[[scheduler_plugin]]

Business Performance Measurement

By Boris Nenide

Business Performance Measurement is concerned with measuring performance relative to some benchmark, be it a competitor’s performance or a preset target. A typical performance measurement helps businesses in periodically setting goals and then providing feedback to managers on progress towards these goals. The time span for these goals is normally a year or less for short-term goals and may extend up to several years for long-term goals. Hence, specifically, business performance measurements are formal, information-based routines and procedures managers use to maintain or alter procedures and practices in organizational activities.

The primary reasons that may be attributed to this exercise of Business Performance Measurement are to synergize profit and growth, and, consequently, decide upon extents of control to be exercised for favorable and justified outcomes. This will also enable you in measuring and redefining your short-term and long-term goals by offsetting them against opportunities and capabilities as you move along. These strategic goals and plans then peter down to operations, human resources and other day-to-day management practices. As an ongoing exercise, it will ensure monitoring and control to drive growth and improvement.

Obviously, to achieve this, a business has to spell out the parameters and subsequently, the scores or ratings to gauge performance vis-à-vis these parameters. The outcomes of such collated data will be very strong indicators of the business health of your enterprise. And this, will, no doubt, reflect on the performance of the top management which mainly drives such business activities. As an entrepreneur, you can then have a holistic view of your business. Such data-based information will empower you with indices with which you can fast-forward your business towards betterment and growth. But do make sure the data are honest and dependable. Check out the IT support practices and tools which collate this data and generate reports as it can make or break your strategic decisions. And always remember that efficiency and effectiveness are central to your business performance measurement, the challenge being to strike the right balance between them.

You can now review performance at all levels, identify improvement areas, set new benchmarks for improvement and then again review the impact of these actions. And, not to forget, reward excellent performance to sustain motivation which always runs the risk of falling by the wayside if ignored. This is what shouldering responsibility is all about, after all.

As an entrepreneur, you must be aware that these parameters of business are being continually researched upon and these indicators have evolved over the years to suit the needs of the present times and different natures of businesses and industries. And even within a business entity, there are various indicators for different aspects of business, including the financial perspective, the manufacturing/operations perspective, the customer perspective, etc. For small enterprises, the financial perspective by itself is crucial. A balanced business scorecard will help you to study and gauge the financial framework of your organization.

FINTEL can be helpful in the process of gauging and managing business performance by providing tools and data designed just for that purpose, including reliable and insightful industry comparisons and trends.

The iconic Brazilian soccer player of the 1960s and 1970s, Edson Pele, was once caught smoking by his father when he was a child. His father advised, “ Listen, if you want to play sport, you have to be in good health”.

This applies to your businesses’ health too. Check out what you need to smoke out! Go, get the barometer.

Boris Nenide has been with the company since its founding and currently serves as its Chief Operating Officer. FINTEL is a leading provider of data services and business intelligence solutions that help our clients to make better decisions based on the largest and most reliable financial benchmarking database of privately held companies. We support your decision making processes with timely, relevant, easy to retrieve and readily presentable
financial information and benchmarks. We have a passion for supplying dependable business intelligence and expert advice that make our customers more successful.

Related Websites

• Top 10 Selection Criteria for Outsourced Electronic Medical Billing Software as a Service (SaaS) Software as a Service (SaaS) is the new generation of ASP model designed to reduce the exorbitant costs of specialized medical practice management software. SaaS model is available for all aspects of medical practice management, including scheduling, billing, and electronic medical records (EMR), which are mission-critical for high quality clinical......
• linklings, brief summary edition A few links for weekend reading - if you're not out enjoying the fall weather... When Your Investment Portfolio Returns To New Highs Best Online Banks for Emergency Fund Brush Up on Your Job Skills and Performance So That You Can Keep Your Job or Get a Raise MonaVie Employee......
• How to Set New Financial Goals No matter how old you are, or how much money you have in the bank, it is never too late to start setting new financial goals. A big part of successfully saving money and making more money is the formation of goals, keeping track of your progress and finding that......
• Avoid This - The Reason Why Most People Fail Online Does this sound familiar to you ? A person joins your business they "try" and make it work after about a month of trying with little to no results they quit and jump to the next great opportunity on the horizon.  These same people move from one business to the......
• DHL Core Values under threat! Two news stories from yesterday... One is a BBC article on tax evasion at the highest level in Europe here. (allegedly) Zumwinkel has (apparently) not volunteered enough tax to the tune of 1m Euros.  If so, it's a case of "Do as I say, not do as I do!" The......

Working Capital Management – a critical aspect of business operations

By Boris Nenide

Quite often, we see that new dreams and new businesses do not sustain beyond the take-off stage due to a small error in management. For instance, a miscalculation of the operating expenses that in business parlance is called ‘Working Capital’ can be catastrophic.
In some cases, an entrepreneur might have done a reasonably good assessment of the operational expenses but may have simply failed to incorporate the debt payment as a key component of working capital. Or maybe, a crisis situation was not provided for by way of contingency funds. One false step, and it triggers a chain of events that lead to a situation like a boulder hurtling down a hill wherein one has no choice but to wait for the boulder to damage everything on its way down and then come to a standstill. And, of course, it is too late by then.

The short-term decisions of a company can be grouped under the heading ‘Working Capital Management’. This deals with the short-term balance of current assets and current liabilities, the focus being on management of cash, inventories, and short-term borrowing and lending.

By definition, Working Capital is simply the excess of current assets over the current liabilities. Short-term assets denote the cash and all such assets that can be converted to cash within a year like marketable securities, accounts receivables, short-term notes receivables, inventory and pre-paid expenses. The short-term liabilities comprise cash expenses within a year like accounts payable, short-term debts such as credit lines, short-term components of long-term debts, accrued expenses.

