Category Archives: Operational Excellence
Improving the financial performance of your business through efficiencies and best practices.
If you learned there was a pill that could improve your cognition, memory, intelligence, motivation, and concentration — would you take it? In the movie Limitless, the character of Eddie Morra (played by Bradley Cooper) is confronted with precisely this dilemma when he runs into an old friend on the streets of New York. The friend claims to be working for a drug company about to bring such a pill to market. Eddie, a struggling author freshly dumped by his girlfriend and late on his rent, decides to take the magic pill called NZT-48 in a “what do I have to lose” moment.
As you may have guessed, the pill has profound effects on Eddie. He’s able to access virtually 100% of his brain allowing him to effortlessly write the first 90 pages of his book within hours to the amazement and awe of his editor. As he continues to take the drug, Eddie turns his life around overnight. With his newfound genius, Eddie can access and analyze diverse knowledge and data within his brain to write brilliant prose, speak foreign languages, play complex Chopin pieces, build a fortune by day-trading stocks and even woo beautiful women.
While this “clear pill” is a product of Hollywood fiction, it may interest you to know there is in fact an evolving genre of drugs and nutraceuticals referred to as nootropics or smart drugs. These drugs are thought to work by (a) altering the brain’s supply of neurochemicals; (b) improving the brain’s oxygen supply; and (c) stimulating nerve growth. According to NZT-48’s fictional (yet hilariously realistic) website, the “clear pill” elevates receptivity and synaptic sharing between the hippocampus, the amygdala and the striatum.
While the current or future efficacy of such a smart pill is debatable, I’d like to pose a different question. What if a “smart pill” existed for your business? What if your business was like Eddie Mora with many of the same problems: struggling to go to market with a new product, being dumped by customers, and struggling with cash flow?
It seems to me, there’s a lot of consilience between a brain and a business. Using the components that NZT-48 targets, we have the following divisions of the brain.
The hippocampus is responsible for forming, sorting and storing memories. Not only does it file and store memories, it connects related memories together to give them meaning. If we imagine your business is a brain, the hippocampus represents the information that is vital to your business.
The amygdala, located deep within the medial temporal lobes, is the engine that manages social interaction enabling integration and cooperation with others.. Interestingly, the size of the amygdala directly correlates to size and complexity of a person’s social networks. Continuing the assumption that your business is a brain, the amygdala represents your interaction with associates, clients and vendors.
The striatum, the largest part of the basal ganglia, is largely responsible for automatic movements we make without thinking. In the context of a business, the striatum represents business processes.
If we set out to reverse engineer a smart pill for your business, we would have to unlock the maximum potential of all of your capital and assets (human and otherwise) by more effectively sharing information and resources. In order to do this, your smart pill would have to do the following:
• Increase access to internal and external information
• Speed the delivery of this information so better decisions can be made in real time
• Allow fewer people to do more work by removing internal friction.
• Integrate business processes with lightening fast communication..
Of course, this magical pill doesn’t exist –yet another invention of Hollywood fiction. Or is it? As if I myself have just ingested the controversial transparent apothecary, I’m suddenly able to access obscure information deep inside my brain. In fact, it occurs to me that there is indeed a business-grade smart pill and it’s called Unified Communications.
If UC is a smart pill for enterprises and not all smart pills are created equal, then Avaya Unified Communications is the equivalent of NZT-48. Avaya’s Aura architecture speeds information delivery by allowing users to instantly lock into the quickest mode of communication for every situation via presence based, multi-mode communications. As a result, vital information travels through the business like electrical charges traveling at the speed of light through Eddie’s brain. With all of the right information accessed at the right time, line of business managers are able to make quick decisions in real time while mortal competition flounders with human latency and inefficiency.
Referring to the three divisions of the brain which NZT-48 targets, UC facilitates the rapid flow of vital information through social networks to enable better, faster decisions. But what about the striatum of your company: business processes? This is where Avaya Aura separates itself from garden variety nootropics.
If there was an easy way to integrate the flow of information not only through social networks, but also with business processes.. well, then we just might have the holy grail of smart drugs. If we had the ability to “plug in” communication actions to business processes, we could further take human latency out of the business by not letting people “get in the way” of what needs to be done based on real time changes in the business. It seems that this would require a sort of synapse that would transmit a signal resulting from information (events), directly to a business process flow which could choose the best mode of communication given the information at hand.
I know you won’t be surprised to learn that Avaya, through intense R&D, offers exactly this type of synapse, or rather an SDK (software developer kit) to rapidly integrate business applications with communication. This SDK is called ACE and it stands for Agile Communications Environment. It is the secret ingredient the boys in the kitchen baked into this NZT-48 and it can take your business to a level no other UC platform can.
