Monthly Archives: April 2016

Business Blog No. 9 – Strategic Planning – Sales and Marketing Part 2

This is the second of a 2-part focus on your Sales and Marketing Strategy.

Last week we looked at your SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis and identified your USP (Unique Selling Proposition). Now it is time to share your USP with your potential customers. After all, there is no point having a great USP if nobody knows about it. Remember the old saying “If you build a better mousetrap, the world will beat a path to your door.” Well that only happens if the world knows about your better mousetrap!

So now it is time to work on your Sales and Marketing strategy. Reflect on your SWOT analysis and USP. With your team, brainstorm who is your ‘ideal’ target customer. What characteristics does your ‘ideal’ target customer have? What industry and market segment are they in? Where are they located? Prioritise those target customers that give you the biggest scope for the most success. Then, most importantly, research their buying process and determine how you can facilitate and influence their process by building awareness of your USP through your Marketing Strategy.

Next, brainstorm questions like: what form will your Marketing Strategy take to create awareness of your USP to your prioritised ideal target customer? Will it be through Advertising? Or Promotions? Or Word Of Mouth? Or Networking Events? Or an Online Strategy? Or Trade Shows? Or Industry Events? Or Cold Calling? Or Public Relations? Or a combination of some or all of the above? Have you got research about what works best from past Marketing plans? If your business is new, try a few things out to see what works best before committing to a specific plan of attack. What do your competitors do and can you differentiate yourselves by doing something different in terms of marketing activity?

Think about the resources you have available and allocated to your marketing activities and decide on the marketing strategy that you think will give you the  biggest return on your investment (remember you are in business to make money first and foremost, not to get your head on the TV)!

Summarise your Marketing Plan. Allocate Budgets to each part of the plan. Ensure enough resources are allocated and that accountabilities and deadline dates are assigned to each action. Map out a review process so you can keep track of your actual results and performance compared to your plan.

So this week, work with your team, to brainstorm your target customers and the associated Marketing Plan to provide a sound foundation for business success.

Come and visit us at our stall at the Smart Manufacturing 16 Expo on May 17.

Smart Manufacturing logo may 2016

Business Blog No. 8 – Strategic Planning – Sales & Marketing Part 1

Last week, we identified the three primary strategic objectives of your business: Cash, Profit and Return on Investment (ROI).

This week we will start looking at developing strategies to achieve these objectives. Let’s start with the profit objective. To achieve a profit objective, we need to start with the top line Sales and Marketing strategy. If sales are not where they need to be, the rest of the strategic financial objectives will more difficult to achieve.

Sales & Marketing Strategy

This is the first of a 2-part focus on your Sales and Marketing Strategy.

Whether you are an existing business or are just starting out, your business and management team should undertake a Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis. What are the Strengths of your business and how can you capitalise on them? Conversely what Weaknesses does your business have that are development opportunities? What Opportunities are there for your business to pursue? Finally what Threats are there out there? Work through each of these and be honest with yourselves so you are clear where you are currently.

Based on your self-assessed SWOT analysis, you then need to develop your “Unique Selling Proposition”, or USP. In other words, what is your unique mix of product/service (or range of products/services), price and customer service that will help customers differentiate you from your competitors in such a way that you help these customers make the correct buying decision. Some examples of well-known differentiation strategies are Apple and Uber (Customer Relationship); Intel (Product Leadership), and McDonalds, Bunnings and Dell (low cost efficient operations).

A sustainable business should generally move away from being a commodity style volume driven model (unless you have scale on your side) where you are a ‘price taker’, to more of a business focussed on profitable growth orientated products and/or services, where you are more a ‘price setter’ in the market.

Differentiation and a clear USP provides you with a competitive advantage over your competitors for which you may be able to charge a price premium to your customers. Your customers will want to deal with you because you provide value to them beyond simply price.

Having a clear USP will also help you in your branding and marketing activities as you focus on the positives created by your differentiation strategy.

