How many lofty company mission statements have you read promising the kitchen sink such as?
“We are a family business that maximizes profits and wealth, as well as a meritocracy that is focused on social responsibility.”
Is your wealth goal competing with your goal of creating your legacy around social entrepreneurship?
If you are wrestling with these conundrums, you are one of the 1000’s of owners who are trying to do the right thing(s). With demands from your family, employees, customers and financial advisors, it all falls on your shoulders to decide what to do.
Recently, I analyzed my 450 business clients to learn what they have done. Here are my findings and my new model From Company Conundrums to Manageable Missions© to help you focus on what’s most important for you and your business.
To understand the motivations of my clients, I categorized them as being either Wealth-Driven, Legacy-Driven, Family-Driven, or Meritocracy-Driven as seen in this graphic:
What’s driving your firm? While there are no absolutes in running your business, we all know that trying to pursue conflicting goals rarely works. So, if your business is focused on your family, it is impossible to run a pure meritocracy where all employees are equally rewarded for their success. Similarly, the objective of building wealth for yourself and in your firm can often come at the expense of creating a legacy within your business, or for your family or your community.
With such wide disparities in my clients’ goals, it’s clear there is no one-size-fits-all approach to creating it’s company’s mission. But being clear on what is most important to you will certainly help you to avoid your straddling. Pursuing all four quadrants equally is no strategy.
It is possible to pick any two of the four quadrants and focus your efforts; please consider the following graphic below:
From Company Conundrums to Manageable Missions Model©
So consider your choices. If you are focused on:
- · Family and Wealth you are working to create a Dynasty and build the wealth of your family. You should invest heavily in your next generation based on the ROI for your business.
- · Family and Legacy you are taking the approach of a Matriarch or a Patriarch. You will make decisions based on your love for your kin and your intention to carry forward the company in your name.
- · Meritocracy and Wealth you are working to create the most Value-Driven company you can regardless of your family. You should invest heavily in the best talent that will generate the highest ROI for your business.
- · Meritocracy and Legacy you are taking the approach of a Social Entrepreneur. Your decisions will be based on how you can do the most good for your community by working with the best and brightest you can hire.
In sum, how can you convert your company’s conundrums into it’s manageable mission? Start by having an honest conversation with yourself and decide what success means to you and your vision of your firm. Once you can define which one of the four driving values best reflect your vision, you can move forward. Now, you have the basis for making the hard choices amongst the conflicting agendas that you are faced with and you are running your business your way. Have questions and thoughts on how to do this? Take the Growth Potential Indicator here birolgrowthconsulting.com/growth-potential-indicator or give me a no obligation call at 412 973 2080. We can chat about it.
In our hearts we all believe the saying, “Nobody is indispensable in a business, not even the owner.” But whether it’s a really bad flu or a broken leg (I’ve survived both) the worst part is the resulting depression as you are out of commission and recovering. So what does a business owner do when he or she is coping with the damage and the resulting blues? What should you do when you, the owner, are simply knocked off your game? Especially when there’s no one to pick up the slack?
Having survived my share of challenges and watched hundreds of business owners cope with theirs, here’s the progression of what I’ve seen happen when a business owner has a meltdown. In progression, an owner first loses his or her ability to
- Approach new prospects and close new customers, then
- Create new ideas, products and services, then
- Serve and oversee existing customers, partners and employees, then
- Focus on individual projects not involving other employees, customers or partners.
So if you are seeing this in yourself, your partner or another owner what should you/they do?
- Don’t fight it. Get the help and take the time you need to heal.
- Use the time to dream and question. If you are really knocked for a loop, your self-doubt and anxiety at some point will emerge and fester. Take advantage of the opportunity to look at all sides of what you are doing and why. Just don’t make any decisions until you are feeling better again.
- Control what you can and can’t do and know the difference. By nature we owners are control freaks. Getting sick is living proof we aren’t in charge. Rely on your faith, loved ones and the healing powers of sleep. Do nothing for a change.
- Count on your reputation, talents and value. Mortgages will get paid, payrolls will be made and most clients will accept your delays based on your good reputation. The ones who won’t aren’t worth keeping for the long term.
