Achieving Flexibility and Results in a Time of Uncertainty;
Three Cheers for Interim Management!

By Charles Besondy: Partner (Austin Office)

Depending on the political slant of your favorite news source the U.S. is either falling into recession or experiencing a mere speed bump. Everyone can agree the economy has taken it on the chin lately. The undertow caused by defaults of sub prime mortgages is still threatening to pull some financial companies under. The record high price of oil is having an inflationary impact on nearly everything we buy. The value of the dollar is at record low levels compared to the Euro. Swings of 100-200 points a day on the NYSE is common place. Unemployment is still relatively low, however, and inflation is in check (at least for now).

These are unnerving times for executives responsible for driving their business plans forward no matter the head wind. Revenue forecasting, always a challenge, is made more difficult by the economic factors in play (not to mention a Presidential election). When there’s less confidence in the revenue forecast executives are loath to add to their fixed costs, such as payroll. It is common in times like these for companies to become very cautious about filling vacant positions, or adding head count.

Just because the economy is sputtering doesn’t mean that companies are putting key initiatives on the back burner, or hunkering down in a bunker mentality. It simply means they are looking for ways to maintain momentum while mitigating financial risks. Interim managers or on-demand leaders in Marketing and Sales can play invaluable roles for companies during uncertain economic times by achieving the necessary results without adding to fixed payroll costs.

Q2 Employment Outlook Softening

ManPower, Inc, the $21 billion employment services company, just released its Manpower Employment Outlook Survey for Q2 2008. It clearly reflects a softer jobs market for the quarter ending June 2008.

ManPower’s CEO and Chairman, Jeffrey A. Joerres summarizes the report’s findings, “The important change we are seeing is not about reductions in workforces, like we would typically expect in a recessionary period, but rather an increase in the percentages of employers who are planning to put a hold on hiring and forge ahead with the people they already have. This is definitely a ‘wait and see’ approach as they evaluate where their economies are headed, rather than a panic attack at this point.”

In the survey “a quarter?over?quarter comparison shows the weakest employment prospects since Quarter 1 2004. According to seasonally adjusted survey results of the 10 industry sectors surveyed, only transportation/Public Utilities employers anticipate improved conditions for job seekers in the coming quarter versus Quarter 1 2008.” As you’d expect the figures vary by region and by industry sector. The report can be downloaded from ManPower’s Website.

Damn the Torpedoes and Full Speed Ahead

Any experienced business leader will tell you the keys to achieving results during periods of uncertainty are to mitigate the financial risks but keep charging forward. The use of interim managers is a smart way to achieve much?needed flexibility and results during unnerving times. Here’s why.

1. You can quickly apply the right talent to achieve the necessary results. Hiring an interim is much faster and easier than is recruiting someone for a senior-level permanent position. Less valuable time is lost.
2. You can focus entirely on the skills you need for the short term without complicating the picture with concerns about future requirements. You don’t have to find the marketing or sales leader who is perfect for this quarter as well as next year and beyond. You can focus like a laser on meeting the short term requirements.
3. Interim managers are the utilities of management talent. You only pay for what you use. This is an enormous benefit during uneven economic conditions because you can adjust the volume of service you need very easily and quickly. To use interim talent you’re making short-term financial commitments with variable dollars, rather than long term, fixed cost commitments.
4. Interim manages can deliver results for less. When the total cost of recruiting and employing a permanent executive or senior manager is compared to an interim’s fees the cost advantage can be significant.
5. Interim managers often provide a more practical and cost-effective solution than management consultants. Usually you can bring in the same level of talent, one with both strategic and operational credentials, who can be a member of your team for less than management consultants with bureaucracies and fancy offices to support.

Don’t let the next months of economic uncertainty prevent you from keeping your customers satisfied and your competitors on their heels. Maintain fiscal flexibility and generate results through the use of interim management for filling gaps and driving forward key initiatives.

For a more in-depth look at how to successfully utilize interim management strategies check out these sources:

• Leadership On Demand: How Smart CEO’s Tap Interim Management to Drive Revenue, available from Amazon.com or direct at www.leadership-on-demand.com
• One Riot – One Ranger, a blog presenting useful insight and discussion on the topic of interim management
• Besondy’s profile: Charles Besondy

Managing Customer Demand When You Have Nothing to Sell

By Peter Klinge Jr., Regional Managing Partner (Salt Lake City Office)

Demand for your goods is at an all time high. Business is so good that you cannot provide the customer with what they need fast enough. You’re anxious as the company’s executive about how long this business cycle will last and if cap ex investment will justify itself 2 or more years forward.

