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Inflation Busters: 15 PAINLESS ways to Reduce Your Business Expenses

April 20th, 2022

“Frugality drives innovation, just like other constraints.  One of the only ways to get out of a tight box is to invent your way out.”  Jeff Bezos

The facts are in–inflation is growing much faster than wages.  Simply, it costs more to do business, and most analysts agree there is no quick fix.

What is an owner to do?

Many small businesses leaders are reluctant to raise prices or are fearful of increasing them enough to maintain profit margins.  While it is prudent to always be seeking ways to increase revenues, and whether you decide to raise prices or not, cost reductions can have an equal, and perhaps larger effect on your bottom line. 

Unfortunately, some cost cutting measures can actually harm your business, so here are 15 ways you can reduce expenses without causing collateral damage.  Some methods might seem more draconian than others, so evaluate each according to your specific situation and goals. They are listed in no particular order of cost savings or importance.

1.    Review your insurance policies. You want to maintain good coverage, but policies differ greatly.  Shop around, consider increasing deductibles, and eliminate unneeded coverage.

2.    Independent contractors. While employees are critical for certain responsibilities, the cost burden associated with recruiting, hiring, on-boarding, training, and letting full time employees go can be staggering.  For many projects and short-term responsibilities, the use of interim freelancers can represent significant savings.  Most estimates indicate that the use of an independent contractor in place of an employee can represent savings of 30%.  If you do decide to pursue this route, make sure you classify employees and contractors correctly to ensure you comply with labor laws.  

3.    Meet customers, prospects, and vendors virtually.  While in-person meetings surely have benefits, most business professionals now expect their associates to use platforms like Zoom for interactions.  In addition to reducing travel and meal expenses, this method offers the additional advantage of consuming much less time, providing bonus hours you can use to remotely visit with even more stakeholders and to devote to other aspects of growing your business.

4.    Automate.  Consider ways to use AI, robotics, and other technologies in place of human beings to perform redundant or programmable activities. This approach may carry some near-term expense but can often provide returns quickly and pay off big over the long haul.

5.    Eliminate paperwork and paper:   
a.    Invoicing electronically eliminates the need for printing, stamping, and snail mail costs.   Invoices are also received quicker, which could lead to receiving quicker payments.
b.    Save documents and files to the cloud, reducing paper, copying, and printing costs.

6.    Make sure your house is in order.  Understand your federal, state, and local rules and regulations.  Stay compliant.  Also, keep your vital documents and contracts updated and in order.  If necessary, invest in a good labor attorney and/or HR professional.  The fees will likely save you serious money in long run versus the potential fines, penalties, and lawsuits resulting from noncompliance or similar violations.

7.    Consider no cost / low-cost employee benefits. The labor market is brutally tight, so you must have a compelling strategy, value proposition, and culture to attract and retain great talent.  Benefits can be important here, but many do not need to cost big bucks.  Bennies like flexible work (remote; flex time), creative, low-cost HSA and/or health re-imbursement plans, and payroll deduction programs so employees can buy their own savings bonds and/or other qualified, self-directed purchases, and more can all be considered. 

8.    Implement low-cost marketing strategies. You do not have Apple’s marketing budget, so improve your strategies and execution effectiveness in areas such as referrals, networking, an effective social media program, and more. Think outside the box. Get creative!  After all, this IS marketing.

9.    Save energy!    

a.    Change your lighting:  You can save up to 40% on energy costs by selecting the appropriate lighting.  Use LEDs, timers, dimmers, etc…

b.    Shut down unused equipment.  Many electronic items include automatic shutoffs and other energy-saving features, but you can save more by asking employees to turn equipment off when it is not in use—especially holidays, weekends, and overnight.

c.    Re-program your Thermostat:  You can also access significant savings by simply reducing the temperature a few degrees during selected times. 

10.     Consider a better banking solution.  While just about every bank claims to be committed to helping small businesses, only a small percentage will back those claims.  So choose carefully.  Make sure you have a relationship with an individual at the bank that will take the time to understand your needs, and your situation.  One who will communicate with you, understand the big picture, shoot you straight, and support you.  In turbulent times like these, you may need personal support and will want a good banker in your corner. 

11.    Evaluate your phone system.  Does your business still really need a landline, especially if many of your employees are working remotely?  Several companies now offer smartphone business plans.  Check them out.

12.    Negotiate prices for goods and services you buy.  If you don’t ask, you’ll never know.  Consider prices, rates, discounts, terms, and more.  

13.    Invest in employee efficiency and effectiveness.  The more efficient your employees become, the more work gets done.  Productivity = Profit.  Your people are your best asset.  Invest in them and the returns can mount up.  This translates into serious cost savings.  Offer training and incentives—these are small investments compared with the potential returns you could reap.