As you start to heal, re-engage back into your job in the reverse order of the above 4 steps. Start first with your routine, individual tasks and then progress back to creating new value and selling it to prospects. Misfortune, sickness and the general stress of running your business will eventually take its toll, throw you for a loop and require you taking some time off. Consider it a forced vacation and enjoy your time off, even it is costing you a lot in the short run.
Filed under: Business Growth, Pittsburgh, Profitable Growth, Uncategorized
Recently I lived the dream of every rock music fan: For four and a half days my friends and I sailed on the MS Legend Of The Seas alongside 27 classic rock bands who played nonstop on three separate stages. And sailing with 3,400 like-minded baby-boomer fans alongside our rock heroes created an instant community relishing the soundtrack of our lives.
What did I see, listen and learn from bands whose prime passed 30 years ago? Seeing rock leaders sustain their talents and keep performing for their fans inspired me to consider how business owners can do it too. If you wonder how you can keep on thrilling your next generation of customers, who like, rock fans may not even have been alive when you first got started, here are my five lessons and implications for your business along with some great concert photos courtesy of my friend Vickie Sullivan.
1. Keep your band performing like the headliners they once were. Paul Rogers of Bad Company, Free and The Firm struts and delivers a great show as if he was at Madison Square Garden.
- Implication for you. Passionately believe in your business’s value and keep delivering it powerfully and perpetually.
2. Ensure your band always has an inspired front man. When Foreigner’s leader Mick Jones replaced his lead signer Lou Gramm with young Terry McDermott, he saved the band and added decades to its life.
- Implication for you. When your business leadership requires you to replace founding members with energetic stars, put your business’s needs ahead of its past.
3. Love your core fans and they will create the next generation. The Marshall Tucker Band are the masters at drawing their audiences into their music. After hearing their leader Doug Gray tell their story, you want to sing his band’s praises as much as their songs.
- Implication for you. Your business undoubtedly has customers who care for you above and beyond just what they buy from you. Remember them and you’ll see cheerleaders you didn’t dream you still had.
4. Assume it’s all about you and you can lose your legacy. We can accept that our idols are getting old, but cannot listen to them live in their past instead of connecting to us in our present. Watching Black Oak Arkansas’ self-indulgent behavior onstage was off-putting.
- Implication for you. Double-check your business isn’t banking on its history but is building on its current successes to serve its customers in the future.
5. Classic fans know your band; new audiences want your hits. Rolling Stones’ saxophonist Bobby Keys, surrounded himself with a fresh young band and delivered his timeless songs like “Brown Sugar,” “Can’t You Hear Me Knocking,” “Whatever Get’s You Through The Night,” and “Delta Lady” as if he was still playing with Mick Jagger, John Lennon and Joe Cocker.
- Implication for you. Project your business legacy and value forward through new channels and voices. Your voice will be recognized as the founder as it carries on loud and clear!
For many of us, the music of the 70’s and 80’s is the soundtrack of our lives. As I watched Bachman and Turner sing “Taking Care of Business” it stirred me to recall my loves, triumphs, and challenges and then to think about you, my clients and your needs. As they play their hearts out in their later years, let’s be inspired by their legends and lessons as we EXTEND our business legacies!
With this January’s debut of the MCI, WPA business owners are taking a new and important way to voice their business confidence as well as where they intend to grow their businesses. Here are early results:
- Consistent with national polls, WPA owners plan to invest the same dollars in 2013 vs. 2012 in their businesses, but employ the same people or fewer to get their work done. Regardless, respondents expect to increase their business’ profitable sales in 2013.
- When asked to rank, “Where’s your firm’s next sources of growth?” a majority chose domestic US, then locally (from non-Marcellus sources) followed by Marcellus sources and lastly internationally.
- By general business sector, respondents see their growth coming first from wholesalers and distributors followed next and equally from manufacturing and government markets.
Finally you have a simple, regular way to join your peers to answer and learn an accurate, local and timely answer to the age-old questions, “How’s Business?” So take 3 minutes now and state your confidence on your MCI.
The MCI was developed by business growth expert and author Andy Birol and SMC Business Councils to professionally gather analyze and report back on your critical feedback.