All small and mid-sized companies consider Working Capital management as the most important management activity because of the significant financial impact it has on the overall organization’s health, not just the financial health. The availability of liquid cash or the ability to generate liquid cash at short-notice through current assets can go a long way in sustaining smooth operations of your business. It is critical to business, and hence, the optimal utilization and constant effort at improvement of Working Capital management are of utmost importance. Else, it hits at the very core of such businesses.

So, what should be considered as adequate Working Capital for a company in a specific industry and, of a specific size? What are the key components of working capital? How should the working Capital for your specific business be financed? What are the various methods required to manage the working capital? For example, excess of cash is also a sign of operating inefficiency. Perhaps, this surplus cash could be better utilized towards growth. An analysis of the cash conversion cycle is a good indicator of this. And yes, one cannot forget to consider external factors like legal requirements, business environment, and internal factors like the organizational structure and internal information communication system, that can impact working capital management.

What has been discussed here is just a basic introduction to the topic. A real-life scenario will have many more complex components and aspects to it. FINTEL is a leading provider of industry data and financial management tools, including it proprietary concept of Net Balance Position developed by the company’s co-founder, Dr. Robert W. Pricer. Empirical testing has shown that this is by far a more effective tool than the traditional liquidity ratios to map a company’s liquidity situation.

Just like an agile sportsperson has to sustain his competitive edge with regular exercises, the wheels of business can keep churning only if they are well greased all the time with excellent Working Capital management.

Here’s wishing you Happy Working of your Capital!

Boris Nenide has been with the company since its founding and currently serves as its Chief Operating Officer. FINTEL is a leading provider of data services and business intelligence solutions that help our clients to make better decisions based on the largest and most reliable financial benchmarking database of privately held companies. We support your decision making processes with timely, relevant, easy to retrieve and readily presentable
financial information and benchmarks. We have a passion for supplying dependable business intelligence and expert advice that make our customers more successful.

Related Websites

• What is CIT And Why Am I Out $17 Because They Went Under? One of the biggest companies you've never heard of went bankrupt yesterday.  It was the 5th largest in US history.  CIT Group, which is not to be confused with Citi, was one of the largest providers of financing to businesses.  They worked with 80% of Fortune 1000 companies and millions......
• Different Types of Short Term Investments Short term investments are the most ideal form of investing if you want to invest over a period that is relatively short. Cash manager accounts make it possible to access your money whenever you need to. Fixed term deposit investments secure your money for the entire length of the term.......
• Wachovia's Bad Day?: A Lesson in Reading Between the Lines A little disclaimer before you read on. This post is kind of lengthy. The point of this post is not to recommend an undervalued stock. This is a detailed look at how earnings are reported vs the way Wall Street interprets those earnings. It might get a little heavy......
• The Entrepreneur Fund: One Year of Projected Expenses As debt freedom moves closer to reality in the Frugal household, my dreams have again turned to the idea of venturing out on my own. I've been fortunate to enjoy some growth around here these last couple years, and my combined earnings from all freelancing ventures are enough to support......
• Collateral Management Tips Have you ever wondered about collateral management or do you work with collateral management in your job? This article is designed to help you understand more about good techniques and how to implement them more effectively.First, you need to understand that collateral is the items, or assets you are......

Getting Back To Lean Six Sigma And How You Can Leverage It To Better Profits

The reason we care about LSS is the fact that it’s probably the single most powerful set of approaches currently known to man that empowers people to be fully effective. I know that’s a lofty claim, and certainly LSS alone is not a silver bullet. That said, it represents a tool box that will take you a long way toward your objectives.

To understand what LSS is all about, we must first have a basic understanding of the two components Lean and Six Sigma.

Lean as a term has been credited to James Womack and Dan Jones, who authored several books about the Toyota Production System, including The Machine That Changed the World and Lean Thinking. I was dragged kicking and screaming into learning about the principles of LSS 25 years ago when I worked in operations management at an automotive component supplier. We learned about just-in-time, statistical process control, quality circles and teams long before these fashionable terms of Lean and Six Sigma were even conceived.

My research traces the underpinnings of LSS/OE back into the middle of the 19th century. After World War II, General Douglas McArthur charted the Japan Union of Scientists and Engineers (JUSE) and they, along with a bunch of Westerners, including Drs. Deming and Juran, helped Japan rebuild based on a different competitive paradigm that today we know as LSS.

Think about it. Japan is an island nation. No coal. No iron ore. No petroleum. No forestry or large-scale agriculture. The only thing Japan had was people; everything else had to be imported. And they had to make things to compete with the global behemoth the United States. The United States was in a great position after WWII. Having basically the only infrastructure left, we could make anything at any level of quality and charge a price of cost plus desired profit margin. And the world was happy to pay it. As we all know, this paradigm has shifted with a vengeance, starting in the late 1970s with the loss of most consumer electronics to Japan and more famously the emergence of Toyota. As a data point, note this: Toyota passed up General Motors in total global auto production in the month of May 2007, a feat no one dreamed of just 20 years ago. Recent events and the melt-down of GM in 2009 have now propelled Toyota to the top – probably permanently. What would it mean if your organization became the ‘Toyota’ of your industry?