14.    Do you really need an office?  If your employees are working primarily from home, your need for office space may be reduced or eliminated.  If you can’t negotiate your way out of your lease, you may be able to sub-lease your vacant space.

15.    Consider capital equipment options:  If you need a new machine or vehicle, a lease will likely cost less each month than a comparable payment on a purchase loan.  Also, it may make sense to purchase used versus new. If you need equipment, re-furbished may meet your requirements. Pre-owned equipment can often be a good option, but if you decide to go this route, make sure to carefully check warranties.

Runaway inflation, high energy costs, supply chain issues, the tight labor market and more will cause many businesses to fold over the next year or two.  However, this turbulent economic environment will also represent some huge opportunities for those savvy CEOs who stay informed, make prudent decisions, and invest wisely.  

These tips are just a small sampling of the most popular techniques forward-thinking CEOs are using to weather our inflationary environment and position their companies for stability and continued success.

There are many more, which bring us to one final point.  DON’T GO ALONE!!!   Collaborate with other successful business owner peers in a group like The Alternative Board.  Doing so will keep you on the tip of the spear, help you make much more informed decisions with regard to how to invest your precious, limited time, money, and resources, and ultimately save you a fortune. 

To your continued success…

Joe

Copyright ©   Joe Zente 2022.   All Rights Reserved. 

Winning the Brain Battle

January 7th, 2022

Happy New Year!  For many, January is a time of resolutions, goal setting, and promises of what the year will (can) bring.  It is estimated that more than two-thirds of us make New Year’s resolutionsUnfortunately, about half of resolutions are abandoned within 2 months and only about 1 in 15 people who make resolution make any progress at all.   Why?  The problem lies in your brain.

Our brains have a huge preference for The Comfort Zone, meaning that the human brain loves to do the same thing over and over again.    If we try to break a habit, our brains will resist.   We can make intense promises, declarative statements, and even begin to implement some near-term changes, but if we’re not careful and hyper-focused, our brain’s plasticity will quickly drive us right back to The Comfort Zone and our old habits.

Habits are not instincts.  They are acquired, conditioned reactions.  Returning to old habits creates relief from the discomfort of change, even if when doing so is unproductive or unhealthy.

So if you’re serious about exceeding your goals and/or sticking with your resolutions this year, here are a few time-tested, proven techniques that could help…:

1.  Make an HONEST assessment of your commitment.  Are you truly committed to this new goal, change, or habit?   On a scale of 1 to 10, how committed are you to succeeding?   This is actually a bit of a trick question, because the scale isn’t necessary.   You are either unconditionally committed or not.   In or out.  Just about anything other than ALL-IN guarantees failure.  So if you are not all-in, don’t bother.   If you intend to proceed with a quasi-commitment, you are simply wasting your time and the likelihood you will fail is astronomical.

2.   Identify a Compelling “Why”.    Close your eyes, project yourself into the future, and visualize how success would feel and look?   Athletes use visualization because it has consistently been proven to work.  Next, try to experience the consequences.  How you will feel if you failed?   Do the rewards of success feel powerful and motivating enough to compel you to enthusiastically leap out of bed each morning and consistently leave your Comfort Zone and behave differently?   If so, great.  If not, I’d suggest you invest some more time with items 1 & 2 before setting yourself up for a very difficult Battle against your Brains.

3.  It’s totally OK to start small.  Many people wait far too long to set important goals, then try to eat the elephant all at once, setting themselves up for almost certain failure.   Small changes can have huge effects.  In sales, making just 2 more calls per week = 100 per year and can translate into millions of dollars of new business.  Replacing just one glass of beer (or wine or Coke) with water, tea, or coffee each day can save upwards of 50,000 calories per year.   Depending upon metabolism, this simple act can translate into 15, 20, even 30 pounds per year.

4.  Make a Plan devoid of Hockey Sticks or Sprints.   Your Success Plan should include consistent, daily behaviors.   Plans that rely upon a gigantic last month or sprint to the finish line are almost always destined to fail.   In the battle with your brain, slow and steady wins the race.

5.  Focus on replacement, not elimination.  Your habits are embedded, so don’t try to break them.  Trying to stop doing something actually makes you crave it more.   If we try to break, our brains will resist.   Instead, focus upon replacing your existing habits with more effective ones. 

6.  Be confident and tell everyone.   Now that you know you have an unconditional commitment to your new goal and a compelling why to maintain the motivation required to stay focused upon correct behaviors, proudly tell everyone about your goal and success plan, especially your best friends and supporters.  Most importantly, tell those individuals who care enough about you to share tough love and to call you out if you allow busy-ness, “life”, or any other excuse prevent you from executing your great new plan.  

