While one way to tackle this problem is to meet cut-back with cut-back, by reducing the size of your own operation to match client cut-backs, the fact is that this recession may last a while, and therefore may outlast your ability to be the last man standing. Therefore, preparing for the worst, in my books it is better to be proactive and try to influence what might seem a foregone outcome. That is, you need to start figuring out what you can sell that the clients want more of, not less. The fix required is not hard to imagine. It involves you stepping out of your traditional business space and looking to give your clients a way to reduce their own dwindling profits or to perhaps even increase them again. And usually this means an integrated solution rather than the sale of discrete products or services.

Just what kinds of solutions a client may want depend of course on your sector of industry. For example, a software company might start offering hardware leasing so that the client doesn’t need to order in and configure additional equipment. A hardware company might offer onsite support alongside its cheap products. An accounting firm might start looking at doing turn-key SOX consulting, ensuring that a client doesn’t go with an upstream competitor. A training company might facilitate training not just for the client’s staff but bring in their customers as well, to critique and give real feedback on what the vendor is doing right or wrong. Or if you’re a B2C retailer, then you might look at customer loyalty program that ties in rewards provided by a third company, rather than simply offering discounts on your own products and merchandise.

The best way to come up with solutions that fit your clients is to open up your input funnel and ask anyone with a stake in the success of the idea to contribute with ideas and comments on those ideas. Try to set up specific brainstorming sessions with both staff and clients, to give them a chance to come up with something original. After you’ve collected the ideas, no matter how crazy sounding they are, put them in front of a review panel of industry-knowledgeable advisors, for validation.

Of course the solution also has to have sufficient benefit for the client to want to use it. The simplest value proposition and one which is hard to resist is the simple cutting of costs. If your solution offers a 30% cost-cut in the next 6 months, it is highly likely that your client will be interested and will keep buying more of the same. In IT for example, we normally only sell to a client when they want to expand or replace an old product, because Head Office usually gets to decide product type and replacement schedules.

However, what if you could offer a sub-system of the IT infrastructure by incorporating some local software that immediately results in lower administrative costs? Then it is highly like that the local Admin Manager would champion the project, even though it may deviate from the normal standards. Certainly in my experience I have found the reduction of personnel is usually a good cost-cutting point to start at. Since people usually cost at least 30% more than their salary, an administration person earning €25M represents an €40M cost to the company. Therefore, and if your solution costs less than €25M, you’re already putting your Client ahead of the game. So Rule Number One: make sure that your solution produces noticeable savings.

Lastly, let’s look at how to put together a solution. Usually you need three collaborators to make a good solution: 1) a person or team who knows your Client`s business and understands where the opportunities are to improve systems, 2) a person or team who knows how to put together the solution technically (be it software, better work flow, better training, or even more effective government certifications), and 3) a person to project manage the solution implementation so that things get done on time and professionally. Of course, there is also you, the salesperson.

If you’re a small company, these three collaborators may not all be in your immediate circle. In that case, after you’ve had the basic idea of what you want to offer, you need to go out and find partners who will work with you and who, most importantly, agree not to charge you anything unless you pull off the deal. Thankfully, this bootstrapping method is easier to do at the moment because everyone else is looking for more business, too. I’ve used collaborating partner companies like this on a number of occasions. My only advice is that because you don’t have control of the collaborating resources be sure that you’re dealing with someone senior in the partner firm to get responsiveness, and also be sure that you have back-up vendors, just in case things don’t work out.

So how do you stay sane in an environment like this, especially if you’re in sales, which typically bears the brunt of the crunch?

For my own sales staff, and certainly for employees in new companies, which are perpetually in crunch mode until the company breaks through into profit, I have a sanity formula that I share with them. I call it my 70-20-10 rule. It’s kind of loosely based on the 80-20 rule, which postulates that 80% of the results are gained from 20% of the effort. People use the 80-20 rule to become more effective and the objective is to find out what that 20% of high-yield activity is, so that you can do more of it.

