It’s a new year, and if the headlines are to be believed, economic activity is finally on the uptick. After three tough years, some companies may be breathing a sigh of relief -- and may be tempted to return to the profligate ways of the late ‘90s. That’s a temptation well worth resisting.

My company, BroadSpire, has been fortunate to do well during a down economy. We were named to the Deloitte & Touche Technology Fast 50 in the Los Angeles area during 2003. But good fortune actually didn’t have all that much to do with our success; neither are we that much smarter than others who may not have fared as well during the recession. It is true that you can make your own luck – but that’s simply another way of saying that it’s imperative to think and act strategically. The fact is, we owe our performance to consistent adherence to certain business fundamentals.

The rules we’ve followed during tough times won’t change one iota as things improve. If you're selling to business, remember that every company always wants to do more with less. In other words, even given these past few years of extreme cost-cutting, companies are not looking to cut and run. They want to grow their business and utilize existing resources to do more. In up and down economies, opportunities abound to sell your products and services. So consider these eight recession-tested “resolutions” as you chart your company’s course during the coming year:

Be manic about product/service quality. Perfect what you sell and make sure it works perfectly each and every time. Whether you’re delivering a product or service, every customer must have a satisfying, consistent, repeatable experience. Their experiences will give you a platform for word-of-mouth and repeat business through existing customers; indeed, your goal is to make them evangelists. We chose not to cut corners with product and service quality during the recession, but instead embraced the Japanese philosophy of kaizan; we sought to make incremental improvements as we went. It’s not necessary to hit a home run each time; just strive to build sustainability to the products and services that you sell.

Build around existing customers. Your cost to acquire a new sale is drastically lower if you can determine what products you sell that existing customers don't already have. So survey your customers. Increase survey response by giving away something for the customer’s time. Mine whatever data you already have. Once you've identified those customers, implement a way for them to try those products/services before they buy. You'll be amazed how well received your new offering will be, and how quickly you can grow your profits. In an improving economy, it’s even more important to continually offer new products to existing customers. The channels are already open; you have an opportunity to have these kinds of discussions, tapping a source of revenue that many businesses don’t fully realize they have.

Build around existing employees. Hiring and retaining top talent sounds easier than it is, but just as it’s vastly better to grow a business through existing customers, it’s likewise far smarter to build from within – especially in a challenging labor market. Provide an incentive-oriented environment where employees partake in profits, aligned with your business goals. Our main goal, for instance, is to provide 100 percent customer satisfaction. To align employees with that goal, we provide spot bonuses, employee profit sharing, professional development and such for those who exceed our customer's expectations time and again. Make them shoot for the stars and train, train, train. As the economy improves, you need to avoid employee churn, since employees are your link to current customers; they’re your institutional memory. Your ability to deliver quality service can come only from the personal touch that is part of knowing (and learning from) your customer.

Partner your way to success. Profile your customer base. Figure out who else might sell services/products to those customers. Pursue partnerships with these firms and offer reciprocal commission-based alliances. Make a concerted effort to put together affiliate programs, retailer programs and partner programs. Formalize the process, and line up the profit percentages in advance. This can then become an alternate sales channel of evangelists, and you’ll have a larger product set to sell your own customers. We pursued this to great effect during the recession, empowering our partners to effectively sell on our behalf – and theirs. Similarly, you can strategically resell some other company's products to your customers as a way to increase your overall capabilities. If you can secure partnerships with other firms that have a sphere of influence over similar kinds of target customers, you can identify complementary products and services to cross-sell and up-sell.

Innovate relentlessly. If you're providing a service as we do, it’s necessary to continually put yourself in the shoes of your customers. Figure out what their needs are -- by asking them (yes, I’ve said this before). This can be dizzying initially because they’ll tell you a thousand different things at a thousand different times. But with a large enough base to survey, you’ll begin to recognize common themes across your customer base. Integrate the solution of these problems with the products you sell. Your customers will be happy, you'll solve more of their problems, and you'll build your unique selling proposition at the same time (while building competitive advantage).

Adapt your product to different markets. As important as product/service innovation is, it’s critical to recognize that your existing product/service base probably isn’t spent. Even if you’ve managed to saturate a few markets, you almost certainly haven’t dominated them all. The key is to diversify your revenue base, and thereby open one or more new sales channels. Early on in the recession, we took our enterprise-class hosting infrastructure (which by then was a sunk cost for us) and right-sized it for small business. Today, we host ~80,000 websites for small business, representing about 40 percent of our revenues.

Perfect your unique selling proposition. Why is your product/service unique, and why should someone buy from you? This may be a moving target as your competitors' products shift from day to day, but keep your sales force continually updated so they can use this in tactical sales. Reinforce this message in all your marketing. The recession compelled focus and clarity, and while the level of hype may increase as marketing budgets once again grow, you can prevail by not losing your focus – and by ensuring that your sales and marketing teams not lose theirs, either.

Service, service, service. Whether your customers pay you a nickel or $100,000 a month, they still trust you for a critical service or product. Their hard-earned money pays your salary. Breed a culture where employees treat customers as if their salary depends on it -- because it does.

Some of this counsel is timeless, perhaps, but it proved especially timely and valid during the recession. Your company’s recovery is neither inevitable nor universal; it’s in your hands. During the last three years, we took advantage of economic adversity to become more profitable by adhering to fundamentals as if there were no tomorrow. Continually benchmark yourself -- then do the same with your competitors. Understanding that you’ll have to filter out some of the noise, take a realistic snapshot of the industry overall, assign the industry a growth rate that you believe is an accurate depiction of reality, and see where you’re growing.

Above all, be in control of your growth. Moving forward in 2004, scale so you can grow on your own terms. After all, it was precisely the “growth at any cost” mentality that led to the meltdown three long years ago.

By Suresh Srinivasan
Suresh Srinivasan is president and co-founder of BroadSpire (www.broadspire.com), an IT managed services provider in Los Angeles.

Bookmark/Search this post with:

| | | | | | | | | | |