Filed under: Business Growth, Marcellus, Profitable Growth, Uncategorized
The fact is, without technology, the opportunities Marcellus has spawned would never exist. In all the talk about the cracking technology that drives natural gas extraction, we’ve overlooked that cracking came as a monumental, technological breakthrough.
But more to the point. It’s now time to hone in on how you can inject your technology into the Marcellus opportunity. And the best way to do this is to understand Marcellus not as a single, monolithic opportunity, but as three tiers of opportunity—direct, indirect, and induced. Look at it this way and you can find a way to inject your technology into serving this emerging-energy marketplace on your terms.
Let’s first take a look at how you can target the tier-one, direct opportunity, admittedly the riskiest of these three tiers.
In a recent conversation with the heads of supply-chain management for Seneca, Chesapeake and Range Resources, they all insisted that new vendors must first address a proven need they already have and then fill out a Master Service Agreement (MSA) before they can do business in the energy sector. Generally, a Master Service Agreement specifies generic terms like payment terms, product warranties, intellectual property ownership, dispute resolution, and the like.
They further emphasized that those vendors who stand the best chance of successfully entering the Marcellus market will:
- Focus on their Best and Highest Use (BHU). This means concentrating on what they do best, what they like to do, and what a market values and pays them for.
- Build on their customer base and not try to be a total-solution provider
- Avoid trying to grow too fast, if doing so risks jeopardizing their service levels.
- Under sell and over deliver.
One of the speakers also let it slip that if you’re going to serve the energy industry, you have to be ready to work at three in the morning, if needed, and to be on call and on-demand as if you’d been hungering for months to secure the piece of business you land
This tells me that an opportunity can exist for you to be ready to breakthrough with your disruptive technology if and when another vendor slips. That’s when you’ll most likely be able to leapfrog over any existing MSA and serve a client who needs you and will work with you.
Nonetheless, if you insist on going after the big boys, then keep reminding them of FUD–Fear, Uncertainty, and Doubt. The more you convince a purchasing agent of the downside of not solving their problem by going with your services, the more likely you are to appeal to their inclination to avoid personal career risk.
Next time, I’ll discuss the less risky opportunities in the indirect and induced tiers, where more opportunities exist for your technology.
Filed under: Business Growth, Marcellus, Profitable Growth, Uncategorized
Since Microseeps (microseeps.com) started in business in the mid 80’s, the company has specialized in providing niche, analytical services to the environmental and energy industries. These analyses have required technology and understanding not provided by the standard regulatory-compliance environmental lab.
Over the last 20 years, however, these analyses have become requisite procedures for determining biodegradation, effectiveness of remediation efforts and source-material determination. In fact, many of analytical technologies Microseeps uses have been integrated into federal and state environmental regulations.
Microseeps faced the challenge of bringing top-of-mind awareness about the advantages of its analyses to a broad regulatory, industrial and geographical customer base.
The Birol Growth Consulting (BGC) Solution
Andy Birol of Birol Growth Consulting (birolgrowthconsulting.com) helped Microseeps conduct field, market and internal company research and analysis. Following this, Tom Hill, Owner, launched a direct-marketing effort with online and off-line tactics to engage with state-approved laboratories across the quad-state, Marcellus shale footprint.
“This was a big step for our company to aggressively market to a specific, target prospect,” said Hill. “We’re excited to introduce this effort. Andy guided us to discover how we could follow our Best and Highest Use to enter this market, and take the right steps to grow our Marcellus business.”
As a first step, Andy helped Microseeps evaluate the current and future potential of its current and primary customer base–the environmental and energy markets. Customers in this market sector comprise other, environmental-testing labs and environmental and energy-consulting firms.
The study revealed a two-fold, market potential for Microseeps to tap, consisting of:
- Environmental-testing laboratories, with a market potential of $67.4 million, and
- Environmental and energy consultants, with a market potential of $324.8 million.
The second step involved developing a market strategy to expand use of the company’s analyses within its current client base and to broaden its industrial and geographical base.
Microseeps started by focusing on marketing to existing clients. This entailed reviewing how clients used the company’s analyses and dividing them into single-analysis users, single- project users, key labs and federal projects. The company segmented them further into users of compound specific isotope analysis (CSIA) and non-users.
