Category Archives: rants

Dead Company V: More Ways to Avoid the GraveYard

In our last post, we talked about twelve smart things a smart company could do to avoid the graveyard that many of its dumb company peers are heading too in this down economy. Today, we’re going to talk about ten more smart things a smart company can do, courtesy of Christopher Lockhead who guest-posted ten “essential strategies for weathering the economic storm” on Dan Farber’s Outside the Lines CNet blog (and one really dumb strategy, that I exposed in Dead Company II, so we’ll skip it).

  • When you really screw up, fixing it will take longer than you think it will.
    Much longer. So heed good advice and don’t screw up!
  • Get the Facts Yourself
    If you’ve got a problem, you need to get to the heart of it fast, and fix it. Real leaders get real facts and take real actions.
  • Get 2 Top 10 Lists
    Gather the smartest, most courageous people in the company to brainstorm the top 10 ways to drive revenue and the top 10 ways to cut costs. For example, to drive revenue you could assign every promising deal in the pipeline to an executive, focus on core markets first, and design a competitive replacement program. To cut-cost you could pull out of under-performing verticals, sell under-performing assets, and stop all stupid travel, off-sites, and trade-shows. (After all, your money is much better spent on Sourcing Innovation.)
  • Tear off the Band-Aid
    Assume the worst and take the necessary action to turn the situation around.
  • Fire Executives
    If you need to reduce head-count, don’t cut the people who actually do the work. As I’ve reminded you again and again, marketing and new product development are your salvation, so don’t cut them — reduce the top-heavy C-suite instead.
  • Chop the Dead Wood
    Every company has underperforming ‘C’ players, especially on the sales team. Take the opportunity to eliminate the worst performers and make the ‘A’ and ‘B’ players happy in the process — no one wants the ‘C’ players around anyway. After all, the money is better spent on additional training for the ‘A’ and ‘B’ players to help them identify ways to find even more cost savings for you.
  • Tell the Truth
    Some executives think that lying, misleading, and otherwise obfuscating will “soften” the blow in bad times. Wrong! If you have to chop the deadwood, kill the entertainment budget, and reign in the travel and training budgets for a few quarters, be honest — brutally honest. Otherwise, you’ll lose all respect, the ‘A’ and ‘B’ players you kept will start looking for a new job, and you might just end-up in jail if you mislead the stakeholders.
  • Communicate Clearly and Powerfully
    The truth is never as bad as rumors that start with a “No Comment”. Deliver the truth, and also the actions you’re taking to improve the situation.
  • Sign a Pact in Blood
    Stick to your guns and don’t waiver, no matter what.
  • Drive It Like You Stole It
    Legendary teams execute their turnaround plans like it is the last thing they will ever do. Take action. Bust your butt. Get on planes and meet with all of you key customers. Rally your teams in town hall meetings in all of your key offices. Refine your strategy. Focus your efforts. Get your people focused on results. Meet with your top investors to tell them how and why your turn around will work. Get help from some wicked advisers. Recruit new talent to the company. Sell, sell, sell, and lead, lead, lead.

Dead Company IV: Avoiding the GraveYard

In Parts I, II, and III, we talked about all the dumb things that many a dumb company failing the CIRCUIT are doing on the path to ultimate failure. So today we’re going to do something different and talk about the smart things a company can do if it wants to get off of the path to failure before it’s too late.

In addition to fattening up the marketing budget, keeping new development on the front burner, and bringing in expert consultants to insure the company stays on the straight and narrow, in his post Fear Kills Businesses, Dead, Brian Solis of TechCrunch offers twelve (12) targeted and affordable suggestions that a company can use to not only sustain, but grow in this economy.