Related Websites

• Do Rich Nations Owe Poor Ones a Climate Debt? [/caption] By BRYAN WALSH Thursday, Dec. 10, 2009 In two decades of climate-change negotiations, a deep divide has remained between wealthy nations and developing ones, each side insisting the other move first to lower carbon emissions and curb the effects of global warming. But this year there was an uncommon......
• 2009 World's biggest companies and fossil energy business Forbes releases the world's biggest companies list. It reveals 2000 companies that, says Forbers,  'will emerge on the other side of the trough far stronger when world economies snap back next year'. Current global crisis is not a hard way for them to keep grow, fund, and entering the......
• Why you Cubs fans hating on the White Sox? Tremone21 asked: White Sox won the world series about a few years ago while the Cubs haven't done it in about a 100 years. Well, Wrigley Field is an amusement park for you guys not a baseball stadium. Suppose Wrigley was the White Sox stadium would you guys be White......
• Macau to Host First International Poker Tournament PokerStars (www.PokerStars.net), the world's largest online poker site, today announced the first ever real money No-Limit Texas Hold'em poker tournament to be held in the People's Republic of China. The 'PokerStars.net Asia Pacific Poker Tour Macau: Asian Poker Open' $2,500 buy-in Main Event, which is being run in conjunction with......
• Six Sigma Training 101 - Better Management Basics What is Six Sigma?Six Sigma is a quality management program that is designed to achieve a six sigma level of quality for products. In the mid 1980s, Motorola pioneered Six Sigma and it has since been adopted by many other companies and manufacturers. Service companies also implement Six Sigma......

Driving service business profits with Lean Six Sigma – Things anyone can leverage to make more money

One of the three things we must do to win in service-providing businesses is learning how to be globally competitive in speed, cost and quality while offering fantastic customer service and continual innovations in what your business offers. We must get and keep the edge on our competitors as part of the every day operations – not just an annual activity.

This is the first of a series of articles about a hot topic among Fortune 1000 businesses globally that I have tailored to fit the needs of any size organization interested in improving their bottom line results – Lean Six Sigma (LSS).

Most business professional already know that fancy methodologies and tools (like those in LSS) alone are not enough to create sustainable competitive advantage in any organization be it for profit, nonprofit, private, public or governmental. Long-term sustainable success only comes through people. Let me emphasize this: long-term success is most effective… primarily through your people understanding and executing it based on your vision and objectives. I advocate an approach to leveraging operational excellence best practices in a way that takes this reality into account. One of my favorite quotes of late that you are likely to already have heard and/or agree with is something like this:

“People would rather live with a problem they cannot solve than accept a solution they don’t understand.” Woosley & Swanson

How can anyone expect great results leveraging best practices without making sure our people really understand? Below are my keys to success that I have learned the hard way in 25 years of learning and applying these ideas with thousands of people in hundreds of organizations around the world.

Borrowing from one of my favorite authors winning in business, Michael Gerber, who authored E-Myth, I believe that there are basically only three things we have to get right in any kind of business endeavor to be successful.

First, marketing and sales must be effective. Without a top line there can be no bottom line. Without understanding the innovations required to differentiate now and in the future, an organization loses relevance and is commoditized out of business sooner rather than later if the competition is global.

The second key is globally competitive operations. Last time I checked, being fast and delivering a great level of quality at a fair market price is required to even be in the game in the for-profit sector. This is where Lean Six Sigma (LSS) and operational excellence comes into play; techniques to empower people to truly know the voice of the customer and deliver on it every day. In addition ,this must be in a perpetual state of continuous improvement, again driven by customer expectations. Going beyond basic expectations sets the real leaders apart from everyone else.

Finally, the third key is human performance. I firmly believe that 80 percent or more of long-term sustainable success in organizations ultimately comes back to its people. Our ability as leaders to educate, empower and lead our people is the ultimate competitive advantage.

Consider this: What is the one thing our competitors don’t have that we do? They can have the best equipment, materials, computers and fancy marketing, and even set up shop next door to our customers. So what is left? You and your people. Our employees are the only thing our competitors don’t have or can’t easily get – employees who are motivated, educated and empowered to act on the vision and promise required by your customers.

Related Websites

• A Network Marketing Fairy Tail Many people would have you believe that making a ton of money in network marketing is simply a matter of  getting a few people who will get a few people and so on...  While there are many hundreds of success stories of network marketers making good money in the mlm......
• Basics of Budgeting 1 For many people in this day and age, the word "budget" is spoken and immediately images of penny pinching and unpleasantly crunching numbers are conjured. Luckily for you, this could not be any further from the truth when it comes to understanding the basics of budgeting and what budgeting is......
• VoIP Phone Systems - There's a Fly in the Ointment The keystone that will lock in VoIP as the successor to TDM technology has yet to be hefted into place. It may in fact take another decade before we see the full potential of VoIP phone systems. The keystone we are referring to is the deployment of standards based IP......
• Office Phone Systems Utilizing VoIP Technology Revitalizes Operation of Small Businesses For small businesses, one of the biggest challenges can be competing with the larger firms fighting for the same market. With limited resources and space, a small business must find economical and efficient ways to make up for their lack of size.Traditionally, one of the biggest selling points for......
• Business Decision: Turning Away a Customer As I have mentioned before, Madoline and I own a small pet and horse costuming business called Franga Designs. Most of our products are custom-made from scratch, and a few are ready-made with a last customization to fit each customer's pet or horse. [/caption] Last month we received an order......

UNDERSTANDING WHAT YOUR FINANCIALSARE SAYING ABOUT THE HEALTH OF YOUR COMPANY

By Max Gregorich

Understanding what your financials are saying about the health of your company is the foundation of successfully running any business. In fact, continually measuring your company’s performance and making operational, organizational and strategic corrections is the most important responsibility for any business owner. Yet, many owners pay very little attention to this aspect of their business. The reasons vary, but the results remain the same; ignoring or not understanding your financials can, and usually does, mean losses that you’re not even aware of, month after month.

Business owners who understand this simple fact have more control over their business strategies, which in turn allows for better financial decisions and ultimately a more profitable business.

