Tuesday, 28 July 2009

Business Basics 2 : It's a numbers game

Another truism – the more customers you see, and the more you see your customers, the more successful you are likely to be. Obvious, but for many of us there can be a gap between what we know intellectually and what we believe in our hearts and do as a result. Outside of work life as well as inside.

Of course there is no guarantee that if you get in front of a lot of customers you will win business – your proposition could be so unappealing that no matter how many people you see no one will buy (though people will buy quite remarkable things – do you remember pet rocks?). But whatever your success rate, 99% or 1%, if you see more existing and potential clients more often you are likely to get more business. As said in the book Rainmaking, by Ford Harding, if my success rate is 10% and yours is 20%, I’ll still win more business than you if I see 21 customers and you only see 10.

Salesmen are used to thinking that every rejection moves them closer to a sale – the rest of us are less sanguine. It hurts when a client says no. When times are hard – like they are at the moment – and possible projects are being put on the shelf it takes a strong mental attitude to keep putting yourself in the way of rejection. And of course, when things get better we are all often too busy doing the work in hand to spend too much time seeing people other that existing clients.

As a consultancy we can talk ourselves out of business quite easily – our current project we nearly didn’t bid for on the grounds that the client knew us well but did not invite us in.. Naturally (and wrongly) we thought they did not want us. Another client I saw recently asked why we didn’t bid on a piece of work that was a follow up to an earlier project of ours – the answer was that we did not know about it. Talking more to our clients more often would have avoided both of the those problems.

In industries like Speciality Chemicals, the risks of a new supplier can be high – and so customers want to see consistent commitment to them as an account before taking a chance on change. Other times technical requirements change quite quickly, which an incumbent supplier might not notice but a hungry supplier on the outside might notice and take advantage of. And sometimes you get lucky and call straight after a need for your services has just arisen.

Of course call rate along guarantees nothing, but little and often (and for a long time) can be the way to get business.

Wednesday, 15 July 2009

Beat the Buyer - 14th October 2009

We are delighted to announce a new joint development with NBA4Business - a negotiation skills Workshop entitled "Beat the Buyer". This is part of a very reasonably priced series of 5 workshops which are being held at the award winning Shine Business Centre in Leeds - more details here.

Nick Bramley is an experienced saleman and trainer, and I will be bringing my expertise as a buyer to give people an opportunity to practice negotiation skills in a realistic setting. This is a unique opportunity to see negotiation from the viewpoints of both the Buyer and the Seller.

Prices for the workshop start at a very reasonable £75+VAT. Booking through NBA4Business .

Tuesday, 7 July 2009

Business Basics 1. More businesses go wrong by not doing the basics than not being sufficiently advanced

This may sound like a consultant talking himself out of business – where would we be if there were no fancy new business model every few years? Some ground breaking new innovation that will change everything about business beyond recognition. Be it the internet, or supply chain integration, or “organic” produce.

Well, I am not saying that these things are not vitally important, and that for some businesses failing to embrace them will mean the end of their business. After all the number of Fletchers decreased after the invention of the gun. But not immediately. Arrows and guns co-existed for a while (at least according to the Western movies of my youth), even if in the end there was only going to be one winner in that technology shift. There are even a few niche fletchers around now.

A fletcher who, unable to transfer his skills to metalworking, ignored the coming of guns surely found that the number of his customers declined over time (presumably after every battle) – but it would have tailed off rather than stopped instantly. However a fletcher who did not pay his bills, made wonky arrows and worked in a shed no one could find would go about of business even quicker.

So, getting the basics of business right is essential in order that you are around in business long enough to worry about the new, new thing. So, what are the basics of business – in a nutshell (or sheaf) they are cashflow, customer satisfaction, profitability, quality of production, security of supply, and promotion. And that has not changed in centuries – internet or not.

Feel free to disagree or tell me something essential I have missed out.

Business Basics: Introduction

One of the interesting things about being a consultant and trainer is that over the years you find that some of the same issues recur on regular basis. The great thing about this for a consultant is that we can quickly come up with an opinion, viewpoint or (ideally) an answer because we have already thought about it. The surprising thing is that many of the repeating issues are fairly standard issues in business, and are addressed in lots of books, training videos, MBA courses etc. You might think that they would never occur again – but they do. And as a consultant I find myself saying some of the same lines over again to different clients.

I thought it might be useful, for me as well as any clients, to put some of these on the blog. I make no claims for these to be the result of years of scientific study, or to be the leading edge of business management research. For that read Harvard Business Review. This simply an occasional series of posts dealing with some of the common issues in business. You may disagree (with either the problem or the answer), and I look forward to hearing from you if you do.

Friday, 3 July 2009

The Engineer's view of Purchasing - Dave Hannon BizConnect

The link here illustrates some of the tensions between Purchasing and their clients. The key part is;

"Dave: "So what do you think of purchasing professionals in general?"

Engineer Friend (EF): "I haven't met one yet I didn't try to get fired."

Dave: "Really? Why so bitter?"

EF: "Well, imagine this. I've been working closely with a supplier on narrowing down a spec, spending a lot of phone and face time with the supplier, figuring out exactly what I want to work in my design. And then I submit it to purchasing and they come back and tell me they have a different supplier that can save us $1. And then the design fails and I get the heat.""
Dave Hannon on BizConnect

I have worked with both Engineers and Purchasing people for years, and the mistrust can be mutual. Purchasing people are rightly suspicious of Engineers who specify requirements so tightly that only one supplier can do the job - who just happens to be the one that the Engineer always uses. Why is that? Are they the best, or do they just have the best salesman, or the best Golf day?

As so often, these are best issues are best resolved by communication - and the best way to do that is to get the Engineers and Buyers together regularly, formally and informally so that they can get a feel for the role that other plays. I am a great believer in short term (3 to 6 month) secondments as a way of raising awareness and co-operation across the business. You might think your business cannot afford that, but how else are you going to get people trusting each other?