7.  Seek a coach and/or accountability council.    Superior athletes and other superior performers understand how to win the Brain Battle.   They understand that achieving new heights and goals demands that they must stretch, so they consistently train themselves to become comfortable living outside of their Comfort Zone.  They do this by surrounding themselves with great coaches and peers who will help to hold them accountable to their commitments and keep them motivated.  This is not rocket science.  We are talking here about time-tested principles that simply work.   Model their behaviors and practices and you can model their performance.

8.  Take action.  The first step is the most important.   You will never accomplish your goals by talking about them, reading, studying, searching the internet, or dreaming about them.   Get into action today and pay attention to results.   If adjustments are required, make them, but stop talking and start doing.

9.  Don’t bail out.  If you make a mistake or fall off the horse, don’t beat yourself up.   Dry cement is yesterday’s news.  Forgive yourself, jump back on, and get back to creating a better future for yourself.

Here’s to your success in 2022!   Wishing you peace, freedom, prosperity, and abundant happiness.

Copyright © Joe Zente 2022. All Rights Reserved.

This Addiction may be Costing You Millions

December 16th, 2021

 Let’s be brutally honest.  When you sell…:

Do you feel anxious to tell buyers why your product, service, or company is great?

Are you more comfortable talking & presenting versus asking tough, probing questions? 

Do you listen more selectively than actively?

Does your blood pressure increase when you perceive a “buying signal”?

Do you often listen with “happy ears”?

Do you feel pressure during sales calls to make sure you get in your “key points”?

Do you often leave sales calls without getting all the critical information you need?

Do you wonder why some of your prospects “Just don’t get it”?

Do you love being an expert?

Do you struggle to convince people to buy your product or service?

Even though you are aware that you should listen and learn more while talking less during sales conversations, do you find yourself talking way more than you’d like?

Is it possible you are addicted to Convincing?

 If you answered yes to one or more of the questions above, you may be a Convince-aholic ©.

Like all addicts, the CONVINCE-AHOLICS EXHIBIT SELF-DESTRUCTIVE BEHAVIOR that temporarily fills a void created by unmet needs while creating poor results.

Similar to other types of addicts, Convince-aholics are constantly bombarded with temptation, making their addiction challenging to overcome.

Most existing sales literature, on-boarding sessions, and training programs exacerbate the Addiction by presenting clever techniques or scripts and encouraging salespeople to use manipulative “leading” questions, tie-downs, and use slight-of-hand.  Each of these convincing techniques actually diminishes a salesperson’s ability to differentiate themselves, to facilitate discovery, to develop trust, to learn the truth, and to add value — the essential core competencies of the world’s most successful salespeople.

Despite the fact that Convince-aholics consistently lose sales and struggle to maintain margins, their behavior provides a dopamine rush.  This rush makes them FEEL like they are gaining. If they didn’t, they would likely stop their destructive, ineffective behavior and replace convincing with a consultative discovery process leading to consistent success.

Some characteristics that come out of Recovery Literature follow. Please consider the parallels:

The Addictive Experience

1. Creates predictable, reliable sensations.
2. Becomes the primary focus and absorbs attention.
3. Temporarily eradicates pain and other negative sensations.
4. Provides artificial sense of self-worth, power, control, security, intimacy, and accomplishment.
5. Exacerbates the problems and feelings it is intended to eradicate.
6. Worsens functions, creates loss of relationships.

At a foundational level, success in selling is based upon mindset and beliefs.  The Convince-aholic mindset dramatically diminishes selling effectiveness, the quality of relationships, trustworthiness, and income.

The great news is that any Convince-aholic can overcome their addiction using a time-tested recovery program.

If you believe you may be afflicted (or know someone who is), would like to assess the severity of your addiction, and would like to understand the process to get clean, feel free to email me and write “I May Be Addicted” in the subject line.

Wishing you nothing but success in 2022 and beyond.

To Your Freedom…

Copyright © Joe Zente 2021.  All Rights Reserved.

The ONE THING: A Science-based Missing-Link to Closing More Sales

June 26th, 2021

Every week, business owners and sales managers ask me how they can improve the effectiveness of their sales organizations.   One of their most popular questions is “why can’t our people close more sales?”   Many have also asked “if we could just change ONE THING, what would it be?”

Many of these executives have invested heavily trying to improve sales performance and have tried (and mostly failed) using a variety of approaches.

