Category Archives: Small Business Planning

May 2017 Newsletter – Determining the Core Profitability of Your Company

Determining the Core Profitability of Your Company

Recently, several of our clients have been going through the process of either buying another business or selling their company. During the requisite work related to these actions there have been many discussions regarding how to analyze the profitability a company.

The profitability of a business is almost the sole determinant of whether it will succeed, making it the most important part of your business’ Financial area. Indeed, it is so important that the abundant profitability of a business can cure a number of “evils” throughout it. If you have a wildly profitable business, you can make a ton of mistakes in various areas of your business and still be successful because you have a large cushion for error.

When most people consider an organization’s profitability they think of the Net Income/Loss of the company. However, you should also consider another key tool you can use to measure and gain insight into a business, it’s Gross Profit. The significance of Gross Profit is that it is a “core” financial measurement, whereas Net Income/Loss has many factors that effect it and perhaps distort its value as an indicator of a company’s operations.

Gross Profit Analysis

Small Business Planning in Atlanta, GeorgiaThe formula for calculating an organization’s Gross Profit is:

Revenue – Cost of Sales = Gross Profit

In the above equation, your company’s Cost of Sales (sometimes called Cost of Goods Sold) are those expenses of your business that are directly related to the production of your Revenue as compared to overhead expenses. For example, if you were a home builder you would produce your revenue by building and selling houses and the costs that would go directly into producing a house (your product) would be:

  • The wages and salaries you pay your employees to build the house
  • Materials (lumber, drywall…) that would go directly into the house
  • Sub-contractor payments for areas that your business will not complete itself (e.g., plumbing, heating and air conditioning)
  • Supplies (you buy 500 lbs. of nails that you use on four different houses)
  • Rental of a bulldozer to clear the land and scaffolding to erect the house

All the above costs would be considered Cost of Sales because when you sell the house, these are the costs that were necessary to produce your product (a house). Once you subtract the direct expenses (your Cost of Sales) from the Revenue that you received from the sale of the house, you have the Gross Profit. What is the benefit of knowing your Gross Profit?

How Efficient is Your Business?

Your Gross Profit (also known as Gross Margin) shows how efficient your business is at producing its Revenue. This information is instrumental in enabling you to analyze your cost of Small Business Planning in Atlanta, Georgiasales and thereby increase your profitability. Gross Profit analysis looks at the Cost of Sales of your business and compares that to your gross revenue in dollar terms and on a percentage basis. Additionally, you can compare your Gross Profit percentage to your competitor’s or industry averages to provide information to improve your profitability.

There are two main benefits of having a higher Gross Profit percentage. First, it means that your business is more “profitable” (i.e., more efficient) in its revenue generation than your competitors. This is key because if you have two similar companies in the same industry and one’s Gross Profit Percentage is 75% versus the other one’s 50%, that means the first organization is 50% more efficient in producing its Gross Profit than the second one.

Relatedly, you can gain even more insights by comparing both your overall Gross Profit and at a component level – Cost of Sales (Labor, Materials, Supplies, Contracted Services, etc.) on a percentage basis to industry averages. Knowing this information is the first step to improving a company’s operations.

Greater Gross Profit Yields More Flexibility

Second, your greater Gross Profit percentage provides you with more flexibility with regards to how you choose to operate your business. This potential flexibility affects every area of your company by providing you the freedom to make decisions and to choose options that otherwise you could not select because of having constrained finances.

A good analogy to use for this “flexibility” is to imagine you were looking at purchasing one of two different sponges; one which absorbed 1 cup of water and one which absorbed 2 cups of water. If each sponge was about the same price, you would purchase the second one, because its ability to absorb twice as much water as the first one.

Ability to Absorb Overhead Expenses

Think of a business’ Gross Profit as its ability to absorb overhead expenses. If you have a higher Gross Profit percentage than your competitors and your industry provides healthy Gross Profits, your business has a greater ability to absorb overhead expenses (i.e., spend money) than do your competitors.

This greater ability to absorb overhead expenses can provide you with many options, for instance you could:

  • Invest more in your Marketing and Sales area to generate additional revenue
  • Expand your business
  • Pay your employees more or provide more fringe benefits to them to increase their satisfaction and morale
  • Pay yourself more or increase your fringe benefits
  • Pay off business debts
  • Distribute more money to the owners of your business

With enough Gross Profit, you can do almost anything!

“This Does Not Apply to Me”

Small Business Planning in Atlanta, GASome business owners may be thinking “this does not apply to me” because we are a consulting, health care, internet marketing, etc. company and not a manufacturing, retail, or distribution business. The Gross Profit Analysis tool applies to all companies because unless you can magically produce your product (I am using the term “product” in the loosest sense of the term) your organization will incur some costs to produce its product. By properly calculating your Cost of Sales and Gross Profit you will obtain great insights into the efficiency and true Profitability of your business.

The mechanics of doing the above are quite straightforward; the only problem is that many businesses do not include costs that are truly Cost of Sales in the Cost of Sales section of their Income Statement, but instead treat these expenses as overhead expenses. The result of doing this is that the true operational efficiency of the business is distorted because its production costs are not being reflected in the most insightful manner.

Performing a Correct Gross Profit Analysis

To have accurate financial statements with which to perform a correct Gross Profit analysis, go through your Chart of Accounts overhead expense section and reclassify any accounts that should be Cost of Sales accounts. Then re-produce your Income Statement and re-do your Gross Profit Analysis.

In summary, by using Gross Profit as an analysis tool you will gain insights how you can minimize your Cost of Sales, which thereby maximizes your Gross Profit. When this is coupled with keeping your overhead costs under control you will improve the profitability of your business, provide more flexibility and reduce your need for financing.

If you need assistance in using Gross Profit Analysis in your company to maximize your profitability please contact us using the below information so we can show you how to use this tool to take your business where you want it to go.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220

April 2017 Newsletter – The 5 Tools for Taking Your Company to the Next Level

The 5 Tools for Taking Your Company to the Next Level

Recently I met with a client who has a multi-million-dollar company, regarding the future of their business. Over the past few years they have tripled their revenue and they have big plans to take their organization to the next level.

