179 tips to help Cash Flow

Conversations with a Consultant, Operations, ,

Here is a tip that may help your personal and Business Cash flow.  In 2015 there was an Act passed in Congress called PATH. This $622 Billion dollar tax cut has nearly 100 different provisions to help a wide variety of tax payers.

  • the Protecting Americans from Tax Hikes Act

The essence of this act was to help keep more cash in the pockets(or Bank accounts) of Small & Medium sized Business Entities(SME’s) and the average citizen.  An SME’s  is a business of less than 500 employee’s.  What you may want to speak to your Tax professional  specifically about what is called,

Tax code 179

Tax code 179 is about buying or leasing equipment for your business that may be deducted rather than depreciated.  Depending on the expense, it may let you only deduct a % of the expense, but it will still help you keep the cash in your business. This is different from prior years and I have an example below of how to capitalize on this.

There is a list of approved items this code helps and of course there is an additional tax form that needs to filed.  But it may be worth looking into depending what your expenses were in 2015.  Using a one time deduction rather than depreciating these expenses may bring money back that you can use in your cash flow.

Here is a quick look at some of the items this code includes;
–Computers and Software
-Office Equipment and Fixtures
-Large Business Equipment and Machines
-Business Vehicles
-Single-Purpose Structures
-Manufacturing Tools
Informational links-

http://www.section179.org/simplifying_section_179.html

A really nice overview pdf created Wolters Kluwer – https://www.bdo.com/getattachment/2ccf64fd-5806-452d-a27b-d976cf8f146a/attachment.aspx

Click here for more information about Cash Flow from C.S.Simons Consulting
Form 4562 is needed for the deduction-

http://www.section179.org/Form_4562_for_2015_Section_179.pdf

 

A quick illustration, thanks to Crest Capital of how this may help you;

...

 

Carpe diem!

Non Profit Marketing takes “S.M.A.R.T.’s”

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A Case Study

A couple of years ago while performing a “Market Study” for a well established Non Profit, I learned of yet another way to utilize the SMART Goal methodology.  This Market Study Project had multiple steps that were designed equally for discovery and for future planning purposes.  Discover who the current supporters were, identify opportunities to reach new audiences AND analyse the existing Communications Plan and aide in developing a new, more targeted approach to plan for messaging.

First, we needed data….

For the first phase, three surveys were designed and well received by the region which provided excellent information of current users, lapsed membership, and of non members.  Multiple avenues were used to reach each base and we had nearly  a 40% return rate (which is very good).  Once compiled we had lots of information to use to determine Attitudes and Motivators.

Many reports and presentations later, our clients were still having a difficult time determining who to target and what to say.  They had never looked at this from the scientific side and didn’t know how to generate goals using this data.  Long story short, I realized the group had a very difficult time creating goals because they had never used the “SMART Goal” technique.

Previous goals were to “increase Volunteers” or “Donations”, but with no details on how to know when you achieved them, or even How you achieved them.

My Corporate Trainer background makes me assume everybody knows and uses the Smart Goal technique, but that simply is not so.  Further more, the entire Board of Directors didn’t use this either and as a result created some unattainable goals in past years.  For those unfamiliar SMART is an acronym that stands for Specific, Measurable, Actionable, Relevant(realistic)& Time based.  The methodology is that SMART is used as a project plan to create a goal.  If you can’t think of a way to answer one of these headers, then you risk setting a bad goal that is not achievable.

The Answer?

I offered to Facilitate a “Goal Setting” session with the Board to help create more concrete, achievable goals that the Marketing team could then build a campaign from.  In one afternoon we were able to unite many different thoughts of what direction this NP should focus based on using the data provided by our firm AND by using the SMART methodology.  As an exercise, I used some past goals and illustrated how if even one component is left out of SMART when forming a goal, that it is likely not achievable.  Then I referred to the notes taken in our initial assessment and proved what they were presenting then as problems were the result of poorly written goals.

Wait, ..Written Goals?

Yes, it is very important when first using this model to write down all thoughts and to then present it to the group for discussion.  SMART is an exercise that helps embed this process.  After time, it will become an integrated behavior or way of thinking, but at first give it it’s due diligence and write them down.

Closer investigation showed that certain goals had been too “lofty” and not Realistic.   The end result sounded nice, but how to get there hadn’t really been planned out.  As a group we broke these down to smaller goals that could be accomplished, once that happened it was easier to attach Measurements to them.  Specifying action steps to help achieve each goal were discussed and they realized that “SMART” is also a management tool to determine what progress they were making.

 Our interviews showed that both the ED and the Board had shown some frustration to each other because the previous goal hadn’t been accomplished.  

By following the SMART technique; Management has direction from the Board and the Board has a way to gauge progress.  There had also been a confusion when setting goals for the organization on the relationship  between time and resources.  Most Executive Directors I have met take on far more than they should.  If the Organization needs it, well, they will find a way to get it done.  This creates a problem over time and literally empowers a BOD to take the Time factor out of goal setting.  If the Board doesn’t  know how to assess the ED’s ability to manage time vs resources, then how can they apply it to goal setting?

Time-bound vs Resources?