  • SEO Optimization
    Keyword and organic search optimization is an inexpensive and effective means for gaining strategic presence and if you want the most bang for your buck, optimize your entire web campaign.
  • Blog Relations
    Creating a consistent and visible brand requires the inclusion of the authoritative, peer-to-peer blogs that your customers and influences read for information, help, and perspectives. And in this space, Spend Matters and Sourcing Innovation get more daily traffic than most, if not all, of the web sites that correspond to the traditional print publications.
  • Media/Analysts
    Analysts can position you as an option among your customers. Even though more and more professionals are turning to the blogs for their insights, the old school still listens to the analysts that they fork their money over too.
  • Direct Sales
    Some of the most successful companies concentrate on direct outreach to decision makers … and it doesn’t hurt to have some good positioning materials to support your sales people either!
  • CRM
    Building a customer-focussed business saves money and increases revenue.
  • Participate
    Participating across the social communities where your customers and prospects are active and vocal provides a looking glass into their thoughts, requests, opinions, dislikes, and recommendations. The companies that interact with their customers are the companies most likely to keep them.
  • Thought Leadership
    Share your thoughts openly and freely.
  • Blog and Blog Comments
    Find the time to contribute to a blog and demonstrate the expertise of you and your team. The opportunity it provides you is priceless.
  • Network in the Real World
    Industry events, local association meetings, and other gatherings are a great opportunity to get in touch with potential customers.
  • Involve Your Community
    Include your customers in the development process and get it right the first time.
  • Websites are Not Just Web Pages
    They’re a statement about you … and it better be one that your customers can connect with.
  • Innovate
    If it ain’t broken, don’t fix it, is the surest path to obsolescence. ‘Nuff said.

Tips on Bashing Your Favorite Blogger

For those who have been paying attention, I was going to post a good-hearted humor rant today on “what to do if you’re a blogger who’s out of content”, but after Somebody’s mean spirited verbal bashing of a fellow blogger in “How the heck do you get this information” on Spend Matters, I felt I had to hold off out of respect, especially since I used that blog as part (but nowhere near all) of my inspiration for the post. So instead, for those of you who feel that they must spend their time bashing bloggers instead of contributing useful information to the discussion, I give you a rather dry post on how to do it right. (And for those of you who feel I have attacked you personally, feel free to use them if it will make you feel better, as this will help you think straight and realize that, chances are, it wasn’t about you.)

Let’s face it, every now and again your favorite blogger, who is only human, will say or do something that you think is completely idiotic. And sometimes it will rattle your cage to the point where you’ll forget about your shy lurker ways and feel the need to post something scathing in reply to knock that smarty-pants off the high horse (s)he’s riding. And it’s okay to feel that way, especially if the blogger posted something that is quite silly when the blogger should have known better, but it’s not okay to go psycho and anonymously deliver a raging verbal smack-down dripping with acid. Not only is it likely to have the opposite effect of what you intended (as the blogger might simply get angry and bust you down so hard that your sagging ego will still be reeling this time next week), but you’ll like a complete idiot to the majority of his (or her) readers who will be saddened or angered at what will have been a completely unprovoked, and if you misinterpreted the blogger’s message, an unwarranted attack on your part. Unless, of course, you do it right. So here are three tips to help you get it right if you truly have nothing better to do than bash (your fellow) bloggers.

1. Keep it light-hearted and keep the humor genuine.*

Every blogger needs a good bashing once in a while, especially if the blogger is perceived to be a thought leader by those in the mainstream media that are supposed to be in-the-know and the blogger is overly prolific. It’s no secret that I like to bash a few of my fellow bloggers from time to time (and take a few lumps myself, though not always where I expect them), and will not hesitate to jump into the fray when a blogger posts something that I believe the blogger clearly should have put more thought or effort into; but each and every time I do my utmost to keep my public comments from getting too personal and too nasty, unless I believe it to be reasonably clear that the comments are in pure jest (as nothing livens up the blogsphere like a good natured smack-down). Let’s face it, without your bloggers, all you’d have is the traditional trade publications and the analyst firms, and that would be a very sorry state of affairs when you consider how stale some of the publications have become and how a number of reputable analysts have made it public knowledge that they are forced to be quite reserved about what they do and don’t say about their firm’s customers in their public writings. Remember, without us to keep the pressure on, they could feed you the same-old, same-old year after year and keep calling it “new-and-improved” when it’s “yesteryear’s news”.

* The only exception is when you decide to engage in a debate against yourself. Then sometimes it’s funny to take it over the top.

