By Larry Walsh
Tune into the press conference given by the losing coach of a football team and you’re almost guaranteed to hear something about the team “failing to execute.” Having a great game plan isn’t enough. Players have to make the plays the coaches drew up before the game to have any chance of winning.
Solution providers that have developed proactive, growth-oriented business strategies like
goal-setting, employee performance reviews, and strategic planning around sales and marketing are ahead of the pack. The 2112 Group has consistently found that a surprising number of channel companies lack formal business plans, management structures and governance frameworks to administer and oversee vital business processes.
So just having an actual growth strategy is a great start. In fact, 2112 research has found that solution providers with strategic business instruments in place have achieved higher annual revenue, profits and rates of growth than their less strategic peers. Apparently, there’s a direct correlation between goal-setting and planning and sustained, predictable growth.
But again, just having a plan isn’t enough. To implement an effective growth strategy, a company needs the resources to execute it. And the most important resources are human—that is, great teams are made up of great players.
Recruiting, acquiring and retaining talented individuals are the keys to an effective business plan. A good management team possesses the ability to identify organizational strengths and weaknesses and then chart a course for improvement that’s largely based on finding the right people to execute the plan, giving them the tools to succeed, rewarding success and carefully governing the processes through completion.
While solution providers are getting better at organizing and governing their organizations, many still lack basic business fundamentals or don’t exercise adequate discipline to impact their bottom line on a consistent basis.
For example, 2112’s field research repeatedly ranks recruitment of sales talent as the second-highest performance challenge of solution providers. They tell 2112 they have a difficult time finding salespeople who can deliver sales at reasonable compensation levels. Part of that sales-talent challenge lies in solution providers’ lack of experience in hiring, enabling and managing salespeople. There’s a disconnect between the skills needed to recognize and nurture sales performance, and those required to effectively execute a prescribed strategy.
Unfortunately, there’s no magic bullet, but there are steps that can be followed for successfully executing a growth strategy, which we’ve seen time and again play a significant role in determining a solution provider’s performance and business health:
- Build unique business models and value propositions
- Invest in sales management and strategy execution capacity
- Commit to sustained and persistent execution
- Continuously repeat that process—adjusting as needed
Great lessons can be learned by following these standardized practices and implementing a framework in support of your growth strategy. A management team’s ability to identify its own strengths and weaknesses, where there’s room to improve and how to leverage its resources to grow is the hallmark of a mature organization. A strategic plan that integrates a full view of operations is what ensures that business will remain sustainable.
Once the management team begins to see real results from the staff it’s assembled to aggressively grow the business, the company can potentially adjust compensation to make it more competitive and revenue based. At the same time, more mature solution providers with effective growth strategies should begin to enter new markets by expanding their vertical focus or geographic sales territory, thus giving the talented team players they’ve developed even more opportunity to lead the team to victory.