With my rule, the 70% stands for frenetic/diligent activity spent prospecting, presenting, and selling one-off or short-term deals. This is the portion of your activity which fills the rice bowl every month and is essential for companies to keep going. Most sales-focused companies want their staff to be doing this kind of work all the time, but after you’ve learned the job, the fun goes out of it after a while and inevitably you start to feel like a hamster on an exercise wheel. This is what causes most sales people to burn out and it is an unusual person who can last more than a year or two in directionless sales. If they do last, it’s probably because the company has a good commission program and so the person at least gets strong financial incentive to be a hamster.

But for most thinking people, there needs to be light at the end of the tunnel. In a larger company this would be a promotion to team management or an opportunity to start up a new project or move into product management. Good if you’re one of the lucky ones, but what about the rest of us?

This is where the 20% and 10% come in. 10% first. It’s a proven fact that people will make extraordinary sacrifices for an ideal or a goal. They die to reach the top of mountains or be the first to the South Pole. They suffer for a god, a nation, or a cause. So the mind is a powerful thing and to keep it healthy and positive, you need to be working towards a goal. The 10% represents your personal efforts to develop yourself in your life journey. For some people it might mean passing exams that give the person pride in their skills and status in the community, for others it could be wealth, power, or self discovery. In my businesses, I try to remind people to keep the 10% high in their minds and use this time to allow them to feel that they are more than hamster-humans.

To pay for the 10%, which may not have a direct bearing on the company, we have the 20%. This represents what I call “The Bank”. That is, sales activity which is either recurring or accumulative, and therefore is more efficient and financially beneficial than simply doing one-off sales. Typically, this type of work is project oriented and takes a while to pay off. So you can’t do too much of it, else you might lose your job while chasing rainbows. But big projects are eminently possible, especially in a big city like Tokyo or Osaka, and even though you might think you’re not ready for the big time yet, you nonetheless should be making efforts to pull such a deal off.

Clearly to have this kind of strategy, you need to be talking to your boss or even someone further up the totem pole. For others in the company watching you do activities in the 10% realm, since they appear to have nothing to do with the company, there will doubtless be complaints and your new efforts will soon be shut down. Instead, think ahead and sell the idea to your boss. Commit to producing results on the 70% and 20% work efforts and most reasonable managers will willingly give you the other 10%.

This research initiative is designed to help executives make more-informed decisions about what supply chain capabilities best serve their operational objectives. The study identified the performance advantages of mastering each of the six supply chain functions. Compared with low performers:

* Fulfillment masters deliver customer orders on time and in full at a rate 13% higher, have significantly lower transport costs, and maintain 50% less finished goods inventory.

* Manufacturing masters achieve 13% higher throughputs (volume of products manufactured), 15% better equipment effectiveness, 30% more equipment uptime, and as much as a 75% reduction in manufacturing lead time.

* Supply chain planning masters achieve 10% greater forecast accuracy and lower inventory costs while maintaining a 99% order fulfillment rate.

* Sourcing & procurement masters deliver 2.5 times more value for every dollar they spend in their procurement organizations.

* Service management masters achieve 33% better turns on spares inventories, 33% higher service spend efficiency, and 10% fewer past-due service orders.

* Product development masters achieve 30% reduction in time-to-market with an equal reduction in resources and have significantly lower product-development costs.

Supply chains are an obvious target in today’s economy, as corporations face heightened pressure to cut costs and drive efficiency. What emerges from the research is that to survive and thrive in today’s volatile business environment, companies must develop dynamic supply chains that can nimbly and flexibly respond to changing business conditions.

Among the leading supply chain capabilities identified by the surveys:

* Fulfillment masters are more than twice as likely as low performers to design their distribution channels to accommodate varying customer needs and product characteristics (70% vs. 30%).

* Manufacturing masters are nearly twice as likely as low performers to adopt and internalize bottom line driven and proven manufacturing excellence principles (90% vs. 50%).

* Supply chain planning masters are nearly twice as likely as low performers to use planning models that are differentiated by customer and product characteristics to enable greater responsiveness (82% vs. 43%).

* Sourcing & procurement masters are more than five times as likely as low performers to have a centrally led category management structure and optimally leverage global sourcing (81% vs. 5%).

