• Fear of the unknown
• Staff reaction
• Culture shock
• Duplication of positions
• Variations in practices
• Credit products and services alignment
• Documentation review
• Integration of credit policy and procedures

During the first 5 days there will be unrest, uncertainty and rumours and speculation. A clear communications strategy will keep everyone informed on where they fit. My approach is to stay calm and keep focussed.

Here is a quick step-by-step plan to help keep you in control in order to achieve a successful transition.

The first 5 Days

Day 1

• Hold group meetings with your staff to announce the news
• Be available for individual meetings
• Provide and define the facts for staff
• Be available all day
• Have an open door policy
• Be patient and sympathetic

Day 2

• Keep communications going with the staff by providing them with updates as they become available
• Provide them with information that pertains to them on an individual basis and answer their questions as much as possible
• Identify management staff to be available as the internal ‘go to people’

Day 3

• Hold staff meetings and introduce the new owners and their management staff and allow time for your staff to ask questions
• Lessen the uncertainty anxiety of your staff by disclosing as much as possible via question and answer document
• Encourage staff to ask questions

Day 4

• Start to prepare a 30, 60, 90 day transition plan

Day 5

• Provide new information as it becomes available, that can be easily accessed on the intranet or email.
• Hold one final meeting before the weekend to provide the staff with the appropriate ‘what’s next?’ information.

Now that you’ve curbed that anxiety for the first week, you’ll have more support; people will be open to understanding and will engage in the activities that are required to help you with the management of the integration process.

I’ve prepared a handy checklist to guide you through the post-acquisition integration management process. You can download our checklist by clicking here.

My next blog posts will address what needs to be done in the weeks that follow.

I welcome your comments and questions below.

The best way to describe Inbound Marketing is to compare it to Outbound Marketing, which is something you already know.

Outbound Marketing is the advertising you see on TV, hear on radio, and read in print vehicles like newspapers, magazines and direct mail. It’s referred to as “outbound” because, by definition, it is pushing a message “out” to the total potential target audience at any given point in time.

In essence, Inbound Marketing is the opposite of Outbound Marketing.

Inbound Marketing is the process of using helpful content like blogs, eBooks, podcasts and online videos, social media, and search engine optimization to attract your target audience to your website like a magnet, landing pages with forms to capture leads, and marketing automation tactics like drip email to nurture those leads to the point that they become willing buyers of your products or services. It is referred to as “inbound” because, by definition, the process pulls customer prospects “in” to discover what you and your business are all about.

The Advantages of Inbound Marketing

Have you noticed that your traditional Outbound Marketing activities are becoming less and less effective in helping you reach your revenue goals? If so, you’re not alone. And guess what? This issue isn’t going to go away.

The problem is that traditional Outbound Marketing inevitably tries to sell things to people before they’re ready to buy. It forces a message upon the whole universe of customer prospects whether or not they happen to be in a buying cycle for your product or service at that particular point in time. As you can imagine, this represents a huge waste in marketing spending. Unless consumers are currently in the market for your product or service, they’ll naturally resent being “interrupted” by your unsolicited marketing messages (like you feel every time your dinner gets interrupted by a telemarketer).

To make matters worse for Outbound Marketers, advances in technology have given consumers the ability to “tune out” these interruptive messages. They now use their PVR to skip over your TV commercials, SiriusXM to avoid your radio spots, and SPAM protection to block out your unwanted emails. Admit it … you do this too!

Inbound Marketing lead generation tactics are inherently very efficient because the customer prospects initiate the process themselves at the time they are starting a buying process for your type of product or service. Their buying process always starts with a research phase and having your valued content easy to find online as they start their Google searching is appreciated rather than resented. They voluntarily give you their name and contact information, and provided that you don’t try to sell them something immediately and just keep giving them access to more helpful information as they move through the buying cycle, they start to like you and trust you and want to do business with you. Makes sense, right?

The Origins of Inbound Marketing

In 2006, a company called HubSpot, based in Cambridge Massachusetts, developed the concept of Inbound Marketing because they wanted to replace the world’s annoying, interruptive marketing with marketing that was relevant to, and appreciated by consumers while they were searching online for information to help them make more informed buying decisions. Over 9,000 companies in 56 countries now use HubSpot’s software to create Inbound Marketing to attract, nurture and convert leads into an accelerating stream of new customers and revenue.

