Advisory #17 - Sales vs Strategy - The Missed Opportunity

Are you a small to medium-sized business relying on sales tactics for growth because you haven't been able to put together a strategic plan?

Thought so.

But it's likely that this focus on short-term sales means you're missing out on the opportunity to grow your business significantly and sustainably for the long term.

Don't worry.

You're not alone.

80% of all the meetings we conducted in 2015 were with clients who did not have a clear strategy on how to grow their business.  More generally, of those that have a plan, according to Harvard Business Review, 86% fail to implement it effectively.

Let's be clear, when we talk about your strategic plan, we're not talking about a multi-page spreadsheet filled with comprehensive analytics and the ROI on market entry, nor are we talking about the extensive corporate presentation designed to appease the board and shareholders ... you know, the one that you work on for days, trying to work out what they want to hear and then never refer to it again after the presentation.

It doesn't have to be so hard to reach the next stage of your growth vision.

When we talk about strategy we are talking about an understanding of what your business stands for today, what you want it to achieve in the long-term and building a series of clear practical steps towards achieving that vision within your own capabilities.

Simple.

Our clients have no shortage of vision, there is always a clear idea of what success represents:

• to become market leader
• to expand into new markets
• to double the size of the business
• to take advantage of market conditions by developing new products & services
• to become leaner and more profitable

But, in most cases,  there is no straightforward step by step strategic plan to achieve that vision.

Our experience has revealed a consistent issue especially with our clients in creative services and broadcast media; that they have a tendency to adopt a short term focus on tactics to achieve revenue with little strategic or operational plan to support their long term business goals.

This is fine for us as it represents the starting point in assisting our clients to grow.  We help them understand their potential, assess any limitations or blockages to growth and provide practical steps to take their business forward to new levels of success.

In all cases, we assist our clients to develop a strategic approach that still delivers on their short term needs but introduces a framework that allows them to develop their potential for the long-term.

Here's an example:

We met a client that was seeking to enter a $30M per annum market with a disruptive product.  By looking at their business, we could see that they were fully equipped to successfully address this market immediately with their existing product set.  There was very little risk.  However, they had not fully understood the size of the opportunity in front of them and did not want to invest in additional resource.  So instead, they set their focus on a "safe and easy" $200k per annum subset of that market.   To address this, they took a tactical approach aiming to win a series of accounts through the networking skills of their existing sales team.

They will be successful in this but look at the missed opportunity; a lack of strategy and planning is sacrificing the multi-million dollar opportunity in favour of a best attempt at a share of $200k.

Which would you rather have?

Vision without strategy is just fantasy.  Your business vision can't be achieved solely by a tactical sales approach.

Of course, it's easy to be distracted by the day-to-day demands of our operations and lose focus on the long term strategy of the business.  This is exactly where it's possible to develop a 'blind spot' that limits the ability to see the opportunities in front of us.

So, where do you start to shift the focus from tactical to strategic without it all being too hard?

Answer this ...

• What is the true state of the growth opportunities in front of your business?
• What is the current operational health of your business? 
• What level of profitability do you need to maintain?
• What adjustments need to be made to your operations to support your growth plans?
• How will you bridge the gap between the capabilities of your business and the unique needs of your clients?

Once you can answer these questions, you are immediately focused on the long term health of your organisation and your short term goals will take care of themselves, packaged neatly within a sustainable strategic framework.

So, just as you don't become famous by making more friends, you don't make your business grow exponentially by focusing solely on short-term account wins.

We help our clients build a strategy for continents not just countries and provide practical steps towards long-term strategic growth so that success for you is not just about struggling to reach a quarterly budget.

Don't sell yourself short.

Once you can support your business vision with the substance of a strategic plan and know the steps you need to take to achieve it, you are no longer short sighted... the result is scalable, sustainable growth, achieved faster.

The Advisory Partnership assists its broadcast and creative services clients with operational strategy, delivering outputs that are scalable to meet the challenges of technological change and international growth.

Post by James Douglas

www.theadvisorypartnership.com

Other Posts by 
The Advisory Partnership

Sales vs Ops - Whatever happened to the operational review?
International Growth Cheatsheet
Case Notes: APAC Centre of Excellence

Advisory No 15 - Partner Smarter Grow Faster

A growing international business needs new staff and lots of them.  