Believe it or not, it’s not rocket science. It’s just knowing what to measure and how to measure it. Without that knowledge, the stronger competitors (those who know how to measure and manage performance) can and will inevitably drive you out of business.

On average, small to mid-sized companies usually don’t capture about 10 to 30 percent of their revenues as profit, but only earn approximately 10 percent or less in profit. The math is simple. Say a company does $1,000,000 in sales with a profit of 10 percent or $100,000. Add 15 percent of the sales to the profit and you have $250,000. Without making one additional sale, the company has increased its profit line 250 percent. Knowing where to look for the cash leakage, and then knowing how to plug the leak, is of utmost importance for any business owner. Once the measurement is done, low hanging fruit generally presents itself, and initial corrections are fairly painless. On-going measurement offers the opportunity for a business owner to plug cash leaks, prevent future leaks and to create a continuous improvement process, which always leads to maximizing profits.

Now, the average business owner believes that if he/she increases sales, it will naturally increase profits. However, if there is a cash “leakage,” the more revenues the more losses. When a company begins growing their revenue, or top line, it typically causes certain internal costs to rise. Over time this becomes a cash leak – usually a very small leak at first. It’s so subtle that it usually goes unnoticed to anyone who’s not measuring it. It begins to add up and one day the company finds itself in financial trouble. So, the fallback solution for the average business owner, who isn’t measuring performance, is to increase sales – which in turn causes greater internal costs – or larger leaks. The spiral continues. One of two things will happen at this point: the owner brings in a reputable (and at this point – usually expensive) consultant to help turn the company around or the company goes out of business. Hopefully it’s the former and the owner realizes he/she needs to learn a new skill: measurement.

The need for this basic, yet essential, skill came to light during my consulting days when I realized the majority of business owners didn’t understand the implications of their company’s financials. With the help of financial friends and many reference manuals, I developed a software application that I called CFO Genie, which quickly performed the measurements. Because the software was so easy to use and understand, my clients kept asking if I would sell them a copy of the software. I eventually realized I would be serving a larger number of business owners by offering a professional development course, called Detox Your Business, on the fundamentals of measuring performance and the formulas used. Now, these aren’t my formulas. Any trained financial expert uses these formulas every day. All I did was to package it in an easy to use format for the financial lay person – so to speak. The workshop simply shows business owners what to measure and how to measure it.

Max Gregorich is CEO of CEO1Stop, is the host of KBZNZ’ Business Genies, author of Understanding Your Financials for the Small Business Owner, and creator of CFO Genie, an affordable, easy-to-use performance software tool for small and mid-size businesses, and created specifically for the financial lay person, which produces easy to understand reports that clearly identify why your hard-earned revenues are not reaching your bottom line and shows you the obvious implications of ignoring those financial “leaks.” To learn more about CFO Genie or to download a free copy of our e-book: Understanding Your Financials visit www.ceo1stop.com.

Related Websites

• Online Business Opportunity Is Waiting For You! Don't Waste It! The concept of the home based business became a real savior to a lot of business owners who could not reach their goals of creating and running their own businesses. As we all know, financial reasons were at the top of the obstacles that were overcame by the help of......
• Compare Business Credit Cards and Charge Cards What are the differences between business credit cards and charge cards? Why should small business owners use a business credit card in handling their expenses? This article should give the basic idea about charge cards and credit cards for business.Charge cardsCharge cards can also be considered as department store cards......
• Technology Help Small to Mid Size Companies Achieve Their Financial Goals Today, IT solutions are aiding small and mid-sized companies alike, as they compete with Fortune 500 companies for a piece of the pie. We live in an age of fierce competitiveness, fiscal concern, and global turmoil and uncertainty. Companies are working hard to continually improve operational efficiency. Many are......
• Business Management - Customer Service Is Overlooked Have you ever visited a store and decided to leave before you bought anything because the employees working there were rude or too pushy? I have and I'm sure you've had at least one experience like this. Customer service is one of the most overlooked aspects when running a......
• Managing Stocks in an Economic Crisis 2008 is showing all of the hallmarks of being a difficult year financially, and for this reason, having control over your cash flow is absolutely vital. Managing stocks in an economic crisis is one of the best possible defenses that you can take during the credit crunch. By monitoring the......

“Recruiting to Your Weakness”

By Markku Kauppinen

Recently I was working with a consulting firm that utilizes the information we provide to help their clients with strategy implementation. This particular client company had a very common problem that we see in organizations in all kinds of industries. It seems that almost no one is immune to it. Their managers were cloning themselves.

They were hiring people that very closely mirrored who they are – people that seemed to have “that certain something”. They were bringing in people who made the hiring managers say: “You know, there was really something about that guy that made me feel very comfortable. He would fit very well in our team.”

I can still vividly remember the conversation I had with one manager eight years ago. He told me with a lot of enthusiasm and conviction: “I know exactly what I need to do. I need to clone myself. Then all of my worries will be gone!” He was a manager of about 45 account executives at a financial services organization. While his group was doing modestly well, no one attributed any of the credit to him. It was a classic case of doing well in despite of oneself.

Have you ever been in a situation when you had a hard time finding the right words to tell someone politely that they were dead wrong? I am pretty comfortable doing it now. Eight years ago I was not so comfortable. I remember saying to myself: “Clone you! Why do you think I am here?”

Since that moment, I have heard the same idea countless times. Actually, on the surface it makes a lot of sense. If I am successful as a manager, or at the very least think I am, why not duplicate myself and multiply the success. (By the way, I have not met many managers who said they were not good managers – have you? I think there must be a few of them out there. At least the employees sometimes claim they are out there.) This plan sounds logical, simple and straightforward. Why not go for it?

