The season of good will - good service is not just for Christmas

As Christmas approaches many of us adopt that casual bonhomie and “hail fellow well met” attitude. The reasons being that perhaps it is because it is expected of us. We have been conditioned over the years through film, books, theatre and the TV to become overly friendly in this season of good will. We can all recall A Christmas Carol by Charles Dickens and how Scrooge is transformed by the Christmas Spirit from miser to benefactor.

But do we need an external stimulus such as Christmas to remind us to be kind or generous to others.

Our goal as business leaders is to ensure that all of our staff are constantly delivering good will. It is the way to build long term loyalty and with it increased life time value and ultimately greater profits.

So when you see the adverts reminding you that it is not just for Christmas, think of your client servicing team and make sure they have the support and skills to deliver goodwill and cheer all the year round.

Your profits will soar if they do!

Profits first - build the foundations

The key to long term sustainable growth is a stable and profitable client base. An established client base that delivers strong profits over time is the foundation on which the long term growth goal is achieved.

Where to start?

The start point for the growth strategy is an audit of the existing business. The audit should generate a report that defines the current state of the business. It should cover:

• people
• performance
• profits

Under the people heading the audit should investigate the people or relationships both internally and externally. Does the business have the right sort of clients and services upon which to build its growth? Are the employees ready to take on more?

As far as performance is concerned, are the management systems and processes in place and delivering the value add that they should. Are the monthly management accounts in place, are costs under control.

And finally, is the business making a profit. If not, then the single most important task is to determine which side of the business equation needs tackling. If it is costs, then be ruthless in cutting out any unnecessary expense, trim the fat to expose the lean. If the problem is individual client profitability, then deal with each one individually until the margins are within benchmark percentages. Finally have a long hard look at the management structures to see if any further trimming can be achieved.

Once this is done the profits should look healthy enough to start the new business development programme - more to follow.

But what if the business is not in profit. Should it embark on a growth strategy? Only in dire circumstances should a company embark on a growth strategy if the base is a bit flaky. It would be far better to restructure to get the profits right and then go for growth.

Are you a Trusted Advisor?

Credence-UK - maximising profits through growth relies on that one key ingredient - TRUST

It has been estimated that on average it costs 4 - 7 times the amount to secure new business from new clients than it does to secure the same amount of business from an existing client. In my experience as a consultant, where it can take anything up to 6 months to get a new client onboard, I would say this estimate is on the low side.

But what would make an existing client, put you at the top of the list when a new project comes up, in a word TRUST. Be seen as a Trusted Advisor and the chances are that they will reach for your advice without going through the 'beauty parade'.

If that's not enough, there are many other benefits of being seen as a Trusted Advisor by your clients including:

• Referrals to their friends and business acquaintances
• Pay your bills without question
• More inclined to accept you recommendation and trust you judgement
• Give you more information that helps you help them
• Forgive you if you make a mistake
• Make your work much more enjoyable

How can this be achieved?

The major components of Trust are:

Credibility - do you understand your client effortlessly, always seek a fresh perspective, challenge assumptions, and give you reasoning and not just conclusions?

Reliability - are you consistent and dependable, always truthful and honourable, always have their best interests at heart?

Intimacy - do your clients feel comfortable discussing difficult subject with you, do you stay calm, can you diffuse tension in a tough situation, and do you help them to separate logic from emotion?

Low self Orientation - do you help clients think through their own decisions without imposing your solutions, does the client see you as a co-equal, and do they see you as being on their side?

How do you measure up?

Rob Hook
Credence-UK - Maximising Profits through Growth
Accelerating Business Growth and Maximising the Exit Strategy

Keep the cash in for long term success

Increasing numbers of small firms are taking too much cash out of their business according to Trevor Williams of The FD Group.

Experience has shown that in a fast changing world, cash is king. Keeping hold of it will ensure that your business can survive the downturns and the lean periods. It also allows for continual investment in the business in terms of assets and more importantly in the people.