As we discussed their plans, the close interrelationship between a company’s Marketing and Sales area and its Production area became very clear. In our Business and Innovation consulting firm, Fountainhead Consulting Group, Inc. we refer to this relationship as “talking a good game, versus playing a good game”. Furthermore, it must be recognized and understood is that there is a chicken-and-egg syndrome between your Marketing and Sales area and your Production area.

Seizing Economic Opportunities

Currently there is a lot economic opportunity in the world and this is reflected in a high degree of optimism for growth in the minds of many business owners. To avail Small Business Planning in Atlanta, Georgiaoneself of these potential rewards, it is wise to consider whether a company is ready go to the next level.

The Structure of Success™ methodology and diagram that we use in working with organizations shows that the Vision and Leadership area of your organization leads to your Marketing and Sales area, and that in turn leads to your Production area – how you produce your product or service. A foundational component of both your Marketing and Sales and Production areas is determining and fully developing the attractiveness of your product or service in light of the opportunity that is presented to you via your target Marketing and Sales market.

Marketing and Sales/Production Chicken-and-Egg Syndrome

The above chicken-and-egg syndrome comes into play because – how do you know what you can bring to the marketplace with regards to the attractiveness of your product or service, (talking a good game) without first working on your Production area to determine how you plan to follow through and actually play a good game?

In reality, it is your expertise in delivering your product or service that should drive your Marketing and Sales area. This requires an organization to figure out how it will meet its greater customer’s expectations before it engages in the effort to create these increased demands via its expanded Marketing and Sales efforts.

Taking Your Company to the Next Level

Small Business Planning in Atlanta, GeorgiaWhile it is easy to say “oh yeah, we can take our company to the next level”, a prudent business owner and their management team should do a thorough assessment as to whether they have the systems in place to handle the anticipated growth. Using a baseball metaphor, does the company have the systems and personnel in place to move from “A” ball, to “AA”, to “AAA” and maybe on to the Major League? Can you realistically compete with the other teams (your competition) in the new league in which you want to play?

An evaluation of your Production area involves reviewing your capabilities so you can figure out a go-forward game plan. There are five areas that should be evaluated, namely:

  1. Your Product Cost/Price

Will scaling your business develop a production cost advantage that will enable you to sell your product or service at a lower price than your competition? If this part of your growth strategy, have you done customer surveys regarding pricing to determine whether it is a significant buying criteria?

 2. Your Product Quality

In taking your company to the next level, can you maintain or develop a superior quality product? Or is there a risk that the quality of your product or service may degrade as a result of growing your company?

3. Your Delivery Time or Convenience

The third factor to consider is whether your growth plans will improve your delivery time (via a faster production cycle) or make you more convenient than your Small Business Planning in Atlanta, Georgiacompetition (more locations or closer to your customer)? Before embarking on a strategy to improve one or both of these areas, it is critical to have done customer surveys to determine whether getting your product or service more quickly or more conveniently is a significant buying criterion?

4. Your Customer Service

You need to assess how your customer service will be impacted by your growth plans. Do you have the systems in place to maintain your current level of customer service or could you provide even a higher level of customer service by improving your systems and personnel?

 5. Your Product/Service Uniqueness

The final question to ask is whether your plans to scale you company can produce some unique feature of your product or service? This uniqueness could manifest itself in several ways. Through increased R & D, could you develop products that have patent or copyright protection? Or, could you develop a design feature that makes your product or service different from your competition?

To assure yourself that your organization is ready for and capable of your desired growth, Production systems must be put in place that will either maintain or improve the above five areas. Otherwise, the organization’s reputation will be undermined as a result of expanding its marketing and sales efforts (“talking a good game) without first putting the necessary ingredients in place to “play a good game”.

If you need assistance with getting your company ready to go to the next level, please contact us using the below information so we can show you how to create a strategic competitive advantage for your company as a result of properly evaluating the above five areas and then translating them to your Marketing and Sales efforts.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220                                             

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

March 2017 Newsletter – 5 Steps to Beating Your Competition Through Branding

5 Steps to Beating Your Competition Through Branding

Do you want to generate ever increasing profits in your business? Would you like to separate your business from its competition and eliminate comparison shopping? Wouldn’t it be great to have instant name recognition for your business?

You can obtain all of the above and more by developing a powerful and attractive brand for your business!

The Importance of Branding

The textbook definition of a brand is the name or symbol used to identify and distinguish a specific product or business. A brand is the overall image or Small Business Planning in Atlanta, Georgiavalue statement you are trying to create in the market for your product or business.

But, why is having a brand image important?

Developing and communicating a brand reduces the perceived risk to your customer of making a purchase decision. With a strong brand identity, your customer feels that your product or business has a known identity, thereby reducing the uncertainty and risk they face compared to purchasing another product.

We see the substantiation of strong brands in the 2016 study by Brandz of the Top 100 Most Valuable Global Brands. Some of the top brands were Google, Apple, Microsoft, AT&T, Facebook and VISA and as a result they are able to dominate their respective marketplaces and achieve the aforementioned results.

The Results of Branding

As companies focus on developing their brand identities one can see the results right in front of them, particularly when they incorporate an impactful and memorable tagline into their brand.

For instance, Arby’s restaurants has developed “We have the meats” into great name recognition. The Sandals Resorts brand of “luxury included” communicates that it provides serene blue water, white sand and casual fun in the sun. Lastly, regional fast-food chain Zaxby’s has developed the brand of a having fast-food experience that is cut above other fast-food chains with great food images in their commercials and the tagline that their food is “indescribably good”.

How would your life be different if you could charge a premium for your product (I will use the term “product” to include services in this article)? Additionally, people want to work for an organization that is going places so what would it be like to have employees jump at the opportunity to work for your business?

The Benefit of Successful Branding

Small Business Planning in Atlanta, GeorgiaYour brand (defined as “the name used to identify and distinguish a specific product or business”) starts with psychological connection to your market and continues on to the actual experience that a customer has with your product or business.

The psychological brand identification is created in the mind of your target audience by your marketing program; its intention is to create the expectations in your customer’s mind that your product’s quality surpasses or is better suited for their needs than that of your competitors’. The experiential aspect includes the combination of all interactions with your business or its product. This is what is known as their “brand experience.”

The Power of Branding

Having a recognized brand is one of the most beneficial and powerful elements in your marketing plan providing unique marketing opportunities to your business and your product.

The power of branding is that it sets an expectation in the mind of your customer of what they will experience with your product or business.

