Unmanaged Growth is one of the Greatest Threats to Business Survival

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The temptation to grow quickly is powerful

Exciting short term gains including increases in cash, customer base and sales impact your entire business in significant ways. Preparation for growth is key and anticipating how scaling for growth will impact your business will keep your business robust. For production, unmanaged growth can result in product returns due to production errors, missed deadlines due to production capacity overloads or even a complete shut down due to a lack of financial or other resources.

Start with your Strategic Objectives

To properly manage your growth over the long term, it is best to plan for it. Your business systems should be flexible so that as your business grows faster it can handle it. To be effective in the long term your Operational Strategy must guide the design of your production systems.

Maintain quality as a top priority

Quality is typically compromised when a company starts growing too quickly. Make sure you have the appropriate systems in place to establish your minimum levels of quality and a plan of action to increase quality over time. Wardell has some tips to to Avoid Poor Quality Production.

Optimize production to handle quantity

As your sales increase, your customers will expect you to handle their requests with the same speed, accuracy and attention to detail as if they were your only customer. Invest in your future growth, but do so within the limits of a carefully designed budget.  One way is to keep costs down by adding capacity only when necessary while the more expensive tactic is to invest for longer term growth.

Your customer expectation is reliability

The more your business grows, the more promises you make. Increased opportunity to create satisfied customers comes at the cost of creating many more dissatisfied customers if their expectations are not met. The very thing that creates rapid growth will cause rapid demise if not taken care of.

Managed growth is fueled by information

When a business grows the scale of activity is maginified. Managing the details of 5 customers begins to seem simple compared to managing 500. If quality and reliability are to be maintained with few errors, a robust information system is needed to identify needs and issues.

Manage the costs associated with growth

In addition to the more obvious direct costs of production, the wear on equipment, facility needs and management costs could increase as well. Scaling your operations to accommodate growth should look at the return on investment for various decisions.

Prepare for growth

While many companies dream about growth, few of them plan for the effects a sudden increase demand will have on their company. More customers means more revenue but if not managed correctly inefficiencies and errors can compound with disastrous consequences on the bottom line, existing customers and brand reputation. For more on managing growth you should watch our Entrepreneurial Skills Program.

Supercharge your Business with Effective Team Development

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Do the people in your company work effectively together?

A strong team dynamic is critical to meeting business objectives in the modern competitive business environment. While the virtues of teamwork are silently acknowledged, the direct benefits of working in a team are pretty clear. While individual experts may be able to perform their tasks, teams of experts can more combine skillsets to produce truly innovative work. Here’s our list to convince you why its worth fostering stronger teams:

Improved Quality

When two or more people focus on a shared outcome, the results are usually of higher quality than if they worked individually.

Better Communication

Teams enable information to flow more freely than might be otherwise possible in the hierarchy of an organization.

Multifunctional Capabilities

Teams are usually made up of individuals with complimenting talents and diverse skillsets.

Increased Creativity

When people with different skillsets are able to collaborate, the free flow of ideas leads to creative solutions.

Greater Productivity

Team environments can foster a competitive spirit by offering a direct opportunity for shared success. Teams made up of individuals from different departments are better able to cut through red tape.

Creating a strong dynamic relies on several principles of leadership and management. The creation of a strong team demands effective organizational design with precise job specification as well as a good conflict management protocol. Teamwork is only one aspect of an effective business, take our Business Strength Test to see how your business measures.

Mark Wardell’s Top 10 Tips to Make Your Market Offering More Effective

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1. Consider expanding into foreign markets

North America isn’t the only market in the world. Even a small business, in many cases, can expand their sales reach to include foreign markets. To determine if this is a wise option for you, begin by developing relationships with export centers and other associations specializing in reaching foreign markets.

2. Reach out to new market sectors

Very often a company can sell an existing product to a new target market with little more than a shift in market positioning. Some companies can significantly increase their customer base by doing this. For example, Nintendo successfully expended their share of the electronic game market with the Wii product by promoting video games to the previously untapped market of middle aged women. So ask yourself, who else might be interested in your products or services?

3. Expand you product/service offering

Ask yourself, what products or services do your customers already consume in relation to your existing product/service offerings? Can you add any of these to your product line? For example, a client of Wardell who manufactures kitchen cabinet doors has employed this strategy to become a wholesaler for an exclusive line of hardware. They have had excellent results.

4. Streamline your product/service offerings

Conversely, consider ways that streamlining your product/service offerings will help you become more profitable. Make sure you are aware of your margins for each of your products and consider dropping or replacing those that don’t make enough profit. Too many business owners only pay attention to their income statement as a whole (if at all) and don’t take the time to drill down into the details, effectively leaving money on the table that should be theirs.

5. Offer self-serve options to your customers and your vendors

Implementing DIY services is a great way to meet the needs of people who prefer self-directed options. At the same time, this alleviates pressure on customer service, and has the potential for significant cost savings. Today’s customers and vendors are no longer afraid of doing their own orders or checking out themselves. Self-check-in at the airport is a great example of how this option can be a benefit to all involved.

6. Improve your level of customer service

Your customers will spread the word about your business for only one of two reasons; they either have a bad experience, or a fantastic experience. It pays, therefore, to put the effort into giving your customers an experience worth talking about. Your customers are your best source of new business, and customer service is your most powerful tool for generating that business.

7. Clarify your market position

Ask yourself, do your customers clearly understand why your business is unique and why they need you? The answer to this question determines if they will continue to do business with you. Conversely, if you are seen as part of a homogeneous category of business, your selling prices will be dictated by your competitors- not a good thing in our current economic times.