This may have been the biggest takeaway of our meeting; the need to insure a goal is achievable with in a certain time frame.  Many do not put timelines with goals for a variety of reasons, and I think I have heard them all.  Understanding that time lines must be part of the foundation of a goal is what makes it a goal.  Otherwise it is simply a dream.  Time lines and accountability make it real and coincidentally, they also make them happen.

Our Results

Over the next month, utilizing the SMART goal method this group was able to develop 3 distinct goals to then ask the Executive Director and the Marketing team to complete.  Each goal gave Specific details of what would be accomplished, it defined how it would be Measurable with both metrics and timelines, it outlined Actionable steps similar to a project plan, the entire team felt these were Realistic steps given the mission of the organization and the new data they had from our Market Study and lastly , the Marketing team felt they could accomplish this goal given the Time they were given and resources that were made available for it.

WHEW!

This Board session also highlighted the need for the organization to budget money on an annual basis to support the ongoing needs of Marketing.  Previously no money was budgeted(common), but the ED spent it when needed(also common).  How is this good planning? Budgeting and goal setting should be done at the same time.  Money is a key resource when considering Marketing tactics.  General guideline is 5-10% of annual Revenue.

Almost 3 years later that Non Profit has a dedicated Marketing Manager with an annual budget.  Other non profits in the area are looking to them for advice on Marketing and Membership has grown.  They have an annual process of Goal setting before the Budget is determined for the following year(yeah!).  This has also opened communications between the ED and the BOD.  Our facilitation that afternoon featured the SMART Goal methodology which certainly had an impact on the way this group does business.

Click here to read my blog on how to build a Marketing Plan or Communication Strategy   LearnMore-Red-Primary-16

For a look at other Case Studies  –Click here

Business PhotoC.S.Simons Consulting specializes in Management & Business Strategy, offering 25 years of successes for you to benefit from.  Offering a Shared Risk Platform – Results Guaranteed or you won’t be billed!   ContactUs-Blue-Pill-16

 

Carpe diem!

How & When your Competition uses Consultants

Conversations with a Consultant, Operations, ,

Deciding whether to hire a Consultant can be challenging.  “Will they actually help the situation in the long run?” “Can’t we do this internally?”  Finding the right fit, the time of yours needed to get them up to speed,and insuring that everyone (in both organizations) is on the same path is a lot of work.  Not to mention that this will all reflect back on you, the decision maker, for years to come. These are all valid considerations but for many the process of securing the best consultant for the project is the largest sticking point.

Our survey shows that referrals from colleagues is the most popular method to hear about Consultants.  However many business owners tend to not ask colleagues about this for a variety of reasons, the primary being the competitive nature of small business and they may not want to bring up that they could use some help to business colleagues.

Help is here!

Here we will share observations and best practices on engaging consultants.  These have been collected 2 ways; through client interactions, and a survey conducted by C.S.Simons Consulting in 2015 of Small Businesses/Non Profits who have experience hiring Consultants (Firms or Independents). Our survey focused on when the businesses used a consultant and what they used them for.  Perhaps their experiences may help you.

Nearly 2/3rd s of the businesses in this survey relied on a Consultant with in the last 3 years

 

Who uses Consultants

This appears to be a common practice for businesses with less than 500 employees’ and longevity of over 6 years.  The 6th year is a milestone everyone looks for in business because the closure rate begins to drop after 5 years in business.   But even the businesses with greater than 25 years longevity in our survey showed strong support for using Consultants.  While each business listed here would use them for slightly different purposes, it was evident that there was a correlation between utilizing outside experts and business longevity.

Most common uses found in our survey;

Consultants providing an edge to Operational Effectiveness and Strategy were widely used followed closely by function experts that could be used as an “outsource” option like Accounting, Legal or Marketing.

  

How does your competition use them?

The best time to engage a Consultant is when business is going well.  This provides a very different perspective of the business and true advances can be made in efficiency, product design, or even opening up new marketing channels.  Consultants may also be used to gauge future Capital needs, Strategic Growth Planning or Board Development strategies.

 

When do you need a Consultant?
  • The most common time to engage is when there is a known problem or business seems OK, but it could be better.  The key is to find a Consultant who is capable of diagnosing the “root cause” of the problem(s) which are impacting the business.  In these situations many business people spend too much time diagnosing or misdiagnose the problem and then the situation can go from bad to worse.  To properly assess a situation a consultant may conduct Survey’s to measure loyalties (Customer or Employee), establishing Performance Monitors, or conducting Profitability Assessments to help manage product costs.
  • A Crisis situation is also a common time to call in a Consultant.  Here you need to find the right type of consultant(s) who can quickly assess and impact your situation before major changes take place.  Generally this type of problem will cost you much more money in the long run given the level of involvement you need from the consultant or resources needed.  Some Crisis situations are not avoidable and are thrust upon the business.  Labor issue’s, Regulatory issues, Public Relations crisis to name a few. Depending on the Industry this happens in, the general practice is to have a team of Consultants available to help correct the situation and insure business continuity.

Don’t be fooled by reality TV to think someone may come in and fix your business in 48 hrs!

How do you find the right one for your business?

