Resultsman’s Blog


Steps are Being Taken- Progress is Being Made

Posted in Uncategorized by resultsman on February 1, 2010
Tags: , , ,

Progress in the nations and global economic recovery is happening, slowly, but the economy is righting itself. One might not believe that real strides are being made in light of the recent correction in the stock markets. The 300 point drop was brought on by a combination of political and economic forces working in tandem.
On the political side, the market’s, continue to be reacting to the restriction that has been placed on a bank’s ability to trade on their own accounts behalf. (Watch what happens to bank sponsored money market accounts- performance of this type of vehicle could change.) What has occurred is a partial reinstating of the Glass Steagall Act which I wrote about last year. Paul Volker, the Reagan era FED chairman who tamed inflation and laid the groundwork for the economic expansion of the 1990’s was a major backer of this move.
To understand this move towards further regulation, one must understand historic context. Through the second half of the 1990’s US banks became less competitive in the global merger and acquisition market place because commercial banking activities were separated from those of M&A banking activities. US banks could not muster the critical mass to put together mega deals. Congress responded with the repeal of the Glass Steagall Act which allowed them to grow and prosper. The unfortunate side consequence of the repeal is that financial institutions grew to a size where they became “too big to fail” without doing major damage to our economy. This is only one of many contributing factors (like lending money to individuals with no ability to repay loans taken) that helped to create conditions that lead to the crisis we find ourselves.
A second political event helped to initiate the correction which we are experiencing. Rumors were circulating that the now serving FED Chairman Ben Vernacke would not be reconfirmed to serve a second term. Yes, the Ben Vernacke who had the foresight to take steps to prevent a complete financial meltdown, throwing the economy into a deep depression. Last week confirmation came, but by that time, investors were spooked and the correction was underway.
Politics had combined with mixed economic results to set the correction in motion. (Corrections are not necessarily bad, they serve a purpose of correcting market price and values.)
So, what is the message behind this posting? Corrections take time to happen. Political pendants are complaining that we have not seen the net benefits of the Economic Stimulus Act that was passed by congress, (and they are correct). So what has happened? Accounting rules require banks to value the assets carried on their balance sheets to market value. By law this is a required event that has not been executed. Banks are being cautious and using the credit and access to cash provided by the stimulus to prop up their balance sheets and methodically cleaning their books up. If banks took the full write downs in the value of the toxic assets on their books, we would have witnessed many more bank failures than we saw in 2009! Fed policy has been loose, more than 1000 banks are being closely monitored, expect more failures in 2010.
In summary, recovery is a slow process that is taking place, just not as fast as a public that is used to instantaneous gratification would like to see. It hurts to say, but time is indeed healing. The right steps are being taken. We have to continue riding out this storm.

Sustainability- Take Charge and Implement a Plan

Posted in Sustainability by resultsman on January 19, 2010

 

It is time to develop and begin designing an enterprise sustainability plan that is right for your organization.

Sustainability is going mainstream. Public opinion is moving beyond challenging whether global warming is an issue. While, sustainability and the control of greenhouse gases is not a top-tier issue for C-level executives, it has become a major topic of conversation. The hype that came with the Copenhagen conference is fading. Now, it is time for major organizations to start “walking the talk”. CEO’s of the world- now is the time to be leaders. Sustainability means many things to different people and organizations. The triggers that spur the leaders of organizations into taking action are unique to each leader and organization. Legislation/regulation is coming. It will create sustainability winners and losers.   Those companies that have strategies planned and leaders that are actively leading the implementation of plans in support of those strategies will be winners.

 (1) Begin by defining what sustainability is to your business, stakeholders and employees. Initially, plans are likely to address a company’s plan for profitable growth. Develop a framework that will follow the triple bottom line concept, balancing social and environmental objectives with those for economic growth. Complexity and depth will follow as time progresses.

(2) Start simply, assuming nothing. Learn how climate change, GHG regulation, rising energy costs, raw material scarcity, transparency, and social responsibility will impact your firm. Take the temperature- Measure the company’s carbon imprint. Define where the organization is.

