At Singapore Changi Airport for a fee available to all is the “Commercially Important Person,” or CIP experience.
At its highest "Jetside" level, as they exit their planes traveling CIPs have a uniformed agent greet and whisk them to the tarmac to a waiting Mercedes that chauffeurs them to a special terminal where customs is cleared quickly, luggage routed, and for travelers with connecting flights amenities of the elegant CIP lounge include complimentary food and drink, free wifi, private showers, and more.
While not materially different from high-end VIP experiences the world over, I find the phrase “Commercially Important Person” wonderfully evocative of the super pro-business culture for which Singapore is rightly famous, and a great one for entrepreneurs and executives to adopt as they think about those most important relationships that can and do propel their business forward.
CIP is value-neutral - it just recognizes that of course some clients, partners, and employees are far more important than others for a company's bottom line and should be treated as such.
For client and partner CIPs better and more personalized service and attention.
For employee CIPs more money, perks and recognition.
All of this should be obvious. But in our technology and social media overwhelmed world, it can be dangerously easy to treat as of having the same value the various likes, followers, and online friends and connections that can be globbed onto oh so easily and seductively!
And then what happens is that start to treat quantity of contacts and breadth of exposure as sufficient measurements of marketing, sales, and client relationship management effort and success.
CIP is a shorthand to break out of this trap. We just ask:
“How much value - in quantifiable dollars today in the near future - will this relationship bring to me and my organization?”
Yes, this is an unfeeling question.
And a difficult one to answer, as most business relationships are somewhat indeterminate as to when and how they might be monetized, or might not lead to direct compense themselves but are enablers for other relationships that do, or are relationships that provide us the comfort and inspiration we need to build and do great things.
Yes, all of this is true and right and real, but...
...really grappling with what a business relationships’ true and quantifiable value actually is can save a lot of wasted and frenetic effort.
My experience with this exercise is that the vast majority of businesspeople find that the truly Commercially Important People in their business lives are:
And so yes, in spite of all of our technological progress, in spite of the almost cultural “faux pas” it has become to not put technology at the center of all of one’s business efforts, that the best business is still done pretty much as it has always been - over-the-phone and in person.
Now, a really neat byproduct of this realization is that as we winnow down and focus our efforts on those few and truly relationships, that a lot of the noise of our business lives naturally goes away.
What is freed up is more business time to invest in those things that actually make us have more value to our clients in the first place.
Like investing in professional skills development.
And in preserving and cultivating our energy so as to be able to deliver those skills to clients that can both benefit from them and pay us for them.
And as we keep doing this over and over again, to and for the right and few commercially important people in our business lives, we might just start to find....
...that the most commercially important person in your business life will become exactly who it should be.
January is always the best time of the year to set big growth and success goals for the New Year. There are two main approaches to doing so:
1. Set Attainable Goals. This is the incremental “get a little better” approach, letting past results guide and drive our goal-setting.
2. Set Stretch Goals. Stretch Goals are goals that are beyond, often well beyond, what we have accomplished in the past. Stretch Goals usually feel unrealistic, even to those that set them. These are the goals of “Childhood Imaginings,” the goals we really want to accomplish but as we grow older are almost embarrassed to admit it.
A classic Business Stretch Goal is BIG revenue growth, and a great one especially for smaller business is to put it right out there and aim to doubling revenue not in 5 years or 3 years but in the next 12 short months!
Now many executives react poorly to stretch goals like this. They consider them Pollyanna and distracting to more pressing matters at hand, like keeping the lights on!
Well, in these first few days of the New Year when hope is fresh, as we do our goal-setting let me suggest we set solid Attainable Goals that as we accomplish them in their aggregate add up to Stretch Goals that tickle the loins and fire the imagination!
To demonstrate, let's break that “Double Revenues This Year” Stretch Goal down into a series of Attainable Goals whereby we improve performance the below four key business processes by just 20% each:
1. Marketing Campaign Conversion
2. Sales Team Performance.
3. Product / Service Pricing
4. Customer Repurchase Rate
Marketing Team Conversion. For the sake of our example, let’s assume in 2016 we send out 100,000 direct mail pieces where we offer a complimentary consultation to learn more about our products / services.