And many do. They bring people into their team who in essence are mirror images. They act and think just like the boss. Conflicts happen less often, everyone gets along and life is smooth sailing.

Unfortunately, it is not all smooth sailing. Although typically a team with similar style employees tends to increase their strengths, they also amplify their weaknesses. What’s worse, they typically are completely oblivious to the latter. No one wants to face this fact. And the ones that do realize it often find it to be a lot more comfortable to be quiet. Who wants to rock the proverbial boat and to tell the boss they are doing it wrong?

The same happens in people’s personal lives. However, it seems that we are more aware of it then. We are more aware that when we are very much alike the amplification of strengths and weaknesses takes place. For example, take a couple of analytical people. They usually are aware that they have a hard time making decisions quickly and can even poke fun at themselves.

But at work, it is different. The problem is ignored and no humor is found in the situation. What often compounds the problem is that certain kinds of careers, jobs and even organizations tend to attract similar styles of employees. For example, the engineering field attracts more analytical styles than sales careers that often pull in more people-oriented styles. Combine this with a manager who clones him/herself and you end up with a team of clones.

“Markku, what is the best behavioral style for a leader (or manager, salesperson, etc.)?” This is a question I get asked frequently – almost every day. My honest answer always is: “It depends on what you need. Do you know what you need?”

Because the truth is that there is no one best behavioral style. There really is not, although I at times think mine is pretty good. Then I take another honest look.

But there is a common denominator with all successful people. They know who they are and they are honest with themselves. They are not afraid to look into the mirror and face the truth about their strengths, weaknesses and challenges. What’s more, they capitalize on their strengths, and they recruit to their weakness. They actually surround themselves with people who are different from their own style.

Why would anyone want to do this? Aren’t they inviting disagreements, conflicts and misery?

Maybe. But what they are also doing is recruiting additional strengths, different viewpoints, and different talents to their team. Please understand, I am not advocating that every team should be equally balanced with the different behavioral styles. That is rarely the best case. However, the most effective teams closely match the behavioral requirements that the mission of the team dictate. When the behavioral styles are closely aligned with the behavioral requirements, the team succeeds.

In sports everyone seems to understand this clearly. Many of us have our favorite players. We may have our favorite quarterback, pitcher, or center. But let me ask you this. Would you want your favorite sports team to be clones of that one player? Of course not! Your team would never have a chance to succeed even though someone cloned a superstar.

Next time you see a manager clone trying to clone him/herself, you may want to ask the same question. Do you really want to clone yourself or do you want to succeed?

Markku Kauppinen is the President and CEO of Extended DISC N.A., Inc. He helps executives to make better decisions about their employees, teams and organization. Markku may be reached at markku.kauppinen@extendeddisc.com

Related Websites

• Surprise! (Not) Your manager matters Anybody who's ever had a bad manager, knows it's true that your manager counts. Keeping up with ideas -- Do you? I like to keep up with ideas in the business world (ex-IBM'er) as well as in the fashion world (ex-multi-store owner.) On the latter, I recommend Nathan Branch's blog......
• The Key to Blogging for Profit In the last two blog posts, we talked about identifying and banking on your strengths, and identifying and banking on your sources of traffic. Any time that you find a significant source for blog or website traffic, there are almost always going to be ways that you can build even......
• Turnkey to Affiliate Program Success - Grow Your Online Business Using Affiliate Management Services Business of the modern times is getting more complex with the involvement of Internet in their major strategies. There is no doubt about the fact that better e-commerce techniques will lead to the success of your business organization but planning and initiating e-commerce strategies is not a piece of......
• What is Anarchy? What is anarchy and anarchism? It’s a commonly misunderstood word usually ascribed to a hateful and licentious lawlessness. Anarchism is sort of a living embodiment of its own principles in that there is no one clearly held body of beliefs. There are more considered approaches of the concepts than a......
• Understanding Corporate Literature to Maximize Practice Management and Client Service Corporate America is far ahead of law firms in systematically studying leadership and organizational effectiveness. As law becomes more of a business - and as leadership becomes even more critical at all levels of a lawyer's practice - it makes sense to consider what corporations know that lawyers and......

The Slow Birth of Sales Enlightenment

By Max Gregorich

I was not a born salesman – as my grammar school magazine foray and my first sales job as a “door to door” encyclopedia salesman records will attest. Both were dismal failures. Most of my life, however, I’ve been self employed and therefore, whether I liked it or not, in sales. I can tell you – I didn’t like it at all. Why? Because my perception of salesmen was like most in our society – generally, very low. Later on, this perception became pivotal in turning my so called sales career around. But, long before that happened I knew that educating me about the sales process beyond what the encyclopedia company had taught me was going to be key. So, I purchased every book I could lay my hands on and followed the steps precisely and only found failure again. The few successes just had to be anomalies. So, more books plus something new – cassette tapes I could listen to while driving. Wow. The problem was – I had no better results.

One day, back in the early 70’s, while working in my racing engine business, a friendly competitor from a few blocks away stopped in to buy all the engine oil I had in stock at my retail price. He told me that he keeps running out of it. My reputation as an engine builder brought me five times his customers. Now, we sold the same brand of oil but he charged twice the price! Yet, no one was buying my oil. Worse yet, people were bringing me parts purchased from his shelves and asked me to use them while building their engines. Weeks later after raising my prices, oil and parts started selling like crazy. It just seemed counter-intuitive to me that discount pricing wouldn’t help sales levels. What I did know though, was that the new sales level I was achieving had nothing to do with the products or my competitor’s marketing or sales ability. It had something to do with the thought process of the prospect.