A brand is the overall image or value statement you are trying to create in the marketplace for your product or business. It is what you want to be known for. Your brand should be what you are famous for; such as having the best hamburger in town or phenomenal customer service.

If this expected experience becomes a known commodity in the marketplace you will be able to catapult your product or company ahead of your competition. The ultimate level in branding is that you are perceived as the only one that does what you do, thus eliminating all of your competition.

Branding is for Organizations of All Sizes

Bear in mind that you don’t have to be a big business to develop a brand. Branding is available to any business – it is just the size of brand area that Small Business Planning in Atlanta, Georgiachanges. The scope of your brand could be your city, county, region, state, section of a country, the entire country, or worldwide.

Let me share three local brand success stories in the North Atlanta area where I live.

  • Alpine Bakery developed a reputation for exquisite desserts, expanded to a much larger location, and started a companion, co-located restaurant, while still supplying desserts to various other restaurants.
  • A local restaurant developed the image of an upscale diner with a very impressive menu, desserts to “die for,” and a unique logo to establish a string of diners – Diner at North Point, the Diner at Sugar Hill, etc.
  • Reliable Heating & Air used its great reputation, marketing savvy, and brand message to expand into plumbing, electrical and home performance, all branded with the “Reliable” name.

Five Steps to Developing Your Brand

There are five steps to fully developing a brand:

  1. Determine your intended brand identity
  2. Validate your brand identity by asking questions of your prospects and customers such as:
    1. What do they think when they hear about or see your business or product brand?
    2. How do they describe your business or product brand to others?
  3. Fully develop your branding by making changes to your brand based upon step 2.
  4. Determine how you want to communicate your brand to your target audience.
  5. Implement the marketing and promotion of your brand throughout all of your marketing materials and efforts.

Begin today to build your brand recognition by analyzing your business’ strengths and weaknesses and the message you are currently communicating to your market. Then make the necessary changes so that your target audience has a positive brand image of your business firmly etched in their mind.

In this way, you will create a business that can charge a premium for its products, grow its profits, differentiate itself from its competition, gain instant name recognition, and attract good employees. Who knows? You may grow your brand reach to your county, state, country or the world in a few short years.

If you need assistance with fully developing your Brand Image, please contact us using the below information so we can show you how beat your competition and separate your business from the rest of the pact via your Brand Strategy.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220                                             

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

February 2017 Newsletter – Creating Experiences Worth Repeating for Your Customer

Creating Experiences Worth Repeating for Your Customer

While at an event recently, I was talking with a Senior VP of Marketing of a Fortune 1000 company and the topic of keeping customers satisfied and happy came up. They went on to share their company was so committed to building long-lasting customer relationships that several years ago they hired a VP of Customer Relations to be the “voice of the customer” within their company.

Shortly thereafter, the actual VP of Customer Relations joined our conversation. As we chatted I shared that our firm has done a lot of work in the area of Customer Experience Improvement and that we described the objective that organizations should shoot for as – Creating Experiences Worth Repeating™. That is, you want to create experiences for your customer that are so good, they can’t wait to do them again. That is how repeat sales and customer referrals are generated.

In working with customers, the most important action is to meet or fulfill their perceived need. However, almost as crucial is the overall experience they have in interacting with your organization.

Satisfying Versus Unsatisfying Experiences

We have all had many experiences where our wants or needs were met, but the overall experience ranged from less than desirable to awful.

The fast food restaurant that was anything but fast, although we did eat. The car repair that cost us more than the car was worth, though the car now runs again. The home repair job that had to be repaired another time. The vacation experience that was anything but relaxing. The tool or appliance purchase that was a trying experience. The meal at a fine dining restaurant that was not a great experience – food but not much else.

Think back to the last time that on a 1 to 10 scale, you personally as a customer had a 10 or even an 11 experience. How did you feel? Did you tell others about the company? Did you become their advocate, not just their satisfied customer?

An Incredible Customer Experience

In working with one of our clients several years ago they shared an incredible example of Creating Experiences Worth Repeating™.

I live in Atlanta, Georgia and a couple of years ago we had a summer with a number of days over 100 degrees (which is very, very unusual for us). So people’s air conditioning was regularly breaking down.

One of our clients is a very large HVAC company and one of their sales people was out completing an order for a man in the hot sun one afternoon. As the sales person was finishing up the order, an elderly neighbor came running across the street saying something empathically – so the sales person thought “this is just what I don’t need.

As the neighbor approached them he said “you have to buy from who I got mine from”. As it turned out, the neighbor had bought their air conditioner from the same company – our client’s company. The sales person was greatly heartened.

Our client had created an Experience Worth Repeating for the elderly neighbor that was so good, that on a blazingly hot day he would run across the street to say – you have to buy from the company where I got mine from!

Five Ways to Improve your Customer’s Experience

Small Business Planning in AtlantaHow do you go about Creating Experiences Worth Repeating™ for your customer?

Your organization must build this in from the core of your offering. It must be engineered in. It cannot just be something that you add as a veneer or is an after-the-fact add in – to try to create a nicer customer experience.

Listed below are paths you can use to move your company towards Creating Experiences Worth Repeating™ for your customer:

  1. Ask your customers and then actively listen to what they say they want and how they want to receive it. Many times companies just don’t want to hear the reality of how they are doing.
  2. Be your own customer. Call into your company and pretend to be a prospect. What is your experience like? Purchase your own product and see what your overall experience is like. Put yourself in your customer’s shoes.
  3. Use focus groups, customer panels and research tools to try to get inside your customer’s mind as to what they want their overall experience to be.
  4. Ask your employees who directly interact with your customers what they think can be done to improve your customer’s experience. If you do this in a sincere and open way they will give you tons of ideas because they see what your customers want on a daily basis.
  5. Take a step back and ask yourself “how ought the world work with regard to my customer getting their need met?” That is, from their point of view, what would an ideal customer experience look like?

If you need assistance with Creating Experiences Worth Repeating™ for your customer please contact us using the below information so we can show you how create experiences for your customer that are so good, they can’t wait to do them again – resulting in repeat sales and customer referrals.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220                                             

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

January 2017 Newsletter – The 5 Essentials for Achieving the Goals for Your Company

The 5 Essentials for Achieving the Goals for Your Company

Recently I was talking with a company President and they shared that 2016 had been a record year for them in terms of Revenue and Profits and that things had really come together for them in 2016. But they went on to express their concern for breaking those numbers in 2017.