Where does the problem exist?  One of the most common misconceptions that often lead to a higher expense is the belief that the consultant must be an expert in your industry. Yet over 60% of our survey respondents noted that Industry Experience was the most important factor when choosing a Consultant.  There are times Experts are needed and industry experience is valuable.  My point is to make sure you know what type of problem needs to be fixed before making that determination; Industry specific or general management/business practice.  The more observant as to where the problems are with in the business first and not what industry your are in, will get the problem solved quicker and more economically.  Many businesses over spend when hiring consultants because of this.  Assessment like this can be difficult for many businesses that don’t have tools or resources to do it adequately.  If that is the case, finding a good Business Analysis consultant may be the best first step.

3 Most Important points to consider

  • Do they have the right industry experience to impact your business?
  • Can they share Successes they have with this type of problems?
  • Delivery style that fits your organization?

The most important aspect to finding the “right” consultant firm for your business starts with the initial assessment/interview.  Consulting is a business of relationships and it is never about a quick sale.  This person should take a genuine concern for the situation and your people.  They NEED to be able to influence you and your people, if you don’t feel they add value from the first meeting, you may have the wrong person.  Be prepared to speak to more than one Consultant before choosing.  While both may suggest the same solution, HOW they achieve it for you or through your people may be very different. After Elvis has left the building it is you that will either look great for bringing them in or to be left have to deal with any fall out.

 

The best way to interview a Consultant?

 The single most important part of this process is looking at references or testimonies.  Experience and Knowledge base is important (and expected), but it’s the results and successes the consultant have brought for the client is really what should matter.  What a client has to say on how the consultant delivered the solution, how it was implemented and the ending quantifiable result is what you are looking for.  Websites should be used to gauge authenticity and can give insight on how the firm goes about achieving results with in their specialty.  The last important thing to look for is content.  Do they blog, have white papers or perform public speaking as a way to educate their followers.   Some create content for the sake of creating content.  It helps with Google and may look good but it may lack any real advice or insight.  Saying what has been said by 100 others recently may not add value to your situation.  Consulting is an industry of results.  Making attempts to educate, add value or guide is what you want to look for in your perspective Consultant. There should be an almost immediate impression that this person will solve your problem.

The “Simple” interview method-

  • Don’t feel you need to have the answers – Most of the time consultants are relied on for their analytical skills.  It is not uncommon when first engaging a Consultant to NOT know for what or where you want to use them.  Rely on them to run part of the first meeting and have a very open mind on the process.  Some business people feel they need to “manage” the relationship and always want it to be known they are the client.  Forming a “partner” mentality with the consultant is the best advice I could suggest.  I offer a Privacy Statement upfront with perspective clients.  It is important to feel you can show your consultant any piece of information that pertains to a problem.  The perspective Consultant should establish Trust quickly.  Then just see where the conversation goes.

 

A more organized interview method

  • Having pertinent documents assembled helps significantly.  Many perspective clients have sent me this information ahead of time (after Privacy Statement) which allows a much more focused meeting on what solutions could be offered.  If there are multiple people in the decision process, having them in the same room will often give the Consultant the most accurate picture of the problem to create a proposal from.

 

Contract?

I could go into great length as to how an agreement should look and why you want one to protect your organization, but for the purpose of this article please make sure to include these in your discussions and/or contract.  They protect both parties and detail outcomes.  Here are a few basics;

  • An accurate assessment of the situation to be addressed
  • What is the expected outcome(s)
  • Joint accountabilities
  • Detail any deliverables – systems, training, reports, etc
  • Measurements, Timelines and Milestones
  • Terms, Expenses, Fee’s – included and not included

 

Carpe diem!

 

Business PhotoC.S.Simons Consulting specializes in Management & Business Strategy, offering 25 years of successes for you to benefit from.  Offering a Shared Risk Platform – Results Guaranteed or you won’t be billed!

If you would like to discuss this in greater detail or would like to see more                                               results from the survey mentioned;

ContactUs-Gray-Primary-16

 

 

 

 

Can YOU beat earnings with lower revenue?

Marketing, Operations, People, Products, Quotes, Observations & Ironies, , , ,

Ironically, today’s earnings report from Wal-Mart proves the point I made in my Blog      “Low earnings /Low Profits – What to do?”

I have a love/hate relationship with Wal-Mart.  I often shop their begrudgingly. I would prefer to support a local business, but when I am buying toothpaste my choices are generally a Wal-Mart, Chain Drug Store, or grocery store.  There really aren’t too many local businesses to buy toothpaste from.  Wal-Mart is cheaper, and there are always other items that I get while there.  They save me time and money and there for they are a value.  I support local when possible, but frankly I couldn’t afford to buy as many things if I shopped only local and I am a typical American who wants as much stuff as possible.

Yesterday Walmart announced that 2015 Q4 revenue was down, and they expect very little sales growth for all of 2016.  Same store sales were reported to increase less than 1% in 2015. To insure they can meet or beat earnings, they have decreased operation costs and reinvested in Human Capital, choosing to focus on culture over new market channels.

