Monthly Archives: August 2011

[video] Dealing With Fault Lines

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Dealing with Fault Lines

The CFO for one of my consulting clients had to run multiple scenarios, do complex contingency plans, and work very closely with their operations and facility managers because a few of their key installations are located near fault lines. You know…like the San Andres Fault Line.  They made a tough decision to relocate one plant because the risks associated with possible earthquakes were now too high.  They kept another installation near a fault line and invested in flexible structures, insurance, and evacuation/crisis plans to keep going.

Another client is also dealing with fault lines, and frankly, they are having far more difficulty addressing the problem. Unlike geological fault lines that are undeniable and measureable, behavioral fault lines can be more insidious.

It’s the new VP’s fault.  He has wanted to get rid of everyone in our department since he came on board.

It’s the Sales Manager’s fault. She doesn’t want to learn how to use our systems.

This is not my fault. There just isn’t enough access to the CEO.

The customers just aren’t listening to us.  It’s their fault they aren’t getting the ROI they want.

Both of these companies brought us in to do strategic planning and help them achieve truly accelerated growth with sustained profitability®.  Which one has more expensive challenges?  Interestingly enough, cooperation, measurement,  directly addressing the problem , and making tough decisions constitutes the best approach for both companies.


 

Aldonna R. Ambler, CMC, CSP has earned the right to be called The Growth Strategist™. She has won over two dozen national and statewide “entrepreneur of the year” awards for the resilient growth of her international businesses across four recessions.  Her midsized B-to-B service, technology and distribution clients get on…and then stay on…the published lists of the fastest growing privately held companies. All of her own service businesses (strategic planning, executive advisory, growth financing, radio show, speaking, search, etc.) help midsized companies in Achieving Accelerated Growth With Sustained Profitability®. Ambler is in her 7th year hosting a weekly peer-to-peer-to-peer online radio program at www.business.voiceamerica.com or www.GrowthStrategistRadioShow.com that features interviews with CEOs/Presidents of midsized companies (typically between $20 and 200 Mil/yr) sharing success tips about the growth strategy-of-the-week. She can be reached toll free at 1-888-Aldonna or at Aldonna@AMBLER.com.

When Proud, Private and Practical Becomes Skeptical, Scared, & Shutting Down

For several years, midsized businesses constituted 30% of the companies and generated 40% of the GNP. But things have been changing over the past few years.  While the percentage of privately held midsized companies has held fairly steady around the 30% mark, their (your) contribution to key economic indicators (taxes, products, jobs, etc) has been steadily dropping.  Perhaps your business was a $35 Mil/yr company before 2008 and you are relieved to be hanging in there at $18 Mil/yr now…which makes your business one of the companies in those declining statistics.

In most markets, 90% of the leaders of midsized privately held companies view themselves as “family owned.”  The stereotypes come from somewhere.  Often these companies are proud, private, and practical.  These folks are not the first people to bring in consultants or hire “professional” managers or listen to the younger generation.  And the events of the past 10 years have not helped.

Proud, private and practical has turned into skeptical, scared and shutting down.

There are too many understandable reasons behind their (your?) cynicism. This recession didn’t feel like the typical economic cycle.  Owners of privately held midsized companies could see through the greed behind the subprime mortgage craze. They (you?) could tell it was a house of cards. And they (you?) can’t help but resent that huge irresponsible corporations were bailed out while the midsized companies took the full brunt of the collapse of the financial industry. And more recently, the US Congress seemed to play “chicken” with the debt ceiling and spending level decisions. The country’s AAA rating actually dropped.

The problem is that all of that anger, distrust, and uncertainty may be adding to the damage done by external forces.  Succession planning has screeched to a halt in many midsized companies. Research projects to learn what customers really value get postponed. Changing the business model to adapt to new realities seems overwhelming to many midsized companies.

OK.  It’s true that you understand your own business better than any outsider possibly could.  But if “just work harder” and “keep bleeding profit and jobs” have become your primary strategies by default, maybe it’s time to replace skeptical, scared and shutting down with some other adjectives.

 

Aldonna R. Ambler, CMC, CSP has earned the right to be called THE GROWTH STRATEGIST™. She has won over 2 dozen national and statewide “entrepreneur of the year” awards for the resilient growth of her international businesses across 4 recessions.  Her midsized BtoB service, technology, and distribution clients get on…and then stay on…the published lists of the fastest growing privately held companies. All of her own service businesses (strategic planning, executive advisory, growth financing, radio show, speaking, search) help privately held midsized companies achieve accelerated growth with sustained profitability™. Ambler is in her 7th year hosting a weekly peer-to-peer-to-peer on line program at www.Business. VoiceAmerica. com and www.growthstrategistshow.com that features interviews with CEOs/Presidents of midsized companies (typically between $20 and 200 Mil/yr) sharing success tips about the growth strategy-of-the-week. Family owned businesses are being emphasized in 2011. Ambler is in the process of launching her 8th enterprise. She can be reached toll free at 1-888-Aldonna or at Aldonna@AMBLER.com.

Don’t Consider Acquisitions to AVOID a Problem

If the legal process goes far enough to actually accomplish the goal, acquisitions can be a cost effective approach to obtain control over an important technology or product.

When all of the pieces come together, an acquisition can accelerate geographic expansion and eliminate a competitor. Look at drug stores (Rite Aid/Eckerd) or grocery stores for recent examples.