So make sure that you take out only what you need after having thought through what the long term needs of the business are. After all it is this that keeps the cash flowing in every month.

Some pointers as to how to manage the cash include - avoid the lavish life styles, stick to the knitting and avoid investing in other peoples ideas, go for the long term, invest in the talent in the business.

The boats, the holidays, the jewellery are all justifiable after years of hard labour, but just make sure that they don't jeopardise the capital value of the business.

Politics and leadership do not mix

This blog is not a political statement. The issue of leadership in a political world affect political parties the world over.

What I am referring to here is the mess Gordon Brown got into when he told us that he did not take into account the latest upswing in the Tory support in the latest opinion polls. The truth or the fact is that we all know that he did. The problem is that some would rather not acknowledge that fact. So he and his reluctant supporters would rather argue a lost point than lose face.

That is not great leadership. A great leader inspires through depth of character. They know that in the times of great adversity they will be called on to make tough decisions. The supporters expect the decisions to be made with the right motives, not through acts of spin to save a faltering reputation.

As a business leader, what would you have done? Would you have continued to argue the point despite all around you acknowledging that you were in the wrong or would you have acknowledged the truth of the situation and demonstrated true leadership?

The importance of succession planning

I attended a talk recently at the DBA by one of the grand fromages of the M&A world called Jim Surguy. He gave an excellent talk about what companies need to do to maximise their value at the exit point.

One of the key points to come out of his talk was the importance of having a succession plan in place. Who are the people who will succeed you and your fellow Directors when the time comes for you to take your hard earned cash and relax on the beach. Even if there is an earn out period they know that your intention is to ease down. Who will take up the slack is the question on the minds of the prospective buyers?

So think about it whilst you are not on the descent path. Who will take over? What skills do they have and what skills do they lack. Are they good as a team or simply as a group of individuals.

If you want to talk to someone about the make up of the succession team call me on 0117 904 7874 to set out the agenda for their progression into filling your shoes.

Exit strategy improves performance

In today's frenetic business climate it takes something special to succeed. It takes that something extra beyond the norm for success to happen. We cannot rely any longer on the received wisdom of today.

The traditional methods for increasing performance such as honing the creative edge, better utilisation of the talent pool, or streamlining the business processes do work to some degree. So do some of the more in-vogue ideas like enhancing culture through becoming more interdependent, enhancing client life time value through relationship marketing, and “user chooser” flexible reward schemes. They have all demonstrated their success over the years.

However, our insight into the media sector suggest that many owner managers exhibit those characteristics of the rolling stones Bob Dylan was singing about when he asks “How does it feel, to be on your own, no direction home, a complete unknown”. They have focused all their attention on doing the work of the business but lack the skills required to maximise the performance of their agency and therefore do not fully develop the capital value.

However, recent independent research in the marcoms agency sector suggests that owner managers in the marcoms sector can significantly enhance their performance by developing:

1. Belief in your own capabilities
2. An exit strategy

If you would like to know more on how an exit strategy can help you to build your agency, please call me on 0117 9047874 or email me at Exit.strategy@credence-uk.com

ABC of Growth - C = Corroboration.

High growth companies have evidence to corroborate their brand and expertise.
They have easily recognised trophy clients. They advertise their successes and promote their expertise through the skilful use of testimonials, reviews, articles and PR.

Prospective clients are looking for ways to reduce the risk of using new suppliers. One way they do this is by looking for evidence of satisfied clients. A list of names is not enough. What they want to see are recognisable names and realistic assessments of what you did for them and the benefit they derived from it.

Do you have corroborative evidence that demonstrates that you are as good as you say you are? If not, then start thinking about asking your clients for a testimonial or writing up your intervention in the form of a case study.

