Monthly Archives: May 2011

May 26, 2011 · 2:07 pm

Interview Discussing The Transformational Entrepreneur on Radio Ear Network.

I’d like to share an interview I did today with Joe Dobzynski on the show, The Authors’ Connection on the Radio Ear Network.  The Radio Ear Network has more than 10 million listeners in approximately 120 countries.  If you’re interested in hearing more about my book, “The Transformational Entrepreneur ~ Engaging The Mind, Heart, & Spirit For Breakthrough Business Success”, please hit play on the audio player below to listen to the interview:

If you would like a copy of the book, either in print or Kindle, it is available at Amazon and select, independent bookstores.

As always, thanks for your interest and I greatly appreciate your thoughts and feedback!

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· 1:38 am

Key Questions Your Sales and Marketing Plan Needs to Answer, Part Five.

Key Concepts ~ In this blog series, we’re exploring the twenty-five critical questions our Sales and Marketing Plan needs to answer to accelerate our success.  Let’s pick up with the fifteenth key question…

15.)  How have you validated your sales strategy?  Years ago, when I was cutting my teeth in corporate, a fantastically successful CEO would ask us, “How do we know that?”  It was the most important question we could ask ourselves…in effect, how have we validated our assumptions.  Every business prototypes their product before taking it to market, but very few test and measure their sales process prior to a full scale launch.  Testing the sales process, measuring target prospect responses, analyzing sales support infrastructure, and wringing out the delivery variables prior to making a major investment in sales can cut months off the ramp up time and help companies avoid costly missteps.  And missteps in front of the entire market.

Example:  Approaching the sales process like a scientist would create an experiment is invaluable.  Some time ago we were engaged to help a privately held company expand their sales revenue.  The owner wanted to hit the accelerator immediately, but we held off and “stress tested” a field sales model.  I personally picked up a bag and headed out the door and made sales calls with his target prospects.  What we discovered was that the owner had been giving deep discounts at the trade shows he had been attending for years.  His prospects knew this, and would wait for the next show to make a purchase.  The company had conditioned their prospects to behave in this manner.  Had we not tested  a field sales model in the real world, we would have never discovered this conditioned behavior.  Deploying a field sales force would have been a disaster because his market knew they could get a better deal by simply waiting to go to the next show.

16.)  What is your formal brand strategy?  There has never been as much noise in the marketplace as there is today.  Each of us is bombarded by somewhere between 3,000 and 5,000 marketing messages a day!  In order to cut through this static, your brand must mean something to your prospects.  More importantly, and this is according to research emerging from the field of Applied Behavioral Economics, your brand must connect both cognitively and emotionally with your prospects.  This doesn’t happen organically, it must be planned and managed for it to emerge.

Example:  Please refer to my blog series, “Building Your Brand in the New Economy” for a detailed example of how my firm, Performance Transformation, LLC is formally building connection, engagement, and inspiring entrepreneurs to engage our services through our branding.

17.)  Have you developed a professional standards strategy?  A professional standards strategy is a formal process designed to engage and enlist the key opinion leaders in a particular industry.  Opinion leaders influence your early adopters by endorsing your product or service.  This is especially important if you are launching a disruptive technology (point number four from earlier in this series).  This is a very common practice in the medical device, life science, and high technology industries.  Recruiting the support of opinion leaders alleviates the sense of risk early adopters may feel when considering your product or service.  Note I said feel.  Once again, this refers back to the emotional aspects of engaging your target prospects.

Example:  Shortly after being promoted to Vice President of International Marketing for a billion dollar medical device company, I realized there was no professional standards strategy in place for a new technology we were about to launch in Europe.  Understanding the cultural variances, country to country (and within several European countries as well) I immediately embarked on a process to enlist the support of highly regarded, clinical researchers in England, France, Italy, Spain, and Germany.  We held a summit at our European headquarters, invited the prestigious clinicians, and outlined the benefits of our technology.  We then engaged them to conduct independent research on our claims to validate our benefits within their circles of influence.  Had we not done this, prior to launching the product, our sales representatives would have been fighting an uphill battle from day one.

Next, we’ll discuss the critical nature of having a detailed, budgeted marketing plan in place, the marketing communications strategy, and the importance of formal sales training.  Thanks again for reading and I hope this series has been helpful!

© 2011, Terry Murray.   