And let’s say on our past campaigns we have achieved a 1% “conversion,” or 1,000 out of the 100,000 recipients took us up on our offer (i.e. 1,000 leads).
Now, in 2016 let's improve the quality of our message / positioning such that as opposed to those 100,000 pieces sent resulting in 1,000 leads, we do 20% better and generate 1,200 leads.
Sales Team Performance. Let’s assume our sales team is now, on average, turning 20% of these leads into customers. But, in 2016 we invest in sales training and technologies such that performance increases by 20% so instead of turning 200 of the 1,000 leads into customers, we do so at a rate of 240 out of 1,000.
Pricing. Let’s also take the bull by the horns and raise our prices by 20% from, say $5,000 per order, to $5,600 (and we invest in improving our brand positioning and value proposition to support this higher price).
Repurchase Rate. And finally, let's operationally improve the quality, speed, and efficacy of our offering such that as opposed to our customers buying from us at an average repurchase rate of twice per year they do so at a rate of 2.4x per year (20% more often).
The math is as follows:
Business as Usual: 100,000 marketing pieces x 1% response x 20% sales conversion x $5,000 x an average repurchase rate of 2x / year = Annual Revenues of $2,000,000.
20% Better. 100,000 marketing pieces x 1.2% response x 24% sales conversion x $6,000 x an average repurchase rate of 2.4x / year = Annual Revenues of $4,147,200.
Voila! We set a Big Stretch Goal of Doubling Sales and we then got there through Attainable Goals of improving four key business processes by 20% each.
So before the year gets too far in, let’s set Big Stretch Goals like this and then invest the time and do the work to identify, evaluate, and improve by 20% four business processes to get there.
Just think how great it will feel in January 2018 to look back at a year with this kind of exciting growth!
A lot of optimistic energy is pulsing through the business and financial markets in these 1st few days of 2017. Perhaps more than in any other year since the Great Recession, “macro” conditions feel right for businesses across a wide swath of industries and markets to have breakout years. Here are 5 ideas to make it so for your business:
5. Push the Risk Envelope. When business and economic confidence are high as they are now, the right mindset when it comes to strategic decision-making is to push the risk envelope. As so eloquently proved in Michael Raynor's masterpiece, "The Strategy Paradox," the vast majority of executives take too little short term risk, and by so doing subject themselves to far greater longer-term dangers.
In essence, this is because most usually the real danger for a business is not its sudden or dramatic failure, but rather slowly sliding into technological obsolescence, commoditization, and a low to no profit economic model.
While this conservatism is more pronounced in times of recession, in good times it is doubly insidious because both the opportunity costs of being too conservative and the likelihood of risky initiatives being successful are so much greater.
A great shortcut question to ask yourself is: “If I had no considerations of time and money, what would I do?”
The answer will usually point you to the riskier, and more often than not, the more strategically correct business decision.
4. Embrace New Technologies. In the past few years, we've reached a tipping point as to the ability of companies of all types and sizes to earn quick ROI via implementing and utilizing business process technologies that allow for the completion of work more quickly and cost-effectively, and at a higher level of quality and consistency.
Cloud-based, on demand, proven and inexpensive technologies are available now for almost all business processes - from sales CRMs to marketing analytics, to project management software to HR, accounting, and finance.
And because of an almost overwhelming number of great software companies building new business process services (and because of SaaS, improving the ones they have almost daily), the cost of these tools continues to drop while their quality and efficacy rises. So let’s all make the business resolution to “try out” a new one of these tools each and every month in 2017 and see what additional marketing, sales, operational and financial efficiencies and improvements we can muster from them.
3. Pursue Global Markets. The volume of US exports hits new records year-after-year, and is projected to cross the $2.5 trillion mark in 2017.
Never before has it been a) easier to sell products and services globally b) have there been so many customers with money to spend the world over and c) has the reputation of US companies for technological leadership, quality products and ethical dealings been greater than it is right now.