As I reflected on their concern I realized the more basic question is, what is the necessary ingredient in a company to cause leadership, management and staff to keep trudging up the hill to bigger and greater achievements year after year?

My experience is that this one ingredient is having a “compelling” Vision for where you want to take your company.

However, in some organizations developing or having a Vision, is just something to “check off the list”. It can just be a “yep we did that” thing versus developing and operating based upon having a “compelling” Vision that engages and motivates your entire company on a daily basis.

Definition of a “Compelling” Vision

Let’s break this concept of a compelling Vision into its two components. First the Vision portion:Small Business Planning in Atlanta, Georgia

Vision is the direction or destination of where you want to take your organization. In other words, what does a successful and thriving business looks like to you? This is cannot be a pie-in-the-sky Vision, but a concrete, specific, and detailed description of what you want your company to look like.

Second, “compelling” means that your Vision is so attractive, captivating, and engaging that people are drawn to it.

For instance, Google’s overall Vision is to “organize the world’s information,” and the results of this it can be easily seen in the many game-changing products they have introduced. Likewise, because of their compelling Vision, Google is one of top businesses with regards to employee productivity, and it is one of the most desirable companies for which to work.

There are five audiences for your Vision. A “compelling” Vision for your organization should impact each of these audiences in the following ways. It should be:

  • Crucial to Customers
  • Essential to Employees
  • An Outstanding Opportunity to Owners and Investors
  • Significant to Suppliers
  • Supportive to Society

Crucial to Customers

Small Business Planning in Atlanta, GeorgiaYour customer must feel that by dealing with your business they will increase their likelihood of success. Your Vision statement must clearly and unequivocally state the “win” they will receive by dealing with you and by being your customer. They must see that not only are you useful to them, but also that:

  • Your product/service is better at meeting their perceived need then your competitor’s product/service
  • They can trust you to deal with them in a desirable manner
  • The value that they will pay you for your product/service is worth the resulting benefit

The words, word pictures, and images from your Vision Statement of how your business will fulfill a customer’s perceived needs is the most important part of any organizations’ Vision.

Most of us have heard that word-of-mouth advertising is the most effective form of advertising for any business. In order for a customer/client to be an advocate for your business they have to feel that they have entered into an ongoing “win/win” relationship with your organization.

A customer recommending you is much more powerful than you trying to sell yourself to the potential customer— because unlike you, your advocate has less to gain from the experience. You can only create customer-advocates by identifying their needs, exceeding their expectations, and in this process delivering something that they consider to be very good value – which should be part of your compelling Vision.

Essential to Employees

Because a company needs employees to survive and grow, and employees need a business by which to be employed, there is mutually beneficial relationship between your organization and your employees.

Your employees’ engagement in your organization manifests itself in two ways. First, your employee must feel that by working for your company they are a partner with you in serving your customers. Therefore, it is necessary to cast a compelling Vision to your employees so they feel that they are part of something bigger than themselves.

Second, employees want to know you are taking care of them, giving them a fair deal, and in essence providing a “win” employment experience for them. Employees want to feel valued and be a partner with the organization’s “management” in fulfilling its Vision.

Consequently, your Vision statement must plainly and explicitly communicate what the “win” is for your employees. They must see how you plan to take care of them and meet their needs. If both of the areas are properly addressed and included in your Vision statement, then your employees will go the second and third mile for you and your customers.

An Outstanding Opportunity to Owners and Investors

Your company may start with you as the only investor but at some point you may need additional capital. Your Vision and consequently your Vision Statement must Small Business Planning in Atlanta, Georgiaentice people to invest.

Additionally, sometime down the road you may want to sell your company. Your Vision Statement should be compelling to potential future owners and investors.

Alternatively, if you are a publically traded company, your Vision should attract people and organizations to purchase your stock. Likewise, with a Not-for-Profit entity – its Vision needs to attract donors.

Keep in mind that part of the attraction of an investor to your organization is how Crucial to Customers and Essential to Employees is your Vision. So the first two ingredients of a compelling Vision have multiple roles.

Significant to Suppliers

An organization cannot exist without suppliers (vendors). Suppliers, in turn, need to have customers for their company to stay alive. Therefore, except in the case where a supplier is so large that you as their customer are insignificant to their revenue stream, there is a stakeholder relationship between your organization and its suppliers.

The goal is to engage your suppliers in such a way as to make them want to provide you with the best products/service and customer service.

I have found that when you communicate your organization’s compelling Vision to your key suppliers they will respond positively to big requests and sacrifices. This is because they can see how meeting your needs in more than just an average way will in turn enable them to achieve their goals.

Sharing your compelling Vision for how your company can allow them to achieve their goals will entice them to go the second mile for you because they can see how doing this will ultimately enable them to grow faster and be more profitable. Wal-Mart regularly does this with their suppliers and that is why its suppliers go the extra mile to meet Wal-Mart’s needs.

Supportive to Society

Small Business PlanningThe Vision for your organization should demonstrate how your company is now and will make the society in which it operates and the world in general a better place.

A company should not only want to achieve its internal goals, it must figure out and then execute the plan for how it will positively impact society. This includes determining and stating the tangible ways it will strengthen the society in which it exists.

Because of their size, the area of an organization being Supportive to Society is more important to larger companies because of their public profile and the need to be a “good corporate citizen”.

It is important to note that a significant part of being Supportive to Society is how well a company meets its customer’s needs and takes care of its employees. So the first two ingredients of a compelling Vision also have a key impact in this area.

If you need assistance with how to develop and implement a “compelling” Vision that addresses all five audiences of a Vision for your organization, please contact us using the below information so we can show you how to make this a reality for your company.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220                                             

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

December 2016 Newsletter – The Three Keys to Building Your Team’s Morale

The Three Keys to Building Your Team’s Morale

According to a recent Gallup report, How Millennials Want to Work and Live, almost two-thirds of millennial workers say they are not fully engaged with their employer’s mission. This sentiment is reflected the overall workforce as well.

A key to someone embracing a company’s overall purpose is the effective communication of an organization’s goals to team members and the related encouragement a person receives from management and leadership as they pursue the entity’s goals.