By ingesting this technology, might not your business make better, faster decisions? Would it not unlock the full potential of all of your people, assets and information? Would you not be able to bring better products and services to market faster than your competition? Respond to changes in the market faster? Avert supply chain issues by instantly taking corrective action? In business as in life, what else is there?
“I don’t have delusions of grandeur. I have a recipe for grandeur.” – Eddie Morra
Unlike NZT-48, Avaya Aura UC can be purchased through an Avaya Business Partner near you. What you do with it is limitless.
Follow me on twitter: http://twitter.com/convergencesoup
A lot of VAR leaders I speak with admit that they don’t have the caliber of sales force that they want. Or even more common, 20% of their reps are generating 80% of their revenue. Let’s face it when it comes to selling virtualized architectures, communication enabled business processes, business continuity solutions, multi-media collaboration, and all of the other intricate solutions you offer — how many sales people can consistently navigate these complex scenarios?
Most partners are telling me sales professionals are becoming more scarce who can find a net/new opportunity, discover customer needs, develop a solution strategy, gain consensus and close the deal. What I’d like to suggest is that perhaps the problem isn’t your sales people– perhaps you have unrealistic expectations of what your sales people should be doing to grow your business.
In 1971, Jack Lengyel accepted a job as head coach of the Marshall University’s decimated football team. The previous year, 75 players and coaches died in a tragic plane crash leaving the school with essentially no football program whatsoever. Coach Lengyel, against sharp criticism, recruited a rag-tag group of young players with little experience and managed to cobble together a team.
After a few practices, it became readily apparent to Coach Lengyel that he wouldn’t be able to employ his beloved Power-I offense he had used with great success when he coached at Wooster. Despite all of the success he had in the past with this offense, he took a realistic assessment of what his offense was capable of. He realized, his players just didn’t have the athleticism or experience to run the Power-I.
Lengyel realized if he was going to field a viable team, he had to simplify his playbook — dramatically. That’s when he decided to adopt “The Veer” offense. The Veer allowed his under-sized players to employ double teams and angles to block defenders. You see, the Veer is a triple option offense that allows the Quarterback to make a last minute read on the defense to select one of three actions. The simplicity is derived from the fact that everyone on the offense does the same thing on every play allowing them to focus on precision and execution.
If you’ve seen the movie, you know that the Thundering Heard won their first home game of the season against Xavier. Given the inexperience of their team, this was nothing short of a miracle. My points in all of this are the following:
1. Partners that have a structured sales process always outperform competitors who do not.
2. You need to assess the skills of your sales people to develop a realistic sales process.
3. Once you have done this, where there are gaps — you need to provide expert resources as an overlay to your players.
4. Sales reps that consistently deliver precision move the ball forward with predictable results – this only comes from repetition.
So my challenge to you, the VAR, is to take an honest assessment of your sales team. Do you have a consistent sales process and does it fit the abilities of your sales team?
Follow me on twitter: www.twitter.com/convergencesoup
At our partner conference last week, Cleveland McBeth shared with our partners some savvy best practices to help maximize VARs’ purchasing power but more important, improve your financial performance and foundation for growth. He talked about two resellers that sell identical solutions, charge identical prices, and get identical discounts. Nonetheless, Reseller #1 requires $805K in additional cash to fund their business!
The difference between these two resellers lies in two factors: (a) investment in accounts receivable; and (b) investment in inventory.
Reseller #2 collects their A/R in 39 days by using a combination of down payments, progress payments and leasing. Furthermore, they have partnered with Catalyst to Integrate their solutions in our warehouse while their engineers remotely program the systems on our bench. Since Catalyst doesn’t invoice until we ship, the reseller avoids investing their cash flow in inventory. Remember, many VARs let gear sit on their bench for a week or two before they even touch it (you know who you are!) Cleve didn’t even include all of the dollars saved in shipping since the product only ships once.
Cleve went on to explain that Reseller #1 pays an additional $64K in interest charges since the bank gives him a higher interest rate on his already inflated working capital investment.
Do you want to have a discussion about how we can help you improve your balance sheet and income statement? We can even benchmark you against partners your size to show you how you compete financially. Call or email me.
Last week, at our annual Partner Conference in Savannah, I spent some time speaking with a certain business partner. He had one of those grins on his face that led me to believe business is good. As it turns out, business for him is REALLY good. I won’t divulge what he’s doing or how he’s doing it (Distributor-Client Privilege), but he’s on pace to quadruple his business this year. If I told you the profit margins this partner is getting (50%+), you probably wouldn’t believe it– and that’s just fine by him. I will tell you this: he’s figured out a way to change the game and make competition irrelevant.