So if you have a global growth strategy, build on it. And if you don't, get one.
2. Be Organizationally Creative. The maturation of business process technologies combined with the “flattening” and full-on “virtualization” of most modern work has created extraordinary opportunities for every company - no matter how small - to profit via organizational evolution, outsourcing, and fractionalization of work.
Things like organizing one’s enterprise via a mix of W-2 employees, 1099 contractors and outsourced technology, project administrative work low partners from around the globe.
My experience is that most of us intuitively get how this stuff works (as evidenced by how much of work we all now do on our mobile devices), but are still held back by a sense of how a “real” company should be organized.
The heck with that! All that should matter in decisions like this is whether it works - i.e. does it deliver higher quality at a lower cost? Everything else is just noise.
1. Have a Plan. Conditions are good. The world is our oyster. Let's commit, in writing, that we're going to make the most of it.
In the immortal words of Goethe, once a commitment is made, Providence moves too.
The spoils and thrills of victory in our so competitive but so opportunity-laden world go to those who devise bold plans of action and then go out and do them.
So let’s make great plans - organizationally creative ones that leverage technology, take intelligent risks and pursue and win opportunities around the world.
That sounds like a great 2017!
December is a natural time to reflect upon the accomplishments of the past 12 months, and to set goals and objectives for the New Year.
In doing so however, most of us think too much about next year, and too little about our longer term and multi-year business horizons.
[To listen to a recording of the webinar, Click Here]
On this recorded webinar, the Growthink Innovation Series turns to the transformative world of financial technology.
According to PWC, within the next 3-5 years, cumulative investment in FinTech globally could exceed $150 billion. Quite simply, the digital, mobile, and Internet revolutions are transforming the way customers access financial products and services of all types, and across all consumer and business sectors.
Traditional financial products and services being fundamentally disrupted by these new digital technologies include consumer and commercial banking, fund transfers and payments, investment and wealth management, insurance, and investment banking.
Webinar Description: Entrepreneurial and Investment Opportunities in Fintech
You’re invited to listen to a webinar, hosted by Growthink co-Founder and Managing Partner Jay Turo, where a select group of Fintech entrepreneurs and investors will share how they and their companies are winning in this incredibly dynamic space.
The panelists are:
On the webinar, the panelists answer questions including the following:
Listen to the webinar via the below link:
The three big economic stories since last month’s election have been a dynamic stock market rally, a strengthening dollar, and rising economic confidence.
Here are some encouraging statistics to ponder:
Of course and as one looks for them, threatening economic clouds can be found everywhere. But for now, the US economic mood is one of optimism, confidence, and possibility.
And so the ambitious executive should ask: How should 2017 business plans and performance expectations be “reset” in light of this improved outlook?
Here are three ideas:
#3. Raise Capital. As your business has adjacent opportunities for which the raising of outside growth capital would accelerate their pursuit, now is the time to go out there and get it.
In my 15 years of working with companies of all types and sizes with their fund-raising efforts, I have found that overall economic confidence is by far the most important factor as to the success or failure of any particular company's financing efforts.
When economic confidence is low - as it was during the Great Recession -almost nobody can raise money.
And when confidence is high, for example as it was during the late 1990s, almost anyone with a solid plan and who gives a heartfelt, assertive effort can.
So if the predictions of 3%+ growth for the US economy in 2017 hold true, then with them will come increasing economic confidence and thus a far easier time for companies of all types and sizes to raise capital.
#2. Work Harder. I vividly recall a conversation I had with a very successful IT services entrepreneur a few years back. He said that in reviewing his financial records October 2008 to March 2010 he determined that he would have made more money if he had closed his doors and sat on the beach during that time instead of actually running his business!
Well, good economic conditions like these are the karmic reward for those that fought and scratched to keep the "lights on" when times were dire.
AND the right reaction is NOT to work less because getting good results takes less effort, but rather to work twice as hard to profit from all the growth and expansion opportunities frothy conditions uniquely allow.
