CEO Success Report -
July 2003
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CEO Success Report
- July 2003
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Increasing the Effectiveness and Enhancing the Lives of CEOs and business
owners.
Contents of this issue...
.. Welcome - A few words from the publisher, Gary Lockwood
.. Thought-Starter - "Rethink Your Sales Approach"
.. Guest article - "Your First Board"
.. CEO Resources
.. Quotes to use in your staff meeting this month
.. Humor to lighten up the executive suite
.. Contact the publisher
.. Subscribe and unsubscribe instructions
See past issues of the CEO Success Report at:
http://www.CEOSuccess.com/archives
===================================================
WELCOME to this issue of the CEO Success Report!
===================================================
Hello again. I'm Gary Lockwood, President of CEO Success.
Welcome back once again to the CEO Success. I know you have
no shortage of material to read and I thank you for choosing to read our
newsletter.
We work hard to provide practical ideas, thought-provoking concepts and useful
information for you.
You (and over 1000 of your CEO peers), have honored me by
being a loyal subscriber. For that, I appreciate you.
The traditional, fast-talking slick sales person is no longer effective in
today's global marketplace. In today's dynamic and highly competitive
marketplace, well educated, savvy customers look to the modern salesperson for
guidance in making well-informed buying decisions.
My "thought-starter" explores three strategies for how you fit your
sales approach to the needs and concerns of today's customers.
May I ask a small favor? Please forward this issue to other CEOs and company
presidents who may be interested in receiving these messages. Thank you.
And now for our guest article this month.
Now that your company has achieved a level of success, you may be thinking about
expansion, requiring more capital and the need to broaden ownership. You may
even be thinking about forming a board of directors.
If you formed a board sooner rather than later you could capitalize on directors
supporting you in efforts to raise capital and in supplementing your thinking as
you grow beyond what you have personally experienced.
Our guest authors this month, Lana J. Furr and Richard M. Furr, Ph.D., write
about getting it right the first time with your first board.
I hope you enjoy receiving these articles and ideas to
help you sharpen your thinking about being an effective CEO.
My wish is that you use the ideas in the CEO Success Report to get the results
you really want. If you want some help in putting them into practice, or if you
have questions, email or call.
As you know, our specialty is Increasing the Effectiveness
and Enhancing the Lives of CEOs and business owners.
Enjoy this issue with my compliments.
Sincerely,
Gary Lockwood
CEO Success
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This month's THOUGHT-STARTER
===========================================
Rethink Your Sales Approach
by Gary Lockwood
"Worry about being better; bigger will take care of itself. Think one
customer at a time and take care of each one the best way you can."
Gary Comer, founder of Land's End
Demanding customers - fierce competition - breathtaking technological innovation
These are the realities of today's global marketplace... realities that changed
forever the way we do business, especially the way we sell. Gone are the days
when salespeople could rely solely on charming small-talk and aggressive closing
techniques to make sales.
Many people think selling is something the seller does TO the buyer. They sell
them something. The result of this attitude to sales is that many salespeople
adapt a manipulative, coercive style of selling. Some salespeople think of
selling as competition where they convince a customer to buy, and success as a
victory.
It's not surprising that many people fear salespeople and distrust them. They
think of salespeople as fast-talking and slick. They are wary of being sold
something they really don't need or want.
The modern view of selling is that the purpose of the sales person is to HELP
the customer make good buying decisions. Someone seen as an ally and trusted
advisor. A business partner you can rely on to provide valuable help and advice
as well as supply NEEDED goods and services.
Since World War II, with accelerated growth of enabling technology, and the
explosion of competition, availability has outstripped demand. Sellers started
pushing their goods and services more aggressively at consumers. We began to
experience the manipulative salesperson. The perception many people have today
of salespeople is the smooth-talking con man so well depicted in movies such as
"Used Cars", "Tin Man", and "Glen Garry Glen
Ross".
How do you fit your sales approach to the needs and concerns
of today's customers? Three strategies:
1. Clearly identify each customer's unique needs and requirements.
2. Tailor your goods and services to meet those needs at a fair price.
3. Ensure a long-term relationship by pursuing customer satisfaction.
* Clearly identify each customer's unique needs and requirements.
Manipulative salespeople try to manufacture a need where none exists. Better if
you can bring existing customer needs to the surface by clarifying your
customers' understanding of the symptoms they are experiencing. Many people make
a very good living out of helping people identify which particular need may be
causing a symptom, then advising them on how to fix it. This includes medical
doctors and good salespeople.
* Tailor your goods and services to meet those needs at a fair
price. For most businesses, offering generic products and services is a recipe
for disaster.
With the vast array of choices available, customers want a solution that is
right for them in their own special situation. Listen carefully to the needs and
wants of your customers, then package a combination of your products and
services that specifically address your customers' needs.
To do this requires the ability to:
- understand what the customer wants, and
recognize what is
important to him or her;
- identify the relevant features of your products
and services
that are appropriate for this customer;
- communicate the specific benefits gained by
using your
products and services;
- deliver the package of products and services
with emphasis
on the desired results expected by this customer.
