2011 May be the PERFECT Time to SELL Your Company or BUY a competitor

When you check into a hotel for 2 nights or more, call housekeeping after you check in and find out the name of the person who will be cleaning your room. Put $5 per night in an envelope and either hand deliver or drop off your early gratuity.

The pre-tip, I have discovered, will impact the quality of the cleaning job and will afford you, in many cases, extra service and amenities. (A generous tip when you leave is good karma but garners no immediate benefit.)

Marc Emmer, president of "Optimize Inc.", a strategic planning and consulting firm in Los Angeles, recently spoke to my LBG group at our December meeting in LA. His presentation was dynamic and compelling. He is the author of Intended Consequences, which the group read. Here is a synopsis of the book from Amazon:

............. Intended Consequences provides practical insights for executives who want to design their future, offering a compelling recipe for competitive advantage in the hyper-competitive marketplace. Intended Consequences challenges underlying assumptions about how strategy is formed and executed. Marc Emmer demonstrates how any organization can identify a compelling vision and align the daily activities of employees to the strategy leveraging tools such as scorecards and pay for performance systems.

Tom Mazza: Marc, one of the most striking bits of information in the book was the impact of training on an organization. It seems that companies that commit to training are dramatically further ahead in revenue, profitability and virtually every category. Why doesn't EVERY company train better and more effectively? It seems that it is an easy fix?

Because it is very difficult to measure the return on investment for training, especially if the organization has a poor performance management system.  In a service industry like yours, training is even more important because you can lose a client with one poor interaction.  The other consideration is that turnover is always disproportionately high in the first year of employment, and there is a correlation between more training, and less turnover during that time period.

 TM: Differentiation is a focus of your book, why is it so important?

Your choice as a marketer is to be the low cost operator (which yields a low profit margin) or to be highly differentiated. The middle in most markets is dead because clients don't know what to make of you; is your offer based on quality or service, or on price? Many irrelevant brands such as Kmart, and Sears face this problem.

The more crowded a space, the harder it is to see the differences within competitors. The marketer must take some risks and do things differently to surprise and wow customers. Consider Southwest Air. Whatever their competition does, they do the opposite, such as free baggage. All companies should find signatures (such as the cookies you receive at a Doubletree hotel) that provide separation. We go through 8 such differentiators in the book.

TM: Marc, After I read your book I asked my clients to commit to a strategic planning day where we can lay out a 1 year and 2 year plan for growth. What effect have you seen these planning meetings have on the overall companies you work with?

Clearly our clients who were good at planning outperformed their competition during the downturn, and they are better prepared to take advantage of opportunities during the upturn.  One specific outcome is that they deploy resources much more efficiently.  Companies who understand their market and specific opportunities within it are able to reduce their overhead per revenue dollar which can generate several points to the bottom line. In this market, a few points makes a big difference. They are also ahead of the curve in terms of their use of technology, because they have a strategic mindset in implementing systems.

TM: Marc, I love the concept of "scorecarding". To make every person aware in your organization that we are counting and measuring performance on a daily basis and rewarding top performances. Give me an idea of how to introduce this concept and get "buy in" from team members?

Scorecarding is like going to the dentist: a lot of people aren't going to like it but that doesn't mean it is not worth implementing. In fact, I think more than any business principle I have learned over the years, scorecarding is the most powerful; it is a game changer. Scorecarding can quickly improve service quality, profitability and teamwork.  The key for gaining buy-in is to have the people being held accountable to the scorecard to have a voice in its formation. Like strategic planning, it is important to have an outside facilitator help you construct it and to assist in overcoming any internal issues including "artificial agreement".  For people to really adopt the scorecard, measures need to be in real time, public and tied to performance reviews, etc.

There is a new biography out on Teddy Roosevelt, our president from 1901 to 1909. In the book Colonel Roosevelt by Edmund Morris, the author describes a moment in the great man's life:

"On the transatlantic trip to New York City from Europe, TR visited the German emigrants on the third class level and told them "how earnestly he wished...that they might find....their dreams" when they arrived in America. Many wept; a girl seized his hand and kissed it. Others followed by the dozen," kissing the skirts of his coat."

Never forget the responsibility of being a business owner. From the car wash worker than you can only pantomime with, to the chauffeur recently arrived from Romania, this country is truly the land of opportunity. Be understanding and encouraging. Tell EVERY employee that you only want the BEST for them. To find a great employee you must be a great leader. Take a lesson from Teddy Roosevelt.