#1. Raise Expectations. As a proud and lifelong New England Patriots fan, I have been so inspired by the “winning is the only option” mindsets of Messrs. Belichick and Brady.
Sure, there's always some excuse for why a game was won or lost, or why a business grows or does not.
Excuses yes, but really no good reasons.
And just like my Patriots are marching relentlessly toward another division title and Super Bowl berth, so is 2017 shaping up to be a championship season for US business.
And that should be the expectation for all of us - record years for sales, profits, asset allocation, and growth.
The macro conditions are there for the taking.
Now it is up to us to go out and win the game.
We choose to go to the moon and do the other things not because they are easy but because they are hard.
- President Kennedy’s “Moon Speech” September 12, 1962
A fundamental executive leadership challenge is finding the right balance between focusing on what is "core" to one's business and investing time and resources into pursuing adjacent and complementary opportunities to it.
Examples of this include:
On the surface, all of these “adjacent” opportunity pursuits seem worthwhile.
They build on business assets and trade secrets, they often leverage "remnant" organizational resources, and diversification of revenues and customers is a sought after business goal is it not?
It can be, and yes effective executives should always default to a positive and optimistic mindset toward opportunities but...
...they obviously must be the right opportunities to pursue.
A simple “Acid Test” way to rate opportunities is to ask two questions:
One, is the opportunity one in which my business can truly be best-in-class?
And two only if the answer to the above is yes, are the market dynamics for the opportunity favorable for its pursuit?
I call these the internal and external opportunity acid test questions.
Internal in their inward look at the real strengths of a business and its people.
And external in their evaluation of the market landscape in which that business competes.
The internal acid test is easily performed by listing the business’ key strengths, like:
As we list these strengths what will arise will be “non obvious” wisdoms as to the likelihood of a successful pursuit of the considered opportunity and perhaps more valuably...
...“aha” moments as to other, more appropriate opportunities for the business to potentially pursue.
“Potentially” is the important word here, because in addition to the opportunity passing an internal acid test, it must also pass an “external” one too, with questions like:
Market. How big is the market for the opportunity? How expensive will it be to pursue?
Customer. Who are its customers? How pressing is their need? How hard are they to reach?
Competition. In our global age, by far the most important question - and not coincidentally the one that most executives do the worst job in asking - how strong and formidable is the competition?
What advantages - first-to-market, brand, relationship, cost structure, etc. - does the competition have that we will need to match and beat?
What points of differentiation must we build and emphasize to successfully compete and win?
As we honestly ask these competitive questions, very often discouragement can set in.
Everything can just seem really hard.
But this sad feeling is actually a good thing.
Because as we work through the discouragement we really learn if we have an opportunity worth pursuing or just a passing fancy.
If it is just a passing fancy, then we will quickly move on to the next bright shining object that passes our way.
But if it is an actual opportunity, then the internal and external challenges that present themselves to pursue it will embolden us to roll up our sleeves and go for it.
For sure, successfully pursuing any new business opportunity is hard.
But let's never confuse hard with impossible.
By properly performing these internal and external acid tests, we can distinguish between hard and impossible...
...and then relentlessly put forward our best energy toward going for it, crushing the competition, and winning!
Last week, I wrote about the Business Physical and of the importance of evaluating a business’ “red,” “yellow,” and “green” areas and proceeding, changing, and innovating accordingly.
As I wrote that post, the most surprising presidential election result of my lifetime took place.
Along with the political change that it represents, so does it foretell a changed landscape of opportunity for businesses of all types and sizes.
This changed landscape starts with the various prognostications on “industry” winners and losers.
Potential winners include pharmaceuticals, infrastructure, and traditional energy, and potential losers include renewable energy, carmakers, and real estate (on fears of higher interest rates).
But let’s note well that these prognostications should be taken with a big grain of salt, as they are made by the same set of pundits that got the election results so wrong to begin with!
But there is one thing as businessmen we can be sure of - that with change in Washington - like with big change of any type - comes big opportunity.