* Develop a long-term relationship through customer satisfaction. Truly
effective salespeople succeed because they are genuinely interested and
concerned about their customers. Their desire to understand the customer takes
priority over their desire to pocket commissions from selling products and
services.
The surest way to cement a long-term business relationship with your customer is
to remember that no sale is complete until your customer's expectations are met
or, preferably, exceeded.
The traditional, fast-talking slick sales person is no longer effective in
today's global marketplace. In today's dynamic and highly competitive
marketplace, well educated, savvy consumers look to the modern salesperson for
guidance in making well-informed buying decisions. If you are unwilling or
unable to adapt, you face the possibility of declining sales and risk severing
long-term customer relationships. The challenge is enormous and the stakes are
high.
Remember, customers buy for their reasons, not ours. When you work to form a
partnership with your customers, providing them with valuable help and advice as
well as supplying vital products and services, you virtually ensure sales
success.
Good selling!
About the Author...
Gary Lockwood is Increasing the Effectiveness and Enhancing the Lives of CEOs,
business owners and professionals.
==================================
Guest Article
==================================
Getting it Right the First Time With Your First Board
by Lana J. Furr and Richard M. Furr, Ph.D.
You've worked hard, sacrificed and succeeded in reaching your initial vision. As
you consider what's around the corner for your company, the picture that is
starting to make the most sense is the idea of expansion, requiring more capital
and the need to broaden ownership. If you formed a board sooner rather than
later you could capitalize on directors supporting you in efforts to raise
capital and in supplementing your thinking as you grow beyond what you have
personally experienced.
You have colleagues who have talked about their experiences with their boards,
and you do not want to get into the same ditches they describe. One of your
friends talks on and on when you have lunch together about how life was simpler
before he had a board demanding answers. Every time he finds a new market or
product area to enter, he says the board wants to hold him back.
What do you need to consider in forming your board in a way that gets the
benefits you need from it without the nightmares?
Keep three points in mind: 1) Be intentional in shaping the role of the board,
2) select your first directors for their competencies, and
3) consider the processes and norms you need to establish about how your board
operates.
Be Intentional in Shaping the Role of the Board
What is your picture of the role of a board? How did your picture take shape?
Maybe you serve as a director on the board of another public company, serve on
not-for-profit boards or have been a party to conversations about the board in
another company. Each of those experiences can implicitly shape your view of a
board. Without awareness of how you perceive a board and its role, you can
inadvertently recreate your prior experiences with boards in much the same way
that many leaders recreate a leadership style based on how they were led by
others. Avoid recreating a negative relationship with a board based on your
baggage.
Do you see a board as a necessary evil? It may be that from your own nature or
personality, you have issues with authority or a high need for control. In that
case, you may well want to control the board, and think it is best to keep
directors in the position of pawns. We have worked with boards whose biggest
challenge was the owner's view that the board was an anchor around her neck, and
she had instilled that perception in each member of the management team. She
really wanted only a "rubber stamp" board, not one that added to the
quality of her decision making. An entire generation of managers grew up in that
company believing that a board of directors is a millstone around management's
neck.
In fulfilling their fiduciary responsibilities, directors have a legitimate role
to play in the following areas:
Examining the future markets, technologies and talents needed in the industry
and helping you shape your strategy;
Monitoring organizational results compared to plans, and assuring that financial
results are reported with integrity;
Managing risk;
Evaluating executive performance and ensuring that a sound succession process is
in place and that your "back-up" is ready in case you get hit by the
bus tonight (you don't really think you are still going to running the company
when you are 80 do you?);
Setting the policy about how to operate as a board or governing body of the
organization and developing itself as a board; and
Providing advocacy for the organization as appropriate to the stage of the
organization's maturity.
These responsibilities are not defined in order to "get in the way of
management." They are what shareholders expect of directors by way of
exercising their duty of loyalty and duty of care.
Select Directors Based on the Competencies Needed for the Strategy
It all makes perfect sense at the time. You have been doing business in a
community for several years, so you select directors who have been highly
regarded in the community, family members who have put money into the business
since you can trust them, providers of services to your business (because they
will understand your business) and friends who have succeeded in running their
own businesses. You also believe that these folks are local, so they understand
market conditions and have more of a stake in local businesses succeeding.
A few years after forming a board in this fashion, it is common for the CEO to
complain that the business has outgrown the board; and with every proposed
initiative, he has to "hit the ball and drag the board". Board members
have become comfortable with the organization's success and are afraid to take
the risks often associated with changes in an industry and a rapid change curve.
Besides, why take action when "it ain't broke"?
Another consequence to basing board member selection on relationships is that
the organization ends up with directors who are not actually independent-one of
the most important criteria for directors to possess in the current business
climate. A director who is providing services to the organization for a fee is
not independent, nor is a family member. Or, there is a need to evolve the
board's membership, and it has become too personal and directors believe they
should have a seat on the board until they retire. Both of these situations are
painful to remedy once they are in motion.
The board should be comprised of directors who possess the competencies needed
to govern the organization given its vision and strategy. Some of those
competencies are needed by all the directors at the table (for example, the
ability to speak up and say what needs to be said or to diplomatically challenge
each others' thinking) and some competencies are needed at the table by one or
two directors (for example, international business experience or experience with
mergers and acquisitions).