Announcing the closure of 269 stores worldwide and releasing close to 10,000 workers will surely get a lot of attention.  But Wal-Mart is focusing the narrative on developing its Culture.   Wal-Mart is investing by raising the wages of it workers. This is very strategic since they have a history of Legal and Public Relations issues around wages and practices.  Improving employee engagement will help drive business into their well established retail presence.  I support this strategy, but I think they have a lot of work to do besides raising wages.

Walmart recognizes that the growth of online shopping has impacted brick and mortar and they have already begun testing new strategies to target these areas.  Experiments in the Grocery offerings (Organic Product selection & home delivery), introducing their price matching app (which is awesome), the ever expanding electronics section, and the “No Questions return policy” to name a few will go along way to exceed customer expectations and build loyalty.

So…… sales are stagnant, they are giving nearly everyone a raise, and adding to their operational costs….how is this a good plan?

Well to start, the Thursday announcement also mentioned that they beat earnings and brought in a higher dividend than forecast.  Earnings came in at $1.49/ share on a projected $1.46 and quarterly dividend was .50 on a projected .49.  At the open of today their stock is down ~4% and they have fallen ~27% over the last 12 months.

But they still had a 2% increase in dividends and profit!

What would your business do in this situation?  Can you bring in a higher profit while loosing expected revenue?  Would you give a raise to help increase store sales?

Proper planning, strategy, and vision makes the difference.

Carpe diem!

Low Earnings / Low Profits? What to DO?

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Stop – Breathe – Plan

Financial Earnings have been reported lower for 8 quarters in a row for the S&P 500(source). Many economists are weary of another recession even though there are some positive signs.  But at the very least Janet Yellens recent announcement of a “mixed picture” ahead speaks to a challenging 2016 and most Financial Advisors are warning of a volatile year.   Large companies are having to do more with less to maintain their budgeted profit lines and meet earnings projections.

Because of this, Big Business has….

  • less overall revenue
  • less people to do the work
  • less quality
  • less R&D
  • less room for error
  • less money to reinvest in smaller businesses

 

Wall street has had to make changes because they need to keep investors satisfied,..

..but Main Street USA needs to do this to stay open!

It is one thing to look at efficiency to help shave money off production or operating costs, but making adjustments due to drastic loss of Top line revenue or disintegrating Market channels is a different problem that will effect the future of your business.

Sound familiar?

There is no difference between what the larger companies are experiencing verses small businesses or Non Profits.  It is simply a matter of scale, everybody has to do more with less while maintaining stakeholders.  Everybody is concerned how these changes will be noticed by their customer base or how it will effect loyalty and future revenues.

But in order to keep things moving, something has to change!

This is not a preferred business strategy, it is a reaction to the economic situation most industries are experiencing.  Large companies arguably have more “fat” to trim when necessary but small companies like “mom and pops” or even Non profits run lean as possible anyways.

To compete with this environment companies are continually searching for ways to maintain quality, customer counts and funding.

Here are 5 Key Differentiators in a business handling this well.
  1. Proactive Strategic Planning.  Too often smaller companies view this as “Crisis” management that happens after the fact rather than as a precautionary planning tool.
  2. Getting a “fresh eyes” mindset to business operations, utilizing efficiency experts, workforce development, and sometimes even a “blow it up” mentality.  If you can’t afford outside help, then utilize analysis tools like a SWOT or PEST to help with direction.
  3. Courageous Leadership.  Do the decision makers have the courage to take calculated risks with business operations or market shifts.  This is scary stuff, but once there is enough data, you need to make a decision.  Make sure you have the right data or input from a reputable source.
  4. Understanding CHANGE Management.  Once you have started something, a change will come, but is it the one you want?  Knowing how to control Change and calculate outcomes takes a proven formula and a savvy leader.  Contact me for segments of my white paper entitled “5 Pillars of Change Management” it will define the key components needed to control Change in your organization.  LearnMore-Light-Primary-16
  5. Having Business Intelligence about your customers/doners/followers.   Savvy companies know who is buying their products and what it takes to get them to buy. Knowing the Attitudes & Motivators is key business intelligence that makes for a much more targeted decision about your audience.  Too often a business focuses on who they want to buy rather than who IS buying their product(s).

Avoid being in a position to make decisions that will hurt your business, its customers and your employees because of lower earnings.  If you feel you need help, call an expert.  You have worked too hard to have to cut what is important.

Stop – Breathe – Plan – Call

Carpe diem!

 

How to make Excellence achievable

Products, Quotes, Observations & Ironies, , , ,

I have been a student of Management for 30 years. Management is as much of an art as it is a science and understanding that you practice management rather than it being a degree on the wall shows that you continually evolve in this position. To be a successful Manager you must have an understanding of how to achieve Excellence. Excellence is a combination of several factors depending on what industry you manage in.  Today I am going to discuss the number one thing to do to achieve Excellence in what YOU do.

Excellence is an Attitude

You do not achieve Excellence by completing a checklist, you do not achieve Excellence by doing what the boss said, and lastly, you do not achieve Excellence through watching an inspiration video (although there are some very good ones).

Excellence is a lifestyle

Excellence needs to be how you address everything in your life.  Excellence means never saying “whatever”.  It is setting the highest standards to hold yourself to and having the discipline to hold yourself accountable.  I don’t care what you are doing, you can be excellent at it.  Washing the dishes, cleaning the bathroom at home, creating reports, or providing customer service, all can have levels of Excellence attached to them.