Yes, much of this opportunity will flow from changing federal government policies, but the election result should also be a wakeup call to “reset” on business as usual.
A reset where we reflect on the idea that no matter how long things have been done a certain way - and no matter the conventional wisdom as to how they will continue to go - change is always only a moment away.
As businesspeople, our first responsibility is to find the opportunities in these changes.
And to then act on these findings with velocity and determination.
Here’s three ways how:
#1. Do that Business Physical. As I outlined last week, positive business change starts with undertaking a structured and thorough review of “where things are now” in a business and its marketplace.
A quality business physical drills down into the real value drivers of an enterprise, how to enhance them and how to fend off the constant existential threats to them brought on by fast changing markets, competition, and customer preferences.
Do the physical yourself, or reach out to a qualified advisor to do it for you.
#2. Challenge the Conventional Wisdom. Whatever’s one’s politics, everyone should reflect long and hard on how wrong the “conventional wisdom” was as to the election’s course and result.
As it does in politics, in business echo chambers of opinion and consensus can quickly get formed and hardened
But just because everyone believes something to be so doesn't make it true!
A great exercise to breakthrough “stuck” thinking is to look at our business and our options from a “tabula rasa” place - letting go of legacy considerations, sunk costs, and the various frustrations of things that just didn’t work out - new hires, product launches, sales campaigns, etc.
As we let go, we start to see the choices and opportunities available to us from a fresh and “future forward” place.
Yes, the realities and limitations of our business model and marketplace will come rushing back to us, but it can be surprisingly high ROI (and exhilarating!) how far just a little bit of pure visionary thinking can take us.
#3. Hard Work Trumps All. Whatever one's politics, the energy and work ethic displayed by both candidates through the long and intense campaign season - unceasing 18+ hour campaign days - should be inspirational to all.
And these were a pair of 70 year olds!
Balance is an admirable life goal, but there’s also a time and place for intense “24/7” effort as so many endeavors of potential greatness cannot be achieved by any other means.
So let’s use this “Black Swan’ election as a spur to take stock of where we are, to let go of the conventional wisdom that might be holding us back, and work hard, hard, hard.
And let's all hope, believe, and act to make it so that the New Year and the new regime in Washington brings high ROI change to all of our businesses too!
Positive business change starts with a full and complete understanding of what the bottlenecks to positive change are and what can/must be done to remove them.
This may seem obvious, but I am constantly surprised by how many otherwise experienced executives invest time and resources into mission-critical initiatives without understanding the right business levers to pull (and how to pull them!) to transform the mere hope of positive change into its actual reality.
This process of understanding I call the "Business Physical" and like a personal health physical when done right it:
1. Identifies the Green, those areas that are working - i.e. things like good exercise and diet habits in a personal health physical that should be maintained and built upon.
2. Identifies the Yellow, those areas where as a business we are falling short and corrective measures are needed - i.e. like when a health physical comes back with high blood pressure, high cholesterol readings, etc.
In a business physical, green and yellow areas include things like:
And as in a health physical, these green and yellow areas yield mostly “keep on keepin on” suggestions. Keep leading with ethics and enthusiasm. Keep satisfying your customers. Keep close to the pulse of your market.
3. And most importantly, the business physical identifies the red areas, those heavy matters that if not fundamentally addressed will lead to the business' demise and death.
Here the analogy would be as when a health physical so very distressingly turns up life-threatening conditions like heart disease and cancer.
Now it is in these red areas where the analogy between a business physical and a health physical needs an important clarification.
You see humans are incredibly resilient beings. We can take hard punches, stay standing and when all is said and done recover pretty darn quickly.
Businesses are more fragile - they stop breathing when the cash runs out, which can and does happen to even the strongest of companies.
This fragility is heightened by the nature of modern business competition.
Blessedly unlike the vast majority of human beings on earth every modern business has dozens, hundreds, sometimes thousands of other businesses out there relentlessly trying to kill them!