2. Make a valid argument.

Comments along the lines of wake up and smell the coffee you arrogant sloth, EIPP has been old news since 2003, while potentially true, are not very helpful and only serve to demonstrate your ignorance as you have not offered a single fact to back it up. If you had instead said “I’m sorry, but I don’t see the relevance or importance of yet another new EIPP solution from vendor X because vendor Y has been offering exactly the same solution for three years, details at this web address“, you would have made a valid discussion point and engendered a lot less animosity along the way.

3. But most of all, keep it civil.

Sometimes a blogger will get it dead wrong, sometimes a blogger will climb too high a horse, and sometimes the blogger will do both in the same post. Although the latter is quite rare for a professional blogger, bloggers are only human and it can happen, especially if the blogger believes he is right. But if he’s not, chances are he wants to know it because professional bloggers care more about getting the message right than looking stupid on occasion, as long as you’re civil in pointing out his mistake. Remember, bloggers are only human and a personal attack is likely not going to accomplish anything besides enraging the blogger who will have difficulty seeing past your incompetence in communication and his gut-instinct to take you down a peg or two. But if you’re calm, clear, rational, and polite … chances are he’ll not only concede every point, but thank you for it.

As long as your blogger makes an honest effort on a regular basis, he or she deserves a little slack from time to time. And if he starts abusing that privilege, and you feel that you must call him out, then feel free to do so, but be civil and constructive — because if you’re not, you’re not helping anyone. Finally, all the good bloggers publish their e-mail addresses on their blog and we’re all open to constructive criticism. So if you can’t be subtle, you can always consider going direct to the source with your comments.

Dead Company III: Fear is the Enemy

After I penned CIRCUIT, Dumb Company, and Dead Company, but before I penned Dead Company II, Brian Soils authored a great post over on TechCrunch on how Fear Kills Busineses, Dead. Noting that recessions naturally inject fear and panic, Brian also noted that fear is not a catalyst for productivity. Fear, and the dissemination of distress, slowly erodes hope, vision, and ambition, ultimately killing businesses instead of guiding them.

For example, just look at the deeply misguided advice that Sequoia Capital has issued in fear: don’t worry about getting ahead, instead, just survive … cutting deeper and quicker is the formula to survive. As I explained in Part II, it’s actually the formula for a slow and painful death! You’d be better off doing a Boo.com and wasting it all on lavish parties … at least you’d have some fun before you joined your brethren in the unemployment line.

As per Brian’s post, you need to instead take the advice of CEO Steve Larsen of Krugle who advises don’t be stupid. Have enough cash to run your business, but … look for opportunities. Difficult times are when they’ll most likely occur. When we’re at a ‘steady state’ and things are normal, good opportunities are much harder to find with GREAT opportunities nearly impossible. It is during periods of tumult and transition when you can spot things that lead to the greatest returns — if you are alert.

More importantly, as I pointed out yesterday in Part II, if you choose to stop vying for customer attention, the world will move without you. In other words, you’d be better off putting up a “going out of business sale” sign than cutting your marketing budget … at least the former will garner you some attention. As Brian notes, the recession is temporary, but business is constant, and, more importantly, if you’re in spend management, this is the time when your business can pick up sharply. In other words, if you haven’t increased your marketing budget lately, this is the year to do it. As long as you develop an innovative and cost-effective marketing strategy, you’re sure to get a return on your investment … and if you play your cards right, you might see a return beyond your wildest imagination. After all, as Brian notes, customers are and will continue to research, invest, and procure the solutions, services, and products that will help them succeed, offer entertainment, or streamline aspects of their day-to-day workflow.

Focusing energies on generating revenue, increasing visibility, and enhancing customer loyalty are the most effective strategies for underwriting longevity, and [hopefully] growth, especially during an economic downturn. Remember, customers do not typically go out of their way to “discover” your products. If they don’t see you in the places, like Sourcing Innovation, that they typically go for information, they’re not likely to see you at all. Smart marketing is your conduit to connecting prospects to your business.

Tomorrow’s Leaders Are Born Today.