You will not achieve Excellence if you think it only applies to a “work” atmosphere.  Excellence can’t be turned on and off.  It’s just in you.

Lets define a few terms;

Excellence – The quality of being outstanding or extremely good (Webster).   Achieving or distinguishing a superior quality in an action or outcome (Simons)

Attitude – A settled way of thinking typically reflected in a persons behavior (Webster).  An approach or outlook demonstrated through actions, communications, or outcomes (Simons)

Pride – A feeling or deep pleasure derived from ones own achievements (Webster).  Personally Responsible In Delivering Excellence (taken from my Corporate Training days)

I am certain I have been “picked on” by those around me for having an Excellence mindset.  I have extremely high standards for myself.  I hold myself to higher standards than I have ever held an employee too.  Why, because it is important to me to do things right (whatever right is).  I look at whatever I do as a product I am producing, and I don’t take it lightly.  Some think I am too hard on myself.  No, I am not.  I just don’t say “whatever”.

Excellence is also about precision.  You need to know exactly what needs to happen in order for it to happen.  Once again, this will carry over to other aspects of your life.  In addition to Management, I am also a classically trained Chef and a life long Drummer.  Precision follows me in both of those.  Playing drums is as much about where you hit the drum or cymbal, and at what angle and with how much force as it is about the rhythms or change ups.  If you match the rhythm but you aren’t precise with your stick, you are a hacker.  If you do it right, you are a drummer.  Doing it exactly the same way every time is Excellence, and much harder than you might think.  The same goes for cooking.  Many people can flip an egg but having the timing to have an entire meal or banquet “go out” together, where no food has had to sit (which degrades quality) and everything is cooked or prepared perfectly can be like conducting a symphony.  Variations will always be noticed by someone in your audience so it is important to be consistent EVERY time.  You need to be very precise with your planning and execution.  You need to know ahead of time how it needs to happen.   Both are great examples because when you haven’t achieved Excellence, you know right away!

Does Excellence allow for mistakes?

Absolutely!  I am far from the best there is at so many things.  Some people confuse my quest for Excellence as thinking that I think I don’t make mistakes.  I certainly do make mistakes, but because of my attitude, I likely work harder to not repeat mistakes than others that don’t have this mindset.  Mistakes are a very important part of learning and you can’t learn from them if you don’t recognize them.  I must confess I get mad if I repeat my own mistakes though.

If you haven’t read the short but EXCELLENT book about the FISH Philosophy, I highly recommend it.  It applies to everyone and will help you realize what attitudes you are choosing.

This is why Excellence is achievable, because it is an attitude, and as you may read in FISH or my other blogs about FISH.

“Choose your Attitude”

Carpe diem!

 

Non Profits & Small Business – How to plan a Communications Strategy

Conversations with a Consultant, Marketing, , , , ,

Content Management, Frequency, and Target Audience are but a few of the components in a Communications Plan.  Non Profit(s) and Small Businesses need to be very strategic on what messaging they need and which tactics to use when creating a Marketing Campaign due to the amount of time needed and financial investment it takes for these to work.

Knowing the attitudes and motivators of your buyers/supporters/followers has a direct impact on measuring  a plans effectiveness.   The following are excerpts from a white paper published by C.S.Simons Consulting  in 2012 designed as a FREE resource for those businesses who recognize the need for better effectiveness in their communications but have limited funds to hire a professional Marketing firm.  There is also 2 worksheets available to expedite your Communication Planning, feel free to contact me if you would like a copies.

Why develop a strategy around a Communications Plan?
  • Planning contributes greatly to success.
  • Increases effectiveness of messaging
  • Identifies key users and followers
  • Engagement, engagement, engagement
  • Keeps entire organization focused on Strategic initiatives

What is Strategic Communication?

 Strategic communication is planned and accomplishes a specific outcome.  It is essentially a project plan for everything you may need to “Market” a product, service or business effort. Designing one will ask the right questions of you as to how you want it presented(see below).  It is designed ahead of time so your company controls the exposure and narrative that puts your product/service/effort in the best light to the people or businesses you want to see it.  Otherwise you risk the reputation and message being delivered.  Below is a checklist to help you organize a Communication Plan of your own.

  • Strategic communication is targeted to a particular audience or audiences utilizing known demographics about your customer.
  • Strategic communication is designed and delivered to produce a desired result
  • Strategic communication aims for results with the best possible use of time and resources.

Strategic communications should be tracked, with measurable performance.

Some key questions to consider at the start of the process are:
  • Where are you now and where do you want to be?
  • What will you need to do to get there?
  • What role can communication, education and training play to achieve your goals?
  • How will you learn from your experiences?