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May 24, 2011 · 1:22 am

The Key Questions Your Sales and Marketing Plan Needs to Answer, Part Four.

Key Concepts ~ In this blog series, we’re exploring the twenty-five critical questions our Sales and Marketing Plan needs to answer to accelerate our success.  Let’s pick up with the twelfth key question…

12.)  What do you anticipate the adoption rate will be for your product or service?  Adoption rates, referring to the ease and speed your target prospects will purchase your product or service, can be challenging to predict.  This is greatly determined by two things; the need for your prospects to solve a problem or capture a competitive advantage and the compelling nature of your value proposition.  As you can see, this relates back to question number six.  This also relates back to question number four, is this a disruptive technology? As you answer these questions you’ll begin to weave together the fabric of a well thought out sales and marketing plan.  The more closely aligned you are to your prospects’ explicit needs (both cognitive and emotional), the tangible benefits of your value proposition, and the clarity in which you communicate this will all impact adoption rates.

Example:  During an engagement with an optical device manufacturer we focused our efforts on helping opticians drive reimbursement revenue through the application of our client’s new diagnostic tool.  While the technology clearly benefited patients, it was the fact that the opticians could capture 30% more revenue per patient visit that drove the speed of adoption.  We aligned with the clinicians’ self interest, demonstrated a very short pay-back period for the them, and clearly demonstrated the clinical benefits for their patients.

13.)  What do you anticipate the sales cycle to be?  Answering this question accurately can be one of the most mission-critical facets of your sales and marketing plan.  Hopefully you have extensive experience in your segment, but either way, take the time to inquire into your prospects’ buying processes.  There are two elements here; your sales cycle and your customers’ buying cycle.  Remember, your prospects are not in business to do business with you!  They’re in business to do business with their customers.  Take the time to thoroughly understand your customers’ processes…and map them out.  Build anticipated and unanticipated delays into the model.  I can honestly report that in all my years of business-to-business sales, what I do today, regardless of the product or service, will not begin to bear fruit for at least ninety days!  Additional research indicates 80% of buying decisions occur after the fifth contact.

Example:  The sales cycle is often related to the degree of risk the prospect will encounter if things go poorly after the sale.  The higher the risk, the longer the cycle.  A client of mine that delivers custom business solutions that strike right at the heart of their customers’ revenue streams has a sales cycle that can extend well over a year.  It takes that long to establish credibility and trust.

14.)  Have you researched your target prospects and created a CRM database?  This can be a key accelerant to capturing initial sales.  It is the difference between hunting with a rifle or a shotgun.  What’s important to remember is you don’t want your sales people driving this preparatory process.  This is a marketing function that should be well researched and validated prior to creating your sales kit and the execution of your sales training.  How else can you position yourself for success?  The last part of your sales training should be the issuance of the database and training on the CRM tool (Customer Relationship Management).

Example:  During an engagement with a life science client, we targeted researchers that were awarded NIH (National Institutes of Health) grants for a particular disease state.  We culled the public information records, identified 20,000 target prospects who could immediately benefit from the technology, and loaded the information onto a CRM platform.  As we completed sales training, we issued the database to the ten sales representatives we were deploying.  Within one month, all 20,000 prospects had been introduced to the new technology.  Thirty days into the launch we were fully engaged with our target segment!

Next, we’ll explore the importance of validating your sales strategy, creating a formal brand strategy, and the critical nature of cultivating opinion leaders in your target segment.  Thanks again for reading!

© 2011, Terry Murray.   

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May 23, 2011 · 4:40 am

The Key Questions Your Sales and Marketing Plan Needs to Answer, Part Three.

Key Concepts ~ In this blog series, we’re exploring the twenty-five critical questions our Sales and Marketing Plan needs to answer to accelerate our success.  Let’s pick up with the ninth key question…

9.)  Are your profit margins healthy and in alignment with your industry’s norms?  This speaks to your ability to control your manufacturing and delivery costs and compete on an even playing field.  You may not need a competitive advantage in your cost structure (i.e. economies of scale), but you need to be competitive.  This also helps ensure you’re not leaving money on the table.  Another key point, if your competitors are making 70% margins and you’re only capturing 20%, a price war could leave you crippled.

