Good for your health

I recently participated in a breakfast seminar with some associates, clients and friends where the guest speaker was Dr. Oomen from the Cardiogenix Medical Centre in Montreal. He is a very dynamic and animated speaker who presented the topic of "Health is Wealth, De-stress for Success" and he had us all motivated to follow his advice and lead healthier, stronger, longer lives.

We were left, however, feeling inadequate trying to be as effective as he was at passing the message on to family, friends and employees. Employees are a particular challenge. Some participants spoke of their frustrations with various programs, large investments and a great deal of time and effort with very marginal results for their staff. Only a few had lost weight or stopped smoking, even with financial rewards or other incentives.

Dr. Oommen seemed to agree that making real progress needs constant attention. Continuous communication, support and encouragement, measuring and rewarding results will all be required before momentum is created and new habits become established.

Nevertheless, it is worth the effort. Everyone wins.

Effective Branding

The value of a good company name struck me en route to spring skiing on Sunday. Flying by on the freeway I suddenly noticed two distinctive names that seemed to stand out in the row of businesses along the highway.

Stonedge and Simple Signman.

Memorable don't you think? A catchy, meaningful and memorable name is always a huge advantage in building brand recognition and corporate identity. Especially if it is a good fit to the business and its strategic positioning.

In working with entrepreneurs I often have to get them to re-think their planned business name after we've completed a thorough review of their corporate strategy and marketing communications plan because it is simply not consistent, not supportive, and often in direct conflict with the message and the corporate identity. For example; "J&B Java" for a retro '60's style diner and gift shop. Or "PBX Services" for an architectural and interior design consulting firm. It's worth the extra effort to try and be more creative and consistent with your marketing image.

You may want to invent a new word for your name, like Yahoo or Google, but unless you can spend a fortune making it known and putting it everywhere, like Starbucks or EXXON, then try something that is more meaningful and memorable.

Imagine the additional business that comes from customers who will instantly recognize who you are and what you do, as well as those customers that will more likely remember you for next time. Think of a good name as a valuable silent salesman - always working for you.

Evolving loyal, long-term customer relationships

Sometimes we get so preoccupied with marketing and sales activities and all the associated details that we forget the original strategic objectives.

The basic objective, of course, is to generate and grow sales revenue. But to have sales you need customers. And to have sustained, profitable and growing sales, the best strategy is to develop loyal, long-term customer relationships.

So the marketing, sales and customer service activities should all be aligned to deliver a customer experience with you, your company and your brand that evolves from a first time buyer to a loyal, long-term customer.

The customer experience typically evolves through four levels:

1. Satisfaction with price and availability

On the first exposure to you and your business, customers will quickly, maybe even subconsciously, compare price and availability to their expectations based on prior experience with your competition. There will likely be no sale, and maybe no second chance, if this minimum expectation is not met.

2. Recognition of superior service levels

The first point of differentiation and the first step to building a stronger customer relationship will be when the customer recognizes that you offer superior service. You can demonstrate it in many ways – faster response to inquiries, easier access, more stock, better prices or terms, better delivery, better warranty service and support.

3. Appreciation of the value of your knowledge and experience

After the basic needs of price and availability are met, and you have distinguished yourself with superior service, the customer experience should then lead to an appreciation of the added value of your knowledge and experience. This will be demonstrated by applying your product knowledge, training, education and experience to educate the customer and give him/her the confidence to make better purchasing decisions. Now you are building a valuable customer relationship.

4. Connection on values, mission and vision

The final step in cementing loyal, long-term relationships will occur when the customer recognizes a common sense of values, mission and vision in the way you both do business. This connection will be developed over several interactions, particularly when problems are solved together, or you meet on non-business related issues.

The sooner you can meet customer expectations at these four levels, the faster you will build lasting and loyal customer relationships.

Super Bowl decisions

Super Bowl ads are always part of the attraction for the 95 million viewers from around the world. For advertisers it was a $2.7 million decision to book 30 seconds.

A good or bad marketing decision? For Budweiser or Pepsi it's a small drop in the bucket of advertising millions they spend every week. For smaller companies it may be an all or nothing budget item and can be a risky bet. In the dot.com days there were always a few that spent their venture capital dollars on a Super Bowl ad just because the notoriety was worth the expense. This year there were still a few Internet companies in the mix.

The most controversial ad decision was the commitment to 60 seconds by Under Armour, an athletic underwear brand name that was launching its new line of training shoes. The six million dollar cost represents the equivalent of one month's net income (last quarter was about $17 million). Somebody really believes in the value of advertising.

When will they know if it was worth it?

Blinded by concentration

I was at a seminar recently which for some reason digressed into demonstrating how we can be so focused on a particular task that we fail to observe what is going on around us. The presenter gave a few demonstrations that we found interesting but unconvincing, then he proved it to us with a group experiment. The object was to watch a short film of students passing basketballs among themselves and count the number of passes, but only betweeen those students in white T-shirts, not those wearing black. OK, we watched closely for about 30 seconds and I counted 12, some said 16 or 17.

