No organization is immune to challenges, not if it has any ambition. But how do we as owners and leaders put our strategy hat on to see down the road, or attempt to see, to predict where markets will go, how customers will act and react? To play the great game of chess in the real world – which is strategy.
Sometimes that is easier said than done. The eloquent Mike Tyson put it so well when he said, “everybody has a plan until I punch them in the mouth.” We would do well to remember how limited our brilliant strategies in fact are, how fragile in the face of ambiguity, uncertainty and future black swan events.
Just look to history to see how companies have been blindsided with the punch they never saw coming. Kodak invented the first digital camera in 1975, but put launch on hold in fear of cannibalizing their film business. We all know the story from there….Kodak who? Or take Blockbuster – which failed to pivot when Netflix showed up. And then Borders and Barnes & Noble, crushed under the Amazon onslaught. And the examples of business strategy gone wrong go on…
Interim management has arrived, and it only took 50 years, from a specialty that started in the Netherlands and moved slowly around the world. And its first and best incarnation is the interim CFO.
A good Chief Financial Officer will help a business catapult to the next stage of growth. Whether public, private or private equity backed, a CFO leads and implements strategy that ultimately creates value for shareholders, increasing EBITDA and cash flow. The means to get there may look different for each organization, but companies choose to bring in an Interim CFO because they are looking for transformation:
Operational Improvement and Strategic Planning
An Interim CFO will streamline accounting and financial reporting, helping owners, board members, investors and the management team get a clear look into the state of the business.
The best, truest, and most bleak line I’ve heard from a mega-successful company founder was Dave Becker telling me: “we have all had the sleepless nights, when it’s 2am and you’re staring at the ceiling.” Dave is the founder of a number of companies including First Internet Bancorp (Nasdaq: INBK), the granddaddy of online banking.
From the outside, we see a successful entrepreneur with multiple home runs and think they must be sitting on easy street. What could possibly go wrong?
The answer is: everything. It always appears easy or obvious once a company has made it, but what we often don’t hear about are the trials and tribulations that happen at every stage of a company’s growth from young and unknown, to in between, and then big and ambitious. The sleepless nights. The questions of can you make payroll. The we-almost-went-bankrupt moments. This is real and it’s no surprise that many of our inquiries for help from owners show up in our inbox after the 9-5 employees have gone home.
The Olympics are the perfect example of the difference between champions who win gold, silver or bronze, and everyone else who goes home empty handed. The winner could be winning by just one ten thousandths of a second.
Why do you think you or I are any different in our work – if we could improve our performance just a couple percentage points, we’d stand out from the masses clear as day.
Steve Jobs was genius at nuance, the subtle improvement that could cause massively asymmetric outcomes in favor of Apple. Thirty companies had MP3 products delivering hardware, software and content for streaming music. The category was done. Then along came the iPod. Not major changes, but so much better!
Software runs the world but hardware and physical products are still part and parcel of our everyday experience. Bill Fienup and his co-founders set out an ambitious goal to help new manufacturers launch and grow. He started small with Catalyze Chicago, a nascent manufacturing innovation hub. Risking their own capital they rented 2,000 square feet, which quickly expanded to 8,000 square feet in five months, serving member companies who had raised $28 million from investors, generating $56 million in revenue.
But that wasn’t enough, and Bill’s plans became what is now mHub, an innovation center focused on physical product development and manufacturing.
We got the chance to do a Q&A with Bill, where we dove into his growing innovation hub and the future of manufacturing:
The truism that every business needs marketing cannot be denied, even by businesses that owe the majority of their growth to word-of-mouth referrals. However, confusion arises when businesses mistake marketing for sales. In simple terms, marketing builds demand, sales closes the deal.
The goal of marketing is to increase sales and, by perforce, grow revenue. The trick is in measuring the success of your marketing efforts. What metrics do you use to measure marketing effectiveness? Although profit is the ultimate goal, it’s not the sole measurement of success. Other benchmarks along the way indicate the effectiveness of your marketing efforts.
Interim executives deliver real results, in real time, real quick. An interim is unique in the depth and breadth of experience they bring to bear. This allows an interim to see hidden value in existing products/processes/systems, implement actionable strategies and gain true alignment necessary to optimize the business. The interim will review the investments the company has made into processes, organizational structure and systems. This will lead to a focus on the areas which can be easily measured and might yield the quickest return on investment such as profits, systems and process efficiency.
Engaging an interim executive isn’t something new. However, the current business environment makes the prospect more appealing to many business owners.
The disparity between the number of top-level vacancies and highly effective talent to fill them is one motivating factor behind the increased willingness to seek temporary executives. Another is frustration with a sales force that consistently fails to meet performance goals.
For the past several months, I’ve been using our blog to highlight the various elements that we focus on as a company. Writing the posts has been great, but every now and then I hit an area that is so many “miles deep” in terms of content that I become completely stumped on how to boil it down (which is why we have, oh, 50 or so posts in the hopper for the future).
Revenue generation is one of those areas.
Why is revenue generation complicated? It’s complicated because every company is unique, and because there are a million marketing “tips and tricks” out there to try. I wracked my brain for a bit on this one and have decided to keep it basic. Since a blog is not the space for eight-point “how-to’s” and twenty-quadrant charts, I’m simply going to share a truth I’ve found to be fairly universal for companies when it comes to boosting revenue (specifically pertaining to sales and marketing):
The world, as we all have known it during the late 90s, is gone. No longer are sales executives order takers and if they think this is the game, the awakening has been and continues to be rude. Culpepper Sale Study, a benchmark for the world of sales, released the following statistics:
1… Fact: 94% of all sales veterans have had less than 5 days of any formal sales
2… Fact: 87% of all sales managers have had less then 8 days of any formal sales
3… Fact: 98% of all salespeople don’t follow a consistent sales methodology.
4… Fact: 93% of all sellers volunteer a price decrease without being asked.
5… Fact: 87% of prospected inquires are never followed up by a sales contact.
6… Fact: 81% of all sales take five calls or more.
7… Fact: 80% of all salespeople are willing to accept a 90% rejection rate.
8… Fact: 40% of all sales veterans experience bouts of call reluctance severe enough
to threaten their contribution in sales.
9… Fact: 93% of all sales veterans have had no training on how to generate their own