(3)  Follow-up by identifying and defining several easy to implement, affordable initiatives that will save energy, cutting costs and reducing greenhouse gas emissions. Hold management workshops to validate the initiatives. Set goals and targets to reduce, reuse and recycle. Create a framework that will prioritize and rank these initiatives Identify the key performance indicators to track performance. Implement quick hitting projects at the start of the program in order to build some success. Success will breed success.

(4) Establish and refine the vision. Work to communicate your strategy and themes to employees and stakeholders while you move up the experience curve. Use this as an opportunity to improve your competitiveness.

Make this personal. Take charge and plan, take action implementing the plan. Finally, track and report on your firm’s progress. Keep your expectations high but grow into them with achievable success stories.

Copenhagen- Observations

Copenhagen- Observations

Maybe I was naïve, for having expectations of a defining agreement coming out of the UN Climate Change Conference in Copenhagen. Maybe I was not realistic. Warning signals we evident back in November. Let’s try to put this process that the nations of the world are engaged in into perspective. In looking over the history of previous climate change treaties and negotiations, I realize that the non-binding agreement that was reached was a more realistic outcome for a process that takes time to conclude. The Kyoto Protocol, a success or failure, depending if you are a class half full or glass half empty person was not arrived at without multiple conferences and countless negotiating sessions. It took time to reach.
Copenhagen was billed by the press as a decisive opportunity for 105 heads of nations and countless business leaders to come together to address the issue of climate change; the defining issue of our age…. Maybe, I was unrealistic in expecting that the conference would deliver a legally binding international deal to tackle climate change.
The four letter word, “time”, is the crux for concern. If current projections are unchecked, by 2030 China will be emitting 60% more CO2 than the US. This comes in spite of having per-capita emissions of 6 T/person vs. those of 20T/ person in the US. Action is required, because time appears to be running out. It is not my intent to start a debate over the relative merits of the scientific claims behind predictions for global warming in spite of a personal belief as a scientist that they are real and the warnings we are receiving should be heeded. The consequences for lack of action could be quite severe.
Let’s explore what we the people of the world got and what was not delivered by the conference.
Causes for Concern-
(1) There is no long term target for a 50% reduction in the amount green house gases by 2050. I chose a target based on my readings. There might be a more appropriate target. If so, fine. Go with it!
(2) There is no time scale for turning the deal which was forged into a legally binding international treaty.
(3) There is no system to tax or penalize nations whose emissions of CO2 grow over time. (In retrospect, I was a bit simplistic in my hopes that the EU’s cap and trade model would be adopted. I neglected to consider its short comings a model that is peppered with offsets and bribes. Some are saying that the Cap and Trade model is analogous to the mid-evil practice of paying for forgiveness of sins by purchasing indulgences.) Perhaps a rising carbon fee model should be adopted.

Reasons to be Pleased-
(1) A non-binding accord calling on Nations to deliver their own, non-verifiable voluntary targets was reached.
(2) 17 nations emit 90% of the worlds CO2. These nations recognize the need for action. China, the US, India, Brazil and the EU are all engaged, participating in the joint communiqué.
(3) There is a consensus included provisions for the developed nations of the world will help to pay for technology transfers into the developing nations of the world ensuring CO2 emissions will be better controlled.

So, What Is Next?
My answer, carry on. Plant the seeds for the growth of the global treaty that we need. We, the general public of the world need to keep the pressure on the leaders of the world. Force the leaders to deliver the voluntary targets called for by the Copenhagen deal. Politicians will respond to the will of the public if our voice is strong and unified. Issues need to stay in the spotlight of international scrutiny. We can’t let the impetus leading into and coming from Copenhagen wither and die. Nations are engaged and each is negotiating to protect their own parochial interests. There is a process going on. Our job is to keep the pressure on the process to make certain that it is not abandoned. Stay informed. Remain active.
Show Strong Leadership and Persevere-
Sustainable business models are profitable. The truly innovative business leaders of the world have already adopted models that are templates to be emulated. This time of transition is filled with opportunities. This is a time to show strong, positive leadership. Don’t be reckless. Businesses and people have to be educated and informed to the point where they believe in the merits of a sustainable business model. They need leaders to encourage them to do this. Stay positive. As a nation and world we can (and will) work our way through this present situation.