* Service management masters are more than three times as likely as low performers to tailor their service delivery by customer segment (81% vs. 26%).

* Product development masters are four times as likely as low performers to reduce complexity by use of product platforms for new product development and leverage up to 70 percent of an existing design, leading to rapid product launch (76% vs. 19%).

It isn’t my intention to do a sales education segment here, but there are indeed some basic things that you need to ask yourself as to why your performance is sub-par, and what you can do about it.

The first thing is to be honest. Is your heart in your work? Are you paying attention to the basics? Are you networking with others so as to gain word-of-mouth introductions? Are you respected and listened to by your customers and colleagues? Customers like to buy from a winner, so are you projecting a winner’s image and confidence?

I’ve worked with many sales staff over the years, since most of my businesses are start-ups and we’re often developing the product/service as we go out and sell. Although many of these people were talented and did well, I recall with some frustration those who had trouble getting over the goal line because of fundamental issues holding them back. For several it was a drinking problem, for others an inability to take the job seriously and show up for work on time. Some people had a lack of confidence that led them to bluster during presentations and thus not listen to the customer’s feedback, and for some it was a basic lack of understanding of how the technical side of the business worked, so as soon as they opened their mouths the customers knew they didn’t know what they were talking about.

I offer my new sales staff, in particular the ones who are struggling, a short “cheat sheet” to sales success. If they stick to the core program, usually they can make themselves more valuable to the company and thus less easy to fire. The program is as follows:

1. Be an Expert. Without being a know-it-all, customers like and respect the quiet confidence of an expert. Therefore, you owe it to yourself to learn as much as you can about your area of business – or even just one part of that business. Several times I have had sales people who learned the technical side of the business so well they could multi-task as a part-time project managers or engineers. Those people were highly successful in selling technology to customers, because the customers believed what they had to say.

2. Follow up. Especially in detail-oriented Japan, if you say you’re going to do something, do it. I make all my salespeople take copious written notes during meetings so they don’t forget a promise. For some customers note-taking may mean lack of mental acuity, but for most the body language is, “This is important, I’d better write it down.”

3. Practice out-of-body sales. If you get stage fright when making presentations, or if you find it difficult to make cold calls or introduce yourself at business events, then try the little mind trick of pretending to be someone else telling yourself what to do. I personally used this technique, of disassociation, and that I was someone else watching myself do the phone calls or event ice-breaking. After a while, I gained the confidence to do it in first-person. Likewise, if you’re having trouble feeling motivated to make cold calls, then pretend that you’re a manager dealing with the reluctant inner you. You may find yourself becoming your own toughest task master and getting a lot more done as a result. As Intel’s Andy Grove once famously said, “Only the paranoid survive.”

4. Talk to the level of the other person (per Maslow’s Hierarchy of Needs). Sales is not about beating someone over the head and saying “Buy this!” But when you’re desperate for sales, that’s what you can often wind up doing. Instead, try to have meaningful relationships with your prospective customers, and try to have them like you as a person. This can help you compete where simple price cuts alone cannot (although recently, price also matters). I tell my sales team to listen to what the other person is saying, and talk to them at the same level. If they like baseball, then by all means shoot the breeze about your favorite teams for the first 15 minutes. If they are concerned about technical issues, then talk to them at this level and do research for them.

5. Keep your activity levels up and network effectively. It is much harder for a senior manager to fire someone who is obviously working hard and putting in the hours. Condition yourself to make calls in the mornings and go out to do customer visits in the afternoons. With focus, you should be able to see at least 15-20 new prospects a week. This is the minimum activity level for a successful salesperson, in my opinion – unless of course you have a stable of repeat customers, in which case, you should be out seeing each of those customers at least 1-2 times a week.

6. Report back. Let your boss know what you’ve been doing. The more they know, the more they feel the excitement of new leads and the more vigorously they will defend you when a senior manager questions your sales track record.

The second macro factor, which we will discuss today is performance expectations by senior management. Clearly this is important, because if in their general worry your management feel that sales people should suddenly be able to double or triple their productivity, then your job is in peril.