Example:  My first experience in senior management was with an injection molding company that manufactured life science and medical disposables.  Several of our product lines were the highest priced in the market while having the lowest profit margins as well.  This immediately raised a red flag relating to our ability to continue to compete effectively going forward.  It spurred our decision to shift our strategic direction away from proprietary products to custom products.

10.)  Are there multiple segment opportunities for your product or service?  This is truly critical, as the worst thing a startup, with limited resources, can do is dilute their efforts across too many segments.  Trying to be all things to all people is a recipe for not securing meaningful traction with anyone.  I guide my clients down the path of creating a comparative decision matrix, a single page tool that compares the costs and benefits of positioning your product or service with particular market segments.  Not only does this help prioritize activities, focus, and investments, it helps entrepreneurs prioritize until it hurts (which is a good thing).  In addition, it helps startups see their rollout in strategic progression; how launching in one segment will build momentum to launch into the next segment.

Example:  I’ll go back to the stem cell company as an example.  We uncovered more than seven different market segments where this product had significant value.  By launching into the most accessible, cost effective, and least critical segment first, we were able to bring our sales team up to speed on complex, scientific concepts, get their legs underneath them, and position ourselves for inclusion in the scientific literature.  This entire process built credibility and expertise for launching into the next, more profitable, but less forgiving market segment. 

11.)  How have you defined and profiled your target prospects?  This sounds simple but you’d be surprised how many startups don’t take the time to fully explore the importance of understanding the buying criteria and application of their product or service in the marketplace.  This comes down to knowing who has the ability to understand your value proposition, who can pay for it, and who signs the purchase order.  There are true prospects and there are multiple buying influences for many things, especially in a business-to-business sale.  If you don’t know your target prospects intimately how can your position your product and relate your value proposition?  How can you know what sales channels will be most effective?  And how do you know what advertising strategy will reach your targets?

Example:  Several years back I was consulting on a project that involved an ancillary product for the operating room.  When the owners of the product spoke to us about how this item was going to bring benefit to the surgeon we realized they hadn’t defined their targets properly.  The fact of the matter was, the surgeon would never touch their product, the O.R. nurse would handle it during surgery.  What could matter to the nurse meant nothing to the surgeon.  This one point shifted the entire go-to-market strategy.

Next, we’ll discuss anticipated adoption rates, the sales cycle, and the importance of creating your prospect database.

© 2011, Terry Murray.   

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May 20, 2011 · 2:25 pm

Key Questions Your Sales and Marketing Plan Needs to Answer, Part Two.

Key Concepts ~ In this blog series, we’re exploring the twenty-five critical questions our Sales and Marketing Plans need to answer to accelerate our success.  Let’s pick up with the fifth key question…

5.)  What does your competitive landscape look like…is it highly consolidated or fragmented?  If you’re intimately familiar with your market, this question is relatively easy to answer, but do your homework anyways.  When conducting macro market research on a budget, take a look at some of the market research companies online.  Start by searching for your particular product, service, or market either on a search engine or on a market research company’s home page.  Most of these companies let you look at their Table of Contents for each report (which can easily run into the thousands of dollars to purchase).  Towards the end of the table, you’ll generally find a list of key players in the market.  Now you’ve got a jumping off point.  If they are publicly traded companies, you’ll be able to download their annual reports and determine their sales, growth rates, and key strategies for the coming years.  Privately held companies may take a bit more research to extrapolate critical elements, but if you dig deep enough you’ll be surprised what you can find!

Whether or not your competitive landscape is highly concentrated or fragmented will help guide your positioning strategy (i.e. how you will go vis-a-vis with the competitors with your prospects).  Don’t let big competitors necessarily scare you off…they can often be complacent and bureaucratic, having lost touch with their core customers.

Example:  My firm, Performance Transformation, LLC, also provides training and strategic development services for established companies.  Our approach is state-of-the-market; we’ve been told by prospects that our programs are often more comprehensive and mindful than the big consulting and training firms.  Can we dislodge a multi-national that’s engaged with another multi-national?  Probably not, but can we offer world class developmental services to small to mid-size companies the big companies can’t be bothered with?  Definitely, yes!  By understanding our competitive landscape we know where to go and what opportunities to pursue.

6.)  What are the strengths, weaknesses, and strategic direction of the competition?  Again, this will help guide how you position yourself in the marketplace.  Talk to your target prospects to get an idea of what they think about the other players in the market.  Play the small company card, especially when you’re going up against the behemoths.  Establish relationships and simply ask what they love about the competition.  Asking positive questions will often lead your prospects to share what they don’t like as well!

