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Unlocking Growth: Part III
By Gene Marino
Strategy time!
This is where we
begin to separate the amateurs from
the professionals. There are just
under a million options to choose
from when attempting to develop
and execute on a strategy, so you
can take your pick. Very similar to
my “warning label” for the series
of unlocking growth articles, it will
boil down to the ability to make the
tough decisions once the path and
direction are revealed. Essentially,
there is no right or wrong model
or methodology used to create
and execute a strategy, and you
could fill a library with books on
the subject. What I traditionally
find is that entrepreneurs do not
seek an outside source to help
facilitate these processes and try
to do “strategy on the cheap.” The
success rate suffers as a result,
and so by default, many go back
to simply doing what they have
always done. This article will try to
create a high level view of what the
ultimate goal of strategy should be
and simplify what it should look like
from a basic perspective.
There are basically four parts to
strategy:
1.) What is our value proposition
and is it a value our clients are
willing to pay for?
2.) What are the ponds you would
like to fish in and what do those
ponds look like?
3.) What are the most important
priorities we want to accomplish?
4.) What are the executable
actions that need to take place
to succeed and who will be
accountable for those actions?
Tackling these three parts is a
challenge, but I will try to simplify
the fundamental aspect of each area
of strategy.
Value Proposition
I cannot stress the importance
of understanding your value
proposition. We discussed this
in Unlocking Growth Part II and
here it is again. It is the empirical
base of why you are in business,
but we simply cannot quantify
and communicate our value
proposition effectively. How can
we get to the answer? Oftentimes
we like to ask our own employees
what our customers like about
us, rather than a.) Working with
outside research teams for validated
unbiased feedback or b.) Going
old school and meeting clients
(and former clients) face to face
to talk about why they buy from
you (or why they left). I can tell
you unequivocally that while
relationship is important, it’s not
a scalable growth strategy if that
relationship is managed by one
person (see Unlocking Growth
Part I for more about this pitfall of
command and control). I can also
say that if it’s all about price, you
do not provide your clients with a
clearly beneficial reason to conduct
business with you.
How is your business different?
What do you provide to your
customers that creates a game-
changing dynamic? How does
doing business with you and your
company remove a client’s pain
point? How can we uncover what
is truly important to our customers
and prospects and provide that
service or product better than
anyone else in our market space?
Time to go fishing
What do we really know about
our markets? Who we sell to, how
many of those clients are in the
market area? What our strategy is
to acquire new customers? How are
we set up to measure progress and
performance?
There are a lot of sources you can
use to assist on defining the size of a
market, but essentially, determining
who you currently sell to and who is
left and making some assumptions
on average order size you can
quickly discern how much market
share you have in a territory or
market. It certainly helps to fish in
bigger ponds so targeting a market
with $10 million in size versus one
with $100 million in size should
improve your chances of success.
Also, assessing the ponds you are
targeting from the perspective of
gross margin rather than revenue
will help assist efforts to add
profitable new business versus just
“new business.”
Once clarity is created on why
customers buy from you and where
you should spend efforts chasing
market share, your growth strategy
becomes much more efficient and
focused on the areas you want to
target, avoiding the trap of chasing
opportunistic bids that fall outside
your core competency and thus avoid
wasting resources along the way.
continued on page 46
MARKETING COLUMN