Email, letter and phone dialogs, targeting 25 to 50 clients at a time, now outline the company’s services and its value. Microseeps tracks these efforts to evaluate their effectiveness and to monetize its successes.
The company also maintains an outbound, email marketing campaign to provide education and technical information to support the use of Microseeps services. This effort supports creating top-of-mind awareness of its services.
To round out these efforts, Microseeps has developed a shale-gas campaign replete with brochures, letters and emails targeted to prospects—laboratories and consultants– that service shale-gas development.
All of these campaigns will provide an opportunity to introduce chlorine, vapor and shale-gas isotope products as they come online.
Major Role for Inbound Marketing
Microseeps maintains three active websites. Microseeps.com functions as the primary site for the company and its services. Insituation.net is its technical and educational blog. And Marcellus-testing.com generates information on the shale-gas marketing website.
With the expansion of social media and growth in education and outreach to clients and prospects, Microseeps plans major updates to its websites in 2013. Website redesigns will focus on gathering information from the education and understanding activities of Microseeps services. Current outbound marketing campaigns will support these redesigns.
Results to Date
Thus far, Microseeps has taken advantage of low-hanging fruit, owing its Sales and Customer Service/Customer Care departments. In November 2012, the first, full month of its new marketing effort, the company generated over $40,000 in new business from existing clients. To date, sales from the shale-gas sector–Marcellus, Utica, Baken, Barnett and other shale plays– have resulted in sales of $100,000 annually.
These early results demonstrate that a focused effort had a hefty sales impact and gave management the confidence to start creating more proactive initiatives.
“With a great year behind us and our new Marcellus and other initiatives under way, I have high confidence that the coming years will continue to be some of Marcellus’s best,” said Hill. Andy Birol has been of great help not just in terms of developing our Marcellus initiative but also in helping us to refocus Microseeps on creating profitable growth for years to come. I look forward to a positive ROI on his and our efforts for years to come.”
Filed under: Business Growth, Pittsburgh, Profitable Growth, Uncategorized
Is your family business or privately held company doing better today, but not as well as it did before the recession? Have the low prices business buyers offered for your company derailed your retirement, exit or succession plans? You’re not alone. Many of my clients have faced similar situations and had to choose between the unacceptable and the uncertain.
They could unacceptably settle for less and sacrifice the value of their firms and the legacy of their ownership. Or, they could accept uncertainty, decide to refocus their efforts back to running, fixing, growing and preparing their businesses to be sold.
If you and your firm face this choice, and wonder what’s involved with choosing uncertainty, here are the questions my clients answered as they chose to run, fix, grow and prepare to sell their firms.
The first step to successfully reignite your company is to commit to more actively running it. Regardless of being the leader, do you need to increase your personal commitment to running your business? Given your company’s track record, or your latest take on its prognosis, what personal sacrifices must you make to reassert yourself as the leader of your business? Refocusing on running your business for further profitable growth starts with rolling up your sleeves and getting back to basics.
Does your company need some internal repair before it can really grow? Are your costs too high? Is your culture unsupportive? Are your sales, marketing or service efforts failing? What key disciplines do you need to demonstrate to show you mean business? Do you need to change your people or change people?
Does your company have the real potential to grow? Do you feel it when you watch your staff, talk to customers or see your competitors growing and taking your share? Is your firm focused on its Best and Highest Use®?
If you’re interested in creating organic growth, many ways exist to do this. The truth is, your marketplace may have punished your business but it has probably created new opportunities as well.
Do you need to reposition your company in the eyes of buyers and business brokers before you can fairly sell it? Do you need a better story to tell about the improvements you’ve made and the opportunities you can seize now?
If your company is in play or you’re getting ready to sell it, what does your organization need during the transition? Who is advocating for your company’s customers, employees, suppliers while the players are bargaining for their share of the sale?
After reviewing these questions, please know that your best decision is to make a decision. It’s now time to address the key factors to run, fix, grow and prepare your firm for sale. If you can’t see yourself doing so, then sell your business for what you can get for it. The owners I know who choose neither path suffer the most.
But if you’re ready to get down to business about your business, call me at (412) 973 2080.