Acquisitions can help expand capabilities and services. There is undoubtedly a marketing company near your business that has acquired a promotional products firm, a letter house, or a printer. If you look closely at the most successful of those companies, you will notice that the acquirers have not disrupted the day to day operation of the acquired.

These days, acquisitions are also a way to consolidate an industry that is at risk. While the 2008/2009 implosion of the financial industry forced the closure of most mortgage and equipment lessors, a core group survived by coming together.

You may be in an industry that is dominated by companies owned by Baby Boomers. If they have resolved complex succession issues, those companies can be in a position to acquire competitors who haven’t.

The point is, there are several GOOD reasons to at least consider acquisitions when you are ready to grow. But recently, I’ve noticed that some Presidents of midsized companies are talking about acquisitions because they can’t seem to attract or keep top talent. Instead of addressing the underlying issues behind their recruitment and retention problems, they are looking to the expensive distracting acquisition process to be their magic bullet answer. This is “grabbing at straws” and does not work. An acquisition will only complicate conflicting strategies, indecision, and dysfunctional corporate culture.

Aldonna R. Ambler, CMC, CSP has earned the right to be called The Growth Strategist™. She has won over two dozen national and statewide “entrepreneur of the year” awards for the resilient growth of her international businesses across four recessions.  Her midsized B-to-B service, technology and distribution clients get on…and then stay on…the published lists of the fastest growing privately held companies. All of her own service businesses (strategic planning, executive advisory, growth financing, radio show, speaking, search, etc.) help midsized companies in Achieving Accelerated Growth With Sustained Profitability®. Ambler is in her 7th year hosting a weekly peer-to-peer-to-peer online radio program at www.business.voiceamerica.com or www.GrowthStrategistRadioShow.com that features interviews with CEOs/Presidents of midsized companies (typically between $20 and 200 Mil/yr) sharing success tips about the growth strategy-of-the-week. She can be reached toll free at 1-888-Aldonna or at Aldonna@AMBLER.com.

Change the Role of the President to Help Shift Away From Top Down (Autocratic) Leadership

As a Baby Boomer CEO/President of a midsized company, you have reached the point when at least the question of succession and/or transition into retirement has come up. You’ve worked at it (and are a little lucky) so you have a management team that is interested and thinks they are ready to step up and make decisions you have been handling for YEARS. Perhaps, you’ve concluded that you want to stay on as the Chairman of the Board (or Emeritus CEO) to keep active, still make a contribution, mentor key people, and serve as a safety net. But will you be able to let go of day-to-day decisions? Will the managers be able to break the habit of depending on you?

One of my clients in this position said he felt like “a surgeon with a team of eager but junior doctors all around him, but he was afraid to let go of the bleeders or the patient might die”.

This situation provides an excellent opportunity for a business to make the shift from top down (autocratic) leadership to more participative management styles that encourage people to accept more responsibility, take initiative, consider consequences and weigh options.

It helps to promote/hire a President who views the role as facilitator, a hub, or orchestra leader.  Replacing yourself with another top down autocratic leader simply protracts the over dependence on an individual. No matter how experienced or bright you or your successor is, a bottle neck develops and the business is less resilient. What if you or your autocratic successor becomes ill? Go on a long vacation? Lose interest? Have an accident? It is also a disincentive for talented people to remain with the company.

Are You Applying Your Knowledge About Generational Differences to Close More Deals and Have More Cost Effective Staffing?

I am writing this week’s blog while on an airplane en route to Philadelphia from Los Angeles. I spent the past five days at the annual convention of the National Speakers Association. As usual, there were several marvelous presentations, hundreds of pieces of practical advice and astute insights. If you’re not tired at the end of each day at an NSA convention, you’re just not paying attention.

Two tidbits from one general platform presentation (by Terri Sjodin) underscored the importance of tailoring sales messages based on the generational differences of prospects. You can imagine the worry on the faces of numerous baby boomers in the audience as they learned that when dealing with a millennial generation buyer, a tailored interactive multimedia opportunity must be integrated into the sales presentation not just the speech that they buy.

In contrast, Dr. Ken Dychtwald’s general session presentation reminded the speakers that the huge baby boomer generation isn’t dropping off of the planet. On the contrary, they now have a much longer life expectancy, are healthier than ever and are reinventing themselves rather than choosing traditional retirement. Many don’t want to work full time but still want challenging projects, opportunities to continue to learn.

How many midsized companies could be more productive if they contracted baby boomers to work on projects and take a week off every month? Work ethic, experience, appreciation for the opportunity, expertise – what a concept!

 

Aldonna R. Ambler, CMC, CSP has earned the right to be called The Growth Strategist®. She has won over two dozen national and statewide “entrepreneur of the year” awards for the resilient growth of her international businesses across 4 recessions. Her midsized B-to-B service, technology, and distribution clients get on…and then stay on…the published lists of the fastest growing privately held companies. All of her own service businesses (strategic planning, executive advisory, growth financing, radio show, speaking, and search) help privately held midsized companies in Achieving Accelerated Growth With Sustained Profitability®. Ambler is in her 7th year hosting a weekly peer-to-peer-to-peer online program at www.Business.VoiceAmerica.com and www.growthstrategistshow.com that features interviews with CEOs/Presidents of midsized companies (typically between $20 and 200 Mil/yr) sharing success tips about the growth strategy-of-the-week. Family owned businesses are being emphasized in 2011. Ambler is in the process of launching her 8th enterprise. She can be reached toll free at 1-888-Aldonna or at Aldonna@AMBLER.com.

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