Monthly Archives: January 2013

The FIT between a Business Leader and a Prospective Investor MATTERS

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It’s not just about the money.

Mike recently had a liquidity event and is now screening investment opportunities. Dave is the President of a business that is well positioned in a fast growth industry.  Dave is screening sources for growth financing. Here is essentially what I said when I introduced Mike and Dave to one another recently:

Mike Meet Dave                   Dave Meet Mike

Dave has put his heart and soul into his business over the past 10 years. Mike, Dave is like you in that he works hard and still finds time for his wife and children … whom he clearly adores. At some point you’ll want to ask Dave to tell you the story behind why he left his corporate job after 9/11/01 to create this company.

Mike… It is always difficult to shrink a list of attributes down to the top two.  But, if I had to, I’d say that Dave is a visionary and a door opener. Mike, you should see/hear Dave when he gives speeches or when he’s networking.  Dave comfortably conveys that he truly understands the challenges facing major corporations when it comes to global mobility…especially expatriates. Think about the variety of regulations in different countries around the world! Think of the policies that are needed! Imagine the complexity of administering things like payroll and benefits with moving targets.  Dave knows that those things can be a “pain in the butt” for their prospective clients… and a source of huge risk for those corporations. It’s great that people tell Dave anything and he is an idea guy who attracts strategic alliance opportunities, vendors, customers…

Dave… Mike is also “the real deal.” If I had to pick two key strengths from his long list, I’d say that Mike brings out the best from people and really knows how money works. Although Mike’s business kept growing past the classic “$5 Mil Wall” and Mike’s 600% revenue growth was achieved over a longer period of time than your (Dave) company will take to do the same thing, Mike has experience in what you (Dave) are now facing.  

Mike’s employees are loyal, passionate, productive, and accountable…..and he has achieved that in an industry that could be viewed by uninformed outsiders as a boring commodity!  Mike talks like a kind CEO and thinks like a conservative CFO.  Mike always knows his cash position, his debt/equity ratio, the utilization rates, and the status of his loans, lines, equity deals, and investments, the status of expansion projects, his capital requirements, and any challenges to budgets. Dave, I think you would get a kick out of watching Mike negotiate with local planning boards, bankers, and construction companies. Dave, you would also enjoy seeing how Mike squeezes profit and productivity out of what exists to help fund expansion. 

 

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 clients get on…and then stay on…the published lists of the fastest growing privately held companies. She owns and operates a suite of companies that help privately held midsized companies achieving accelerated growth with sustained profitability® through opportunity & resource analysis, 4 approaches to strategic planning, executive advisory services, growth financing, and targeted search.  2013 is Ambler’s 9th year hosting a weekly peer-to-peer-to-peer syndicated on line talk show 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. An archive of over 300 interviews is available at www.GrowthStrategistShow.com. She can be reached toll free at 1-888-Aldonna or at Aldonna@AMBLER.com.     

Are You Becoming Blind to Your Own Dashboard?

XYZ, Inc. is a privately held midsized service firm that competes with very large publicly traded corporations for global accounts.  Industry norms for measures like billing multipliers, capacity utilization, gross profit, and customer satisfaction are prominently displayed on XYZ’s dashboard/balanced scorecard. The executives periodically celebrate that XYZ has “hit” the norms in all of these categories for 18 straight months. And they go back to work.

Good for XYZ, Inc.

It is great that the firm is consistent, dependable, and not in trouble related to these metrics.  But doesn’t hitting the “norms” mean that XYZ, Inc. is now an “average” company in their industry?  No one on XYZ, Inc.’s executive team is asking, “I wonder if there is at least one of these metrics in which we can excel! ”

What if their firm figured out how to optimize capacity so much better than their competitors that they could attract fabulous employees, provide even more value for their clients, or generate more money to fund innovations?

What if XYZ, Inc. could push the envelope related to “customer satisfaction” to have clients who are truly raving fans who refer business to XYZ, Inc.?  What if their clients viewed XYZ, Inc. as a true strategic partner they simply cannot live without… regardless of changes in the economy?

I am seeing fewer and fewer companies utilizing stretch goals.  During periods of uncertainty (like now) it is even more crucial to excel at something important … to distinguish your business from competitors…and compel prospective customers to take a chance on investing in your services.            

No one can afford to settle for “average.”

 

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 clients get on…and then stay on…the published lists of the fastest growing privately held companies. She owns and operates a suite of companies that help privately held midsized companies achieving accelerated growth with sustained profitability® through opportunity & resource analysis, 4 approaches to strategic planning, executive advisory services, growth financing, and targeted search.  2013 is Ambler’s 9th year hosting a weekly peer-to-peer-to-peer syndicated on line talk show 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. An archive of over 300 interviews is available at www.GrowthStrategistShow.com. She can be reached toll free at 1-888-Aldonna or at Aldonna@AMBLER.com.     