8. Get to know your customers

The more you know about your ideal customers, the better you can make their buying experience. Are they more interested in customer service or self-service? Do they want better prices or more value for their money? Do they want you to make them look good to others or do they want to feel good for themselves? Ask, observe, and experiment. And by relentlessly focusing on your customers needs you’ll develop an almost unfair advantage over your competitors.

9. Track and analyze your prospecting systems

By properly tracking both your lead generation and your conversion rates (leads that become customers) you can develop a clear picture of the pace of business coming your way. This is critical for several reasons. (1) It helps predict production rates, increasing overall efficiencies. (2) It sends up a red flag when a drop in sales is coming, giving you time to do something about it. (3) It supports the setting of sales targets, helping to drive top-line growth.

10. Change your pricing

Far too many businesses remain at the same price point because they fear losing customers. It’s worth your time to research a spectrum of your competitors ranging from lower to higher end versions of your market. For example, sometimes raising prices may help associate your products/services with a higher value. While in some cases, slightly lowering prices may place your products at a better competitive advantage.

7 practices for a Rejection Proof Sales System

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Sales is just as much about the customer as it is about the salesperson.

Investing in a strong sales system is one of the most efficient ways to see a return on your employees sills. Rejection is a part of any salesperson’s job but with a strong system of support, guidance and continuous improvement your sales people can confidently perform in even the most competitive markets.

1. Hire sales people with the right attitude

Sales is a people oriented occupation, you need people oriented people to close a sale. Reviewing your hiring system will ensure you bring the right kinds of people in your sales department.

2. Create a bonus structure that kicks in at various predetermined sales volumes

“Financial Carrots” can help motivate sales people to close a sale. Review your compensation system so that it motivates the right kind of behavior in your sales department.

3. Insist on a minimum number of sales calls per day/week and track them

Establishing a baseline will guarantee a certain level of success for your sales people and will breed success from success.

4. Organize supportive and motivational sales meetings on a regular basis

Everyone needs a little push now and again. Review the communication systems you developed to determine the impact they are having on your sales department.

5. Provide ongoing sales training

Sales people are responsible for generating revenues so make sure they are continuously improving their skills and honing their pitch.

6. Provide outstanding sales tools

Great tools help sales people look and feel more professional. Review the tools you are offering and consult with your sales staff to make sure they are adequately prepared.

7. Encourage a corporate culture that promotes pride in your company

People who are genuinely proud of their company and its products have little reason to fear rejection.

For more a great advice, see what Wardell has to say on Handling Prospect Objections  

Mark Wardell’s Top 10 Tips to Increase Your Productivity

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1. Don’t pass the buck

When things don’t go as planned, great leaders take responsibility for their own actions (or inactions). Do this consistently, and teach your people to do the same. Once everyone starts taking personal responsibility for their work, your productivity will climb dramatically.

2. Start working towards “open-book management”

When you share your company’s financials with your employees, you encourage them to behave more like owners. Many entrepreneurs worry their employees will think the company makes too much money, but most employees actually overestimate the company’s bottom line before they are exposed to it. It’s not an easy step for most entrepreneurs to take, but those that do typically find the benefits are worth the risk.

3. Do the tough stuff first

One of the simplest, yet most effective strategies for dealing with procrastination is to cross the tough stuff off your to-do list first. Teach yourself to do this and then train your employees to do the same. If you can stay committed to the process, you’ll build an incredibly productivity corporate culture.

4. Develop a company knowledgebase

In every business, new ideas are generated daily. Some are great, and some are not, but most are lost forever. To fix this, develop a company knowledgebase where good ideas can be stored for future use. This can be as simple as a folder on a computer or as fancy as a company wiki. Over time, this will become one of the most valuable tools you’ve got.

5. Take a break

Business should be fun. But life should still be about more than just business. Take a holiday and recharge your batteries. You’ll come back stronger and more productive than ever.

6. Revamp your organizational structure

The best people in the world are of limited value to a company if they aren’t organized to run your businesses as profitably as possible. To accomplish this, take a second look at the roles of your current employees, their responsibilities, their work-flow and accountability to one another. Everyone should be contributing to the bottom line in some form or another. Many times, revamping your organization structure can be the single most effective way to increase workplace productivity, not to mention the overall value of your business.

7. Implement a solid management team

You need to find managers who can make your business better—people who have already proven they can manage a business like yours as well as, or even better than you can. If they already work for you, you’re in luck. Otherwise, research the all-stars who have successfully transformed the state of peer businesses. Are they available? Ask industry colleagues, friends, suppliers, vendors and even recruiters if they know a potential candidate who matches your needs.

8. Transfer key relationships from the owner to the business

As long as your company’s key relationships are also your personal relationships, it will be difficult to convince outside investors your business is self-sustaining, not to mention the fact that, as the owner, it’s not the most productive use of your time. Start by introducing your personal contacts to the appropriate contact within your organization, and then slowly but surely pass more and more of your interactions on. The message you want to continuously deliver to your customers and vendors is that they will receive better service by dealing with the “right people” in your company, but that you are always available should they need you.

9. Use Key Performance Indicators (KPI’s)

Numbers are the most productive way to measure progress and raise red flags – before it’s too late. So, begin the practice of documenting and reviewing things like margin growth, inventory turnover and customer satisfaction levels. Then compile your results into a standardized format to help monitor how well you are doing at any given time. And finally, share this information across your organization. This practice will help your entire team stay focused on achieving measurable goals.

10. Tighten up your receivables

Most invoices say “net 30 days”, so they are paid at least 30 days after the invoice arrives. Instead, take a lesson from the credit card companies and replace this vague statement with a hard and fast date. Something like, “due Sept 25th”. I’d even suggest moving the date forward by 5 days or so. Try it for a few months and you’ll be amazed at how well it works.

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