Was I naïve? No! Do I have high expectations for the leaders of the world? Yes! Can we help to shape the future? Most assuredly!

Have Traditional Salesmen been morfed into Willie Lohmans?

Posted in Sustainability by resultsman on December 17, 2009
Tags:

Sustainable Solutions?

Have Traditional Salesmen been morfed into Willie Lohmans?

 

A paradigm shift is taking place. Certainly, within the geographical confines of North America, the issues confronting Willie Lohman, the central character in Arthur Miller’s book Death of Salesman, have never been more relevant than they are in today’s world of ecommerce.

I ask, are salesman still relevant in today’s selling models?  Certainly, the cost pressures driving business in general are forcing businesses to optimize their marketing and sales models. Witness what is happening within the pharmaceutical, chemical and automobile industries.   I contend that sale personnel are still relevant, but the role that they must assume in the business model is very different that it was even five years ago.

What does a sustainable business solution ask of a business?  Profitability, environmental

acceptability, and socially responsible….

Let’s explore the global dynamics.  A fundamental shift is taking place within markets. Manufacturing in all business sectors continues to migrate to sources of inexpensive labor in Asia. Pharmaceuticals, electronics and automobiles are all following this trend. Within a year we can expect that China will produce more cars than the US.  The $3.7 trillion demand and market for chemicals is certainly following this trend.  In the last two years, Asia ($1.3 trillion) has surpassed North America ($ 806 billion) as the leading region for the demand of chemicals.  This gap will continue to widen through the economic recovery.

Here is what we can expect- Demand for chemical products will decline in Western Europe, remain flat in North America, and grow dramatically through Asia.  On a segment basis, through all regions, we will see growth in the demand for pharmaceuticals, pharmaceutical intermediates, and specialty chemicals along with a decline in the demand for industrial chemicals.

So what will the implications of these trends be? Limited “organic” growth- 2 to 3% through North America. Ultimately I suspect that this will mean that there will be a greater need for M&A activity in order to maintain the “business side” of sustainability.  With mergers come consolidations and fewer sales representatives.

Profitability- Certainly employing a sales model that uses fewer salesmen, and accomplishes a business’s sales objectives will meet the business sustainability criterion. 

Within the pharmaceutical sector, we are witnessing a shift in who controls what drugs are prescribed.   Costs are dictating what products are used.  In effect, our primary care physicians as losing control in favor of the payers or insurance companies who are dictating what they will pay for a treatment.

Here are some facts- Pharmaceuticals- Fewer primary care physicians per capita have less time and take less time to visit with the traditional Pharmaceutical representatives.  When they do see a representative, doctors remember less of the encounter than in the past. The net result, less impact on the part of a sales representative. 

What about the chemicals? How many unaddressed solutions are there out there?  My contention is less now than in the past. The real opportunities will be in areas that are really the best environmental solution in the case of inorganic chemistry or adopt renewable, sustainable raw materials as a part of their solution… reduced VOC emissions in use or a favorable carbon footprint resulting in lower CO2 emissions.

A greater percentage of commerce in the chemical industry is being transacted on-line. There are less people available and willing to see sales staffs.  Those that do see a sales person, often devote less time to the calls because they have other duties.

 Today’s customers are better educated and know more about company’s products when they do make contact with a sales person.  Sales personnel must truly be experts in their fields if they are going survive. Correspondingly, they need to penetrate to the level of the decision influencers like research or formulating chemists in order accomplish their objectives.  

The world has reached a point where marketing and sales are truly intersecting?   Think about this, marketing is defined as creating the conditions that make a customer want to purchase a good or service. Web sites are doing this.  Transactional functionality is accompanying the educational focus on many web sites.