 

 Be careful! – what to avoid
  1. Communication is part of the entire Policy and Strategy implementation process.   To implement a Communication Strategy there are many projects to be prepared and undertaken. There must be an understanding of what your customer wants from you, who your customer is and where to find them.  Demographics, Attitudes and Motivators is how it is referred to with in the Marketing world.  These are addressed first prior to forming a Communications Strategy around how to effectively have that group pay attention to you.  Most business people or Executive Directors would agree with this yet this stage often receives little attention until much later on.  Often communication is considered only after plans, polices or projects are prepared which strongly reduces the potential for successful project implementation.
  2. Ad hoc communication is not effective.   There is an enormous difference between communication strategically planned and that without strategic planning.  It will miss the target audience or deliver the wrong message.  You may have very little time to get the attention of your audience, so every little effort needs to be effective.

 

FREE Checklist for planning a Communication Strategy

 Message: This will comprise a combination, of WHO you are trying to speak to, and WHAT you want them to remember or HOW you want them to act.

Timeframes & Frequency: You have to clarify if you are designing a communication strategy with long term goals, a communication plan with short term goals or a communication plan for a specific project. A Strategic Communication Plan will likely utilize all three types of communication plans and is a comprehensive approach for long term messaging.

Target Audience:  To create a master strategy, match the goals of your strategic plan to groups identified in the recent membership survey.  The membership survey results provide detailed information on demographics such as age, proximity to lake, length of membership, and communication preferences.  Use this information to choose which medium to communicate to each demographic.  To broadcast a particular message, many organizations choose multiple mediums and alter their message slightly to improve connection with a particular demographic. Much of a communication program success relies upon the content connecting with its target audience.

Budgeting:  You must consider costs when planning a single event or campaign style communication.  This needs to be in the planning phase to insure its completion.  Too often plans don’t become reality because the finances weren’t thought of ahead of time.  Include time of any staff in your estimation even though it is part of a different line item.  When you want to determine the success of a tactic, all costs must be considered.  Include any print materials, ad space, postage, graphic design, sponsorships, office supply and smallwares (table, chairs, poster board, raffle prizes, etc)

Content:  The body of the communication and the vehicle for reaction.  Utilize demographic information to “speak in a language” that the reader will understand.  Incorporate grabbing headlines, pictures or graphs whenever possible as this is a proven to increase attention and action.

Tools & Format;  what method or medium would be best suited to deliver message and achieve results.  Consider the target audience, and how to best reach them based on prior success.  If trying to reach a new target audience, which design works best for the market? Is capital expense needed for a first impression?   Is graphic designing needed for a mailing or email blast?  Print ready advertisement design?  Pictures needed for social media or press release?

Instrumental style communication – You need to be conscious of whether you are dealing with a communication campaign that is organized to raise the interest of the public, politicians and other special groups for a particular issue, or to generate support for policies or plans.

 Interactive style communication – A plan is for establishing active dialogue with certain groups and fully involving them in planning, implementing or evaluating (Feasibility study)

 Maintenance and Accountability;  to assist with daily management of any communication campaign, the creation of tools to help monitor message, frequency, placements and responsibility should be utilized.  Examples of such tools are provided in the tools section of this report.

 5 considerations for Successful communications
  1. When implementing, regularly check how feasible the plan is, and what disasters may occur.
  2. What will affect the success of the message? Which stakeholder is it designed for?
  3.  Be flexible in adapting the plan in case of shortages in money or time.
  4. What will people’s reaction be – What do they want in the communication?
  5. If the communication is announcing an event or action item, how much time is given for members to react?

 

When to use a campaign and when to use single source messaging

A campaign can be designed for virtually any application, after all, more is often better when done right.  The primary goal behind a multi-tactic campaign is to leverage each individual tactic/method to achieve greater impact with the desired message.

Some occasions for use of a campaign

  • To educate a population on a particular subject
  • To tell a story of your brand
  • Establish a dialogue
  • To create recognition of a subject
  • Public Relations
  • To display a style or belief system

Single source messaging which is a one time event through standard media such as direct mail, email, website or online posting and is designed as a “one and done”.  It doesn’t have a direct connection to either the message that LSPA has agreed to or a direct connection to the mission of the organization.  While it is important and informational, it may not lead to a call for action like those in a campaign will from its recipients.

Some occasions for use of single source messaging

  • Scheduled events
  • Confirmation of expected information
  • Thank You’s
  • Annual Reports
How Non Profits can identify the role for a Communication Plan

 To identify the role of communication it is necessary to ask:

  • What is the current Knowledge, Attitude and Practices (behaviors) of the target groups and stakeholders involved?
  • What reactions do you want the target groups and stakeholders have?

It is also important to clarify what are the desired changes in the people involved in this issue:

  • Is it to change the attitudes of people and/or organizations
  • change the mind sets – the way people look at a certain issue
  • change the way people feel about an issuer
  • change behavior? (more difficult)

To assess the role of communication in this change process it is necessary to understand if the problem is due to:

  • A lack of awareness that the issue is important
  • Negative attitudes towards the issue or the solutions
  • Lack of skills or “know how” to make a change

In these cases the different states of knowledge, attitudes and practices need different communication solutions, and communication may be used as a sole instrument.

 Frequently made mistakes in communication planning

 The objective of the communication activity is not properly defined or is too vague

  • The objectives are too ambitious to achieve
  • There is lack of knowledge of what is precisely wanted from the target groups and what is required to achieve the result:
    • e.g. is knowledge needed? new skills and practices?  
    •   e.g. do we need an attitude change from them?
  • Communication goals are set to change other people’s behavior and values without understanding how the behavior change can take place
  • The fact that people need social, economic or other benefits for any kind of behavior change is not considered when objectives are defined
  • Indicators are not defined for the communication targets/objectives, making evaluation of the outcome difficult.