Asking a person to become a board member should be construed as recruiting a
professional, not offering a personal gesture of friendship.
Processes and Norms for Board Operations
The norms about how boards operate develop quickly and the roots grow deeply.
For instance, if we expect meetings to consist of simply going over reports
generated by management, we can develop a habit of always looking at the past
and not discussing the future or strategy of the organization. Boards need to be
deliberate in deciding their practices about how they operate. Several areas
deserve thoughtful consideration:
Meetings - How often the board meets, how the agenda is constructed, how much
time is allocated to reviewing the past versus discussing the future are all
significant decisions affecting the success of the board's work.
Information - How much information do directors need, whether it is strategic or
tactical in nature, who provides it (management or outside sources), by when and
in what form affect the quality of decision making and the confidence directors
feel in making high stakes decisions.
Decision-making climate - What is the tone of decision making.is it formal with
little discussion or lively debate?
Tenure - What is the expectation about service? Do directors expect to be
re-elected automatically at the end of a three-year term and to remain on the
board until retirement? Or do they know the membership evolves to some extent in
support of strategy?
Performance accountability - Is there an established process for dealing with
performance issues? Are they swept under the table and never confronted? Or is
there a director review process that enables the board to hold people
accountable for performance?
Board development - What processes does the board use to evaluate itself, to set
goals and measure their attainment and to seek further education? Is there any
board development?
Entrepreneurs who know they will need a board may not have any experience with
the critical success factors needed for a successful governing body, but given
the consequences; it is well worth the time to do some homework before selecting
the first board. It is so much easier to do it right the first time than to live
with an ineffective board or to go through the trauma of having to repair a
dysfunctional board.
About the Authors...
Richard Furr, Ph.D. and Lana Furr are partners of Furr Resources, Inc. For more
information contact Richard Furr at rfurr1@triad.rr.com or visit
www.boardanddirectors.com
=============================================
RESOURCES for CEOs =============================================
Get ALL you want from your business AND
have fun along the way!
I have openings for two new business coaching clients. If
you are ambitious, ready to tackle some big achievements,
and are willing to be accountable for the results you
produce, let's talk.
Coaching is not cheap, nor is it easy. If you are in charge
of your life, ready to move quickly, and can afford to invest in your future,
contact me at 909/984-3344 or by email at Gary@BizSuccess.com
We can discuss your situation and how the business coaching program could help
you get the results you want.
Check out the details at
http://www.BizSuccess.com/coach.htm
=====================================================
QUOTES to use in your staff meeting this month
=====================================================
"The only real mistake is the one from which we learn nothing."
John Powell
"In the fields of observation chance favors only the prepared mind."
Louis Pasteur
"Power is the ultimate aphrodisiac."
Henry Kissinger
"To succeed in politics, it is often necessary to rise above your
principles."
Anon.
"Wear the old coat and buy the new book."
Austin Phelps
"Every great advance in science has issued from a new audacity of
imagination."
John Dewey
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HUMOR to lighten up
the executive suite =====================================================
Someone has said that this is the reason why
American English has
been rated the most difficult language to learn,
even more difficult
than Chinese:
The bandage was wound around the wound.
The farm was used to produce produce.
The dump was so full that it had to refuse more
refuse.
He could lead if he would get the lead out.
The soldier decided to desert his dessert in the
desert.
Since there is no time like the present, he
decided it was time to
present the present.
A bass was painted on the head of the bass drum.
When shot at, the dove dove into the bushes.
I did not object to the object.
The insurance was invalid for the invalid.
There was a row among the oarsmen about how to
row.
They were too close to the door to close it.
The buck does funny things when the does are
present.
To help with the planting, the farmer taught his
sow to sow.
The wind was too strong to wind the sail.
After a number of injections, my jaw got number.
Upon seeing a tear in the painting, I shed a
tear.
I had to subject the subject to a series of
tests.
Yes, English can be bewildering. If we explore
its
paradoxes, we find that quicksand can work
slowly,
boxing rings are square, a guinea pig is neither
from Guinea nor is it a pig, and a peanut
is neither a nut nor a pea.
In what language do people recite at a play, and
play at a recital?
How can a slim chance and a fat chance be the
same,
yet a wise man and a wise guy are opposites?
Yes, in American English, your house can burn up
as
it burns down, you fill out a form by filling it
in,
and an alarm goes off by going on.
That is why, when the stars are out, they are
visible; when the lights are out, they are
invisible.
That is why we drive on the parkway and park in
the
driveway.
And, when I wind up my watch, I start it, but
when I
wind up this essay, I end it.
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CONTACT CEO Success
=================================
Gary Lockwood is the publisher of the CEO Success Report.
Email: mailto:Gary@CEOSuccess.com
Office: (800) 272-1575 (USA) * (909) 739-7444
Fax: (909) 494-4314
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Your Comments, please?
========================================
I appreciate feedback, corrections, and comments about the
CEO Success Report. Please send your thoughts to:
Gary@CEOSuccess.com mailto:Gary@CEOSuccess.com
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