Nominate Your Customers for Awards

A company’s marketing can certainly benefit from awards.  Organizations that are on the lists of “Best Places to Work” save money on recruitment.  The effectiveness of a public relations (PR) firm is underscored by PRSA “Pepper Pot” awards. Business owners can convey their recovery from a previous downturn by appearing on the various lists of “Fastest Growing Companies.” Marketing Directors usually figure out which awards are worth the time and effort.  The focus is on getting awards that help reinforce your brand and the benefits of doing business with your company. If your brand has anything to do with focusing on your customers, it pays to nominate your customers for relevant awards. 

 One of our clients is Princeton Legal Search Group, LLC.  Recently, we were delighted to nominate Mary Clare Garber for an “Emerging Leader” award.  She loves to network and enjoys making so many other people look good.  It’s been a no brainer to nominate one of my mentors, Joan Verplanck, for various community service and leadership awards. We nominated Anne Klein of AKCG for inclusion in the Philadelphia Business Journal’s list of “Women of Distinction.”  In my opinion, she should have been included on that list YEARS ago, so we must not have done our part strong enough before…but we are working on that.  Mike Lackland certainly deserved our nomination of Storage Assets for “NJ – Family Business of the Year.” Amenta Emma Architects won an award for an advertising campaign which helped to promote their incredible talent as designers and project managers. Granite City Electric won a “Most Improved” award within an electrical wholesale industry group. We are currently looking for awards related to Association Headquarters International and BLINK Reaction, Inc.

It pays to learn where a client attended college because “Alumnus of the Year” awards mean a great deal to most people. My father is an “Alumnus of the Year of the Hershey School for Fatherless Children.”  I am fairly certain that award still means more to him than even being named “Teacher of the Year” at the Rochester Institute of Technology (RIT).

Which of your customers deserve recognition for innovation? Creativity? Customer service? Industry leadership? Community service? Job creation? 

CG NJ Women of Leadership: Growth, Sustainability and Mining Your Resources

“Tomorrow’s best products solve today’s frustrations and problems,” Aldonna Ambler

Interview conducted by Mary Clare Garber Princeton Legal Search Group, LLC

Come find out why ACG NJ is one of your most powerful resources and how to extract the resources from your ACG network. ACG-WOL’s upcoming evening of Roundtable.  Discussions will provide a unique “hands on” opportunity to collaborate with other ACG professionals through interactive discussions.

In preparation for the event we interviewed Aldonna Ambler, The Growth Strategist, to seek her views on the importance of this topic and how the event can help us to utilize the resources available in our professional networks. In addition to being an award winning entrepreneur in her own right, Ambler has led strategic analysis and growth planning for over 800 B2B companies. She hosts the weekly talk show, The Growth Strategist®, where she interviews Presidents and CEOs of INC 500 companies.

To frame the context of the discussion Aldonna points to three current trends in the marketplace that heavilyinfluence the dynamics of growth and a company’s ability to emerge successfully. We will discuss these trends and how they influence the four foundations of sustainability and growth: Technology/Innovation, Marketing/Branding, Human Capital and Equity/Debt Financing.

One, Innovation: Presidents of the most successful privately held midsized companies emphasize innovation.  To develop the right products/services, a company needs meaningful timely market research.  It’s not surprising that private investors have stepped up their demands for current, very relevant market research. Tomorrow’s best products solve today’s frustrations and problems. Once business leaders can select the best problems to solve through innovation, the emphases on their marketing, staffing, and financing become more evident. The point is that it pays not to jump right into the details of staffing, marketing, and financing without being centered in innovation & differentiation.

Two, Tough Decision Making: Real wealth can usually be traced back to decisions made during tough economic times (like today). One reason is that market research is more accessible and affordable during uncertain times. Cash tight customers are more apt to express themselves and whine about their challenges. Although that fact can be difficult for your sales people, that information is exactly what is needed to guide innovation.

So often, busy people participate in their own professional or industry societies.  CPAs network with other accountants. Serious management consultants are in IMC. ACG is an excellent example of an association that provides important interaction for members across industry lines.  Interaction with one’s customers and other people who influence your customers can be very enlightening and plays a role in crucial market research that guides innovation, staffing, marketing, and financing.

Three, Executing the Plan: You can feel the momentum and excitement in a business where innovation and staffing, marketing, & financing strategies are in sync and are being executed well. The energy is palpable. But the average company is strong in one of these ”pillars”, just OK in another, and weak in the third. So behind each sob story told at a cocktail party about a lousy boss or concerns  about layoffs is a lack of congruence between marketing, staffing, and financing. The pillars are incredibly interdependent.

ACG-NJ’s Women of Leadership [hosted] a roundtable event on Nov 1st that will provide an excellent opportunity for each of us to hear great examples, ideas, and suggestions. That opportunity will pay off even more if we learn a little about the source of suggestions.  Come learn and share with your peers for a unique evening of networking.