 

For more on this subject or to discuss additional ways to help your organizations Ability to Generate Revenue, contact C.S.Simons Consulting.

 

Carpe diem!

 

 

Great Quote on Continuity and Change

Conversations with a Consultant

“Precisely because change is a constant, the foundation has to be extra strong”

– Peter Drucker – Management Challenges from the 21 Century.

 

Both Continuity and Change happen on purpose and by accident and most of us put a lot of effort into managing or reacting to them.  The key is to balance these two.  How do you know your organization can balance any change needed while maintaining business continuity?  There is a common denominator for both and developing this with in your organization is the “foundation” that Peter Drucker is referring to in this quote.

Lets first define each

Continuity (business) -process to insure that critical business functions will continue in standardized fashion.  Policies, Procedures and Risk Management efforts build around protecting the organizations core mission or that products will continue to operate despite interruptions, incidents or disasters.  This falls under a category of Risk Management because it protects your organizations interests and the 3 primary focuses are Resilience, Recovery, and Contingency.  This also effectively protects a company through Change.

Change– essentially focuses on transition of any size or scale.  Change Management focuses on how people and teams are affected by an organizational transition. It deals with many different disciplines, from behavioral and social sciences to data and technology, and business solutions.

The common denominator is information.  How an organization chooses to share information is pivotal to the success or failure of Change and Business Continuity.  Peter Drucker is simply saying that in order for things to stay the same (Continuity) or for a transition (Change) to work as expected there needs to be adequate shared information as to why it is happening and what needs to be done differently to make this happen.

Now a days this is management 101, sharing the right information with people (both associate to supervisor AND Supervisor to associate) the Why, the What or the How is the foundation needed in a sustainable organization.  I doubt this is a revelation to anyone reading this, yet a vast majority of the time that a problem occurs it can be traced back to incomplete information sharing.  Which is why it is considered a foundation.

Challenge – When you make a decision or a Change, ask yourself “Who needs this information to make this work?”

Carpe diem!

 

P&L’s – The most important number?

Ask an Expert, Operations, , , ,

I received a question about  our recent post regarding Financial tools every business needs regarding the Profit and Loss Statement.

The question is…

” Which is the single most important number to help manage your business on the P&L?”

The answer quite simply is the “% Variances” column.   Not all P&L reports even have that so what is it?  To truly have an idea where your business needs to be, you need to start with creating a budget.  Every line on a P&L should have a “budgeted amount”  number in it.  This is the amount you expected to spend to yield the profit you planned.  If you don’t do the work to create a budget, then the P&L looses half of its value as a tool to help your businesses ability to generate revenue.

Many know that to help manage your business you compare the “Actuals” to the “Budgeted” columns for each line.  But there should also be a percentage column next to each of these showing the percent of total revenue that each is, which isn’t as common to find in smaller businesses P&L.  It is important to do this because Percentages reflect day to day execution of the operations in your business.

The VARIANCE column shows the difference between the budgeted and actual dollars spent, which should also have a % Variance column next to it.  This is an excellent “At a Glance” illustration of how you did in that area for the given period (+/-).

The variance dollar columns are great information for when you need to “dig in” and find why an area was high or low, but comparing that areas “actual” percent to the percent of “budgeted” revenue….

is the single most telling number for performance.

Example:

Sales are up, which would likely mean some controllable expenses are up, right? But how much more should you spend to maintain your margins?  Management needs to make sure expenses are still with in the Budgeted percentage of sales to maintain profit levels as expected.  Simply put if you expected to spend 20% of your expenses on materials, you should still spend 20% on materials whether sales go up or down.  This column helps you keep an eye on that and make adjustments if necessary.   Businesses that have a lot of fluctuation tend to run these reports more often (Food, Retail, etc).  This helps you control your product costs.  Granted, this may also mean that profit dollars are down (assuming revenue is down), but at least you maintain product and fiscal integrity.  That is very important which I have a lot to say about as well as how to impact these numbers, but I will save that for another time.

But the SINGLE most important number, one that a Business Analyst or Owner should focus on first is the % Variance to budgeted because it shows so much information.

Call me if you need help with this, my number is at the bottom of our Contact page.

Carpe diem!

Non Profits & Small Business – 3 Keys to Finance Basics

Conversations with a Consultant, Operations, , , ,

Businesses of all sizes will eventually need to prepare and manage three basic financial statements.  They are included in any comprehensive Business Plan and I will show you how they are commonly used for business strategy and routine Operations Management decisions.  These are the Profit & Loss Statement (P&L), the Balance Sheet, and the Cash Flow Statement.  I admit these can be both intimidating and confusing yet the sooner a business can use these as a compass the sooner they can be financially independent.

They will be asked for by any Business Analyst, Loan Officer, or Financial Advisor of your business so what are they?