So this week, with your team, start brainstorming your SWOT analysis and Unique Selling Proposition. Figure out how you can use your business’ unique attributes to differentiate your business from your competitors and provide a sound foundation for business success.

Business Blog No. 7 – Strategic Objectives

In the preceding blogs, I have given you the framework for setting your business’ direction over the long term and clearly defining your Mission-Vision-Values. Now we actually move into the strategic planning phase. Numerous books and articles abound on the topic, many of which make it sound a complicated and difficult process. I am a big fan of keeping things simple, practical and easily explainable.

Let’s start with the simple over-riding notion that you are in business to make money, whilst adhering to the values outlined in your Values Statement. Given that, there are three simple primary strategic objectives all businesses will have, whether they are start-up, existing businesses, manufacturers or service businesses.

  1. Cash
  2. Profit
  3. Return on Investment (ROI)

Taking each in turn, let’s start with cash. It is common knowledge that good businesses can go broke because they simply run out of money. They can be profitable but still not have the cash flow to survive. Ensuring you have cash for now and for the future is the lifeblood of your business survival.

Secondly, you need to make profits. A sustainable business needs to generate profits; they are a key indicator as to how your business is performing. Profits generally convert into cash and so is a good lead indicator that you will have the cash to prosper (but not always).

Thirdly, you need to be making a return on your investment (ROI) to reflect the risk you are taking. Larger businesses often use a target of between 10% and 15% ROI as their benchmark. Why is this important? If you can’t make a return on your business investment, you might as well put your money in the bank and earn some stress free bank interest.

If you think of these three things as your primary strategic objectives, everything you do, all the priorities you set and all the plans and decisions you make should be linked to achieving and improving these 3 inter-related strategic objectives.

You might also have some additional key strategic objectives to add that matter to you. These might be noted in your vision statement and may encompass an Environmental objective, a People Development objective or a Succession Planning or business exit objectives? This is where brainstorming with your team is invaluable.

So this week reflect on the three primary financial strategic objectives. Identify where you are currently and quantify these three measures, then decide on some broad targets for each of the three objectives. Consider which other key strategic objectives you also want to focus in on.

Next week we will start looking at devising the strategic plans to work toward these strategic objectives.

Business Blog No. 6 – Organisational Structure

The next step to set your business up for success is to get your internal organisational structure set up. Successful enterprises are powered by the right people in the right roles covering all the key disciplines of the business, including the day to day running of the business itself. You might recall that I have mentioned ‘brainstorming’ a number of times in this blog series so far? It is your management team that you should be doing these processes with.

The key four pillars of a senior management team are the CEO, Sales and Marketing Manager, Chief Operations Officer (COO) and the Chief Financial Officer (CFO). Other management team roles can include Quality Manager, IT Manager, Technical Manager and HR Manager and these roles should also be involved in the strategic planning brainstorming process.

The head of the management team is the CEO. The CEO him/herself is expected to have a skill mix covering five key areas:-

  1. Strategy
  2. Leadership
  3. Commercial
  4. Operations
  5. Finance

In the SME sector, typically a CEO’s strength will be in the operations or commercial areas, particularly if the CEO is the founder or owner of the enterprise. The CEO’s skill set may need specialist support in the finance and strategy area if this is the case. This is where ensuring quality personnel are in the key roles either within your organisation or as part of your external advisory team (such as a Part-Time Virtual CFO).

Choosing an appropriate organisational structure to support the senior management team is essential. The most common organisation structure is the functional structure whereby departments of like functions are grouped in a traditional top-down hierarchical structure. Modern structures to ensure agility and efficient communication have arisen whereby various departments work in tandem to a common aim such as at a divisional level, or a new product/service grouping. The matrix structure is a dual reporting dotted line structure with a blend of traditional functional lines along with product or divisional reporting lines.

Use this week to consider which organisation structure best suits you and your entity to build a sound foundation for business success. Next week it will be time to get into the strategic plan itself.