Due to the comments and interest generated by the previous blog “Do You Have a Primadonna Business?”, I'm starting a new series discussing the 10 core business processes that you need to have in place -- and walking through them individually.
First, why are the 10 core business processes important? They're important because they speak volumes about the sophistication and maturity that you've implemented in your business: not necessarily maturity in terms of the number of years, but maturity with regard to your fundamental understanding of what it takes to have sustained performance, sustained growth, and sustained ability to deliver a consistent product and service. The issue that you run into without these 10 core business processes is that you are clearly operating at a high degree of risk for your business, which means that for any corporation looking to do business with you, you are also transferring that risk to them. And the first thing you have to understand about large corporations is that their business model is a risk averse model. To put that in perspective, what I mean by risk averse model is that clearly being in business comes with risk, but when you observe corporations with a lot of employees, one of the things they pride themselves on is their ability to identify, mitigate and (to the extent that they cannot mitigate it) manage the risk so that it becomes prudent risk taking.
When corporations pick suppliers, they try to pick suppliers that fit into their systems and minimize the risk to operations - the risk of loss. They see that you have actually implemented these processes, which means you're more like them and less like people who haven't done the work and are just hoping for the best. Big companies are well past hoping for the best. They have a high degree of planning that ensures they can deliver at a superior level on a consistent basis.
Now you might be saying, “do I have to have all of these processes in place to make money”? No, you don't. You may not make as much money; your contracts may not be in place for long, you may not get the really big contracts, but you do not have to have the 10 core processes to make money. I strongly advise, however, that you get them in place, and you get them in place sooner than later. I understand you might actually be operating on a shoestring budget and you just don't have a way to do this right now, and I would challenge you on that thinking. I talked about financing your small business a couple of episodes ago. You may be able to bring more resources into your business if you find people that will work with you until you actually get the revenue in place. You may be able to work with other partners who have resources you don't have and have processes that you need already in place. There is a whole host of opportunities available to you if you don't currently have these processes in place right this minute, but implementing these processes is going to be imperative to your business sooner rather than later to play in this game with the large corporations.
The first of the 10 core business processes is customer strategy and your marketing approach. A number of us take a broad view of our business. We start out believing that we can sell to anybody. We just really need a chance to get our foot in the door. That may be true, but it's a terrible strategy from a marketing perspective. You really and truly want to be extremely specific on whom your target customer is. You want to start with the customer that is either going to be the most receptive to what you're selling because that gets you speed to cash; or the customer that is going to benefit the most from your service, i.e. which customer is currently having the most pain around what it is you offer?
The issue is not does every customer have pain around what you're offering -- but which specific customer segments. I’ll give you an example. Tech is heavily male dominated and, in the past, high tech had a host of issues with the “me-too” movement and men being insensitive to how to really treat women in the workplace. So, if you're doing any type of diversity and inclusion work and you have a program in place, then tech would be your target demographic. There are other industries that are in pain regarding diversity, but the tech industry primarily because the market has been calling them out. That's an example of what it means to have a customer strategy and what your marketing looks like. If you were to target the tech industry, you'd probably approach them differently just because of what you know about their workforce. With the automotive industry, oil and gas, or banking and finance or any other industry you would have different conversations, so your customer strategy and relationships become huge.
As this is a core process, what we begin to get into is something that's referred to as your sales strategy or your pipeline management. What I mean by that is you always want to have X number of customers in the pipeline.
AT&T, for example, has an idea of how many new customers they're going to get per month. They have an idea of what new products, and how many customers they're going to get on each product. They have an idea of how much money they're going to generate. Each week they have daily sales goals and they have detailed processes and instructions around how they manage their customer flow, their profitability, their new products, their sales and everything else. And they probably, in some cases, will project out certain portions of their business anywhere from six to 18 months because they understand how long it takes to close a deal.
In your business, so that you don't get into feast or famine situations (feasting is when you get more business than you can handle, and famine is when no business is coming in), you want to have a robust pipeline management system. Some people will say you also need a customer relationship management system -- something like a salesforce.com or some other things that are out there. At some point you are going to need that because you're going to need your sales efforts coordinated and you're going to need to be able to see at a glance what's going on and what you need to be doing, and see if you have any drop-offs -- but you don't need that right off the bat. A lot of this you can do with what we used to call a “Big Chief tablet” which is nothing more than an eight-and-a-half-by-11 tablet of paper where you just ask, “who are my customers? What's going on? What do I need to know about them? Who's calling on them? And what opportunities do I see in their organization where I think I can help or where it looks like they need our help?” As long as you stay ahead of that, even if it's manual, that will work wonders for you. But what I want you to take away from this is that the reason this is a core business process is it speaks to your ability to make it rain. It’s your ability to keep cash coming in the door; your ability to keep the doors open because you have customers coming in, you've got opportunities coming in, you have a process that just keeps going for you. And that's why the number one capability is you must have continuous revenue coming in to fund the business, and also be able to generate new customers or new revenue, which is deemed a customer strategy -- or a sales and marketing program.
There are nine more core requirements after this one, so stay tuned for the next one which is Employee Development Satisfaction. Please go to and get on our email list to stay up to date on new episodes.