More books and more tapes. But this time a few on psychology too. Years later, a glimmer – and I mean a slight glimmer – of an understanding of value and perceived value. I thought I had found the holy grail … but no. It was impossible to incorporate this one piece of understanding into a sales presentation with any repeatable success.

Back to the drawing board. More books … more tapes. This time I included live courses. Some courses were so inspiring that I couldn’t wait to get in front of a prospect because I knew I could now outsell anyone. Well, after that balloon deflated I found other courses so complex that I was sure I wasn’t smart enough to be a salesman. Trying to remember all those tactics and techniques and in which order they were to be executed was mind numbing. My only motivation to continue came in the mail – relentlessly – bills that needed to be paid.

Just so there’s no misunderstanding. I did earn a fair living and I did develop what I would call a “sales charm” that brought reasonable success. But what I didn’t have was real repeatability.

You guessed it: more books etc. etc. etc. Because of this so called “sales charm” I was offered a project to help a company involved in the telecommunications industry break into military and international markets. After preparing budgets and resource requirements I was informed that that level of resources wasn’t available and was asked to penetrate the US market to raise the capital needed for my project. Forging ahead, I connected with a major US Telecom that had an interest in my products and proceeded to schedule appointments with their senior staff. I spent two months preparing a presentation for their senior vice president and almost a dozen of their top engineering department heads. I studied it; memorized it; reviewed it on the flight to their headquarters and again in the hotel. When I showed up the next morning at their corporate offices, ready with my three hour presentation, my gut told me that the presentation wasn’t going to work. So as any good salesman would do … I panicked. Ten people in the room, 2500 miles of travel, two months of preparation, millions of dollars at stake, and I drew a blank. But I was about to learn something incredible. I emptied my sample case on the conference table by flipping it upside down. Samples scatted everywhere. I watched their expressions go from bored anticipation to not-so-boring shock. They were waiting for me to speak: “Gentlemen, I would not presume I could tell you a thing about how these products are used. But if you’re interested in the quality and craftsmanship that go into their manufacture, I would be happy to answer any specifics. What’s for lunch?” They simply applauded and took me to lunch.

A seven million dollar sale in under 45 seconds. How great was I. After I got my head out of the clouds and stopped patting myself on the back for doing such a fantastic selling job, I realized I didn’t have a clue about why that sale even happened! After all, everything I prepared for never occurred.

More books, more tapes … still no clue.

But I tried similar techniques with other prospects with a high rate of success. One international prospect was about to close a $200 million deal with me (in under 3 minutes) when the company that hired me for the project informed me they couldn’t finance that kind of top line growth and this deal would bankrupt them. So, after 18 months on this project and increasing their top line by almost 700%, I moved on.

These sales made me certain I was on to something. And I was. More research was on my “to do” list. Little did I know it would take another ten years of research, trials and errors, successes and failures before clarity would finally come.

Why so long? Why did it take 40 years for clarity? I simply kept looking in the wrong places. I truly believed that we are all independent thinkers. I truly believed it was my job to sell. I truly believed in my beliefs. And why not? I was programmed to believe them. The truth? That we are, for the most part, robots. Automatons, if you will … programmed to respond identically and predictably to stimuli in a repeatable manner. Surely some of us are different, but most fit the category. Once I understood these phenomena, sales became as easy as having a quiet conversation with a friend.

In the end, my colleagues have convinced me to create a course. So, here it is. “The Psychology of Sales” – the culmination of 40 years of research and has nothing to do with anything found in sales books, tapes, CD’s or other courses. It’s about the psychological reasons (the six laws that people can’t break) that cause people to make a buy decision and creating the right psychological reasons for sales professionals to become sought after super sales professionals. The course also includes a segment on ethics and how it affects longevity in the profession and a session with management on sustaining and improving the understanding.

Since then, I have never spent more than 3 months achieving an annual sales goal and have helped numerous companies achieve significant and serious increases in their top line.

Visit this column again for specific client success stories. And thank you for your indulgence.

For more information about the “Psychology of Sales” course, contact us.

Max Gregorich is President of CEO 1 Stop and host of KBZNZ Talk Radio’s Business Genies. As a successful business owner, consultant, software creator for small and mid-sized business performance analysis, and former race car team owner, Max has an immense array of business and life experience which he uses to bring practical knowledge and usable tools to his audiences through both his show and his immensely interactive signature presentations and workshops “Psychology of Sales” and “Detox Your Business.

Related Websites

• Why I Don't Buy Digital Media [Caution, I'm going to get on my soapbox for this post. If you are not interested in soapboxes, I suggest you avert your eyes] Yesterday, I touched on the Legality of IPodMeister's digitizer service. Bringing up the First-Sale doctrine opened up a can of worms in my mind. I love......
• Books I Want to Read As promised, and I know you've been ancy all week, here is a short list of books I want to read.  You won't really find personal finance books on Weakonomics simply because there is too much redundancy.  If you don't understand the basics of investing by now its because......
• The Basics on T1 Line Solutions For Small Business T1 Lines have been the primary source of mission critical bandwidth for companies of all sizes for nearly 20 years. With so much history, a basic understanding of the T1 line should be common knowledge among business owners who are looking for reliable bandwidth for Internet access, data communications, or......
• UK financial picture continues to look bleak. Rumours have it that Bank of England governor Mervyn King may have had some serious explaining to do Chancellor Alasdair Darling as to why the consumer prices index went shooting up to 3.5% added to the worst ever January figures on record with a first time deficit for the......
• ATP Preview for Hamburg, Germany and Indianapolis, USA Here is an ATP preview for Hamburg in Germany and Indianapolis in the United States: The beginning of the US Open tennis series is just beginning, and things are falling for Hamburg. Take your pick for this upcoming week because the Tour has a little bit of something for just......