Penn State

Over the past three years and particularly during the 2016 College Football season I have been struck by how Penn State’s Head Coach, James Franklin modeled effective communication and encouragement to his team. Coach Franklin (BTW, I am not a Penn State Alumni and I am impartial regards to his team – but have only observed his remarkable leadership style) has had a dramatic impact on Penn State’s football program in that they just achieved a Big 10 Championship and a berth in the Rose Bowl – in only the three years since he arrived.

What is particularly noticeable about his leadership is how focused and under control he is during interviews, but how enthusiastic and congratulatory he is with his players on the sideline when they do something admirable.

So how does this apply to your organization?

As you lead your company, keep in mind one of a leader’s chief roles is encourage their personnel and be the cheerleader who makes their employees feel good about their efforts to achieve the goals and Vision of their business. This results in building high company morale. I would like to look at thee aspects of this.

I. Celebrating Successes

One of the most important aspects of encouraging your personnel is recognizing the progress that is being made towards the business’ goals. This is because people Small Business Planning in Atlantaneed to feel that it is worth their while to keep plugging away at the goal in front of them.

Having one-on-one chats, group meetings, and companywide events where the mile markers on the road to your organization’s goals are celebrated is a key to keeping morale high. A wise business owner takes advantage of every opportunity to encourage their employees by celebrating their business’ achievements.

Give Verbal “High-Fives” and “Hugs”

If you see Coach Franklin on the sideline he is regularly “high-fiving” and hugging his players as they come off the field after making a great play – and you can tell his players LOVE this. While giving someone a physical high-five or hug is not appropriate in most companies, alternatively, when was the last verbal “high-five” or “hug” you gave to one of your employees after they did something really great? Regularly doing this will instill within them the importance of their overall effort in making a difference in your Customer’s lives and the world.

A business owner that does not regularly and sincerely encourage their employees is missing a great opportunity to build company morale. The danger of not encouraging your employees is that they will get burned out, jaded, and discouraged which can lead to them not giving their best efforts in pursuit of your business’ goals.

II. Empowering Your Personnel

When viewed in conjunction with the above process of leading and encouraging your employees, the concept of empowering your employees is a very important part of your overall goal to keep morale high. How do you empower your personnel (both employees and contractors)? There are three steps, namely:

  • Developing and sharing a compelling Vision for your company with your personnel
  • Creating the organization that includes the Systems that is required to achieve your Vision
  • Providing the resources (e.g., equipment, Information Technology, personnel…) that are required in order to achieve the Vision for your business

Coach Franklin’s players have reported that they have bought into his Vision for the team and that he is very organized in the execution of his overall program and his detailed game plan. This results in them feeling empowered to great things.

The Secret is Doing All Three Steps

Please be aware that unless you do all three of the above, “empowering” your personnel can backfire. For instance, if you share your Vision to your personnel and create the organization required in order to achieve your Vision, but do not provide the resources that are required in order to achieve your Vision for your business, you will thoroughly frustrate your personnel and debilitate their spirits.

However, if you have properly developed and conveyed a compelling Vision and the related company goals to your personnel and then empower them, you will be amazed how people will respond to various challenges.

III. Abounding Optimism

Small Business PlanningAn integral part of moving your organization toward its Vision is that you as a business owner or leader must be optimistic and must communicate that optimism to your personnel.

If you see an interview with Coach Franklin, you will very quickly notice his optimism. The quiet confidence that he knows where he wants to take his football team and how to get there is unmistakable. And his players positively respond to his approach.

Likewise, if you look at virtually any truly successful organization and the leaders of that company, you will see that great leaders are always optimists. Having started and operated 9 companies I know that being the leader of a company is a daunting task that at times may seem to be overwhelming. But the special thing you as leader of your company bring to the table is your Vision, your dreams and goals for your organization.

However, on a daily basis your employees are on the firing line in your operations and they see all of your business’ warts – up close and personal. This can dispirit them and get them down. Therefore, they are sorely in need of the optimism that comes from you knowing where you want to take your company and how to get there.

If you need assistance with how to put encouragement to work in a practical way in your organization to elevate your team’s morale and performance, please contact us using the below information so we can show you how to make this new year the best ever for your company.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220                                             

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

November 2016 Newsletter – “Future Proofing” Your Company for 2017 and Beyond – Part II

“Future Proofing” Your Company for 2017 and Beyond – Part II

We have all been there – you are out of the office using your Smartphone, Tablet or Laptop and you want to print something. But lugging a bulky printer with you is not feasible.

Enter a company named Zuta Labs, which recently introduced new mobile, robotic printer (that ships in early 2017) the size of a baseball which enables people to print anywhere and on any size paper!

They used the concept we introduced in the October Newsletter of “How Ought the World to Work” to develop an ideal solution to printing something when you are out of the office.

They reasoned that printers are essentially a print head running back and forth on a moving piece of paper, so let’s reverse the process. Let’s place a print head on a set of small wheels and let it move across a sheet of paper, thereby allowing a printer to become tiny.

The Initial Four Steps in “Future Proofing” Your Company

Last month we looked at how to “Future Proof” your company for 2017 and beyond by fostering visionary thinking. This involves moving past theSmall Business Planning

constraints of your current operations to embrace a future that is very different from today. We examined four components of this open-ended, re-conceptualizing process:

  1. To start to develop “ideal solutions” you must get inside your customer’s heart and mind to fully understand what your Customer’s needs are and how they sense these needs
  2. Then utilize the concept of “how ought the world to work” for your customer to create ideal solutions for your customer’s need
  3. During this process do not limit your possibility thinking, but start from a totally unconstrained point of view so that you think outside the box
  4. The goal of this process is to generate multiple “ideal solutions” that provide you with an array of options, which may include variants of some ideal solutions

Let us now examine the remaining four steps of “future proofing” your company.

Narrow your ideal solutions to a certain price level or target market

The fifth step is to narrow your ideal solution down to the best solution that can be provided at a certain price level or to a particular market that has pricing constraints. Keep in mind that you are still ignoring your current business in this process and are not taking into account how you currently operate.

Let us look at an example of this narrowing process. Say that you are a mid-priced cruise ship line, and you are completing this re-conceptualizing process. In this step you will evaluate various ideal solutions at a mid-market price level, not a luxury cruise line price level. During the previous steps, you should consider all the ways you could better serve your customer, no matter what the cost, even if a certain idea or option does not fit in your pricing range as a mid-price cruise line. This is because during this step you may be able to modify an idea that is too expensive to provide an improved solution to your current customer within various pricing constraints.