Finally, the social aspect of this entire new business model is yet to be defined? Are corporations our brother’s keepers? Certainly, unstated social contract between corporations and employees is a thing of the past.  In all too many instances corporate citizenship was a means to an end. Local plant employees were active in local civic organizations in order to promote and prevent issues. I can’t really say how altruistic the renewed efforts accompanying sustainable business models really are.  

In summary, previously, sales people where a primary source of information about the products that they sold. Today’s customers are better informed before they ever make contact with a sales representative. They are likely to already have accessed a company’s web site to learn about products and be in a position to make buying decisions.

I ask you, Willie Lohmen?  Probably not, but certainly there will be fewer representatives operating in new more encompassing roles. More will be expected of fewer individuals with less supporting help.

Copenhagen- The Time to Act is at Hand

Posted in Sustainability by resultsman on November 30, 2009

As the Copenhagen Conference Approaches….

Can the World Achieve the same level of success and cooperation that was obtained with the Montreal Protocol?

 

One can only hope that as the world’s leaders meet in Copenhagen have the foresight to recognize the opportunity and challenges that wait as the world’s attention is directed to reducing green house gas emissions. This is a complex situation with no easy fixes.  The world has learned a lot since the Montreal Protocol was adopted in 1987. Montreal was not a perfect solution to the CFC emissions issues which the world faced in the 1980’s, hence the Kyoto revisions were necessary.  The solution adopted in Montreal worked.  In spite of the complexities, the undeniable truth is that chlorine presence in the troposphere is down.  Global consumption of fluorochemicals is down more than 50%. When the protocol was adopted, the world’s fluorocarbon ozone depleting emissions (ODP) originated in the developed countries.  The developed countries of the world have successfully made the transition from use of CFC’s (chlorinated fluorocarbons) to HCFC’s (halogenated chlorofluorocarbons).  The developed countries of the world are now making the transition from HCFC’s to HFC’s (hydro fluorocarbons).

  I began my last entry with the words “Opportunity is knocking for those who are bold enough to hear its call”. Nothing could be more truthful as the political and business leaders of the world prepare to meet in Copenhagen to formulate plans to reduce green house gas emissions and reverse the trends of global warming.  Bold leaders will recognize this fact and work to create a platform that can help save us from ourselves. Followers wait for them to occur.

“Sustainability” based business opportunities will abound in the new business cycle. Corporate values are evolving.  Many major corporations are adopting “Sustainability Platforms” that encompass a sustainable business, environmental and social frameworks for conducting business.  Firms are publishing their Sustainability Platform in their annual report.  Some businesses are making real investments that will help reduce the amount of CO2 that a business consumes. Unfortunately, many other opportunities are not being acted on because companies are sitting on the sidelines as they wait to see what will come from the meetings in Copenhagen and how this will be translated into law in individual countries.

The time for action is at hand and the willingness to recognize the need to take action seems to be changing amongst the world’s business and governmental leaders. I am confident that action will follow this first important step. But the first most important thing that the world needs is a definitive, equitable template coming out of the Copenhagen meetings.  This could easily be roadmap that is followed for the next 40 years. The alternative of inaction could have cataclysmic consequences.

Opportunity is Knocking!

Posted in Uncategorized by resultsman on October 6, 2009

Opportunity is knocking for those who are bold enough to hear its call. Bold business leaders will recognize this fact and create their own opportunities. Followers wait for them to occur. It appears as though we have now experienced the worst of the recession of 2008/2009. Business conditions as expressed by economic indicators and the stock exchange indexes are improving.  

I recently read a blog posting in which the author wrote that a restructuring will take place among private equity firms due to the fundamental changes in financial markets.  The private equity business model will remain as an important part of the innovation cycle, but the opportunities will come from different places and be exploited by executives with a different set of skills.  During the last business cycle, many firms in the private equity sector enjoyed unprecedented growth and increases in return on invested capital as a result of financial engineering skills.  The days of easy credit and extreme leverage are behind us.  The mediocrity of executive leadership is being exposed!  In the future successful executive leadership will come from those people who have the capability to create wealth from (1) the reorganization of stressed assets and (2) to create wealth from the growth of new businesses. 