Industry Leaders Seeks To Increase Profits with Business Financial Intelligence

By Boris Nenide

One of the key challenges any business faces in times of turbulence is how to sustain and enhance profitability. Profit is, no matter how one puts it, the very motive of all commercial endeavors and the management is answerable to the stakeholders for the profitability performance.

Profit, simply put, is the gap that exists between a firm’s revenues and its expenditure. So, as long as the company is able to increase its revenues at a certain rate and its expenditure increase at an equal or lesser rate, the company’s profits are likely to improve – this is a layman view of things. Revenues are, in turn, dependent on volume and price.

Now, in a recessionary economy, there is a sure slump or stagnation expected in demand for almost all types of goods and services, so the volume is unlikely to go up. The prices can only go down in midst of low demand and competition so both the multipliers on which revenues depend are likely to shrink i.e. most companies are bracing for a deceleration, if not, decline in revenues.

However, this is where the management has to show its knowledge and skills to the stakeholders – ok, we know that there is a crisis situation but that is what we were hired for….if it were all smooth and easy, why would professional management ever be required…

This is where cost-cutting, production efficiency and smarter financial management can help. Increasingly, business analysis and financial benchmarking tools such as FINTEL’s Business Scorecard and Industry Metrics are being used by industry leaders seeking to sustain and enhance profitability. By highlighting areas of operational and financial inefficiencies, and presenting industry benchmarking and best practices data, these financial intelligence tools provided by FINTEL are helping managers to control costs and thus, maintain or even enhance the gap between revenues and expenditures.

The power of better financial management can just not be overemphasized. It is one of the few ways in which a company can not only survive the present slowdown, but enhance its margins and become a leaner, efficient organization with least wastage, a competitive advantage that cannot be easily lost to competition.

FINTEL is a leading provider of data services and business intelligence solutions that help our clients to make better decisions based on the largest and most reliable financial benchmarking database of privately held companies. We support your decision making processes with timely, relevant, easy to retrieve and readily presentable financial information and benchmarks. We have a passion for supplying dependable business intelligence and expert advice that make our customers more successful. Boris Nenide has been with the company since its founding and currently serves as its Chief Operating Officer

Related Websites

• Fannie Mae & Freddie Mac Collapse About 5 weeks ago I suggested that both Fannie Mae and Freddie Mac were going bankrupt and their shares were going to hit single digits in 12 months. Well it looks like the market believed that too and their shares were punished. Instead of having to wait a year, the......
• Microsoft, Yahoo or Google, who will win the paid search battle in 2010? Recent acquisitions might add $10 billion in revenue to one company's pocket Microsoft plus Yahoo vs Google, Microsoft vs Yahoo and other variations of names in the paid search game seem to make all the headlines these days. A week ago, StatCounter Global Stats reported that Microsoft’s new search engine, Bing, has passed the market share of Yahoo's engine. Since Bing’s launch,......
• History of Top 10 Banks of the United States [/caption] The year 2009 was not a very promising one as the global recession wounded the financial conditions of the world. The economic slowdown of the advanced countries that began as a result of sub-prime crisis in U.S.A., soon spread over across the globe. The banking sector was bound to......
• Invest in Your Company with Business Sales Training In the UK and abroad, managing a business requires top responsibility. When your business has just been introduced into the market, profits do not always manage to hit targets. Some companies may have been existing for years, yet sales performances continue to drop. Today is the best time to offer......
• Growing Your Business with a Company Blog If you are looking for a way to grow your business but you don’t have a lot of available resources at your disposal, a corporate blog is one of the easiest means of accomplishing this goal. The set up costs are minimal and with the right management, you can easily......

Financial Intelligence: What the Numbers Really Mean

By Boris Nenide

How financial intelligence is helpful to enhance the company’s financial performance.

Quite typically, the term ‘financial intelligence’ is linked to a very niche government activity of gathering of information about the financial affairs of entities, the exercise aimed to curb money laundering, financial fraud and such evils as terrorism.

However, a more relevant and business related meaning of financial intelligence is ‘understanding the financial aspects of business and applying the knowledge of financial management to improve the operations and profitability of the company’. Top consultants have often argued that better financial management, more than anything else, is the key to improving a company’s competitiveness in the market. They claim that employees, stakeholders and business affiliates should understand the financial implications of their everyday decisions and actions, and work for the best financial outcome for the organization.

In fact, business intelligence tools of today, including industry benchmarking, that aim to place the organization’s performance side by side with that of competition and industry peers, place strong emphasis on financial performance. Saying that a competitor has a better network, enjoys greater channel support or better credit terms from raw material suppliers or has higher per employee productivity doesn’t suffice anymore – financial metrics give dimensions to such observations. When an organization invests in business financial intelligence, it shows its commitment to not just knowing its performance vis-à-vis that of its peers or competitors but to its determined endeavor to improve its cost competitiveness, its revenues and thereby, its profitability. Top management and the Board manage by exceptions – they cannot go over to everyone on the shop floor to ask what is wrong and then try to correct it. However, business financial intelligence provides concrete, actionable insights into what a business is doing right and where it is going wrong. When usage of obsolete machinery is seen together with lower productivity in dollar terms, the decision makers can immediately smell the rat and consider modernization of the plant.

The decision to modernize or continue the same way is again based on its financial impact – if the expected benefit (increased productivity) seems to surpass the cost of modernizing, the decision makers may be keen to go in for it. Industry best practices are discovered when financial performance of the organization is placed with that of peers and competitors in the backdrop. Enterprise business intelligence has acquired a financial flavor – very objective, actionable information is needed to succeed and be profitable today.