In case you’re interested in learning more about Inbound Marketing and how to implement a successful Inbound Marketing program in your organization, I’ve developed an eBook in partnership with HubSpot to explain everything you’ll need to know. Click here to download the 33-page Essential Guide To Inbound Marketing Lead Generation.

By reading this eBook, you’ll gain an understanding of how Inbound Marketing can help you achieve growth for your business and build stronger customer relationships.

I welcome your questions and your comments.

Prospective non-profit board members need to understand that they may have some questions as they evaluate the not-for-profit organization (NFP). The important part is to make sure a board is thinking about the right issues. It is extremely important that management and the board of directors can discuss, process and come to conclusions (and actions) in a positive and constructive manner.

Most likely you are there, or asked to be, because you are aligned with the mission or the values of the NFP. Secondly, you have a passion for the cause. You want to share your talents with the board. In particular, think about your set of questions against the backdrop of your board value and your contribution both of time and dollars. I have found from my research that the best NFP boards are ones that are clear in their mission, their values and how they carry out the strategy to accomplish the mission’s purpose.

You can click here to download my 21-point checklist that covers many of the items discussed in the area below.

What is the Not-For-Profit Board structure? What types of relationships currently exist?

Before you make your commitment, clearly understand the composition of the current board of directors. What are the responsibilities for the role you are being asked to take on? The toughest questions involve how the directors function with each other and with management. That gets to the heart of the culture of the organization. I have known certain boards to have a skills matrix that they follow when trying to fill a position on the board. When there is a high number of new board members, the culture maybe very different than it was 4-6 years ago.

Here are five questions I would start with:

1. How capable and committed are other board members?
2. Is there an “orientation” program to bring new directors up to speed?
3. What about board governance education requirements?
4. How do members stay abreast of the latest trends? This would include being up to date on new legislation such as the new Canada Not-For-Profit Corporations Act (CNCA)?
5. What are existing board members’ views on management? If they have strong views, does this change the dynamics of how decisions are made?

Board relationship and interface with management

These relationships should be based upon mutual respect and a willingness to listen and consider different experiences. Pay close attention to how these questions are answered.

Here are three questions you might consider when assessing the relationship between the board and management:

1. How does the management go about reinforcing the values of the NFP?
2. Have you considered the relationships between board members and other members of executive management?
3. Is there open dialogue and proper respectful discourse? How are differences resolved?

Management naturally might be wary when answering these types of questions. It is best to understand what is appropriate to ask, what discussions have taken place in the past and how it’s followed and by whom. I always seek out the person with the most institutional memory on the board or about the NFP to assist in answering those types of questions.

It would be helpful to know if the management team attends your board meetings occasionally to provide insights, updates or clarity. At least once a year, one meeting should include all management and board members for a social get together. These types of meetings allow you to talk about common interests and ask questions more on a personal basis.

It is best to keep an open mind. Remember, there are no perfect charities, no perfect NFPs and no perfect boards. Prospective not-for-profit board members need to understand that they will find some issues as they evaluate any organization. The important part is to make sure the board is thinking about the right issues and that management and the board can discuss, process and come to a conclusion (and actions) in a positive and constructive manner. This type of due diligence is a best practice of good governance when joining a board.

The checklist below has 21 points for evaluation of a board. Use this checklist as a guide for questions to ask when you are joining a non-porfit board or have been asked to be a part of NFP board.

This is the first in a series of blog posts about different types of pricing strategies. Why? Because everywhere I go these days, I see people who need help with how to set prices.  I promise to make it as exciting as I possibly can!

In a recent blog, ‘How To Set Prices To Seriously Increase Profit‘, I indicated that pricing was a large and complex issue for many organizations. The complexity stems from a variety of sources, including customized price structures by customer, responsibility for price discounts not centralized within the company and potential misinterpretation over how and when to use the broad range of pricing strategies available.

In order to reduce this complexity, I streamlined the 16 most common pricing strategies into four categories. You can download my ‘Guide to Pricing Strategies’ here.

I thought it might be helpful to expand on these various types of product pricing strategies over a series of posts. The cost-based pricing  strategy is arguably the least exciting, but it happens to be first on the list, and therefore the subject of this post. Cost-based pricing strategies use the cost of production as a baseline upon which to make pricing decisions.