Opportunities will abound in the new business cycle. Corporate values are suppressed. For a while now, deals of necessity (bankruptcy or cost-cutting capacity elimination/consolidation) have been the only type of transactions that are taking place. This situation seems to be changing. Prudent risk is the part of any investment. Those who can identify the growth opportunities and implement plans to exploit them will be successful. Calculated risks taken now will be rewarded as we progress through the growth of the next economic cycle.

We are experiencing an evolution in the innovative growth model for businesses.   Large companies have a reduced willingness to make the investment in R&D than they once did. Growth in many large firms is coming by way of merger and cost reduction through consolidation.  The pharmaceutical and chemical industries offer two examples of this.  Pfizer is acquiring Wyeth, and Dow has completed the purchase of Rohm and Haas which it entered into before the financial collapse. In both cases cost reductions and consolidation will follow the transactions.

The period of consolidation is a challenging time for the new organizations.  Eliminating organizational redundancies can create an environment of fear and uncertainty for the remaining employees.  Once the work of eliminating organizational redundancies has been completed, organizations must quickly turn their focus to establishing a positive re-enforcing sales culture.  The sales culture will be the engine that drives the “organic” growth of a business.  A true sales culture is systematic, supportive, trains, motivates and energizes the sales force, recognizes that everyone in the whole company is in sales and finally creates the conditions to be the difference between average and astounding results.

 Small companies are being relied on to a greater extent to be the engine of innovative growth.  Many small pharmaceutical companies are being created as a result of entrepreneurial activity or as spin-offs from larger firms. Universities have been an ongoing source of basic research which is often followed by licensing and entrepreneurial commercialization in small startup firms. These small firms help the innovation process by mitigating the developmental risk and cost of guiding promising pharmaceutical compounds through the development and commercialization maze. The larger firms are then purchasing these small companies late in the regulatory process.   

The job of the leaders of small to mid-cap public companies to enhance the wealth of its shareholders by creating value (1) equity from “organic” growth and (2) payment of dividends. More often they are now taking on the second step of the commercialization process by making targeted acquisitions of these startups and small-cap companies from their founders as they enter into the rapid growth phase of the life cycle. 

It will be the ability of managers to create value by organic growth that will differentiate the stellar businesses from the average performers.   Those with the capability to assemble management teams that will create value from the assets being acquired will prosper in the long run. This is certainly going to be the mantra of the next business cycle. The time to move is at hand.

Time to Move On!

Posted in Uncategorized by resultsman on October 2, 2009
Tags:

For people in transition, perhaps that hardest thing is to know when to move on. For some, it might be facing the challenge of dissociating themselves from a previous employer. I did not understand the concept of moving on until I experienced the challenge associated with giving up this dream of buying and running a company that I had identified.
I wanted to make something exciting and real happen. All of the coaching and guidance tells you to look for that right opportunity that you really want. I thought I found it in a small chemical company that is focused in a business segment that I was familiar with. The business was for sale and everything seemed to be falling into place to make a serious run at buying the firm.
Here was this great little company based on a business and technical model that I am familiar with. Sales into a growing market, low market share with an opportunity to grow, a good manufacturing cost position and strong supply chain; what could be more perfect?
I spent a considerable amount of time researching the competitive trends, market potential, supply chain, earnings, and potential for growth. On the surface, everything appeared to be in order. There were a few warning signals here and there, but nothing that could not easily be explained away. Certainly, nothing that could deter this unemployed executive who was intent on creating his own American Dream.
There is a moral to this tale. Do your home work and most importantly, trust your instincts. If little warning bells are ringing, listen to them. Make certain that you are comfortable with everything. As hard as it was to accept, as much as I wanted this to be the right company and situation, it wasn’t! Do not act in haste or on emotion. Make sound business decisions based on fact, but trust your instincts. They were probably right in the past and helped to make you a success in the past. For me, it is time to move on.
So, What Is Next?
Perhaps you have considered moving on and diversifying into new areas.
My answer, carry on. Plant the seeds for growth just as you would in making a sales call. Continue to establish the network contacts. Make your sales calls on target companies as you would on a prospective account that you want to do business with. Implement the marketing programs that promote yourself and will create a demand for your products. In general run the business of “Me Inc.” with the full expectation that conditions will recover. Opportunities abound, either to create a business or to find a position within a company.
Repeat this message at company after company just as you would at any target account in a territory. Work to sell at all levels in the organization. That is, don’t rely on any single person like an HR manager. Learn to cultivate them just as you would a purchasing manager. Couple this with organizational networking. Things will work out.
Show Strong Leadership and Persevere-
Times will recover and business conditions will improve. This is a time to show strong, positive leadership. Don’t be reckless. Businesses and people have to persevere. They need leaders to encourage them to do this. Stay positive. As a nation we can (and will) work our way out of this present situation. Recessions, while they hurt, can be good for the economy as a whole. They create the platforms for future growth. Remember, it took almost 9 years to really get into this recession. It will take time to recover.