Example:  One of my first sales jobs was with a tiny biotechnology products distributor in Massachusetts back in the 1980s.  There were nine people in our company and I was competing with four big distributors whose sales were in the hundreds of millions of dollars.  By spending time with my prospects I began to learn that the customer service levels of my big competitors were fair at best.  Could I compete with them on price?  No, and I never wanted to do so.  Could I out hustle the competition in my accounts with personalized service?  Yes, and that’s what I did, securing the entire stockroom account for one of the largest biotechs in Cambridge at that time.  Size doesn’t always matter…people root for the underdog!

7.)  What will compel your prospects to do business with you?  This really speaks to your value proposition.  Traditionally, this has been entirely grounded in determining what rational benefits you can deliver.  More recently, however, the field of Applied Behavioral Economics has shed new light on economic decision making.  Approximately 70% of economic decisions are emotionally-driven, even in business-to-business transactions.  What does this mean to entrepreneurs?  We need to uncover what I call the secondary emotional gain our prospects will enjoy by doing business with us.  

Example:  Back in my sales days, I worked for J.T. Baker, a division of Proctor & Gamble that sold specialty chemicals to the biopharmaceutical manufacturing market.  Much of what we sold was U.S.P. (United States Pharmacopeia) grade, meaning every competitor sold the exact same formula…true commodity status.  In my first year we went after seven major contracts, were never the low bid, and won every customer!  How?  Our quality systems delivered a higher degree of comfort with our prospects.  They were willing the pay more for sodium chloride (table salt) from us because it was less risky to their careers.  If the FDA came calling, they knew we had their backs.  That’s secondary emotional gain.

8.)  What is your pricing strategy?  This can be challenging to new entrepreneurs.  How do we price our products and services?  I guide my clients down the path of customer-centric pricing.  In other words, take a look at how your product or service enables, adds value, or cuts costs with your client’s endeavors.  This approach to pricing is directly related to what is important to our prospects, not us.  It is not cost-plus a desire margin or me-too pricing.  It speaks directly to the needs of our customers.

Example:  When I was running an international service business that supported pharmaceutical manufacturing equipment, we took a dramatic turn with our pricing strategy.  Pharmaceutical companies have a limited window to pull value out of their drugs before they go off patent.  Every day a “blockbuster” drug is offline due to an equipment problem they are losing upwards of $3 million per day in revenue that they will never recover.  So, if my business can get them back online faster than anyone else, how much of a premium is that worth?  Charging ten or twenty thousand dollars for emergency response is peanuts compared to losing $3 million a day.  And what do you think the secondary emotional payoff is to the director of manufacturing in that situation?

We’ll pick this up next time with an exploration of profit margins, segment prioritization, and validating targeted prospects.  Thanks for reading!

© 2011, Terry Murray

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May 19, 2011 · 2:21 pm

The Key Questions Your Sales and Marketing Plan Needs to Answer, Part One.

Key Concepts ~ This blog series will examine the critical questions every startup needs to answer on their way to market.  We’ll explore twenty-five key questions that need to be answered in order to drive success.

Working with first time entrepreneurs, coaching them through their strategic planning process, I consistently observe a common challenge they all seem to encounter early on.  We always seem to move briskly through examining their Vision and Intention.  The Self-Assessment process (strengths, weaknesses, and core competencies) is relatively straight forward, albeit highly self reflective.  But once we get to the Market Assessment phase, the foundation for their Sales and Marketing Plan, the real challenges begin.  What I quickly realized was it is difficult to come to the right sales and marketing answers if you don’t know what questions to ask.  That’s what we’re going to cover in this blog series; identifying the right questions we need to ask ourselves in setting the foundation for a well researched, validated Market Assessment.

Whether you’re a sole entrepreneur, running a firm that will require funding for growth, or intend to sell your company someday, you’ll need to create a well researched and validated sales and marketing plan.  Failing to do so can send you off in the wrong direction, mis-prioritize your opportunities, and cause you to invest poorly in marketing with little return on investment.  It can mean the difference between reaching traction (positive cash flow) or falling off the map because you’ve burned through your seed capital.  If you will be seeking investors or intend to sell your company someday, documenting the answers to the following questions will also be critical for your success.

