Benchmarking. If you are serious about making your numbers, then 'Making the Number' is a must read. If you are serious about becoming 'world-class', then not only is the book a must read, but I would also suggest that you visit www.salesbenchmarkindex.com. Happy reading. ian 'The man who sold Hot Dogs'By now you would have gathered that I am, deep down at least, an optimist. To that end, I came across the following article by Doug Kennedy, President of the Kennedy Training Network, that was taken from ehotelier.com, January 30, 2009. The article entitled: 'First step in new sales: Believe it is possible!' addresses the hospitality industry, however Mr. Kennedy's message is relevant to all of us regardless of what industry we work in. Key points coming out of the article: > Don't cut the level of optimism for the future > Your level of optimism is visible every day in the actions of sales managers and employees as a whole > The lack of optimism in sales becomes a self-fulfilling prophecy Mr. Kennedy's final words provide valuable advice to us all: 'Make sure your actions as well as your words demonstrate a strong belief that although we might currently need to work a little harder and a little smarter than we did during those last few years of record profits, there is still plenty of business out there to be won.' My thanks to Mr. Kennedy and the team at ehotelier.com ian
I need your help, please!Every year I revisit our Mission Statement to make sure that we have not strayed too far from it or that we are living up to the standards that we have set. If we have strayed then I want to make sure that all associated with the company are happy with the new direction. And if we are not living up to our standards, I want to know why? To date, we haven't strayed at all, probably because our Mission is so wide. And, I am pleased to say, we have met our exceptionally high standards, if feedback from our clients is anything to go by. There is however one area that I feel I have erred and that is with this Blog. Although, I have received some very nice feedback, I have not actually asked you what it is that you would like to read or know or get help with. And for that I do apologize. Our Mission is simple: 'To create outstanding value every day for our clients, staff and the community that makes for a better world.' It can be a smile, a warm welcome, a simple thank you or finding the solution to a particular problem. So if you have any ideas as to how I can create outstanding value for you through this Blog - please let me know. And if there is a particular subject that you would like to know more about, feel free to again let me know and I will see what I can do. The way I see it - this is just as much your Blog as it is mine. What brought this on apart from the regular visit to the Mission Statement - I subscribe to a number of other blogs and it seems to me that they have become more intense (almost bordering on panic) with their offers and their messages. But on closer inspection, their messages are the same and no different to what they have always espoused. Times are changing and they need to change. I don't want to make the same mistake. So let me know where I can create value with this Blog for you. And please feel free to send this to whoever you know, open it up to others in your organization, your colleagues and friends. Let's start a "How can we create outstanding Value' open-blog debate. I look forward to hearing from you. Thank you. ian Yes, we will!It never ceases to amaze me how resilient we are as a species. No matter what life seems to throw at us, we always seem to bounce back. We may be hurt, we may be in pain and we may even be down; but on average, we always seem to bounce back. That is the wonderful thing about us humans! Whatever you may call the current crisis that we are facing, be it meltdown, recession, catastrophe, shameful, unfair - there has been no limit to the descriptors used in the media - one thing I know for certain and that is we will bounce back. Yes, we will. We will be a little stronger, and a lot wiser; but we will bounce back. The question that I ask though when we do come out of this is 'what do you want to look like? How will you describe the way you behaved? What will our actions tell others about ourselves? How will what we do today in this crisis position us for the future? How will our companies or departments look like and what would we have done to shape those companies or departments? Did we put our hands up to be included in change or did we keep our heads bowed? Prior to his becoming President, Barack Obama suggested that each of us is responsible for doing our part and that we can not and should not wait for government or for others to fix the mess. We need to take the initiative and do our part. To say that I am not worried by the state of the world's economy or even for that matter, for the state of my country's own economy, would be a lie. I am in the consulting business and will be impacted by the crisis. I am also in the middle of raising funds for a new business venture that we will be launching next month - now how idiotic is that!! But, I am also excited by the changes that are happening across the corporate world. No, I am not in favor of regulation on executive salaries and will have to live with 'social capitalism' for now. I am excited that in order to survive, companies are off-loading weak or debt-ridden companies that were nothing more than a noose around their necks anyway and created no value for shareholders. I am excited that managers are being forced to find costs outside that of simply 'cutting labor' because a more business and operationally savvy manager will be born. Weak companies that should have folded years ago, will disappear and well-managed companies will get stronger leading to more value overall. The supply and demand for labor at all levels will change as labor enters the realm of 'free agent' status. And, finally outside of the corporate arena, I am excited that we, as individuals, will change as we take stock of what is truly important to us and realize that spending beyond our means is not always a wise investment. Yes, we will get through this and when we do, I want to make sure that I can look back and honestly say that I played a part in the changing landscape; that I painted on the new canvas and was not just a spectator or a critic from afar. And also, when we do get through this, I want to make sure that I am ready to move quickly on the opportunities that will surely be available. Yes, they will. ian More Recent Articles |