Everybody is Selling Something

Posted in Uncategorized by resultsman on March 17, 2009
Tags: , , ,

Almost everybody is or will be responsible for selling something at some point in their life, whether it is a physical product to customers, service to business or organization or perhaps your personal skills or services to a new employer. Do you have the total package necessary to influence and persuade and convince someone to make a buying decision? The key to tipping the scales in your favor is to create value through the marketing process.
Marketing
Marketing is the process of creating the conditions that will make someone want to buy a product or service. Quality and service are critical components that a product must have if it is going to generate sustainable profits. One of tools used in the marketing process is branding. The use of a brand, whether it is personal brand as one differentiates their own personal identity or a product brand in the competitive world of consumer marketing is a useful tool in the value creation process of marketing.
Product-
First and foremost, you must have a product to sell. A mousetrap of some sort is necessary. This could be most anything, a car, a family or families of chemicals, a service that reduces costs or brings value to a company or this could be yourself – the knowledge and personal skill sets, god given talents and drive that you would bring to a company, value.
In order to be successful the products value or professional contribution must be presented in a manner that is compelling enough to make a person want to purchase it.
Great sales professionals have a total understanding of the value that their company brings to the market. In a similar manner a job applicant must have a similar understanding of their own self worth that they bring to a company.
Promotion-
This is an essential part of marketing. Every product has features, characteristics and benefits that make it unique. The key to the promotion is being able to know and really understand the product. What are the features or specifications of the product? Are these specifications the industry standard? Or, do they product meet and exceed the standards in some way to make the product truly unique?
Can these indentifying features and characteristics be associated with the product in a way that makes them unique. Or perhaps, they can be associated with a business or maybe a person in the form of a personal brand. Once the association is created there are a many ways in which potential customers can then be educated or made aware of the branded product.
Promotional literature, trade show promotion, technical presentations, B2B web based marketing are just a few methods that can be used to spread the word about a product. The job aspirants have their own promotional literature in the form of resumes, bios and 1 page promotional pieces and web based promotion in the form of social networking like LinkedIn to use.
Finally, in many settings whether it is industrial or retail, there is good old fashioned selling. Sales calls or networking. All are similar tools that can be used to make a sale.

Distribution-
Service and Distribution are also a critical element of the marketing process. A marketing and sales department can do the most effective job of demand creation and selling in the world, if distribution or delivery of goods or service falls short of expectation all of that work and good will could be lost. A sound, functioning supply chain is a critical component of the marketing process.

In short, if you make a commitment to do something or a sale, honor it. A good reputation or brand is hard to establish and keep.
Price-
Pricing a product can be a complex undertaking. Many strategies can become involved. First and foremost is profitability. One must ensure that they are making a profit. Is the situation competitive?
Strategy- Will the sale be a onetime discrete event? Or are recurring sales with the goal of sustainable profits part of the objective. What about ensuring reinvestment economics? Price escalators, de-escalators pegged to actual costs or indexes can be considered.
To summarize, the highest price that the market will bear and still support the strategy being adopted is the price that the product should be sold at.
Finally, once sales begin, the elasticity of the market should be regularly tested. If selling opportunities are not being lost to aggressive pricing on occasion, even when a sales force has positioned a business in a spot to make a final price offering, the price policy might not be aggressive enough.

