What every salesperson needs to know! Part 1

May 28th, 2012

If staffing customers say they care most about service and quality why do they so often go for the lowest bidder?

We think it’s because we haven’t been able to adequately demonstrate  how spending a little more hour will give them much greater value.

We also think that they also really want a great sales experience.

When it comes to building valuable relationships with customers, sales representatives are critical players on the front lines. Customers want to be contacted just enough, not bombarded. Let the customer tell you how often they want to see you! Ask them,when would it be a good time for me to follow up with you?

Sales reps should know their services intimately and how they compare with those of their competitors. Customers need information on how a service will make a difference to their businesses. And while customers may say price is one of their biggest concerns, a satisfying sales experience is ultimately more important. How it is measured is critical.

 These were the key findings of a survey conducted by management consultants, Mckinsey and Company of more than 1,200 purchasing decision makers in small, medium, and large companies throughout theUnited States  and   Western Europe  who are responsible for buying high-tech products and services. The insights were consistent across simple to complex services and products.

McKinsey found a big difference between what customers said was important and what actually drove their behavior. Customers insisted price and product aspects were the dominant factors that influenced their opinion of a supplier’s performance and, as a result, their purchasing decisions.

 Yet when McKinsey examined what actually determined how customers rated a vendor’s overall performance, the most important factors were product or service features and the overall sales experience. The upside of getting these two elements right is significant: a staffing service seen as having a high-performing sales force can boost its share of a customer’s business by an average of 8 to 15 percentage points.

 That makes their next finding all the more important. Of the many habits that undermine the sales experience, two that are relatively easy to fix accounted for 55 percent of the behavior customers described as “most destructive”: (1) failing to have adequate product knowledge and (2) contacting customers too frequently. Only 3 percent said they weren’t contacted enough, suggesting customers are open to fewer, more meaningful interactions. Part 2 of this posting will appear in our next blog.

Strategies for Successful Integration of your Acquisition Part 2

May 21st, 2012

First 100 days

  • Implement a tracking program to determine how critical functions are performing within the new company
  • Develop a process for identifying process improvements

Process improvements

  • If time allows, consider letting both companies run independently to identify best practices
  • Evaluate differences between the two companies and what can be adopted into the new company

There are several common issues that often derail mergers, including a lack of planning, underestimating the scope of the initiative and failure to communicate. These issues can become apparent within any facet of integration, and can result in inefficiency during the process and an increase in costs involved.

Cultural considerations are also often underestimated in a merger environment, and it cannot be assumed that synergies are going to be achieved quickly. What the merger is going to mean to the people involved such as employees, customers and vendors, tends to be overlooked and can be a significant concern, if not addressed proactively.

Management must be upfront in communicating the goals for the merger as well as how business processes will change in the combined company.

Concerns regarding topics such as relocation, the shifting of job roles and any new tools or software that will need to be learned are often prevalent in a merger environment.

The fear of the unknown can be very real for those affected by the merger, and it can have a significant effect on productivity.

To achieve successful merger integration, many companies turn to a third party or if they are active acquirers have an internal “Integration Task Force” to help implement strategic plans and track progress toward goals. Your internal employees have a day job and it is difficult for them to dedicate the time that is necessary to manage such an important endeavor.

Mergers and Acquisitions Update for the Staffing Industry

May 19th, 2012

During the first half of 2012 we have noted several factors that have impacted the current state of the M & A market for Staffing firms

  • More buyers are prepared to pay reasonable values;
  • More sellers are recovering value lost in late 2008 and 2009;
  • It is clear that Private Equity money is available;
  • Sellers have stronger resolve with valuations recovering;
  • Buyers are stepping up for quality staffing firms;
  • It often, but not always takes longer than usual to close a deal;
  • Perhaps, most importantly, more deals are being completed;
  • Sellers are getting better multiples, if they are growing;
  • Buyers are still being cautious with worrying about the seller’s business disappearing; perhaps this is contributing in part to the longer time frames it takes to close deals;
  • Buyers still prefer to use earn outs to share the risk;
  • Deal term lengths are getting shorter as buyers don’t want to pay sellers too much for the buyers investment in the growth of the acquired business, especially if the seller is no longer there;
  • More sellers are coming on the market each month in 2012;
  • While there is no sign of market saturation, the market for M & A can be volatile and change quickly; we could do without any more negative economic news from Europe;
  • Market looks to remain strong through year end at least, if we can survive the upcoming elections;
 For more information or a complimentary confidential discussion, contact: Bob Cohen at 416-229-6462 or Sam Sacco at 910-509-0691. We can also be reached at bob@racohenconsulting.com or sam@racohenconsulting.com.  

 

Strategies for Successful Integration of your Acquisition Part 1

May 14th, 2012

Businesses routinely look at Mergers and Acquisitions as a growth strategy to expand into new markets, lower operating costs, increase shareholder value, or even to realize tax benefits.

When executed successfully, a merger can be a significant benefit to a company’s bottom line; however, the majority of acquisitions fail to deliver on their expected value.

Often, it is less a than ideal integration process that holds back the synergies. What can your company do to help ensure that your merger integration is successful?

Merger integration is a complex process; therefore, a comprehensive plan should be developed and implemented to manage difficult decisions and help maximize the potential of the new organization.

The main objective is to move quickly without missing opportunities and with a minimum number of disruptions to the organization.

There are several aspects that companies should focus on during integration, incorporating key milestones related to day one readiness and during the first quarter of operations. Those include:

Day one readiness

  • Prepare early, optimally during the due diligence phase
  • Perform a full process review to identify best practices and potential process improvements
  • Develop a day one plan that incorporates regulatory and organizational components as well as a communication plan for key stakeholders
  • Prioritize key elements for day one such as financial reporting and cash management while relegating non-critical functions to phase two initiatives.                                  Part 2 of this post will appear in our next Blog.

Are Mergers and Acquisitions in your future? Part 2

May 7th, 2012

Why Consider a Merger or Acquisition?

The reasons to consider a merger or acquisition are many and include:

  • To gain economies of scale
  • To increase financial growth
  • To achieve vertical integration
  • To eliminate competition
  • To acquire new assets
  • To hedge a counter-cyclical business
  • To gain Intellectual Property (IP)
  • To expand into new markets
  • To expand into complimentary products and services
  • To eliminate emerging IP and product threats
  • To acquire new customers
  • The need or desire to acquire or merge is always present in the business world but the challenges are many.

Challenges of Mergers and Acquisitions

When it comes to mergers, the merging companies must become fully integrated, meaning cultures must be meshed, operations brought together, and core competencies of the resulting organization improved.  Mergers are most common when an industry begins to consolidate in order to survive. Such is the case with the consolidation occurring right now within the airline industry.  This fight for survival brings up a whole other set of business and psychological issues and challenges that must be managed along the way.

In the case of acquisitions, the challenge turns to how the buying company will handle the acquired company.  Whether to integrate or leave the company as an autonomous unit is the most common initial concern.  Cultural, financial, operational, and strategic questions and concerns abound in the process.