It needs to have tried-and-tested suppliers to provide the products and services that it can’t deliver itself and it needs them fast.  

And it needs strategic partners to help extend its geographic reach and to build a network of customers that will deliver on the business plan.

What these three categories have in common is that every growing business is reliant on people and partners to deliver its strategic growth plans.
  

For start-ups and developing businesses, having the right team around us is critical to our growth success and it’s definitely not the time to cut corners.

As managers it is likely that we are busier than our peers of 10 or 20 years ago and the speed at which we are required to make important business decisions is accelerating. When we are working in start-ups, this pressure can be ten-fold.

It's time to call in the experts to support us.

However busy we are, we must appoint any new relationships with care, whether they are our staff, suppliers or strategic partners.  This is because our own success is ultimately reliant on the partners that we choose to represent us. 

Our partners success is our success and their failure is ours to own.

It’s tempting, but we should never make our decisions based solely on the candidate that we know best or is closest to hand.  In the rush to start-up and grow our businesses we often quickly grab our former colleagues and partners as a short cut to establishing a new team.  We have to be careful here.

We don't achieve something different for our business, simply by replicating an old model so it’s important that our partnership appointments are regularly given due-diligence and tested against alternatives in the market.

No decision is a valid decision until it can be compared against alternatives. A choice of one is not a choice at all.

It's always wise to properly review alternatives as the 'sanity test' to your preferred partnership choice and it's is time worth investing as it provides clarity, validates your decision and defends your position in the event of any conflict.  Most importantly, you develop a balanced approach as you are forced to consider the negatives as well as the positives of your preferred partnership choice.

When we take the time to fully review and make informed decisions on our business partners there’s every chance that growth will come stronger and faster than if we select solely from our inner circle.

Once established, it's also critical to review our partnership arrangements regularly to ensure that they remain effective.  

We regularly work with businesses who have set up partnerships to manage their interstate and international operations.  On closer review, we discover that they are not always delivering the maximum contribution to our client's business.  We recommend an annual review and health check for all partnership arrangements to ensure that they are performing to expectation.  There's always room for improvement.

The pressures of establishing, growing and maintaining your business are tremendous but be careful to take the time to establish the right partnership network as part of your business development strategy.

Be open minded to change. 

The Advisory Partnership assists its clients with business development and operational strategy, delivering outputs that are scalable to meet the challenges of technological change and International growth.

Post by James Douglas

www.theadvisorypartnership.com

More from us...

Over Promise, Under Deliver
Partner Smarter, Grow Faster
International Strategy - How to Get an A in Geography

TAP Case Notes 3 - Global Ops Strategy

Client            Advertising Distribution Company

Service         Global Strategy Review - London UK

Result           70% Cost Reduction in Regional Offices

Background

Our client was a technology business supporting the advertising industry with distribution and asset management services.  Following a period of significant expansion, they understood that the strategy to roll out their broadcast services globally was neither scalable nor financially viable. 

The challenge of business development in the Americas, Middle East and Latin America could only be achieved through a different strategic and operational model.

Challenge

We were appointed to manage a diagnostic review of global operations and to prepare an international expansion plan that would provide a strong operating profit while removing the requirement to build new offices in each market.  

Specifically our client needed help in understanding the priority for geographic expansion as the lack of a clear regional strategy had created inefficient local operations with high costs and much duplication of resource.  They needed a solution where the costs would scale with the opportunity.

Approach

Our approach was to clarify the business strategy with senior management and test it against operational realities.  We produced departmental audits of Traffic, Broadcast and TV Production discovering that market expansion did not match the sales opportunity nor was there visibility of the expense to service international markets remotely.  

Additionally, poor market research and inaccurate data had produced a flawed business case.  This led to poor results from new markets and a reduction in support from the Board for further expansion.  Our approach provided the support for a cost effective operational model and a strategy to prioritise and manage global expansion.

Results

The regional strategy that we developed, organized the client's 30 offices to report into three ‘centres of excellence’ aligned by operational similarities.  These offices were given extra financial support, allowing their ‘satellites' to be maintained at 70% lower cost.  Regional functions were standardised, ensuring that global decision-making was faster and more collaborative.  This allowed faster and more efficient business planning while reducing overall headcount.  