These business leaders experience results that consistently fall far short of sales projections.  They are trying to find out why so many new forecasted sales postpone or cancel.  They want to know why such a large percentage of “high probability” sales in their CRM are dying on the vine, and what they can do differently to improve the results.  Many of them believe the problem is a lack of closing skills.   Others think it is more about prospecting.

While most would agree that prospecting and closing effectiveness are important qualities in a salesperson, science has recently produced some extremely revealing data that identifies what may be the single largest cause of unclosed sales.   The Missing Link and supporting data are outlined below, along with a brief summary of how you can fix the problem.

The data set is large.   Objective Management Group is a company that has evaluated over 2 million salespeople.  The graph below represents a Sales Team with regard to their skills, potential, processes, and mindset regarding Reaching Decision-Makers.

Graph for blog 

You may notice that the graph includes data from both sales force evaluations and individual salesperson pipelines.  Pipeline information was derived by asking each salesperson to identify 4 late-stage, proposal-ready or closable opportunities, with 19 questions asked about each opportunity.    The data was integrated and analyzed to produce some important findings.

This team’s results closely mirror overall averages of salespeople evaluated in the study.   Like most, the vast majority of the group believes in the importance of reaching decision makers and in using their skills to reach them.  More importantly, the team averages 54% of the attributes for Reaching Decision-makers, but only 13% (green pie slice) are strong at reaching them.

For the most part, these salespeople believe it’s important to reach the DM and have a milestone in their sales process to reach them.  And despite the fact that they possess some of the selling skills to do so, they still fail to reach the decision makers.

If we focus upon the first two attributes in the chart, both concerned with Calling on Actual Decision Makers, we notice contradicting data.   The pipeline data shows that nearly 90% of the salespeople met with the actual DMs on these late-stage opportunities.  Not too bad.

Unfortunately, the evaluation data shows that only 10% of salespeople are reaching actual decision makers overall.  Yikes.

In other words, when salespeople reach true decision makers, opportunities typically cruise through the pipeline resulting in a win.  However, most salespeople do not reach actual DMs.  Consequently, most opportunities (the vast majority) remain unqualified.  The salesperson never even has a change to differentiate, so the sale ultimately peters out resulting in a loss.

Further inspection of the data reveals that half of salespeople are calling on purchasing people, instead of DMs at the start of the sales process.  Why?  Because nearly half aren’t comfortable talking with the true decision maker, and a third need to be liked and resist pushing back on buyers who won’t introduce them to or “give them permission” to meet with DMs.

I don’t mean to assert that this is the only problem that sales organizations are facing.  It certainly is not.  However, the data clearly shows that if most salespeople could fix only one thing today, the consistent ability to reach decision makers would make an enormous difference.

If you’re still reading, you’ve discovered the Missing Link to a gigantic, untapped castle of riches.  It is unlikely, but I hope your sales team is one of a very small group of outliers who are successfully and consistently reaching decision-makers early in the sales process.  If not, and if you’d like your team to begin, here are just a few pointers…:

1. The simplest thing you can do is to make your salespeople AWARE of the enormous impact of visiting with true decision makers.  Ask them to read this article and encourage them to focus upon reaching DMs.  Even if you do nothing else, simple awareness should have some positive effect.

2. If you want to know where you team stands with regard to the skills, strengths, and potential to reach DMs, you can always assess them using the tools described above.

3. If you’re ready to get serious and blow your sales through the roof, the world is your (potential) oyster.  Before you start, just know this…:

a. Most people, including your salespeople, will resist change.   They are currently behaving the way they are behaving because that is how they CHOOSE to behave.

b. Because of this resistance, an Unconditional Commitment of leadership is required to make it happen.

c. An effective consultative sales process, including advanced listening and questioning skills, an ability to differentiate, and knowing how to be perceived as a trusted advisor is required.

d. Timing and emotional intelligence are critical.   An effective salesperson must understand how to earn the right to make certain requests.

Just think….  If your salespeople could only reach only 20% more decision makers, consider the huge impact doing so would have on revenues, profit, and the strength of your business.

Now that science has provided you with the keys to the castle, what are you going to do?

Copyright © Joe Zente 2020. All Rights Reserved.

FREEDOM!!!!!!!!

May 18th, 2021

Have you ever wondered why the “busiest” people are often the least successful? 

Each month, I meet with dozens of business owners.  Some consistently set and achieve their goals.  Others seem to be in a constant state of struggle.  Interestingly, the owners that struggle the most also consistently seem to be mired in self-talk about how “busy” they are.  When I ask what they are busy doing, their reply usually relates to some type of urgency or a need to react to situations “outside their control”.  If questioned further, they offer up reasons (aka: excuses) as to why they are unable to “make time”.  They’ll discuss the things they “have” to do, and they sincerely believe that they “just can’t find the time” to work on the things they should do or would like to do.