The Job Search is Selling-
There is an equivalent part to the selling process in a career transition job search. Organizing and using an effective marketing and sales strategy should shorten the career transition process.

10 Years to Get Here; What’s Next?

Posted in Uncategorized by resultsman on February 6, 2009

10 Years To Get Here; What’s Next?

It has been nearly 10 years since the Glass Steagall Act was repealed. This removed safeguards that had been in place since 1933 and allowed commercial banks to acquire brokerage firms. During the intervening time we all enjoyed some wonderful business conditions. Unfortunately, excesses and abuses of sound business judgment created a bubble that has led to the deep recession that we now find ourselves. Nothing new in that statement! 

Here you are running a business that is mired down in these tough times. The important issue is, “what actions should be taken in the here and now to protect for the future?”

So, What Is Next?

You have done the obvious things to take care of the business.  Costs have been cut to the bone. Maybe, you have released good people from service.  Your product line has been rationalized and streamlined to focus on the businesses core competencies.  You have analyzed the customer base and segmented them into profitability groups. You’ve increased the service that you provide to your most profitable customers. At this point you really can’t afford to lose any customers. You have considered and perhaps diversified into new areas.

 

My answer, carry on.   Plant the seeds for growth. Make your sales calls on customers and prospective accounts that you want to do business with.  Implement the marketing programs (to your financial limits) that will create a demand for your products. In general run the business with the full expectation that conditions will recover.

I’d like to relate a story from the 1980’s that occurred in the Louisiana Oil patch following the crash in the price of oil.  Times were grim in Texas, Louisiana, Arkansas and Oklahoma. The region experienced a downturn in economic conditions that were remarkably similar to what we as a nation are experiencing now. The demand for crude oil and refined gasoline products had dropped dramatically. Businesses were failing. The price of real estate through the region crashed falling upwards of 40% in some areas.

One of the nations’ largest refineries in Lake Charles laid- off over 1000 workers and shutdown the majority of their operation.  I had an appointment with operations management set up for the day after the lay-offs occurred at this refinery. When I got into my appointments office, the first question that I was asked was “Do you know what happened here yesterday?  Why are you even here?” My reply was “yes I do know, and I believe in this site and its people. You will recover and come back.”                  

I repeated this message at account after account through the Gulf Coast.  I acknowledged the situation and that accounts were not in a position to make immediate purchases, but I also expressed confidence in the people and the organizations that I did want to conduct business with. We were in this together.  I told them so.  To make a long story short, I was rewarded when conditions did improve.  Sales tripled in a 3 year time frame. 

 

 

 

 

Diversify if Applicable-

If diversification is in your plans, now might be the time to do it. Do what you have to in order to survive.

This might mean getting into areas of your mainstream business that you had never considered. I recently spoke with a contractor who specializes in designing and installing custom kitchens. He told me that people just are not spending the money to customize kitchens right now.   He is diversifying into refurbishment and refinishing in existing kitchens just to keep his business on operation. 

There are opportunities out there to purchase good sound business that will be valued reasonably from a Price to EBIDTA perspective because of the downturn in the economy. Keep your eyes open, inquirer. As the adage states,“ Nothing ventured, nothing gained.”

 

Show Strong Leadership and Persevere-

Times will recover and business conditions will improve. This is a time to show strong, positive leadership. Don’t be reckless. Businesses and people have to persevere. They need leaders to encourage them to do this.  Stay positive.  As a nation we can (and will) work our way out of this present situation. Recessions, while they hurt, can be good for the economy as a whole. They create the platforms for future growth.  Remember, it took almost 9 years to really get into this recession. It will take time to recover.

Hello world!

Posted in Uncategorized by resultsman on January 22, 2009

Welcome to WordPress.com. This is your first post. Edit or delete it and start blogging!