1.)  What is the projected market segment consumption capacity for your product or service?  Simply put, how much of your product or service can the market consume if you were to capture 100% of the market.  Granted, nobody does this, but what this does is identify the total size of your targeted market segment.  It identifies whether or not the market segment is worth pursuing.

Example:  My firm, Performance Transformation, LLC, provides professional coaching and strategic development services for nascent  entrepreneurs (people considering starting a business).  The Small Business Administration’s Office for Advocacy has identified that, at any given time, there are 12.6 million nascent entrepreneurs in the U.S. who spend more than $60 billion annually trying to figure out how to start a business.  That’s a segment worth pursuing!

2.)  Is this a growing segment?  You will see the term CAGR (current annual growth rate) used to define segment growth in your research.  If you have competing opportunities in various segments for the same product, technology, or service, answering this (in combination with question #1) will help you prioritize your sequence of focus.

Example:  Some years ago, I was creating a strategic plan for a life science technology company.  The core business of selling cryogenic freezers was very mature and only growing by a few percent a year.  The demand for centralized cryo-storage repositories, a service business, was growing by more than 20% per year.  Our strategic focus shifted from box manufacturer to service provider and the company’s valuation grew tenfold in four short years.

3.)  What are the key barriers to entry?  Barriers to entry can be organic or competitively derived.  These are hurdles you will need to clear in order to secure market traction.  Understanding these barriers will help you forecast how long and how expensive it will be to access your target market segment and secure profitable customers.

Example:  Organic barriers to entry emerge from the nature of the business.  They relate to the expense and time it will take to set a foundation.  Launching a new automotive company would represent a huge investment requirement and years of construction, design, and advertising to launch simply due to the nature of the business.  Competitively derived barriers relate to the entrenchment and anticipated response of well established competitors in the segment.  Toyota and Honda have economies of scale and high brand equity…and they may not embrace another competitor on the scene.

4.)  Is this a disruptive technology?  A disruptive technology is a game changer in the marketplace.  It challenges the dogma of the market and is so new in concept and enabling capabilities it can take your target prospects time to get their heads around the value proposition of your product.  Launching a disruptive technology takes missionary zeal!

Examples:  How do you listen to music today versus fifteen years ago?  The iPod and iTunes are examples of disruptive technology.  They displaced the entire business model of the recording and music industry.  

A business-to-business example is an adult stem cell (meaning it was not from human embryos) line I was engaged to launch back in the early part of the century.  The cell line, derived from human umbilical cord blood, post-birth, was genetically stable, naturally occurring, and highly naive (meaning it could be differentiated into many kinds of tissue – neural, cardio, bone, liver, pancreatic, etc.).  It was so revolutionary the scientist we spoke to couldn’t believe it was real.  The other disruption the cells represented was the fact that research scientist had built all their research models around murine (mice) stem cells.  Their entire research platform had to shift to accommodate the new, enabling technology.  But as one of our sales people said to a researcher, “I don’t think the National Institutes of Health are spending $28 billion annually to cure cancer in mice!”

We’ll pick this thread up next time…I sincerely hope this is helpful and, as always, your thoughts and comments are welcome!

© 2011, Terry Murray.

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May 17, 2011 · 1:14 pm

You Cannot Manipulate Your Way To Engagement.

Key Concept ~ Engaging prospects on an emotional level with positive intention and authenticity does not mean manipulating people’s base emotions.

I came across a fascinating article the other day that illustrates how business-as-usual thinking misunderstands what it means to authentically engage prospects and customers.  The article, entitled, “Say It With Heart” appeared on the Fox Business website on May 11, 2011.  As this is a main theme in our business philosophy, of engaging the mind, heart, and spirit for breakthrough performance, I was intrigued to read what they had to say.  What I read revealed a gross misunderstanding of what it means to engage one’s prospects on an emotional level with positive intention and authenticity.  The article reflects the old school’s misinterpretation of the conscious work that is emerging from enlightened researchers, behavioral economists, performance psychologists, and Transformational Entrepreneurs.

The author, whose background is in producing commercials and jingles, pointed to five elements that he believes will enable marketers to “make an appeal to the heart”.