Filed under: Business Growth, Marcellus, Profitable Growth, Uncategorized
The only thing more authentic in Western Pennsylvania than doing business with locals is our love of hunting and the Steelers. And when it comes to something new like Marcellus and positive proof that the shale-gas boom is generating results for businesses, it’s important for me to talk about companies you know, buy from, or whose owners you live next to.
So let me invite you, in Part One of my Dynamic Business column and in Part two in the next issue to review ten of my client companies making money because of the Marcellus Shale gas boom. Doing so will reveal ten different ways to create growth for your company.
General Products and Supply Inc., based in Export, Pennsylvania and known as a custom formulator and industrial supplier of cleaning supplies, has learned how to balance its energy-based, customer growth while serving its current, non-energy customers.
Creating separate efforts to serve these two markets has given General Products the stability and independence that results from diversifying customers across two, separate markets.
First Niagara Bank recently debuted a Marcellus Shale Roundtable series featuring exclusive content in an intimate, owners-only environment. First Niagara knows that owners need help to develop and implement growth strategies with the support of a peer group and expert advice.
The customers of Microseeps want to know more about the efficacy of the groundwater in the land they work on or live on. They also want to be aware of any impurities in the groundwater and the sources of these impurities.
Microseeps has done a terrific job of becoming the go-to third party by setting technical standards to help define water quality for their customers.
Menard USA, in Bridgeville, Pennsylvania, operates as a specialty subcontractor that provides ground-improvement services through its continuous modulus columns. These columns enable more efficient use of steel foundations and ultimately, the land itself.
Menard USA has branded and differentiated its business to grow its margins. Specifically, the company has developed a series of educational Geo–Seminars to demonstrate to prospects and customers how their products outperform pilings.
WK Thomas has grown its business dramatically by understanding that their steel-building business attracts companies interested in quickly erecting buildings to establishing physical presences in Western Pennsylvania.
What sets these companies apart is the ability of their leaders to recognize the value of serving companies directly involved in Marcellus drilling.
Filed under: Business Growth, Pittsburgh, Profitable Growth, Uncategorized
My recent article for TEQ WWWWW: Why Don’t Wonderful Websites Work?, spelled out why my new website, would ignore the best advice of website gurus and would focus purely on generating conversations with visitors.
Well, I ate my own dog food and did what I told you I would. I created a blog–based website. It has no other purpose than to make it easy for visitors to qualify me, self-qualify themselves, get to content of value, and contact me. My new tag line for businesses is: Run it. Grow it. Fix it. Sell it.
The new site features case studies and success stories for three, tightly defined target markets–business owners, advisors, and meeting planners.
I made the centerpiece of the site the Growth Potential Index (GPI), a free, confidential, instant, non-promotional assessment visitors can complete. As they do, they self- profile themselves and demonstrate their interest in needing help.
My new website has been up only for three weeks, so I don’t know for sure how it’s going work. I’m told it’s too soon to tell. The spiders and crawlers haven’t yet picked it up. And I’ve chosen not to invest in keywords or other more traditional means to make the site sticky.
Instead, I use the native content that Google valued so deeply on my previous site because of my 500 articles. This approach propelled my former site to first-page status without any investment in keywords, clicks, or other artificial methods.
Thus far, I’m getting a steady flow of business owners who engage with me by taking the GPI. Their engaging with this tool gives me information I would otherwise lack on how they score on five criteria. For example:
- Best And Highest Use (BHU): Owners’ average confidence that they are focused on their own BHU is at the 53rd percentile.
- Personally Indispensable: 50% of business owners consider themselves personally indispensable to their businesses. The other 50% say that they are not.
- Focused Business: Nearly two thirds of owners report that their businesses are sufficiently focused on the right opportunities.
- Alignment: Surprisingly, owners’ average confidence level stands at the 56th percentile that their businesses are aligned with their own Best and Highest Use.
- Demand for Their BHU: Owners are at the 63rd percentile of confidence that the market will continue to demand their firm’s Best and Highest Use.
Website experts, designers, and social-media mavens may scoff. But frankly, I don’t care. If my strategy generates 10 conversations a month with business owners that I can turn into three meetings and close one sale, I’ll be pleased. Stay tuned.