The question is, what direction are you taking? It’s a fair question. Some VAR’s are doing well and can get 15% -20% growth by improving execution and making some “tweaks” in their business. Or maybe, just maybe it’s time to take a fresh look at how you sell and what your value proposition is. Maybe it’s time to admit blocking and tackling isn’t going to take you to the next level. Maybe it’s time for a revolution.
Today, I had the pleasure of attending a technology conference and learned some startling facts from some senior IT leaders from very prominent companies. Overwhelmingly, these executives had one thing in common. They all confessed that until very recently (which is why they were speaking at this conference), they never engaged in the act of strategic planning. They also admitted that by doing so, it’s had a dramatic impact on their business and more importantly, the perception of their group within their organization. These IT leaders all said that the biggest key to having a meaningful relationship (translation: revenue producing) with them is being able to help them create a strategic plan by taking the time to really understand their business.
They also said VARs that actually do this are virtually non-existent. Now, I know what you’re thinking, “They’re not talking about us — they must be talking about the other guys.” Maybe. But I think you need to take a really hard, honest look at how your clients and prospects perceive you. They may perceive you as an talented VAR able to design and implement a complex solution at a competitive price. But, do they consider you an indisposable part of their team? Do they know that your sales rep understands exactly what the CFO and COO expect from the IT group?
Part of this planning includes (a) helping them learn how to uncover what the business requirements are in their own organizations ; and (b) Helping them communicate how new technology initiatives match up to the companies strategic goals.
To me, this says you can’t just parachute into an opportunity when the customer has declared they are ready to purchase a new network, data center or communication system. The goal should be building a partnership with companies who can look to you as being part of their brain trust. If you build that type of relationship by slowing down and taking the time, you’ll find a hundred ways to generate revenue with them over the years, but it may take a little time.
This brings us to the challenge that many VARs face. How do you develop these types of relationships when you need revenue today? Remember, sales reps often have quotas and mortgages that keep them focused on short term revenue. It’s a painful transition to make but I think the most successful VARs figured out how to keep the lights on until they get to that point. Perhaps the way to do this is by gradually migrating your sales force into this M/O and compensating them by hitting some very clear metrics that aren’t necessarily tied to revenue — at least until they get over this longer hump.
Once you get over the hump, you have a wealth of valued partnerships that are all generating consistent higher margin revenue from ongoing projects. But it requires constant engagement and a lot of listening. VARs need to ask themselves: Do my reps have the ability and time to build these types of relationships? Have we developed a sales model that supports this kind of business?
It’s the old one in the hand versus two in the bush which brings us full circle. IT leaders and VARs really are facing the same challenge. By being more strategic in how you approach partnerships with clients, you build a more sustainable and profitable business (once you get over the hump). This is done by helping your customers get out of the day to day tactical, project based, operational rut that is so common for them. Once you do that, you get out of the low-margin, knock-down-drag-out rat race that is becoming all too common.
Okay, perhaps we can file this post under N for “no-duh”, the question remains: Are your sales people and engineers strategic or opportunity-focused? Have I rambled too much? Who invented liquid soap? Why have the Wildcats never gone to the Rose Bowl? These questions haunt me…
Captain Sully is a national hero. Thanks to years of training and experience, he was cool enough under pressure to land an Airbus in the Hudson River like a pro. Of course, Sully has said many times he’s not a hero.. he was just doing his job and it was the training and experience that allowed him to perform his job well.
Let’s imagine we put the world’s best Avaya VAR in the captain seat of an Airbus. Might that person have the same results? Perhaps not, but what if Sully was riding shot-gun? That person could leverage his years of experience and training and most likely land the plane almost as well.
On the flip side, what if we put Sully at the helm of a budding Avaya Business Partner? Could he get his sales people trained, get them in front of customers telling the Avaya story effectively, guiding them on how to create an Avaya proposal while helping his operations team to order and implement a solution without missing any of the necessary steps in the process? What if Sully had a …Sully?
Guess what, Sully has a Sully and it’s called the Avaya Co-Pilot. It’s not flashy, I put this site together myself. In a nutshell, this site provides the following:
– Consistent, Repeatable Training Path for New Sales People
– How to assemble a custom proposal for a customer, cradle-to-grave including hardware, software, software support, maintenance and implementation.
– How to order and register a new system while ensuring maintenance is triggered.