The first element discussed was a call to appeal to a customer’s “Moral Compass”.  While this may sound fine, the example the author used (buy local vs. sending your money to Asia) sounded a bit more like xenophobia than appealing to one’s core values and beliefs.  Now, supporting local businesses is a wonderful thing, and we do so whenever possible.  If buying local is a moral imperative in someone’s value system there’s no need to demonize another part of the world…the intention there is to trigger a fear, if not a hate-based response.  It simply does not sound like an appeal to a higher purpose.  If we are to appeal to another being’s moral compass shouldn’t we do so through our own?

The second element explored was “Phobias”.  This is another fear-based approach, and the example used was a classic “hurt-and-rescue” technique every sales representative in the 1980s (including me) was taught in an attempt to scare the customer into buying.  In fact, this goes beyond triggering simple fear, as the dictionary defines a phobia as, “a persistent, irrational fear of a specific object, activity, or situation that leads to a compelling desire to avoid it”.  Sounds a bit like bullying to me…bullies find a weakness and exploit it in their victims.  How does that appeal to the heart?

The third element was “Self-Reward”, which as it was explained read more like self indulgence.  Perhaps the author had also written the jingle, “You deserve a break today, so get up and get away…” I’m sure you know the rest of the commercial.  The example the author provided pointed to an appeal for selfish behavior…you’ve been burdened all day with the responsibilities you’ve incurred through your life decisions, so you deserve a shopping spree.  Not only is this an attempt to trigger resentment, it also cultivates a sense of entitlement.  These are all concepts rooted in ego-driven behavior that isolates us rather than connecting and engaging us on a deeper, heart-felt level.

And speaking of ego, we come to the fourth element, “Peer Pressure”.  The opposite of living a mindful life is succumbing to the insecurities of peer pressure.  Goodness, isn’t this a fundamental lesson we try to impart with our children?  To think for themselves, embrace their own values, and ignore the negative behaviors that can emerge from peer pressure.  The example the author used was even more onerous; attempting to cultivate jealousy and envy because someone with a lower paying job is driving a nicer car than you.

The final element the author explored was “Guilty Conscious”.  He pointed out the powerful technique of leveraging the fears that keep people awake at night to motivate buying decisions.  Lovely…as if we are sleep deprived enough!

The point I’m trying to make is the importance of intention.  The sum of the elements from this article suggest that cultivating fear, hatred, xenophobia, insecurities, jealousy, envy, guilt, entitlement, and selfish behavior is the way marketers can “Say It With Heart”.  This is remarkably incongruent, manipulative, and clearly resonates with negative intention.  It reflects a predatory mindset and zero-sum game.  For me to win, someone else must lose.  And just to emphasize the negative intention behind these techniques, there was no place to leave a comment in response to this article on the Fox Business site!

The fact is, people can sense when they’re being manipulated and it is the quickest way to disconnect any opportunity for meaningful engagement and relationship to emerge.  Intention matters, and the companies that understand this and walk their talk will create a flourishing, preferential advantage in their marketplace.

© 2011, Terry Murray.

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May 16, 2011 · 1:49 pm

Ten Common Missteps Entrepreneurs Make On Their Way To Market

Key Concept ~ Ten common errors entrepreneurs make on their way to market.

Having spent the past ten years working as a consultant and business coach for entrepreneurial endeavors and investor-driven startups I’ve witnessed a lot of mistakes really smart, highly motivated professionals make on their way to market.  When you sit back and examine them, they seem fairly obvious, but in the heat of the launch even the most seasoned entrepreneur can lose his or her perspective.  Here are some of the most common missteps I see, year after year:

1.)  Don’t fly by the seat of your pants.  You need a business plan.  Eight of the top reasons businesses fail, as identified by the Small Business Administration, can be traced back to the lack of sound, strategic business planning.  The ninth?  Inadequate business planning.  The value of planning is in the process itself.  It charges your vision with the positive energy of your intention.  When done well, it forces the entrepreneur to think through potential risks and develop contingencies.  It also provides a critical management tool for measuring and calibrating execution.

There’s a movement in the blogosphere led by young technology entrepreneurs that proclaim, “Just do it…don’t bother with a plan…it will just slow you down”.  This is the worst advice I’ve ever heard.  Just because some youngster struck it rich writing the code for a widget that caught the attention of Google doesn’t make them an expert in launching a new business.  Caveat emptor.