Bear in mind as you are completing this exercise, the absolute best solution you can provide to your customer at a certain price level may change over time with advances in technology or changes in the environment, energy, social, or political arenas affecting your market.

Decide what you are willing to change in your business to provide an improved solution to your customer

Small Business Planning in Atlanta, GeorgiaThe next step involves coming back to the real world and considering where your organization is currently at, and starting to visualize how your business could provide this ideal solution. This stage requires you to look at the personality of your company and its available resources in the context of being able to produce and deliver this ideal or perfect solution. This step also requires you to assess how willing you are to possibly change your entire company philosophy, business model, and operations to be the source of an ideal solution to your customer’s need.

The above process of envisioning, consideration, analysis, and deliberation should lead you to make decisions about how far you are willing to go in the process of creating an ideal solution to your customers’ needs. This phase automatically yields a continuum of options that are available to you as a business owner. You could choose to make the commitment to totally transform your business to be the provider of the ideal solution for your customer (which may also require you to transform your Delivery Channel). Alternatively, you could choose to do nothing at all. Or you could choose to do something in between. Included in this continuum of options are various incremental approaches to moving your current solution toward the ideal solution.

Develop the systems to deliver the improved solution

The seventh step involves determining what systems would need to be changed within your company to deliver the improved solution to your customer. This analysis requires you to consider, design, implement, and perfect the methodologies that will be necessary for delivering this new solution to your customer.

To supply this more desirable solution to your customer, you must engineer into your systems the quality and other attributes that your improved product must contain so that your business can produce the product. By concentrating on the optimization of the system that will be used to provide the new ideal product, you will as a consequence perfect both the product and the system that provides it.

Identify other changes you need to make in your business to provide the solution upon which you have decided

The last step in the re-conceptualizing process is to take a step back and consider what other things in your organization you may wish to change in Small Business Planning in Atlanta, Georgiaconjunction with providing an improved solution to your customer. To do this, once you have decided on what improved or ideal solution you will be providing, then re-examine your company’s Critical Success Factors to determine if any of them require updating.

If your re-conceptualizing process results in your entity basically continuing in the same direction as it has been going, then most likely you will not have to revise your Critical Success Factors. However, if you are making any substantial change to the direction of your business as reflected in its Vision, then most likely you will need to evaluate and possibly modify your Critical Success Factors and Strategy components.

Just like Zuta Labs did by developing a mobile, robotic printer which enables people to print anywhere and on any size paper, by using the concept and process of “how ought the world to work” to create ideal solutions for your customer’s need, you will be able to “Future Proof” your company.

If you need assistance with how to use this concept of “how ought the world to work” to transform your organization, please contact us using the below information.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

October 2016 Newsletter – “Future Proofing” Your Company for 2017 and Beyond – Part I

“Future Proofing” Your Company for 2017 and Beyond

Recently, industrial heavyweight companies Fujifilm and Hitachi announced plans to incredibly change the future of their respective companies by significantly investing in the area of Stem Cell research and development. These are marked departures from their traditional areas of focus.

In their announcement they said while Stem Cell research and development is a small sector now, it is expected to grow in Japan to $950M by 2020 and to $120B worldwide by 2030. This is a bold move based upon their view of where the world is going and their Vision for how they want their companies to look like in the future.

How does an organization foster such visionary thinking? How can a leader move past the constraints of their current operations to embrace a future that is very different from today? I call this open-ended process, re-conceptualizing a business.

“How Ought the World to Work”

I have found that a great way to jumpstart the re-conceptualizing process is to reflect on or ponder about “how ought the world to work” in the context of Small Business Planning in Atlantathe environment in which your business operates. This involves focusing on your Customer and envisioning the best way they could have their need met (i.e. how ought the world to work from the standpoint of their need?)

At the beginning of your re-conceptualizing process, absolutely do not limit or consider the meeting of your Customer’s needs in the context of how your existing business operates. In fact, it may be helpful to pretend that your business does not even exist! In essence, imagine in a perfect world the best possible way that your Customer’s goals could be met.

One of our clients, a Physician recruitment and Physician office training company, used this unconstrained view of their company to begin the process of re-shaping their organization into an online Portal for all things related to operating a Physician Office practice.

How Would an Ideal World Operate?

This step will require you to expand your thinking and develop your thoughts regarding how an ideal world would operate pertaining to your market and your Customer’s needs being fulfilled. In imagining how ought the world to work or operate, it may be useful to reflect on the “true values” of life, the “truths of life,” the entire concept of excellence, and how excellence would be manifested in your market.

Here are ten innovations from 1995 to 2010 where someone asked – What is the best way that our customers’ needs can be met?

  1. iPod
  2. YouTube
  3. Smart phones
  4. Groupon
  5. Facebook
  6. All-electric cars
  7. Civilian hypersonic aircraft for space tourism
  8. Apps for smart phones
  9. Civilian use of GPS

An Unconstrained Point of View

Small Business Planning in AtlantaTo properly complete the re-conceptualizing process, you must first examine and determine the ideal solution from an unconstrained point of view – you want to think outside the box and not limit your possibility thinking. By thinking about all the various options that could meet your Customer’s needs, you will be able to generate the greatest number of options, possibilities, and alternatives for enabling your Customers to achieve their goals.

While some of these ideas may be unrealistic from a technical standpoint or pricing perspective, the ideas will spawn other ideas, thoughts, and concepts that may be more practical. One way of looking at this step is that it is a uniquely targeted method of brainstorming related to what you can do with your business. The outcome from this uniquely constructed method of brainstorming is then eligible to become your renewed Vision for your business.

Generate Multiple “Ideal Solutions”

Please remember that the above process may not yield just one ideal solution; it may present multiple ideal solutions. In fact, this exercise of looking at how ought the world to work may provide you with an array of options, which may include variants of ideal solutions. At this point in the exercise, do not let your possibility thinking be constrained by costs to deliver or price points in your market; the goal is to develop as many excellent ideal solutions as possible.