These individuals are slaves to external circumstances.  

 Do you know anyone like that?

Conversely, successful owners seem to always have plenty of time to plan, to act strategically, to keep their commitments, and to work ON (versus IN) their businesses.  Almost magically, they are able to find time to calmly handle all of their business (and personal) interests, desires, and obligations.  These CEOs prioritize effectively and to manage their calendars proactively.  

Superior CEOs refuse to work below their pay-grade.   Unfortunately, most owners do not.  They waste many hours on activities that produce little return.

So how do these successful owners do it?  After all, there ARE only 24 hours in a day…  Here are some facts (and some patterns I’ve noticed) that can help you become less busy and more productive.  A simple to-do list — your pathway to Freedom…:

1.  It is rare to meet an owner (successful or not) that does not have a full plate.  I can’t remember the last time I met a CEO who wasn’t juggling multiple priorities that required some attention.  For most entrepreneurs, a plate that is not full can be a sign that resources are being under-utilized, and that something probably needs to change.

2.  We all have “stuff we gotta do”.   However, we should never confuse things we must do or should do, with things we want to do, could do, or have to do. 

3. “Busy” is a state of mind.  Great entrepreneurs accomplish much more than weak ones, but rarely tell you that they are “really busy” when you ask how they are doing.  Conversely, unsuccessful owners are addicted to busy-ness.  They almost always feel busy and reactive, versus feeling focused and proactive.  Even though their “busy-ness” is destructive and isn’t getting them where they want to go, they still feel some kind of adrenaline rush or feeling of importance from having “too much to do”.  They have no problem finding things to do, but have no process or structure to determine whether they are working on the right things or the wrong things. The Owner-Slave Mindset really has nothing at all to do with the number of hours in a day.  Most would feel addicted and over-whelmed whether a day included 24, 48, or 2400 hours. 

4.  The problem of effectiveness and productivity is never due to the number of hours in a day or the fact that we “do not have the time”.  

5.  We all have only 24 hours in a day. That is the one single thing that none of us can control.   

6.  We CAN all control how we CHOOSE to invest our time. 

7.  There is only one significant difference between a super-successful owner and a mediocre owner that wallows in crisis mode. The difference is how they CHOOSE to invest their precious time (and resources).  Productive owners choose wisely and skillfully and focus on the IMPORTANT, while struggling owners choose unskillfully and focus upon the URGENT.   The best CEOs refuse to work below their pay-grade, and their employees follow suit.   In other words, Busy Owners breed Busy Employees, and Productive Owners breed Productive Employees.  

8. The most successful owners understand they are personally the single biggest contributor to (or detractor from) exceeding their goals and the ultimate achievement of their company and personal vision.  In other words, they are personally the biggest problem.  They are also POTENTIALLY the biggest solution (IF they make wise, skillful choices).  

9.  Owners that understand this simple success formula also know that it would be absolutely foolish to attempt to make these choices in a vacuum.  

And they know that they don’t know what they don’t know.  

They, therefore, choose to invest their time in a time-saving, decision-making process, and surround themselves with other successful owners who are committed to help, such as the peer advisory board structure of The Alternative Board (TAB).  A structured peer process helps owners make better decisions and skillful choices.   The process directs them to invest their incredibly valuable time wisely. Wise, skillful choices have a huge positive impact on the bottom line.

10.  The best entrepreneurs choose to spend one-third or more of their time working on, versus in, their business. Wow. This may seem impossible, especially if you are young, new, or small business owner, but if you don’t set a goal, you will certainly never achieve it.  In this context, I recommend to all of my clients to COMMIT to themselves to spend 33% percent of their precious time working ON the business within 3 years.  If you commit to this goal to get yourself out of the weeds and make it the most important one in your portfolio, you’ll notice that the rest of your business goals will tend to take care of themselves.

This singular choice provides an owner with FREEDOM. It allows him/her to abandon the addictive habits of busy-ness, urgency, and fire-fighting and to adopt the effective habits required to build a consistent, effective, growing, scalable profit-generation machine.

So if you feel like you are “really busy” or “overwhelmed”, if you “never have enough hours in the day”, or if you often say “yes” to the urgent to the exclusion of the important, please know that you are not alone.  Freedom and productivity are just a few simple steps away.

There is no better time to commit to your personal freedom than today.  

If you have any questions about how to begin, or simply feel like you are too stuck to get started, I’d love to hear from you.

I hope you enjoy the fruits of making wiser choices.

To Your Freedom,

Joe 

Copyright © Joe Zente 2020. All Rights Reserved.

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