Defined

Profit & Loss Statement (P&L) –  Also called an income statement.  This is a consolidated record showing how much you have spent (expenses) and how much you have made in revenue.  The two are calculated showing what your net income is over a specific period of time.  The period of time these show may depend on the industry you are in and typically are either by calander months, fiscal period(typically 28 days), or weekly.  It is also very common to have quarterly P&L showing a consolidated series of numbers that help you determine if it is time to sound the alarm or not.

Balance Sheet – This is a dashboard of your companies overall health.  It provides a summary of the businesses assets, liabilities and net worth.  Essentially the balance sheet tells you what you own and what you owe.  Assets are resources your business controls such as cash, equipment, buildings, furniture, inventory and money owed to you.  Your Liabilities will be the obligations you owe to others such as payroll, taxes,  Accounts payables or loans.  Your net worth is what is left over.

Cash Flow Statement –  This report demonstrates how cash has flowed in and out of your business over that time period.  Typical software programs to produce all of these would be Quicken or  Peachtree if you do your numbers your self (opposed to an Accounting Firm) or for smaller or really savvy businesses Excel works just fine.

How you use them – the 101

P&L – Depending on the scope of your business the P&L Statement can be very complicated or extremely simple.  The key is to have it inclusive of money going in and out of the business over a set period of time.  All expenses should be categorized so that at a glance you can tell why and where they are up or down from a previous period or the “forecast” budgeted amount .  Similar with revenue.  The more information the better because this tool will not only help track history, but it will help you predict future spending in most areas.  The expenses are commonly broken down into two categories; “Controllable and Non Controllable”.  Examples of non controllable expenses would be rent, loans & taxes.  Controllables are pretty much anything you can say “NO” to (much more on that another time).  This report will subtract the expenses from the revenues and show your “net profit” at the bottom.  This is a very important report for the Operations Management team to utilize and if used properly it can be very effective in containing costs and contribute to a positive cash flow for the company.   But it is not all inclusive and needs to be used in conjunction with the other two forms.

Tip – A “best practice” I have all my clients do is when using a P&L is to have all expenses broken down as a percentage of total revenue that is expected.  Manage by using the percentages and not necessarily the dollars on the form.  Ex:  (Forecasted Revenue is always 100%).  Say labor is expected to be 15% of your revenue $.  Then lets say Revenue is down a little.  The manager can either adjust labor or not during that month.  Well if labor comes in at 14% of  projected revenue, you may still be ok in that category.  If labor comes in at 20% because the manager did not use the P&L to make adjustments, then you have lost money.  Same goes for every line on the P&L.  The more information you have, the better your daily decsions could be!

Balance Sheet –  This report is generally broken into a few areas.  Assests will be broken into categories depending on how accessible they are or how quickly you may expect to use them.  “Current or Fixed”  is common terminology.  Current assets, often referred to as “Liquid” means you could use it today if needed (cash, accounts receivables, or short term investments) and are usually listed first.  Followed by Fixed assets which may be a building or equipment you own.  While you could free up money invested in these it may take some time to access it.  Under Fixed assets you are likely to find “Depreciation” which is the amount of money estimated to be used up from the fixed assets. Meaning,  if you had to sell them today, what would they actually be worth?  If you subtract the depreciation from the Fixed assets you will determine how much is available or “net Assets”

Liabilities are listed next and they are everything that the business owes to someone else.  Accounts payable, taxes, loans, wages, etc.  Similar to assets these are also categorized by time frames, although Liabilities are listed by due dates.  If your business has a invoice that has 90 days on it, it won’t be listed on your P&L, but will be listed on your balance sheet.

Both the assets and the liabilities are then subtracted from the assets to determine a businesses “Net worth” or “Owner Equity”.  In short it is a snapshot of what you would have left if you had to sell the business today after you paid everything off that you owed.  Most would agree, it is a good idea to keep an eye on this figure!

Cash Flow Sheet –  depending what type of business you are will determine the frequency in which you use this report.  Any organization that may have an unpredictable revenue stream will rely on it more frequently.  As one Non Profit client put it, “this report essentially shows you how much air you have left”.  This report will not only list what cash is expect to come in and go out of the business, but it calculates a time frame of how long the business could continue should things change drastically.  Generally measured in days weeks or months depending on the size of the Balance Sheet numbers.  In a larger corporate environment this is only reviewed by the most senior level Executives but for Small Businesses and Non Profits, who tend to live “day to day” this can be a helpful report to review quarterly.  Because using just a P&L, like so many companies do, can be deceiving.  It may look like you made money during a specific period but other expenses not appearing on a monthly P&L may come to terms.  Remember the 90 day invoice I mentioned earlier?  Well that may also need to be paid which can throw off your cash accounts.  A Cash Flow sheet would show what will be due and help you plan for it so you don’t become over extended.  As mentioned this is particularly important for many small or seasonal based businesses and pretty much all Non Profits.

As mentioned most software packages on the market will take a lot of the work out of creating these important reports for you.  All it takes is a small time investment to load all the information on a daily basis.  If you prefer to hire an Accounting Firm to get you started, I work with several I would be happy to recommend.  I guarantee that using these standard Financial tools will improve your businesses ability to generate revenue.

For more business basics click here for information on our Business Boot Camp Workshop

Carpe diem!