This site, chock full of helpful guidance, is for Catalyst Partners and it’s also invaluable for new sales people with experienced partners. The address is http://copilot.weebly.com/. It is password protected so shoot me an email and I’ll give you the password.
I should have done this a couple weeks ago, but it occurred to me today that it would be worthwhile to review Convergence Soup’s 2009 highlights. If you haven’t followed CS or haven’t followed it religiously, I bet you there’s some good ideas you missed that could help you grow your business in 2010. Here’s a look at my favorite Soup entries. You can find all of these by hitting the “archives” link above.
1. 12th Century Stone Mason’s Guide to Selling Technology (Okay, not 2009, this is just last week) We look at how we could apply the strategies of a stone mason to find new sales opportunities in technology infrastructure.
2. Biz Dev Idea 11/14/2009 — How to expand your market reach by building a partnership with executive recruiters who specialize in CIO’s.
3. Skunk Works 11/5/2009 — This little RSS feed I built announces fresh new opportunities every day for convergence resellers. http://sites.google.com/site/consoupskunk/
4. If Sun Tzu were a VAR 11/4/2009 — Beat Cisco where they cannot defend by showing your client how they are buying expensive switched ports they don’t need.
5. Timing is Everything 10/29/2009 — How to make friends with new CIO’s when the ink is still drying on their business cards.
6. Sales Lead Hack 10/22/2009 — How to get sales leads in your email inbox every day, automatically.
7. 1800 Reasons Your Customers are Considering Moving Away from Cisco 10/6/2009 — How to shatter Cisco’s illusion of simplicity to attract new clients.
8. Godin Gazpacho 9/23/2009 — Ideas inspired by famed author Seth Godin to help you envision exciting new partnerships that could expand your reach with less effort.
9. Avaya Owns Nortel..What Now? 9/15/2009 — One Avaya Partner took my advice and got a head start on capturing the attention of Nortel customers.
10. Linkedin IS a sales tool 9/10/2009 — How to use Linked in to protect your customer relationships and find new opportunities.
Those faves don’t even include the infamous soup strips!..more to come in 2010. Also, Convergence Soup will be rolled up into Catalyst Telecom’s official social media initiative so keep your eyes peeled for a new look and feel.
What do you do when you come across a large complex opportunity that requires weeks of time consuming, deep pre-sales professional services in order to win the deal? If you’re like many partners, you’ll go after the deal but not quite spend the amount of time necessary to really tailor the perfect solution that can clearly pay for itself. You look at the opportunity and say, “how much of my resources can I really afford to pore into this opportunity without any guarantee that I’ll win the deal?” A balancing act right? What if you could increase your odds of winning the deal without having to chew up all of your resources for several weeks?
Enter Avaya TAS (Technical Account Services). This is a program available to Avaya partners for the most application rich opportunities you find. So I know what your next question is.. how much does it cost? The good news it doesn’t cost anything if you don’t win the deal? This means there’s zero financial risk for you. If you win the deal, you pay Avaya for the professional services already completed. Of course, you could position it the same way with your client so his/her expectations are aligned with yours. Or, maybe you do charge the client 25% of the eventual feeup front so they’re invested and you guarantee yourself some revenue. Here’s the benefits I see from this.
- Maximize your account control — if the client commits to this level of engagement, you’re in the driver’s seat.
- Much more application rich sales. I like to think application rich is a euphemism for “margin rich”.
- You can triage your finite engineering/PS resources where they capture revenue most quickly.
- Dramatically increase your conversion rate — I seem to recall the closure rate is somewhere in the high 80’s%.
This could represent a major shift in how you approach these larger complex opportunities. Instead of selling the customer a very complex solution that solves all of their needs, you are selling them on a no risk opportunity to develop a tailored solution that pays for itself and helps them grow their business.
Sounds like a win-win to me.
According to the partners I speak to, the second biggest challenge (btw, the #1 challenge is finding good sales people) goes something like this:
How to get sales people effective training that:
- Isn’t marketing “fluff”
- Doesn’t take them out of the field for too long
- Can be replicated and is consistent
- Gets results Read the rest of this entry
That’s how I would summarize the IP Office sales cycle. We have found through experience with our partners that speed is a critical factor in being able to win IP office deals. Many partners are still relying on their design engineers to put together IP Office designs. This is not only a not-so-good use of that expensive resource’s time, it’s also a sales obstacle since it adds time. There’s no reason why your sales people shouldn’t be putting together their own quotes with Catalyst’s IP Office Quoting Tool. A few partners have asked me if this tool will be around since Read the rest of this entry