An example of this is when one of our clients, a large HVAC company, went through this process they ended up with several very different options for moving forward. They allowed themselves to fully flesh out each one independently and once they had considered the advantages and disadvantages of each one, they choose one that over the past 8 years has generated a 10-fold increase in revenue.

Get Inside Your Customer’s Heart and Mind

Keep in mind that to fully understand what your Customer’s needs are and how they sense their needs, you must get inside their hearts and minds. To Small Business Planning in Atlanta, Georgiafully comprehend your Customer’s needs, you must understand and address their perceived short-term, intermediate, and long-term goals, and the related emotional state that they perceive they want to be in as a result of achieving their goals.

This entire concept of getting inside your Customer’s heart and mind is the foundation of preparing for 2017 and beyond because the world is changing and changing fast and your organization must be ready for these changes.

In next month’s Newsletter, I will cover the remaining four steps of “future proofing” your company by looking at how ought the world to work.

If you need assistance with how to use this concept of “How ought the world to work” to transform your organization, please contact us using the below information.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy™ and FastTrak Innovation Program™ methodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

September 2016 Newsletter – Seizing the Opportunity to Triple Your Revenue

Seizing the Opportunity to Triple Your Revenue

Last month we examined a major force in the business marketplace – the threat of “disruption” and how to overcome it by creating game changing innovations within your company.

This month I would like to look at the flip side, the incredible opportunity being presented to virtually every company or organization in the world.

Unprecedented Middle-Class Growth

According to a number of experts, including Brookings Institution scholar Homi Kharas, the worldwide middle class will increase from 1.8 billion to 4.9 billion people by the year 2030. This increase will mainly occur in Asia and India, however significant middle-class growth will also take place in Central and South America, the southern fringes of Asia, Africa and the Middle East.

According to organizations like the United Nations and the Organization for Economic Co-operation and Development (OECD), currently middle class is defined as someone who earns or spends $10 to $100 per day – depending on the local cost of living.

At that point a person has enough disposable income to purchase consumer items like smart cell phones, microwaves, upscale clothing or consider buying a car.

As the UN suggests, the growth is being driven by industrialization and the globalization of the economy. The industrial revolution of the 19th Century and globalization of the economy in the second half of the 20th Century transformed the economies of much of the world. As this continues, the move from agrarian to industrial societies in other countries will generate income increases that will create enormous groups of middle class consumers.

Why This Matters to You

But what does this mean to you?

It means that there will be consumers everywhere in the world, not just in your current country. Business Small Business Planning in Atlanta, Georgiaopportunities will explode. This explosion in the middle class and development of the transportation and related systems necessary to get goods to them will enable you to sell products worldwide.

For service companies the demand for and infrastructure (i.e. the Internet) required to deliver them will allow you to provide services anywhere on the Earth. The unprecedented opportunity to deliver medical services globally will raise the standard of living and improve the health of much of the world.

Tourism will explode because many more people will have the time and money to see areas outside their local geographies. That is why there has been a recent binge in airlines buying planes – they know this travel explosion is coming.

The bottom line is that the Internet and globalization are changing everything!

As long as trade wars and major disruptions from terrorist attacks can be avoided, the future of the world and growth opportunities this presents for businesses looks very inviting.

Innovation is the Key to World-Wide Growth

So how does a company get across the chasm of threats from disruption to the land of 21st century opportunity? By applying innovation to itself to develop a much larger, even a global footprint.

To do this, closely consider what your organization currently does and then examine how to take advantage of this nearly tripling of the world-wide middle class? That is, how can you tap into consumers across the world? What actions can you take to start selling your products in other countries? Where do you need to begin to become a global services company?

Small Business Planning in Atlanta, GeorgiaAdditionally, how could you go about delivering medical products and services across borders? What steps could you take to avail yourself of the explosion in world-wide tourism and related services occurring? Where could you begin to use the Internet more fully to reach this global market?

At the core of all these opportunities is the need for and call for innovation. Once the above opportunities have been deeply considered, then closely examine your company to determine how you can apply innovation to it to take it to the next level.

Ways to Go Global

Increasingly, there are more and more Federal, State and Regional organizations that can help you expand internationally. Also, many Industry Organizations offer assistance with taking these steps.

Alternatively, instead of taking the actions by yourself, you could partner with another company in your country that is already doing business overseas.

Another tactic to utilize is to contact foreign companies doing business in your geographic area and provide innovative services to them as your customer. Once they are pleased with your products or services, ask them if they could facilitate you doing the same for their operations in other countries.

If you are already operating in foreign lands, use this new-found understanding of the upcoming middle-class growth from 1.8 billion to 4.9 billion people to ignite your commitment to fully embracing the company-wide innovation that will be necessary to avail yourself of this opportunity.

By taking these steps you will be able to grow revenue, attract new customers, and generate more profits.

If you need assistance with how to use innovation to grow your global presence, please contact us so we can show you how to do this by using innovation to transform your organization.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve their goals by using our unique, comprehensive and systematic, innovation, business planning and growth Structure of Success™, Innovation Academy and FastTrak Innovation Programmethodologies. Using the components in these methodologies, each month we examine an aspect of how to transform your business or organization into a true 21st Century operation.

Office phone: (770) 642-4220

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com

August 2016 Newsletter – Is Economic Disruption Knocking at Your Company’s Door?

Is Economic Disruption Knocking at Your Company’s Door?

Various thought leaders say we have moved from the Information Age to the Innovation Age and companies that innovate faster than their competition will be the future winners. We see that all around us. New innovative companies are springing up almost overnight, while other, more established organizations are struggling to survive.

Disruption

A key component of this new Innovation Age is “Disruption”, which has become a major force in the business marketplace. What is disruption?