Therefore, the second strategic question to ask yourself after the leadership issue is whether or not the new targets are attainable or not. If they are not, then as a team you need to go back to management and reason with them. There is no point in a team even attempting unrealistic goals, because the disappointment in not achieving them will severely demoralize everyone – leading to depression and resignations. In additional some nastier managers may use the missed targets as an excuse to start playing politics and culling people they don’t like. Unfortunately, ugly corporate politics often manifests itself during economic hardship.

So what is a realistic sales goal? What should management reasonably be expecting?

Attainability in sales is can be measured in a number of different ways. The most obvious measure is to look at what the team’s top performers have been doing over the last year. It is probably reasonable to assume that if you are in a sales team with more than 3-4 individuals, and you’re in a company of more than 10 people, then at least 1-2 of the sales team are performing at a high level and the business rests on their shoulders. If these high performers are getting more than 30%-50% better results than you are and you’re not new to the position, then your job may be in danger. I will discuss in the next column what to do about this.

Another measure is to look at what other companies are getting from their best salespeople. By other companies, I’m not talking about the top dogs with their unassailable Intellectual Property, patents, ad budgets, and highly profitable parent companies. Instead, it’s the other 90% of companies who have competent but unimaginative offerings and who have formed lasting relationships with good-sized client bases.

In my experience, this average 90% of companies focus on profits rather than sales, since they are not going to go public tomorrow, and because profits are what pay the bills. So you should be thinking in terms of profits as well. In most companies the rule of thumb is that salespeople need to be bringing in an average of €2MM~€3MM of Gross Margin (after Cost of Goods/Services but before General Administration Expenses). Alternatively, I have a rule of thumb for my own companies whereby we set a target for fully productive sales staff of earning at least five times their salary in Gross Margin.

To figure out what you cost your company (which I refer to as “salary”), remember to include the cost of both your base and bonus/commission compensation, as well as the cost of your transportation and social welfare.

Actually, if you think about it, both the €2MM a month and five times numbers coincide with someone being on a base salary of about €4MM to €6MM and supporting two other individuals in the business, while helping the company to make around 10% Net Profit before tax. Clearly if the company is renting an expensive office and/or has an expat boss, then the Gross Margin profit requirement will be at the high end of the scale.

Although the Sales team is so important, for better or worse it is also the most visible and most measurable part of the business. This means that the Sales team is most vulnerable to senior management criticism and “remedial action”. In an economic downturn, one of the first moves by senior management is to typically address the “sales problem”. They’ll do this by either exhorting staff to make greater effort, pruning the poor performers and swapping in new people, implementing pay cuts (hard to do), or by admitting that the current line-up of products/services need to be changed to match clients’ changing needs (in service companies in particular, this takes time).

You’ll notice that some of these management change options are strategic macro issues while the others are more tactical. Needless to say, it is easier for management to address the tactical issues first, and so people get warnings and others get fired. However, I believe that if a company doesn’t address its macro issues early on in a downturn, then no amount of tactical pedaling by the Sales team will turn the sales numbers around. Sure, there may be a temporary one or two month reprieve, but it will come at the expense of frayed tempers, everyone’s health, and client alienation as sales people become increasingly desperate for results and resort to increasingly hard sell tactics.

So for you as a sales person in a struggling sales team and now being confronted by management mandates, you need to ask yourself two key questions up front: 1) do we as a team have the leadership to change and adapt to our new environment? 2) Are we as a company selling things/services that customers actually want or need? If the answer to either of these two points is “no”, then you might want to consider looking for a new job.

But let’s assume that you like where you work and you want to be part of the turn-around. After all, promotions come from turning bad situations into good ones. Then the two key macro issues need to be dealt with before your own personal efforts will have much effect. Let’s deal with leadership first.

Management tinkering with the Sales team is not only going to introduce a lot more work for everyone, but also a lot more potential for conflict and emotional stress. Therefore, a struggling team absolutely needs a strong and confident leader to help them deal with seemingly unreasonable new expectations and unfamiliar new tactics that may at first seem pointless. A calm voice with good vision of what a new future might hold is like a priest with soldiers before they go out into battle. That one person can calm nerves and build confidence that will result in victory.