This scenario of seemingly unlimited opportunity to grow revenue becomes a nightmare for some companies.

One client called their posture…order prevention… avoid answering the phone…

While this approach does not endear a company with customers, it’s all too common. Commonsense suggests there’s an opportunity to provide value in satisfying customer in such circumstances, and with even higher margins… but how? Some suggestions for the senior sales and marketing executive:

• Know your most important customer very well > define the ideal client profile; tier their value to your company in segments and treated accordingly;
• Understand your personal as well as your company’s commitment to a value proposition > customers need you, and the relationship is much more than transactional; what is the customer priority and pain and define your value in that context;
• Develop knowledge about supply chain and when products can be reasonably made and delivered to customers> demonstrate to customers your leadership on understanding and managing the process issues;
• Manage customer expectations…Be on time and when you can’t do that be early…Your promise is an example of your reputation. The promises you keep enhance credibility and the relationship with the customer.

This might be pretty obvious to most experienced executives, but often in the throws of the battle these points are overlooked.

A good client example is one that services the mining exploration industry. Since 2004 the industry has been exploding as demand for base metals increased dramatically. Much of the demand increases point to the developing economies and infrastructure build outs of China, India, Russia, and Brazil (BRIC).

The client company is a leading exploration driller. They also are a leader in certain products needed by drillers to secure ore samples at the mines. Added to this is a limited supply of global companies for customers to pick for service. The result is a classic supply-demand bottleneck with providers in an enviable seller position.

Strategies to address demand issues:

• Consolidate business around the largest worldwide customers by offering preferred contract rates for extended terms;
• Focus precisely on key account needs and issues to meet delivery expectations;
• Process these needs into ideal client profiles that might look like the following:
• Extended multi-year contracts;
• Client understands Company’s value proposition and the need of dialogue in partnership if the service provider is going to properly address their economic and business issues;
• Emphasis on delivery solutions to problem versus price point;
• Win-Win account management approach to establishing benchmarks, goals, fair pricing and incentives to achieve mutual satisfaction and benefit;
• Greater mutual business visibility to understand requirements for profitability, equipment and people, supply chain, and cap ex support for manufacturing expansion for product.

The initial priority of this process centers upon serving major mining houses exploration needs. The Company’s product segment is undergoing a similar process as a means of more effectively aggregating smaller customer segments into varied client profiles based on purchase recency, frequency, and dollar value.

This method of analysis will inform the strategy to determine further key account development for larger customers versus a more self serve retail model for smaller ones.

Most significant in orienting a business in a demand management scenario is a willingness to train a company’s efforts on listening to the customer, and then outlining what can be reasonably accomplished to meet the challenges.

For a more in-depth analysis from Peter J. Klinge on other issues, please visit his OneAccord

Profile: Peter Klinge

• Four Steps to Better Behavior Marketing
• Landfill Power Generation: Making Public Policy Work with Enterprise

How Does the VP of Sales Get Results?

What Activity Management should the CEO Expect?

By George Twiss: Partner (Seattle Office)

How does a good sales executive manage sales results? He/she doesn’t.

Assume your organization provides a product or service for which there is a market, a need or want which you can expect to satisfy in a reasonable time frame at a price that delivers mutual value. Then here is a simple formula to drive sales results:

People + Process = Performance

The formula means this: Sales leaders need to hire the right People, train and motivate them; take care of their needs. [Remember, a leader’s role is to help people be successful; remove roadblocks]. Then, ensure the Sales Process, the selling steps and cycle that fits best in your industry with your customers/prospects, is in place and being followed.

If you focus on People and Process, then Performance, in terms of Sales results will follow. CEO’s, in helping your VP Sales be successful in delivering the Performance you both want and need, ask about the People and the Process.