What is the product cost?

Go make friends with the accounting department! Responsibility for setting prices could benefit from a better understanding of accounting methodologies by discovering the components involved with the Cost of Goods Sold, the impact volume will have on the over or under absorption of overhead and the resultant effect on the profit and loss.

Let’s assume that your company uses a traditional costing system to determine the Cost of Goods Sold or Product Cost. In such a system, the product cost would be made up of the actual Direct Labour and Materials, while Overhead would be estimated on some basis, such as planned volume and allocated to the product.

Note that this system does not take into account any non-factory overheads such as investments in marketing or selling and/or general and administrative costs. These costs must be covered from the Gross Margin generated.

Setting the price

In a cost-based pricing model, the price is determined by adding a profit element to the cost of making the product. This could be a fixed amount per unit, or more likely, a percentage. I promised you some excitement in this blog, so here’s the math, using the framework above and some fictitious costs:

Direct Materials                   =$2.50 per unit
Direct Labour                      =$1.50 per unit
Overhead Allocation            =$0.50 per unit
Product Cost                       =$4.50 per unit

Here’s the impact on Gross Margin $’s and %’s at several fabricated selling prices:

Selling Price                $13.50 per unit      $9.00 per unit      $7.00 per unit
Product Cost               $04.50 per unit      $4.50 per unit      $4.50 per unit
Gross Margin ($)         $09.00 per unit      $4.50 per unit      $2.50 per unit
Gross Margin (%)          66.7%                    50.0%                   35.7%

Impact of this strategy

I don’t know about you, but when I look at the margins above, I automatically migrate to the highest selling price and resultant margin. In fact, the greatest advantage of a cost–based pricing strategy is the business knows its costs are being covered. Cost–based pricing is a simple strategy, and it’s still widely used because of this.

However, there are weaknesses to this internally focused strategy. It does not take important external factors into consideration. For example:

• Consumer or customer demand – Setting prices without understanding how customers or consumers value your product will often leave money on the table. If your company had an internal margin target of 50%, you would quite logically price your product at $9.00 in the hypothetical example above. However, if you had consumer insight that indicated a $13.50 price point would be acceptable, you would double the gross margin generated.
• Competition – Conversely, setting prices without a true understanding of competitive pricing, may place your business proposition in jeopardy. You could find your prices are too high, resulting in a rollback and/ or a re-evaluation of market or channel viability.

Summary

Certainly you need to know your costs, and how they are derived, before developing pricing. While a cost–based strategy will help you on the cost side, it is a myopic strategy as it fails to consider important external influences.

Relying solely on a cost–plus approach reminds me of an H.L. Mencken quote:
“For every complex problem, there is a solution that is simple, neat and wrong.”

Our next blog will look at competitor-based pricing strategies.

As always, I welcome your comments.

What is personal branding?

According to Wikipedia, “Personal branding is the process whereby people and their careers are marked as brands.” And to a certain degree, this is very true, but personal branding goes a lot further than your own professional career. Personal branding is about who you are, what services you offer, your style of business, personality, opinion, hobbies and everything that encompasses you.

What most people tend to forget when developing their personal brand is that this image they are sending out into the world is essentially the first impression others will have of them once they first come across their profile.

Going forward, it is important to ask yourself: who is your target audience and how do you want them to see you?

How to brand yourself

A fun way to begin developing your personal brand is to start with how you view yourself.

Step 1:

Think of 5 words that represent you as a business professional and write them down. Think about why you’ve chosen these words and why you think it’s important for this message to reflect on you for your target audience.

Step 2:

Ask a coworker that has known you for a long time and knows what you do and how you present yourself. Ask them to choose 5 words they believe reflect your character and ask them to write them down.

Step 3:

Ask a coworker you’ve known for a very short while and do the same as you did in step 2.

Step 4:

Now that you have the perspective of a close and new friend, compare their describing words to your own and see how close and/or far the impression you have of yourself has come along. Ask yourself these questions:

• Are you surprised with how your coworkers described you?
• Is your close coworker’s opinion that much different from your new coworker’s?
• Did you find it difficult to do this activity on yourself?