Filed under: Business Growth, Profitable Growth, Uncategorized
Do you feel lucky? Will venture capital make your day? With an improving economy, you know your new business is poised to grow. However, to seize your day, you need more money. Unfortunately, with your firm’s earnings history, no banker, investor, or traditional lender is interested. With your friends, family and angel investors already tapped out, venture capitalists could be your best option to get the investment you need. Or, are they?
There are good reasons to seek venture capital. Venture capitalists have and will risk their money, advice, and resources just when your business needs these most. Their cost, owning a part of your business, seems minimal in light of what they say it will be worth.
Dont be fooled again: Delusion and Dilution. The basic problem with using venture capitalists is that their need to earn quick, big returns conflicts with your goal of building your business. Growing a company’s customer base rarely enriches a venture capitalists as much as the next round of investors who buy them out. To sell your company, the VC must find shortcuts to creating customer value. The technology and life sciences industries offer capabilities that may be easily commercialized and sold. However, even these odds are very long. The venture capitalists’ own statistics show how choosy they must be. Venture capitalists only:
- Fund one out of 1,000 business plans they see;
- Need two of ten portfolio companies to succeed to earn the 100 to 1 payoffs their investors expect. And, therefore, VCs may only
- Stay committed to healthy businesses, because problem companies are cheaper to close down than fix.
If you are not deluded (your business is venture capital-fundable), you face a new challenge–that of dilution. When you work with a venture capitalist, you must ensure your vision; ownership and energies stay in control. Your risk of dilution is high because:
- After successive rounds of equity financing, it is quite possible you can end up with neither ownership nor a big payday to show for your hard work and effort.
- Every minute you spend writing business plans for investors is time you could be spending growing customers. A business plan never convinced a customer to buy what you sell. In fact, many venture capitalists often shuffle plans among themselves in a practice called “passing the trash” in the hope of finding more investors to carry the risk.
- After the post dot com\9-11\Enron disasters, the improving economy is favoring real companies creating real value for customers by selling real products and earning real revenues. The “home run” technology companies are fewer and farther apart.
- The changing deal flow of venture capitalists is reflecting this. The impact of too many “dream deals gone bad” is trickling up to the VCs and their investors. They are laying-off and cutting back before funding businesses with modest returns on longer paybacks.
Don’t Get Burned: Keeping the Heat Down if You Stay in the Kitchen.Venture capital does play an important role in certain businesses. If your business must create a completely new business process before it can sell anything to anyone, you probably are well suited for venture financing. So when outside investment precedes money from paying customers, then get your business plan perfected and put it in front of the firms that fund ideas like yours. But still take the following precautions:
- Pay more for less money if it comes with fewer strings.
- Realize that venture capitalists exist to make their partners wealthy.
- The more customers you grow, the more of a real business you have and the less equity you will have to give away to get funding.
- “Lawyer up” to protect your interests and business goals.
Home Grown Venture Capital: Have Your Customers Finance Your Business.If you really plan on building and managing your business for the long run, turn your focus to finding, keeping and growing more customers for your products. There is an old saying it is better to learn how to fish than to be given fish. No business survives without a strong and well-developed ability to get new customers. If you focus on this rather than getting money first, you will be in the driver’s seat and will live and retire to tell about it. So:
- Make your new product or service something people can buy now.
- Put all your efforts into creating sales people, channels, and proposals.
- Over deliver to the first customers you close and ask them for referrals and references as soon as they are happy with what you have delivered.
- Reinvest all the money you make from your early sales into more customer services, benefits and products. This will grow your company faster than anything will.
Remember, customers get you money better than money gets you customers. Each paying customer provides you with more money you have already earned.
Turning to venture capital for money to grow your business is sort of like going to a bar looking for someone to marry. The longer the night goes on, the clearer it is that most people you meet have unacceptable objectives. So, to find capital just as you would find a spouse, the same advice holds true. Focus hard on your own success and the right people will buy into you for what you are, not who you might become.
Articles by Birol Growth Consulting are © copyrighted and all rights are reserved. However, articles may be reprinted with prior written consent if attribution is included as follows:
© Copyrighted by Andrew J. Birol, President of Birol Growth Consulting, who helps owners grow their businesses by growing their Best and Highest Use ®. Andy can be reached at (412) 973-2080, by email at firstname.lastname@example.org, or on the web at birolgrowthconsulting.com.