Finally, use every piece of corroborative evidence as many times as you can. Insert it on your website, your blog, your newsletter and so on

If you need any more information - please give me a call on 07956 532963 or email on blogresponse@credence-uk.com

ABC of Growth - B = Brand

High Growth companies recognise the value of their brand. they cherish it and nurture it. they know that it takes times to build a strong brand but only a few minutes to destroy it. It has lasting value that ensures a legacy to future employees and clients. Everything they do adds value to their brand and their reputation.

It is not enough to have a logo, or good stationery. A brand is so much more than that. Wally Olins, a noted thinker in this area has this to say "In a world that is bewildering in terms of competitive clamour, in which rational choice has become almost impossible, brands represent clarity, reassurance, consistency, status, membership. Brands represent IDENTITY".

Does your brand represent your identity. If they see your brand will they recognise you for what you are, what you stand for and what you can deliver?

Call me on 0117 9047874 if you would like to discuss how to maximise the value of your brand.

ABC of Growth - A = Activities

The clearest sign that a business is well led and managed is its ability to deliver consistent, profitable growth.

After years of working with small businesses I have worked out what they need to do to grow.

And it is as simple as ABC!

The ABC of growth – what high growth businesses do well.

High growth companies are hives of activity. They are “doing” orientated. They get it right. They do the right things with the right people to the right customers at the right price in the right place at the right time.

Are you a doing or a thinking company?

How many proposals have you sent out, how many new prospects have you seen, how many networking events have you attended?

The list of activities that will build your business goes on and on.

If in doubt, do the things that you like doing - but do them well and frequently.

The great companies are doing orientated - now go and do like wise

Shout your virtues and boost your profits

Why is it that some companies are more successful at winning new business even though you (and probably they) know that they are not that good? Why do you lose a pitch when you should have won it?

Here is the answer. The client didn't trust you enough to give you the work. So all your hard work spent working on your pitch was wasted.

Here is how you can go about changing things to your advantage.

The secret

You need to build your reputation as a trusted advisor or to put it another way - you need to break through the trust barrier.

Successful businesses promote their reputation by who they are, what they do, who they work for and as importantly, who they do not work for. They have worked out the secret of what makes it easy for clients and potential clients to trust them and as a result they always get selected.

Ponder this well known marketing maxim “In any market where the number of choices is high and the risks of getting it wrong are also high, the more established, trusted or reputable suppliers will win more business.”

Put yourself in the client’s position and ask yourself what you would do if you were faced with a huge array of suppliers, many of whom seem to offer the same service and your job is on the line if you make the wrong choice. Simple, you would opt for an established, trusted, reputable agency. The emphasis is on being “established”. Once you are “in” it takes an enormous amount of effort for a client to change their supplier.

Sadly, the chances are stacked against you usurping the incumbent supplier.

So what can be done to reverse this situation? How can you stand out from the crowd and get in front of more clients?

You build a reputation that makes you stand head and shoulders above the rest.

I will be posting more on how to build that reputation so come back soon to find out more!

Call me for more information on 07956 532963 or email me at robh@credence-uk.com

Would you employ a sales person?

A few clients of mine asked my advice on whether they should employ a dedicated sales person to grow their business. They were established and looking to grow and felt that having someone out there "selling" would help.

I thought about it and came to the conclusion that they should not employ a dedicated sales person. The reason being that they were both small companies. The risk of employing someone at such high fixed costs (estimated to be of the order of £50k) was too high. They only needed a few good contacts and a few new clients and they would be close to capacity.

Rather than hire an expensive fixed asset, here are my suggestions:

1. Clearly identify who has the propensity to buy from them - their target market
   
2. Develop their offering to resolve these individuals pain - ease their pain
   

They can then use other, less costly methods to build their reputation with the target audience. Write thought pieces, blogs, draft articles, speak at conferences, call them to ask for a meeting. Each of these will build the relationship. Some will turn into clients. Some will not. That's fine. If you keep in contact they may become clients in the future, but they will also be talking about you and that in turn builds your reputation.

So don't employ sales people if you are a small business. Build your reputation instead.