So what are some things you can do to keep you off of the dead company path? Stay tuned for part IV!

Dead Company II: If You’re Hoarding Cash …

Like my fellow bloggers, I talk to a lot of companies in the run of a week, and many more in the run of a month, and one thing I’ve been hearing too much of lately is “we’ve cut back on X” — where X is marketing, development, or outside consulting — “because we have to conserve cash to get through the current crisis” — where the crisis is the current recession, downturn, etc. And it saddens me because the truth of the situation is thus: If You’re Hoarding Cash, You’re Not Going To Last … you’re just prolonging a slow, agonizing death!

As I’ve reminded you many times before, great companies are born in recessions … especially in Spend Management! This is a spend management company’s best time to shine … and the time you are most likely to get the undivided attention of senior management who dismissed you as unnecessary when times were good and the stream of cash was overflowing. Plus, it’s an opportunistic perfect storm like none you’ve ever seen: companies are desperate for savings, prices have nose-dived in many commodity markets which had been climbing steadily for years, and many types of spend management technology — including sourcing, procurement, analysis, optimization, supplier information management, and trade management — are now mature low-risk technologies in the eyes of even the most conservative techno-phobes. Plus, SaaS has hit mainstream and advances in cloud infrastructures allow you to keep your costs, and prices, low enough to make your solutions, and the returns they offer, within the budgets of even the lower end of the mid-market. In other words, everyone needs it, everyone can benefit from it, and everyone can afford it — especially if you can offer SaaS and they don’t have to come up with a large amount of cash up front, before they see savings.

But you’re not going to see a single sale if:

  • they don’t know you’re there
    and they won’t if you don’t keep your brand out there where they can find it
  • you’re not keeping your technology up-to-date
    because even the most technology illiterate procurement professionals know that advantages are fleeting and the only real value will come from solutions that are continually being improved and updated
  • you’re not innovating ahead of your competitors
    because it is always a buyer’s market and customers are going to buy the best solution … and you’re not going to know what that is if you don’t bring in some expert help once in a while to help you do a competitive analysis and chart the right roadmap

Now, I’m not saying that you should go out and spend 50K to 100K on a trade-show and staff your booth with magicians, super models, and sports stars just to get attention; that you should double your development team and see how much you can pump out in the next year; or that you should go out and hire a McKinsey or A.T. Kearney to do a complete end-to-end analysis of your software and service offerings — just that you need to conduct business as usual against a thought-out growth strategy. Otherwise, you might as well pack it in and go home, because odds are that you have no future.

However, I am saying that you need to maintain visibility where it counts, and especially on-line as some recent studies have found that appropriately designed on-line campaigns can easily be three times as effective as print campaigns; that you need to continue to enhance your current offering and continue to develop one or more new offerings with a high ROI potential, and that you need to continue to validate your offerings and directions with an external expert. And if you’re smart, you can stretch smaller marketing, development, and consulting budgets and get a big bang for your buck.

Because if you decide to hoard your cash, here’s what happens.

  • You cut your marketing budget and fade from memory because no one remembers you exist in the face of constant marketing from your smarter peers; as a result, you don’t get invited to the table when new opportunities arise and your pipeline shrinks until there’s no one left to sell to.
  • You cut your development budget and your solutions get stale, and even when you do get invited to the table, you lose because your competition not only has more functionality, but has new features and functions that streamline processes, improve analysis, and identify more savings.
  • You cut your consulting budget and you lose touch with your target market, going down tangents that your CEO thinks are important but that, in reality, are only valuable to one or two companies with obscure processes and, as a result, what you thought was a great new feature that would put you ahead of your competition actually scares potential customers away.

And even if you manage to make it through the recession to the next boom, you’ll be one to two years behind your competition, who will likely grow by leaps and bounds and decimate you on all fronts when you emerge from your cocoon. So, unless you’re sitting on at least three to four year’s worth of cash in the bank, which I know is not the case for over 99% of companies in this space, remember this: those who hoard cash don’t last. Another shake-out is coming … and it is the predators, and not the prey, that are going to win this round. The question is, which are you?