Leadership is particularly important when you are not only dealing with external adversity but when management introduces new business requirements as well. This is because even though your new services/products might be excellent, your clients can be so wrapped up in their own problems that they are unable to be receptive to suggestions and changes that will make their business better. For this reason, my experience has been that when the economic climate is negative, not only will you have a period of falling sales from your core business but your new initiatives will also be slow in building momentum. Thus there is money being burned on two fronts and it takes a very strong manager to stay the course.

How long will that course take? Well, I believe that it takes at least six months longer and repeated sales approaches to get a hurting client to move to a new service or product that is actually good for them. One trick to help them make accept your value proposition quicker, is add a loss leader that directly cuts their costs as soon as they start using it, so they can see a bottom line result from the outset. Few clients can resist this type of purchase. BUT, be sure that the initial loss-leader sale is connected to the service/product that you’re actually trying to move them over to. Don’t be tempted to separate these actions and go for the quick but profitless sale. That won’t fix your company’s problem.

The combination of business’ increasing reliance on IT and the volatility of the marketplace has put more pressure on IT to plan quickly, accurately, and thoroughly. IT must now compare plans to alternatives, prepare them with contingencies, and review them on a monthly or quarterly — not yearly — basis.

Why IT’s current planning function is ill-equipped to plan at the pace of business:

· IT takes too long to adjust plans to meet business needs. By the time IT is prepared, opportunities have passed and the plans are obsolete. IT doesn’t have the means to understand how it currently supports business strategy. The linkage between IT’s capabilities — and their associated costs, benefits, and risks — and business needs is not mapped out. Additionally, information gathering and number crunching hold the process back.

· IT makes plans that don’t reflect what IT will actually do or what the business actually needs. In the end, business doesn’t understand how IT contributes to the execution of strategy. IT doesn’t start planning with a clear picture of which demand is truly strategic or which actions will have the biggest impact. Information regarding business needs and the costs, benefits, and risks of IT capabilities comes from sources of varying quality. IT then makes planning decisions based on
misleading information.

· IT’s plans often end up rigid and unverifiable. Plans don’t include contingencies that reduce the impact of change, nor have they been verified as the best plan of action via comparison to alternatives and scenarios. IT simply doesn’t have the time and information for it. Manually preparing multiple plans and selecting the best one would take too long for most organizations — especially considering the availability of the information needed for a comparison.

Sure, there’s an infrastructure to do the actual execution, but the real focus is on merging the business processes and the software services that execute them. That focus promises to eliminate the messy work of aligning business and IT, because IT and the business are one.

And it promises to eliminate the huge costs of application integration and also make it easier and cheaper to change business processes, because no rigid systems are in place—just an overall architecture that ensures services work together naturally even as they are removed, added, and altered.

The problem is that without labor-intensive retuning, MySQL performs poorly as a data warehouse. If you’ve got a lot of time on your hands, you could mess around with MySQL. Otherwise, “it’s just not optimized for BI.”

Data warehousing appliance market is already so crowded all coming in cheaper price-per-terabyte basis.
Competition sights are set on appliancies delivering high-performance data warehousing in a mass market for MySQL data warehousing — smaller-than-10TB warehouses used for Web analytics.

How to get a faster performance?
Accelerating the database by running commands in silicon, as well as its columnar storage engine tuned to read data quickly, which is key for data warehouses.

ICT in the supply chain responds to the concerns of the logistics industry in an economic environment in which the capitalization of technology companies can make big differences in competitiveness.

Four main threads to highlight the role of Supply Chain Information Technologies: the excellence in Operations as a competitive advantage in times of crisis, the improvement of transport efficiency, the implementation of new technologies in the integration of manufacturers and distributors of electrical equipment, and improving the Productivity and costs of transportation and inventory management by applying IT.

Solutions could be found in a wide range of activity areas: purchasing and cost control, demand planning and supply, sales and distribution, forecasting and resupply, materials management, order management and fulfillment, planning and sequencing of production, planning, costing and management of transportation, inventory management, warehouse management systems, reverse logistics, sales and operations planning, vendor management , global trade and traceability.