Our review of the operational cost to service specific countries produced a model allowing the country-by-country rollout to be prioritised on existing business, confirmed prospects and existing outsource costs. 

Our strategic recommendations have delivered on the global expansion imperative and kept operational costs to scale with revenue growth.  Finally, we proposed a structured business case process that is now required before financial commitments to new markets are agreed.  This safety net has avoided further investments in unprofitable markets.

The Advisory Partnership assists its clients with operational strategy and structural change, delivering outputs that are scaleable to meet the challenges of technological change and international growth.

The Advisory Partnership assists its broadcast and creative services clients with operational strategy and review, delivering outputs that are sustainable and scalable to meet the challenges of technological change and international growth.

Post by James Douglas

www.theadvisorypartnership.com

More from us:

Sales vs Ops - Whatever happened to the operational review?
International Growth Cheat-sheet
Over Promise, Under Deliver
Partner Smarter, Grow Faster
International Strategy - How to Get an A in Geography

TAP Case Notes 1 – APAC Centre of Excellence

Client      Global Advertising Technology Business 

Service    International Strategic Development

Result     Creation of APAC Centre of Excellence  

Date          2014

Background

Our client was a technology business that supports the advertising industry with TV distribution and asset management services.  Following our strategic and operational review of their existing operations in APAC, the client accepted our recommendation to create a joint venture with an existing Asian partner to service the region. This business already had a long standing relationship with our client; it serviced their print advertising distribution and had an operational footprint in Malaysia, Singapore and Hong Kong. 

The project was firstly to relocate the client’s APAC operations from Hong Kong and secondly to form a regional ‘centre of excellence’ in Malaysia to allow for expansion throughout the region.

Challenge

Once the regional office was established, we were appointed to provide the framework for the client to roll out their service to 17 Asian markets generating USD $23M at 48% EBITDA within 3 years.  Our role was to ensure that the Asian operation was fit for purpose both as a regional head office and as a ‘centre of excellence’, able to lead the direction of the business in the region.  We were required to implement the best of the client’s international experience while ensuring each Asian market's unique processes were fully understood.  

At the same time each of the 17 markets were transitioning from analogue to digital TV services so, with an industry in flux, we were required to include strategies for change across a number of markets with diverse, cultures, languages and processes.

Approach

We had already proposed the client’s global and regional models and had completed the transition of the Hong Kong office from a regional to a satellite sales office so we understood the task. 

To build the centre of excellence, and to meet the growth challenge, we appointed a ‘SWAT Team’ sourced from the client’s most successful operators worldwide.  This team was important to help with the digital change required within the region and to quickly instill values consistent with the rest of the the client's business.  We then focused on hiring an experienced local leadership team to build credibility and deliver the skills to quickly deliver transactional revenue.  We ensured that the model we prepared was scaleable and easy to replicate on a market-by-market basis throughout Asia.

Results

The relocation of the regional office from Hong Kong to Malaysia created a strong regional centre through which the client could direct its regional growth.  Despite obvious disruption, no customer was lost in the transition of the operation from Hong Kong and within 6 months, the Pan-Asian operation was servicing markets in Vietnam, China, Singapore, Thailand and Hong Kong.  

Asian business sourced from the client’s global client network could now be managed through Malaysia, and each of the client’s country operations can now sell Asian broadcast services to their local clients.  This was a significant win for the client who could add Asia to their many international proposals and tender requests a potential revenue lift of 20%.

Initial revenue was not however as budgeted. This was due to the TV product having limitations in dealing with local business issues specific to Asian markets.  However, we prepared a product review and business case for interface changes that is scheduled for completion in 2015.   Revenue is forecast to meet expectations by June 2015.

The Advisory Partnership assists its clients with operational strategy and structural change, delivering outputs that are scalable to meet the challenges of technological change and international growth.

Post by James Douglas

www.theadvisorypartnership.com

Other Posts by The Advisory Partnership

Upscale your International Growth
Over Promise, Under Deliver
Partner Smarter, Grow Faster
International Strategy - How to Get an A in Geography