Because of this fragility and the “only strong survive / fight to the death”nature of our modern marketplace, as business leaders we must always be super vigilant to the “existential” business threats surrounding us always.
Identifying these threats is core to a quality business physical - even to the point that if those threats are deemed too great to overcome the recommendation can be to sell or close the business.
But far more likely will come a series of recommendations and suggested tasks and projects that can and will make things better.
Some of these will be “Business Internal” - like tending to our financial health, to our culture, to the satisfaction of our clients, to the effectiveness of our organizational processes and accountabilities.
And some will be “Business External” - like tending to the positive attributes of our brand and reputation, to the “conversion efficiency” of our marketing and sales regimes, and how we leverage these assets in toward healthy growth.
When done right, a quality business physical spits out a list of specific projects and to-dos for executives to work on right away to make things better- more profits, more assets, more overall sustainability and longevity.
I encourage all executives and business leaders of ambition, especially this time of year, to submit their companies to a thorough and complete business physical.
It is almost always transformative and revelatory in its own right, and can quickly put a business on the correct path towards improved shorter term results and longer term health and growth.
Last week, I met for dinner with a longtime client as they traveled through Los Angeles on a stop-over on their way back to Europe.
It was both by design and natural inclination of all involved, a working dinner where the main topic of conversation was the client's business model in all its permutations - new market penetration and geographies, new product development, prospective new hires, growth-by-acquisition opportunities, establishing Newcos to house new technologies, discussing the personal exit plans of the company's founders, and on and on and on...
It was also meandering, energy was fruitlessly expended on ideas without reasonable probability of success, and was distracted throughout (pleasantly so!) by more "prosaic" conversation around food, wine, travel, family, sports and more.
AND it was probably the most productive two hours any of us had all year.
Because while enjoying a tasty meal in a beautiful restaurant, we organically arrived at a killer marketing idea worth potentially tens of millions of dollars.
By organically I mean we came up with it through a classic “thesis, antithesis, synthesis” back and forth.
The company’s sales manager shared some remarkable research that showed that while the “conventional wisdom” was that the company’s market space was in free fall and under severe “legacy” pressure, in actual reality the market was experiencing solid, and in some areas, unprecedented growth.
As we digested these eye-opening statistics came the "after-the fact obvious" idea of sharing them in a way that would paint the company's seemingly legacy offerings in a future-focused light.
First, through featuring these insights across the company's various marketing platforms - in its marketing and sales collateral, its white papers and case studies, in its email newsletter, and potentially in the its tag line and logo.
And more excitedly, through the development of a new product with a market potential many times greater than the company’s current core offering.
To give some idea as to the power of this idea breakthrough, it had the company’s CEO and Founder - and note that is a 20+ year old, 8-figure in revenue and very profitable business - thinking about changing the name of the company to leverage it.
This was obviously a very high ROI outcome from a simple dinner, but there was another outcome that was arguably even more valuable.
You see this wonderfully animated dinner discussion inspired that most magical energy to be found in any gathering of humans - a sense of BIG possibility.
The possibility that the future will be better than the past.
The possibility that we, as a team, have the right stuff to win and do great things together.
The possibility that technology can just not be a threat to an older line business, but instead can open up avenues of new opportunity for it.
And the possibility that even if we don't have at hand all of the solutions to our problems, that we can put our heads together and find them.
It doesn't always work.
As often as not those ideas arrived at after the third glass of wine don’t seem so hot in the cold light of morning.
Or if they do hold up, actually acting on and making them happen falls by the wayside for the various excuses and reasons.
And sometimes the ideas just don’t work.
But my experience is that as the seriousness and earnestness of purpose of all involved in a brainstorming/ideation session goes up, up, up...
....the likelihood of these “false positives” goes down, down, down.
I highly encourage all executives of ambition to bake more of these kinds of sessions into their normal business days and nights.
To do so alertly, with great stamina, a strongly positive mindset, and with a firm faith that answers ARE out there.
These sessions can and should be as much fun as one can have in business...
...and lead to breakthrough ideas, strategies, tactics and initiatives unreachable through any other means.