Climbing out of a dive.

How to refill the sales Pipeline

Have you come across a similar tale as the one below?

You hear of a successful company that suddenly seems to run out of steam. The sales pipeline dries up and the management and or owners cannot seem to work out why. Their immediate response is denial. They argue that there is nothing intrinsically wrong; it is the time of year, part of the business cycle, normal business churn they say.

However, things get worse and the typical gushing from the sales pipeline has dropped to a trickle and even those leads are not good quality.

Eventually they take action. But note that the typical actions are passive.

They gear up their on line marketing effort sending our newsletters, updates, white papers and so on with the hope that it will encourage sales.

They reason that they need to increase their Search Engine Optimisation ratings to capture the millions of potential leads that they know are out there and work diligently to determine the optimum search terms. They then rewrite their web pages with all the new content crafted around the SEO terms.

But it doesn’t work so they then turn to sales professionals either in telesales or in real time sales to turn the sales around.

But the response rates are pitiful. They spend hours fruitlessly tracking down new names and addresses that don’t seem to develop into sales opportunities. And cash is running out and fast. Pressure on the sales teams seems to be having the opposite effect. They are doing less and less and seem to be costing more to achieve less.

Cash is now at crisis levels.

No new sales initiatives can be started because there is no cash. The focus is now on survival. Cuts are made but they are not enough. Huge amounts of management time are spent determining the extent of what and where to cut but it seems to have no effect and cash is now gone.

The staff seem to notice that the senior team seem intent on working on the minutiae of the business. They have developed that “thousand yard stare” that is typical of those undergoing shock or serious trauma. They seem to have lost their objectivity and leap at any and every passing fad in the hope that it will turn things around.

In the worst cases the company sells out as a fire sale or ceases trading.

Does this sound familiar? It does if you have been in the consultancy field for any length of time.

The answer as to why they experience a dive lies in their new business process. For many companies the new business programme is:

• Passive
• Generic
• Hesitant
• Short term

A passive programme relies on using the media to encourage their target audience to make the first move. A generic programme promotes the agency’s entire range or describes it in terms that lack specificity. Hesitant programmes stop and start according to the prevailing emotional or cash flow conditions at the time, missing the buying cycle and therefore freezing themselves out for 12 months or more from re-pitching. And short term programmes falter because they fail to build the relationship with the potential client. Finally, if this was not bad enough they hand over the responsibility of new business to a third party.

Some do survive because they take action. What action do they take, find out in the next gripping instalment of Climbing out of a dive!

If you cant wait, call me on 07956 532963 or email me on robh@credence-uk.com. Or wait until the next blog where the answers will be revealed!

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.