According to innovation expert, Clayton Christensen, disruption is caused by an innovation that so completely changes an existing market so as to displace established market leading firms or totally unbalance existing products and alliances. Below are some examples of disruption:

  • The cell phone/camera disrupted Kodak basically out of business
  • Internet video streaming and companies like Red Box and Netflix killed once venerable Blockbuster Video
  • Online retailer Amazon has created massive problems for retailers with physical stores
  • The new Apple Watch threatens to disrupt the personal medical equipment industry
  • Uber has disrupted the taxi cab and shuttle bus marketplace

“Disruption Won’t Affect Me”

But you may be thinking, “disruption won’t affect me, it only affects big companies”. A very interesting article by Geoff Small Business Planning in Atlanta, GeorgiaColvin, Senior Editor-at-Large of Fortune Magazine said even if your model has worked for decades, even if it’s working okay right now, odds are that soon it won’t be. Business models are suddenly becoming obsolete, almost in the blink of an eye. Below are some industries that are currently facing disruption:

  • Education industry – With the advent of Massive Online Open Courses (MOOCs) and the internet in general, the education industry is wrestling with how they can lower the cost of learning and provide greater value in an increasingly competitive industry
  • Banking – In talking with various banking executives they are very concerned about the explosion of non-traditional banking options including Apple Pay and Android Pay. Many concede they could be out of business in the next 20 years from these upstart companies
  • Music – Artists are able to by-pass the traditional recording industry and release and manage their music themselves which has thrown a big monkey wrench in the recording industry’s business model

Disruption not only affects large companies, it impacts smaller and mid-sized ones. For instance, one of our clients is one of the oldest sod companies in the state of Georgia and they are facing disruption due to new organizations that are buying up small sod operations, consolidating them, and deriving cost savings and efficiencies from combining them. They are then cutting the price on sod and using social media and other mass advertising to increase their sales volume. This is proving to be a huge challenge for our client.

Two Possible Responses to Disruption

There are only two possible responses that an organization can opt for in the face of this looming challenge of disruption. First, just put one’s figurative “head in the sand”, ignore the disruptive forces, and hope they just go away. Second, acknowledge the disruptive influences, stay abreast of their ongoing development, and embrace one’s own use of innovation as a counter offensive. This second strategy involves trying to overcome the tidal wave of disruption battering a business by the company itself creating game changing innovations.

If an organization did follow this second approach, how would this impact the company? Obviously the innovations would form a bulwark against the disruptive effects and allow it to grow revenue, attract new customers, and generate more profits.

But there are additional benefits to doing this. If an innovative environment is developed, just like Amazon, Zappos Shoes and Google have done, your employees couldn’t wait to get to work each day. Or you could end up being like Apple, whose customers will buy its new products “sight unseen”, and customer loyalty could become your company’s greatest asset. You could establish an exciting, fun and rewarding business to come to every morning. An organization in which every one of your employees becomes a fountain of innovation.

There are three primary steps that can be taken to foster an innovative environment:

Proactive Leadership is a Main Ingredient for Innovation

Small Business Planning in Atlanta, GeorgiaYour employees need to know that innovation is important to your organization and that you want them try to develop innovations. A leader’s role should be to articulate, support and promote innovation. This results in clarity of objectives, an emphasis on staff participation, and nurturing of innovation. The goal of this leadership is to establish a creative environment within your organization.

Active leadership is a main ingredient in creating an environment where innovation thrives. The need for innovation has resulted in a new focus on the role of leadership in shaping the nature and success of creative efforts. Studies show that an innovative climate is positively correlated to the presence of proper leadership.

A leader should challenge their followers to take ownership for their effort and its outcome, thereby causing the staff to align and regiment their daily activities with the company’s overall vision.

The proper leading of an organization’s innovation initiative contributes to both idea generation and idea implementation. Using patent awards as a measure of innovation, studies have shown that proactive leadership was linked to effective innovation and the support and development of new ideas.

Develop a Strategy for Innovation

An organization should develop a strategic, long term approach to innovation by looking outside itself to determine what markets, sectors, applications, product types, and technologies have significant growth potential. Ideally, these areas are at least somewhat adjacent to existing markets in which it currently participates.

Then an assessment can be performed to determine the company’s core competencies. This includes identifying the unique capabilities of the business that can be leveraged to advantage in other markets, applications, and sectors. The goal is to work from an organization’s strengths and base of knowledge, as compared to starting from zero in an entirely new market of which nothing is known.

This is exactly what Corning did when it leveraged its knowledge in glass and related materials to create a product usedSmall Business Planning in Atlanta, Georgia for the flat LCD displays (for cell phones initially, then laptops and desk top monitors, and lastly for LCD TVs and larger displays). This type of thinking led to major innovations that were developed in each of Corning’s business sectors over the past decade, including the creation of four new product lines. These efforts literally turned the company around from having loses to huge profits.

Once the strategic areas for innovation have been identified, they should be communicated to the firm’s employees so that they know areas you want them to focus on. Thereafter, during the year leadership and management should provide encouragement to their personnel and share stories and examples how they have been successful with innovations in their areas of strategic focus.

Provide Training on Innovation

The third piece that needs to be put in place is innovation skills training for your staff. Training is necessary because people generally don’t recognize opportunities for innovation without education on how to think in such a way to spot these “golden nugget” ideas. Training should include on how to come up with ideas, which is called ideation, how to develop the ideas into innovations, and how to commercialize innovations.

This training should include how to use appropriate innovation “tools” because various innovation processes and tools have been developed to enable the effective and rapid creation of innovations. These tools include both hi-tech and low-tech items like standard development procedures and systematic testing processes.

Ideally, the training is provided in a live setting so that the participants can practice using the tools. Thereafter, an intranet portal can be made available to provide employees with ongoing learning and innovation skill set development.

Part of the innovation education initiative can also utilize specially trained internal innovation mentors to keep people on track with their efforts. Also, bringing in outside experts can speed the entire innovation process.

By taking these steps you will be able to overcome the disruptive influences that may be threatening your company and enable you to grow revenue, attract new customers, and generate more profits.

Additionally, by taking these actions you will create an innovative environment where your employees can’t wait to get to work each day, customer loyalty could become your company’s greatest asset, and every one of your employees becomes a fountain of innovation. As a result of this you would establish an exciting, fun and rewarding business to come to every morning.

If you need assistance with how to use innovation to overcome potential disruptive forces in your marketplace, please contact us so we can show you how to do this by using innovation to transform your organization.

Fountainhead Consulting Group, Inc. is an Innovation and Business Planning firm. During the past 17 years we have shown over 1,200 companies how to achieve the goals for their business by using our unique, comprehensive and systematic business planning and growth methodology, the Structure of Success™ so they can Work Less, Make More and most importantly Have Fun in Their Business. Using our Structure of Success™ methodology each month we examine one of 12 areas of a business or organization.

Office phone: (770) 642-4220

www.FountainheadConsultingGroup.com

George.Horrigan@FountainheadConsultingGroup.com