B2B manufacturing CEOs have a good reason for “sitting on their cash” and not investing in new hires. You’re oppressively taxed and over-governed, especially when you are in an Illinois business state-of-mind.
Your management team awaits your decisions on many fronts. Let them wait. When you are paralyzed by what business-killing legislation will come next, this is no time to be making business decisions of consequence. Besides, in a public enterprise nowadays, indecision has the appearance of prudence; and in a private enterprise, indecision seems a virtue.
The importance of cost cutting and cost prevention seems obvious. Then again, there’s the Price Waterhouse study that determined the value you can add to a business through cost cutting is mathematically limited to zero. If the decision is to NOT invest in business-building strategies, then there is no business-building decision of consequence.
Which is why a few highly strategic B2B manufacturing leaders will not just sit on their cash for the next year, and why they will come out of this recession victorious. They will invest in growth by building internal value definition and external value recognition. Guided by these two reference points for strategic decision-making, they will lead their companies forward.
By definition, innovation and marketing are inherently risky.
Moreso, indecision powered by fear.
jb
Friday, August 27, 2010
Tuesday, August 17, 2010
What is HR doing for your business?
A business forum in the Chicago area last week discussed HR’s role toward business recovery and during the lively exchanges, one of the panelists offered this observation:
"Performance is not an HR problem, it’s a managerial or supervisory problem.”
Upon hearing this, I noted in the program guide that the panelist was with the Illinois Management Association. The keyword leaping out here was management, and yet it seemed that such a statement would not go uncontested. Surely, during the closing Q&A, one of the many HR titles in the audience would raise a hand to say something. Something like, hey wait a minute. Did I hear you right?
But no such follow-up occurred. Audience applause, the forum was over. Time to go.
Days later, just now digging through the stuff handed out during the event, I come across an HRMAC publication called FORUM. HRMAC stands for the Human Resources Management Association of Chicago. It turns out HRMAC has been around since 1915 and the organization has arrived at some interesting conclusions regarding the role of HR, in any economy. The feature article in the publication, written by freelancer Matt Alderton, quotes an HRMAC board member, Bob Davis. And what Mr. Davis has to say should be taught in management school.
“It used to be that your go-to-market strategy was the most important thing in your organization, but really it’s your people,” Davis says. “That realization has allowed and forced the HR profession to step up from being what were historically functional experts to being full business partners and consultants. We as a profession need to evolve – and have been evolving – to better understand our organizations’ financial drivers, customers and value propositions so that we can take a holistic approach to what we do.”
Go-to-market strategy. Customers. Value propositions.
These are not refrains calling for better management. They are calls for educated leadership. The kind of leadership that will bring marketing, branding, sales and HR together at last and put them to work for America’s businesses.
jb
"Performance is not an HR problem, it’s a managerial or supervisory problem.”
Upon hearing this, I noted in the program guide that the panelist was with the Illinois Management Association. The keyword leaping out here was management, and yet it seemed that such a statement would not go uncontested. Surely, during the closing Q&A, one of the many HR titles in the audience would raise a hand to say something. Something like, hey wait a minute. Did I hear you right?
But no such follow-up occurred. Audience applause, the forum was over. Time to go.
Days later, just now digging through the stuff handed out during the event, I come across an HRMAC publication called FORUM. HRMAC stands for the Human Resources Management Association of Chicago. It turns out HRMAC has been around since 1915 and the organization has arrived at some interesting conclusions regarding the role of HR, in any economy. The feature article in the publication, written by freelancer Matt Alderton, quotes an HRMAC board member, Bob Davis. And what Mr. Davis has to say should be taught in management school.
“It used to be that your go-to-market strategy was the most important thing in your organization, but really it’s your people,” Davis says. “That realization has allowed and forced the HR profession to step up from being what were historically functional experts to being full business partners and consultants. We as a profession need to evolve – and have been evolving – to better understand our organizations’ financial drivers, customers and value propositions so that we can take a holistic approach to what we do.”
Go-to-market strategy. Customers. Value propositions.
These are not refrains calling for better management. They are calls for educated leadership. The kind of leadership that will bring marketing, branding, sales and HR together at last and put them to work for America’s businesses.
jb
Wednesday, August 11, 2010
Don't fall in love with your line card...
"Over 71% of the firms in the Inc. 500 list of newer, faster-growing companies were started by individuals who duplicated or modified innovations at their former employers."* In other words, most innovation is being done by people who felt compelled to leave their companies in order to create new products and services.
Consider the implications this has for a maturing B2B manufacturing company.
If your line card hasn’t changed recently, then you are an easy target for talent defection. Worse, you are an easy target for commoditization. You become your own enemy as your organization sells itself short.
And the reason for this?
Business leaders allow their people to fall in love with their products. The connection between innovation and growth is this simple: Companies whose organizations are focused on line card marketing have misplaced their passion. It’s not so much the products that matter. It’s the reasons why you set out to create those products in the first place.
*Source: Baruch Lev, in his book Management, Measurement, and Reporting. Dr. Lev is a world-renowned researcher and consultant on business valuation, and professor of finance and accounting at New York University.
jb
Consider the implications this has for a maturing B2B manufacturing company.
If your line card hasn’t changed recently, then you are an easy target for talent defection. Worse, you are an easy target for commoditization. You become your own enemy as your organization sells itself short.
And the reason for this?
Business leaders allow their people to fall in love with their products. The connection between innovation and growth is this simple: Companies whose organizations are focused on line card marketing have misplaced their passion. It’s not so much the products that matter. It’s the reasons why you set out to create those products in the first place.
*Source: Baruch Lev, in his book Management, Measurement, and Reporting. Dr. Lev is a world-renowned researcher and consultant on business valuation, and professor of finance and accounting at New York University.
jb
Tuesday, August 3, 2010
Performance trumps price even in a depression
One of our clients is in the steel construction industry, in a sector that has experienced an incredible 62% decline. The president of the company tells me, if this is not a depression, what is? And yet, here is a company that is certain to come roaring out of these difficult times, and here’s why:
Even in the deepest recession since the Great Depression, this company has put performance ahead of price. They have marched through the valley of this recession holding on to their margins, when competitors could not.
In a largely bid-based industry where the lowest qualified bid gets the job, here is a company that has held tight to the belief that demonstrated value has value in any economy. And you know what? The company’s nearly down and out, but tough-minded and business-smart customers agree: Performance trumps price.
The lesson is here and now for all B2B companies to witness and to learn. If a company cannot define its core business advantage internally, then it cannot articulate and defend this value in the marketplace.
It is a function of branding to establish the value – the brand identity – a company brings. And it is a function of leadership to recognize this need.
jb
Even in the deepest recession since the Great Depression, this company has put performance ahead of price. They have marched through the valley of this recession holding on to their margins, when competitors could not.
In a largely bid-based industry where the lowest qualified bid gets the job, here is a company that has held tight to the belief that demonstrated value has value in any economy. And you know what? The company’s nearly down and out, but tough-minded and business-smart customers agree: Performance trumps price.
The lesson is here and now for all B2B companies to witness and to learn. If a company cannot define its core business advantage internally, then it cannot articulate and defend this value in the marketplace.
It is a function of branding to establish the value – the brand identity – a company brings. And it is a function of leadership to recognize this need.
jb
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