No business can survive in today’s rough, cut-throat markets with ‘flab’- customers expect enhanced value at lower cost, and surprisingly, one finds that competition is often willing and able to extend such offers. Financial intelligence is a discipline that cannot be ignored if the business has to be one up on its competition.

FINTEL is a leading provider of data services and business intelligence solutions that help our clients to make better decisions based on the largest and most reliable financial benchmarking database of privately held companies. We support your decision making processes with timely, relevant, easy to retrieve and readily presentable financial information and benchmarks. We have a passion for supplying dependable business intelligence and expert advice that make our customers more successful. Boris Nenide has been with the company since its founding and currently serves as its Chief Operating Officer.

Related Websites

• How to use Debt to Improve Your Credit Many of us have the wrong idea when it comes to debt. After years of being told that it is a bad thing and should be avoided, most of us never want to get into the problem of having to deal with debt. Millions more are in over their heads......
• Connectivity e-News Alert Connectivity e-News AlertAlliant DataTel, Inc. - Atlanta, Georgia - Monday - July 7, 2008 - 770.441.9999Wireless data communication tools are an integral part of today's mobile workforce. The trend for remote connectivity and data access is fueled by demand for real-time access to information including the Internet, corporate intranets, IP......
• Developing and Implementing ITIL in a Company Information Technology Infrastructure Library is a must-have for practically all companies these days and it has caught on fast. The benefits it offers like cost-saving, improved security and better interaction with customers on the part of companies has added to its popularity.There are two key indicators that show ITIL......
• Creating Income Streams That Last Whether you are decades away from retirement, or it is staring you in the face, creating multiple streams of income is considered to be one of the best ways to secure your financial future. However, it is important to consider not only how much these streams can bring you, but......
• Check These Facts Before Purchasing Your Next Business Telephone System Does your Business telephone system work for you? Or, do you repeat un-necessary tasks to get the same results? Are you putting your business at risk by loosing customers and huge costs involved? There are a few problems that must be looked at to resolve the issue.Cost. Size Features......

Business Benchmarking – Is It Really Effective?

By Boris Nenide

In today’s competitive business world, it is necessary to spend more time working on your business rather than in the business. You always compare your business with your competitor, but have you ever tried to know whether you are charging enough for your products or services? Whether you are spending too much? Who’s the top performer among your industry peers and competitors? And how do you measure this? etc. Although most business owners do not pay much attention to these aspects, these considerations are considered to be among the pillars of a successful business. Benchmarking is a business management tool that is used strategically to review the position of the measuring organization within the market place.

Introduction to Business Benchmarking

The process of identifying who is the BEST, who sets the standards and what the standard is, is called Business Benchmarking. It other words, it is a process of determining ‘best practice’ related to both products and the manufacturing and delivery processes of these products. The search takes place in all the industry.

Process of Benchmarking

The process of Benchmarking involves the examination of performance levels of other industry or organization. In this way benchmarking helps explain the processes behind excellent performance. Business benchmarking facilitates improved performance in critical functions within an organization.

The four major key steps for applying benchmarking are as follows-

• Understanding your own existing business process in detail

• Analyzing the business process of your competitor

• Comparing your process with that of others.

• Implementing necessary steps to close the performance gap

Major Benefits of Benchmarking

Benchmarking is very effective for all the small and large businesses. It helps the organization enhance its performance level.

Major benefits of this process include the following Benchmarking -

• Allows an organization to compare itself against the competition, the market,

• Is a powerful motivator for change and can facilitate developing a roadmap from current state to best practice.

• Can improve the day to day management of the business

• Offers valuable insights

• Helps to identify the areas of underperformance compared to other organizations, their reasons and needed actions.

FINTEL is a company that brings you an array of product to help you understand and improve the financial performance of any organization by using business benchmarking tool. If you are searching for some source to enhance your financial performance, you can take the help of FINTEL’s Business Scorecard.

FINTEL is a leading provider of data services and business intelligence solutions that help our clients to make better decisions based on the largest and most reliable financial benchmarking database of privately held companies. We support your decision making processes with timely, relevant, easy to retrieve and readily presentable financial information and benchmarks. We have a passion for supplying dependable business intelligence and expert advice that make our customers more successful. Boris Nenide has been with the company since its founding and currently serves as its Chief Operating Officer

Related Websites

• T1 Bandwidth - Still a Useful Business Voice-Data Platform? With all the options available now ... e.g. ethernet, wireless, etc. ... is T1 bandwidth (and all it's flavors) even a viable choice as a network solution (or part of one) for today's businesses?Though the T1 is a hold over from a technological universe from a galaxy far away.......
• Buy Books In Bulk - How To Buy Books In Bulk To Sell Online? Running an online book store relies on the degree to which you are able to buy them in bulk for the cheapest possible price to generate a higher profit margin. Taking into account the current economic conditions, we can comment that dropshipping is becoming increasingly clear as the most successful......
• Alliant DataTel Helps IT Align with Business Objectives Alliant DataTel Helps IT Align with Business Objectives— Michael KirchhoffSr. Convergence EngineerThe economy is headed for a downturn and now is a good time to make an investment in your business. Your competition has learned how to use technology effectively to generate business. They attract new customers, increase productivity and......
• Toll Free Numbers For Small Businesses Toll free numbers are beneficial for both small businesses and large businesses. A toll free number is a telephone number provided for customers to maintain direct contact with a company or a business representative, free of cost. The call charge is paid by the business owner. Toll free phone......
• Yoga for Busy People Too! Do you think you are too busy to exercise? Can't fit in a lengthy yoga session every morning? Don't worry, there is yoga for busy people too. Here is a quick and easy yoga sequence that you can do at home, in the office at lunch or whenever you need......