2.)  Don’t assume just because there’s a need there’s a market.  If there’s one thing we’re learning from Applied Behavioral Economics is people, and entire organizations for that matter, aren’t as rational as we once thought.  Approximately 70% of economic decision making is emotionally-driven.  There could be myriad reasons your market isn’t ready for your product or service, none of them relating to what appears to be a rational need.  Validate your assumptions.

3.)  Don’t develop your product or service in a vacuum.  Get your target prospects involved early and involve them often along the way.  Making meaningful calibrations early in your development process is exponentially cheaper than making the same changes during your sales launch.  Be customer-centric!

 4.)  Don’t price your product or service solely on the competition and never price by formulating your cost plus a desired margin.  While competitive pressure may influence your pricing, it shouldn’t define your value proposition.  If you price too low, you may be sending the wrong message and once your prospects are anchored to your price/value proposition they’ll never forget it.  It is very difficult to raise your prices once expectations are set.  And remember, except perhaps for Walmart, very few businesses have discounted their way to success.  Quantify and validate your pricing decisions.

5.)  Don’t be overly optimistic about your revenue projections.  Until you engage the market, you don’t know what you’ve yet to experience.  Be brutal with yourself regarding your pro forma financials.  Make painfully conservative revenue projections, then cut them in half.  Now, cut them in half again.  Is what’s left still a viable business?

6.)  Don’t underestimate the sales lag driven by early adoption rates.  It takes time to establish your presence in the market.  If you’re launching a disruptive technology (an entirely new technology or methodology that challenges the existing dogma) anticipate it will take you twice as long to achieve traction as you initially thought.

7.)  Don’t discount the level of noise your target prospects have in their world.  People are bombarded by anywhere between 3,000 and 5,000 marketing messages per day.  Just getting an appointment with a decision maker is ten times more challenging today than it was just a few years ago.  Expect your prospects to be overworked and remarkably busy.

8.)  Don’t assume you’ll be able to get seed-funding.  There have been dramatic shifts in the angel investor, venture capital, and private equity landscape in just the past few years.  Plan to bootstrap your way to your launch threshold.  For the vast majority of startups, that’s where the funding action is today, in commercialization, not development.

9.)  Don’t bet the ranch on social networking.  While the marketing tools have changed, the fundamentals are the fundamentals.  Social networking may help you connect, but will it drive engagement?  You may be able to build a large following and generate a bit of a buzz, but if you’re not positioned to commercialize and convert this traffic and attention it can be a waste of time.  Social networking is a tool, not a strategy.

10.)  Don’t go it alone.  Find some seasoned help, whether it is through S.C.O.R.E., a coach (with applicable skills and expertise in startups), an experienced strategist, or a trusted advisor.  You need someone that can challenge your assumptions and, at the very least, be a sounding board.  A planning template or software program does not replace the wisdom that comes with experience.

© 2011, Terry Murray.

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May 12, 2011 · 2:39 pm

Igniting Breakthrough Performance, Part Five – The Common Denominator

Key Concept ~ Igniting breakthrough performance comes down to one element that affects everything else in your business; the quality, congruency, and authenticity of your relationships.

On a side note, I’ve updated my Services page.  Hopefully this update will clarify my vision of how I work with you, my clients, and will resonate with my intention!

We’ve covered a lot of ground in this blog series, so I’d like to take a few minutes to distill the discussion down to its defining element – relationships.

Here are the key points we covered in the series:

1.)  Igniting breakthrough performance requires three coordinated and aligned elements:  Leadership, Strategy, and Culture.  These elements support authentic engagement.

2.)  Engaging people, whether they’re your associates, prospects, partners, potential investors, or constituents, on both an emotional and cognitive level is a critical success factor.  How people feel about your business is as important, if not more important, than what they think about your business.

3.)  Authentic engagement is kindled by your Vision and your Intention.

  • Your intention will resonate in people.
  • The clarity of your vision will help communicate your intention.
  • Your passion will amplify your intention.  It is infectious in others.
  • Check with your gut…your intuition will help guide you.  Your vision and intention must feel right to you for it to feel right in others.

4.)  Your level of Self Awareness is critical.  It is the first step towards self mastery.  Self Awareness leads to Social Awareness.  These attributes combine to create presence.  Authentic presence (not ego-drive) enables you to quickly establish trust and create meaningful, lasting relationships that serve your business.