 

How My Various Roles Provide Important Perspective

As a growth strategist/executive advisor, I have noticed that:

despite high unemployment, the primary barrier to growth for midsized companies is not sales or financing…it’s difficulty attracting bright employees who are continuous learners.  The executives are quick to say that their companies are ready to train new employees to “do things [their] way.” But job applicants show up late or ask about the number of vacation days during early stage interviews. Our clients ALL have unfilled job vacancies.  Several clients are looking for sales professionals. So…how many high-potential people are settling for their current jobs despite feeling uninspired?

As the host of a syndicated peer to peer talk show, I have noticed that:

most of the Presidents of INC 500 listed companies have a laser focus on customer driven innovation. Yes, they spend time attracting/retaining top talent and financing growth; but those efforts are approached in ways that enable the development and delivery of innovative products/services that customers need and want.

These Presidents also utilize dashboards, balanced scorecards, or other similar tools to keep a watchful eye on important performance ratios. And they expect department heads to hit goals, initiate improvements, and prevent slippage.  It’s not OK for a key ratio to be missed without a corrective action plan.

They stay informed about things like the value of the dollar, but none of the guests from INC 500 companies whine about the economy.   

As a growth strategy speaker at business conferences, I have noticed that:

owners of mid-sized businesses are initially skeptical when I pose the concept of tripling gross revenue while only doubling operating costs.  Uncertainty has sucked many business owners down into incremental thinking and survival mode.  In many ways, those companies no longer have Presidents or CEOs. They have regressed to duplication of effort and micro management.  Too many department heads are no longer expected to optimize productivity and customer satisfaction…the President is.

But it doesn’t take long for Presidents/CEOs to recognize that their job is the big picture, growth strategy, and long term resilient success.  No excuses.  As business leaders, if we can’t even imagine several options that could triple our gross revenue, how on earth could we actually do it?

As a growth financing intermediary, I have noticed that:

business owners are still complaining about the process. Although interest rates, ROI, and board participation demands are more favorable, the due diligence step has become more detailed.  A company that receives growth financing must prove that it has a scalable business model, provides a differentiated product that customers clearly want, and can consistently generate a reasonable profit. 

Too many applicants for private investor financing ask investors to cover their day to day operating expenses instead of solving their profitability issues before approaching investors. And too many applicants are looking for small amounts of money, which just wastes the potential investor’s time.

Too many applicants haven’t taken the time to learn about various financing instruments.  A mid-sized company that could/should finance growth through stronger joint ventures or clearer equity deals with key stakeholders will probably be turned down by a venture capital fund.  I’ve seen business owners look right past licensing, franchising, and corporate sponsorship opportunities.

As an advocate for mid-sized companies, I have noticed that:

the lobbying of many statewide chambers of commerce is focused more and more on large corporations and micro sized businesses… sometimes to the exclusion of mid-sized companies. This is happening, in large part, because owners of mid-sized companies have been letting our memberships in statewide chambers of commerce lapse.

When association dues are compared to the electric bill, this may seem like a frugal thing to do. But the national and statewide chambers of commerce can provide a strong voice for members. The thing is, they can’t help change the policies and regulations that stunt our growth if we aren’t members and let them know our priorities.

The needs of huge publicly traded corporations are often very different from the priorities of privately held innovation driven mid-sized companies.  Plus the largest corporations have their own government relations departments and directly pay professional lobbyists. Being part of an effective statewide chamber of commerce can feel like you have your own government relations department and professional lobbyists on staff. A few hundred dollars of dues to have some say about the issues that encourage or stunt business growth seems a small price to pay.

As a Business Owner/Executive/Employer, I have noticed that:

targeted market research is more important than ever…and needs more frequent updates than ever. Baby Boomer business owners who wanted to continue to work for 5-6 more years will suddenly decide that their succession plans must immediately change because they “have had it” and will retire soon. Leaders of growing businesses that had been fighting industry consolidation are quietly entertaining proposals from “roll up artists.”  Leaders of stagnant companies suddenly awaken to the need to clean house, create new products, go global, or upgrade technology.  Readiness for dramatic change is impossible to read if your market research is too infrequent to catch the changes.

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 mid-sized B-to-B clients get on…and then stay on…the published lists of the fastest growing privately held companies. She owns and operates a suite of companies that help privately held mid-sized companies in Achieving Accelerated Growth With Sustained Profitability® through opportunity and resource analysis, four approaches to strategic planning, executive advisory services, growth financing and targeted search.  2012 is Ambler’s 8th year hosting a weekly peer-to-peer-to-peer syndicated online talk show that features interviews with CEOs/Presidents of mid-sized companies (typically between $20 and 200 Mil/yr) sharing success tips about the growth strategy-of-the-week. An archive of over 300 interviews is available at www.GrowthStrategistShow.com.

Growth Strategy Tip

Testimonials

I really appreciate the fact that she is there for me to speak to because there is no one else I can talk to who knows me and can distinguish between cold feet and a genuine concern about any issues I am dealing with.

Lynn S. Evans, CFP
Northeastern Financial Consultants, Inc.

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