Step 5:

Take the words of your coworker and start brainstorming reasons why they see you this way. Do you like or dislike what they have said? Do you want to change this impression? If you wrote down that you’re organized and your friends didn’t, think of way you can go forward with this personality characteristic clear to others in your day-to-day routine. First impressions are important (as made clear by your new coworker’s words to describe you), but lasting impressions go a long way too (as shown by your close coworker). Now with stage 5 of your reflection process, decide how important it is for you to align these impressions together to come up with the way you want others to see you as. You’re personal brand is your largest and most important asset and it’s important that you have control over it. Do you agree?

If you found this activity especially difficult, then maybe you haven’t rounded out your own personal brand just yet and maybe this is something you want to start considering. In today’s society, if you don’t know yourself, how do you expect others to?

Download this free worksheet I’ve created to help you think of 5 words that represent you as a business professional. If you can’t pick 5 words from this matrix to describe yourself in less than 5 minutes, you have some work to do!



As always, I would love to hear from you. Let me know what you think about personal branding. Do you have it all figured out?

The Online Sales Channel Cannot Create Its Own Synergy – What’s in Your DNA?

Almost every performance-driven business lists ‘continuous improvement’ as one of its key objectives. Most organizations, however, fail to understand that without a systematic approach to integrating its disparate sales channels, the web’s true potential, not to mention the potential of its offline channels, cannot be realized. Unfortunately, today’s business climate is increasingly unforgiving, and customers are increasingly demanding.

Industry pioneers such as Amazon, Walmart.com and eBay are redefining their online value propositions, and thus, the customer experience.

Consider these three capabilities:

1. Order online, pick up your selections at the brick-and-mortar location of your choice (a popular Walmart.com offering)
2. Order today and receive delivery today (offered in selected U.S. cities by both Amazon and eBay)
3. Shop from increasingly vast assortments of value-priced merchandise in nearly every category (offered by all of the above)

Although technology and an innovative spirit were key factors, it is also important to understand that these initiatives were also the results of a common belief in the Internet as a driver of strategic value. Amazon, Walmart, and eBay do not simply view the web as its own isolated channel. Instead, they understand that when online’s unique strengths are combined—or ‘integrated’—with other channels, the ability to accelerate growth, generate new operational efficiencies, and achieve a stronger competitive position are strengthened.

A Quick How-To Guide

Infusing this mindset into your company’s DNA, however, is no accident. Over the years, I have found five steps that are essential:

1) Develop a clear strategic commitment.

From the top down, it must become clear that channel silos will not be tolerated. Remember, it’s about value creation!

2) Develop a comprehensive list of every sales/communication channel.

If customer communications are to be clear, they must also be consistent. Consider a broad definition of channels and sub-channels such as:

• Brick-and-mortar retail locations
• Websites (traditional, mobile, and tablet)
• Social media
• Outbound e-mail
• Direct mail/catalogs
• Print advertising
• TV and radio
• Outdoor and event marketing
• Telemarketing (inbound/outbound)

3) Define and consider each channel’s unique capabilities and advantages.

Each channel brings distinct advantages to the party. Brick-and-mortar locations allow the customer to physically touch the product, websites provide 24/7 shopping and expanded merchandise selections and social media allows unprecedented interaction, to cite three examples. By building out a comprehensive list, your organization will begin to more fully appreciate each customer touchpoint.

4) Integrate the web into each customer interaction.

Brick-and-mortar locations, for instance, can leverage the web by assisting store customers who could not find a particular item in the store by locating the item online and arranging for delivery. Conversely, channels such as direct mail, print and broadcast media should empower the customer by promoting all retail alternatives whenever possible.

5) Measure synergy and refine as needed.

No strategy will be successful without measurement and multichannel integration is no different. In nearly every case, the most profitable customer is the one who utilizes and is influenced by more than one channel. This can be mapped by tracking each known contact, its financial cost and the resulting sales that are generated.

Channel Integration is a Learning Process

Since the Dotcom Bust of 2000, the Internet’s strategic challenge has shifted from “which channels?” to “how do we create channel synergy?” With careful planning and implementation, your organization, regardless of size, can improve, create and implement strategies that incorporate this essential mindset.

To learn more about competing more effectively in the challenging multichannel environment, please contact Boardroom Metrics.

Request our FREE Download …

Test Your Channel “IQ” (Integration Quotient): Are You Optimizing Your Sales Potential?