5.)  Meaningful relationships, the ones that help you move your business forward, emerge one step at a time:

  • Cognitively Connect (the mind).  You capture someone’s attention and interest.  They think they may have interest in your product or service…it is worth a second look.
  • Emotionally Engage (the heart).  Your intention resonates in others…they care about your success, your mission, and your business.
  • Inspire and Motivate (the spirit).  Your call to action.  Your congruency, of your authentic self and behavior, and your alignment of leadership, strategy, and culture moves people to purchase, invest, and join in support your endeavor.

Regardless of the type of business you’re in, I’m confident this approach will spark a greater level of success.  I’ve seen it work too many times to not have absolute faith in this approach.  It is even more important in today’s economy, especially the internet economy, where information flows freely and business relationships can emerge without ever meeting face-to-face.

I hope this series has provided some fresh insights and a slightly different perspective for your business.  As always, thank you for reading and your comments are always appreciated!

© 2011, Terry Murray.

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May 10, 2011 · 12:33 pm

“SuperJobs”? Really?

Key Point ~ Corporate behavior is eroding their own competitive advantage,  opening the door for entrepreneurs to succeed.

I read an article in the Wall Street Journal the other day that compelled me to comment.  It was titled, “SuperJobs:  Why You Work More – Enjoy It Less”.  It was not exactly breaking news, detailing how individuals in corporations are being asked to expand their duties well beyond their traditional job responsibilities, working more and more hours, and seeing little in return.  Buoyed by the psychological fallout of the worst economic stretch of the past 70 years, the article points out the fact that many corporations are taking full advantage of the situation by asking more and offering less in return.

We’re witnessing some remarkably disconnected behavior and thinking from leadership in Corporate America.  In IBM®’s bi-annual CEO survey of 2010, chief executives stated the single most important attribute they’re looking for in leaders is creativity and their ability to develop creativity throughout the organization.  Yet most corporations cling to outmoded leadership philosophies that trace their origins to the 1920s.  It simply amazes me that executives fail to see the correlation between how they continue to treat people and the record levels of employee disengagement and employee dissatisfaction.  Research from Gallup® indicates nearly three quarters of employees have little or no passion for their work.  They’re literally sleepwalking through their day in order to survive emotionally.  I’ve recently read several surveys that place the percentage of dissatisfied employees at between 43% and nearly 60%.

The fact of the matter is, the source of value creation in today’s economy is the efficient commercialization of intellectual property.  And where does that intellectual property come from?  People.  Human creativity is the defining source of value creation in today’s (and tomorrow’s) economy.  Unfortunately, and this is what baffles me, corporations continue to operate from a perspective of the Industrial Age; of exploiting once cheap, abundant, raw materials, the application of low-cost, specialized labor, combined with the leveraging of capital.  During a recent research project my firm, Performance Transformation, ran some numbers and estimated that, for many companies, approximately 50% of their payroll delivers little or no return on investment.  That’s one hell of a scrap rate!  What do you think Henry Ford or Alfred Sloan would have done if half their raw materials went to waste on their factory floors?

People, and the application of their talents, represent the raw material of intellectual property.  Creativity cannot be sparked through exploitation…it must be cultivated! Squeezing our way to growth and profitability is not a sustainable strategy in today’s economy.

The article went on to say that these challenges will make people better leaders in the long-run.  That stretch job assignments, while difficult, temper the next generation of leadership by fire.  Well, perhaps.  It did for me during my corporate career, but the net result was that it prepared me to be my own leader, to start my own company, to be an entrepreneur.  That’s the remarkable, regenerative process of capitalism.  I strongly believe corporate behavior is spurning the next wave of entrepreneurs, not the next generation of their own leadership.

Managerial process always lags behind technological progress. The Industrial Revolution can be traced to 18th century England, but it wasn’t until the early part of the 20th century that Alfred Sloan and Henry Ford invented new methods of management and production.  We’re at a similar inflection point, where a new approach to management and production needs to evolve…it is long over due.  The companies that figure this out will be the stars of this new century…those that don’t will be relegated to the history books.

And that’s where we come in, the entrepreneurs of this world.  This is the great blind spot of the Goliaths.  Big companies may enjoy many advantages over us small players, but human engagement and creativity isn’t one of them, and that will be the defining differentiator in the coming years.

© 2011, Terry Murray.

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