He asked, "Did anybody see the gorilla?" What gorilla? Most of us didn't know what he was talking about. So he showed the fim again and, to my amazement, somebody in gorilla costume walked into the middle of the scene, paused, waved at us, pounded his chest, and walked on. Wow. (It wasn't a different film because some people had seen the gorilla the first time.) I always knew I was able to concentrate and ignore the background noise, but this surprised me.

I was reminded of the story by this morning's newspaper article about Barbara Ann Scott who is celebrating the Sixtieth anniversary of her Olympic gold medal in figure skating at St. Moritz in 1948. (The first and still the only Canadian woman to do so.) Apparently in her early routine on the outdoor rink, a helicopter flew over and hovered to watch her perform. When asked if it bothered her, she said, "What helicopter?"

Being able to focus is obviously important to performing a task at our best, but occasionally we need to look up and be aware of our surroundings. Maybe the gorilla is not friendly, or the helicopter is crash landing.

Looking back and planning ahead

The start of a new year is a good time to look back and plan ahead. (Sounds dangerous. May explain the pain in my neck.)

However, looking back at 2007 can you conclude on the mistakes you would rather not repeat or the things you would like to do more often? Or maybe the issues and ideas that were completetly neglected? Select your priorities and include them in your plan for 2008.

Is it time for a radical new strategy or simply continuous improvement of a well established formula for success. Don't forget to look outside your business at your personal priorities. Is it time to fix the foundations of family, friends, physical and financial health?

And don't try to do too much. Small successes will usually add up to more than a few big ideas that don't get finished. Good luck.

Pricing your business

In recent mandates with several different clients, we have gone through the exercise of valuing their business.

A few important principles were confirmed:

1. The value to the owner is unique to that individual. Ego may artificially inflate the price, but more importantly the role and relationships established by the owner may change drastically with his/her departure and thereby affect the price.
2. Value is always determined by an evaluation of the future income relative to the uncertainty or risks associated with obtaining the expected returns. Regardless of the valuation method, (P/E multiple, payback period, or discounted cash flows) the forecast future income stream has to be solid and the known risks have to be reduced to get the best possible valuation.
3. Current owners tolerate more risks, uncertainty and "fuzzy" circumstances than new owners/investors. You may be OK with the fact that you are dependent on one key supplier because he is an old high school buddy; or that you have no signed lease but the landlord is your uncle; or that your best sales rep is also your only son and he wants to be president. Prospective buyers will be much less enthusiastic unless those issues are all resolved to their satisfaction in advance of any offer to purchase or invest.
4. Different buyers will accept different prices, terms and conditions. The prospects usually range from the passive investor looking for a reasonable return for reasonable risk; to the active investor who sees the potential to do better than your forecast under his own management; to the strategic investor who sees even greater opportunity in buying a competitor, supplier or customer and merging it with his existing business to increase revenues, eliminate unnecessary overheads, and substantially increase profits. The selling price will increase accordingly.

For more on the subject visit: http://www.directtech.ca/pricing_a_business.htm

Teaching entrepreneurship

So the course is over and a dozen enthusiastic young entrepreneurs passed with excellent marks. Will they all succeed as entrepreneurs? Sorry, but taking a course is not enough.

In the very first class we agreed that anyone can be an entrepreneur if they are passionate determined, persistent and patient. So why not? It sounds like the same cliches we hear from successful celebrities - "believe in your dream, never give up". But we neglect to be honest and admit that there is always one more requirement for success - talent!

It's like the rookie golfer who just couldn't improve and after every bad shot the pro kept explaining that his problem was LOFT. So the the rookie tried another club and still couldn't hit it straight. The pro then explained "I didn't say your problem was loft, I said it was L-O-F-T: Lack Of F***ing Talent!"

Sometimes its best to discourage budding entrepreneurs who have a dream but need to recognize they are only dreaming. First find something they can be good at.

An impressive CEO

At a recent McGill alumni breakfast, the guest was Darren Entwhistle, President and CEO of Telus, Canada's newest national telecommunications provider.

A very articulate and focused leader, Entwhistle clearly communicates where he wants to go and his process for getting there. Still "frustrated and bitter" about the federal government's inability to get out of the way for his bid to acquire Bell Canada, he thinks we are handicapping Canadian telecom's from growing into world class competitors. A familiar refrain also from the banking sector and other industries frustrated by regional and provincial barriers.

Entwhistle also described the challenges of ignoring the financial critics and market watchers to stay focused on the internally sound corporate strategy. Short term share prices and industry fads will sway those outside opinions, but a well developed sound strategy will succeed over the long term.

An impressive CEO, Entwhistle obviously inspires confidence in his leadership for the management team, employees and shareholders of Telus. (And he's another McGill MBA - Class of '88.)

The Platinum Rule

Again I learned something new at the McGill MiniBiz Seminar this week. The topic was managing diversity, especially the generational gap between those born before WWII, the Boomers, Gen X and Gen Y.

For both managers of those diverse groups and for members of each generation the recommendation was to remember the Platinum Rule.

OK, we all know the Golden Rule, "Do unto others as you would have them do unto you". Apparently a pretty universal concept that has worked for many generations. Essentially, treat other people the way you would like to be treated. Seems good to me.

But consider the more effective Platinum Rule, especially when there are large cultural or generational differences to consider: "Treat other people the way they would like to be treated." Powerful concept.