Looking closely at this simple formula, we start with People. As a Sales leader, what must you do to leverage success? Here are some of the elements you need to consider:

• Selection – Sourcing, recruiting, and hiring are the keys to long-term success.
• Training – The key to short term success.
• Compensation - It is absolutely a Sales motivator. Be sure it is fair, carries doable targets, can be leveraged by overachievement – and is focused on the behaviors you want.
• Recognition – Another motivator, everything from ad hoc “good job” to a regular monthly/quarterly program possibly leading to an annual Presidents Club trip [these do not have to start elaborate or expensive; I have done a simple overnight at a nearby resort].
• Communication – be sure to let the Sales force know what you are working to accomplish and how.
• Opportunity – there is a need to know how someone can contribute and grow.

Taken together these elements help create a healthy environment that enables members of your Sales force to feel good about themselves and perform well.

There is more people focus needed, however. Besides the direct sales force, you must look to other key relationships, for example: Internal - CFO, Service, Production; External – key customers, partners, industry contacts.

When I speak of managing relationships, I differentiate between managing and manipulating. The difference, I believe, is in the intent. By managing relations, we are genuinely interested in improving the end product, in accomplishing more for all by working together. Manipulating on the other hand, implies favorable results for one party only, without regard for others or the end result.

After people we turn to process. Here I mean the process used to manage the business activities. Any specific process will vary from industry to industry. What is most important is that you have a process and follow it. Any good process will be built around these three principles – Sales cycle, Customer focus, A’s before B’s [need to change Attitudes before you can change Behaviors]. The elements of your process might include:

• Prospect Identification – Referral [always the best and highest]; Web search [look for someone you know: management, board, Linkedin connection]; E-mail/phone contact – mix them [especially to “warm” leads]; Industry Association activities [including trade shows]; Cold calls or cold e-mails [tough but not impossible].
• Prospect Development – Who is a prospect and why? Who is not and why not? What is needed to move forward?
• Closing Tools – Proposals, Demonstrations, Trials – what ever fits your industry.
• Tracking – Next step: what, who, when? Can be as simple as a MS Excel [or Word Table doc - which I prefer], more complex [ACT, Goldmine, etc], or fully featured CRM based on your needs. But it must be inspected if you expect it to be current
• Sales Forecasts – where “the rubber meets the road.” – what is real and can be expected to close, and when! Covered in regularly scheduled sessions – and published.
• Senior Management Involvement – Remember, Sales is everyone’s job! How can you assist? Visit or call key prospects? Just make some calls with the Sales force [or take a few prospects and work them yourself]
• Customer Complaints – Don’t neglect to consider these as Opportunities: fix it fast and retain now or regain in the future. [Senior Management – this may be your best area of contribution].

People + Process = Performance – does this formula work? Let me tell you a story about myself when I managed Xerox’ office in Worcester, the second largest city in Massachusetts. That time Worcester County was the leading manufacturing area in the state. So that is where we set up a pilot sales assignment, Manufacturing Specialist - a first in the Northeast. The value proposition was to use Xerox technology to enable manufacturing firms to make their products more efficiently. Here is how we set up the assignment:

People – I chose my best up and coming, hard?charging young star. We provided specialized training and local market pr.

Process – We identified the top firms and developed a game plan centered on unique applications to enhance productivity. My Specialist developed a presentation and set out to conquer the manufacturing market. I made contacts and calls with him, often.

Performance – Nothing happened! No results. For six months – marginal performance. The Specialist made good calls and presentations. He made good contacts but no sales. My young star was becoming frustrated and disappointed.

Evaluating the situation at the time, I knew that the market was there; the proper Sales Rep was in place as Manufacturing Specialist – trained and motivated. We were calling on the right people, making the right recommendations.

So what was wrong? My first decision was that the People and Process were right. So, if is not broken; don’t fix it. Nothing was wrong. It just was going to take some time for customers to get used to new ideas [A’s before B’s - we had to change Attitudes before we could change Behaviors].

By the end of the first year we had moderate success. The Manufacturing Specialist did make quota. By the end of the second year he was the # 1 Sales Person in Massachusetts, while carrying the largest quota in the entire Northeast.

The moral of the story - I could not manage the performance in this case and would have
failed if I had tried. What I could do was manage the People [the Specialist and slow –to- change customers] and the Process [the Manufacturing assignment and prospect development]. If these were right, Performance would have to follow – and it did! If you want to improve Sales, CEO’s and VP’s, look to these two elements that drive results.

For an in depth experience analysis of George Twiss and his work, please visit his OneAccord profile page: George Twiss