A marketing epidemic, to put it mildly, has been impacting most businesses — and it’s time to think about keeping your message simple if you haven’t already done so.
The roots of this epidemic can be traced back to two events.
First, during the economic fall of 2008, as businesses looked for ways to preserve revenue streams, companies hunkered down and focused on sales to preserve existing customers. Many cutoff or significantly reduced marketing budgets, and others shifted to digital media as a “low-cost alternative.”
The second event was the rapid spread of social media and the skyrocketing use of smartphones and tablets, which provide instant access to relationships, information and communication.
The social media craze and businesses’ desire to market on the cheap led companies to flood the marketing channels with content. Sales sheets, photos, videos, web pages — companies were suddenly all things to all people because they could push content to digital channels for “free.”
The problem — our marketing channels are now very noisy. As consumers of information, we respond to this noise with limited attention spans. The result — companies have sent confusing messages to the marketplace and people aren’t listening.
This current epidemic of marketing noise distributed across all channels leads to a common marketing need for all businesses — simplification.
Keeping it simple
So how do you achieve message simplification? It all ties back to the business. Here are seven steps to help get you started:
1. Identify three to four key business objectives for the next two years. Do you want regional growth or growth in a new industry? Do you want to sell more to existing customers?
2. Prioritize your objectives by placing dollars or number of opportunities next to them. This will help you focus on the most important areas.
3. Brainstorm a list of marketing tactics that can help you achieve each objective. Can you generate more leads from trade shows, your website, your existing customer list? What tactics do you need to adopt?
4. Write a succinct summary, or “elevator pitch.” This should be one to three sentences on how you benefit the people you are targeting in your objectives.
5. Compare your elevator pitch to your marketing tactics and existing materials. Review your website, brochures, email newsletter, social media accounts, videos, trade show collateral, etc. Notice how many “extra” things you say in an effort to cover all your bases.
6. Rework your message. Focus on the audiences for your key objectives. Identify the benefits for these audiences. Your marketing message should speak directly to these audiences so they can understand your value and usefulness to them.
7. Prioritize your marketing tactics. It’s tempting to be trendy and market on social media or through video, just remember to consider which tactics will best reach your audiences. You don’t need to be in every marketing channel, just the ones where your customers and prospects will hear you.
Finally, once you’ve simplified your message, stick to it! It is important so that people understand the benefits and value that you deliver. While it might seem repetitive to you, your audience will appreciate the clarity and with time, will remember what your business does best. ●
Kristy Amy is director of marketing strategy for SBN Interactive. Reach her at mailto:email@example.com or (440) 250-7011.
Life has a way of presenting us with difficult circumstances. Sometimes it’s in our personal lives, and sometimes it’s in our business.
If the circumstance is severe enough, it can create a crisis, which can often cause a feeling of hopelessness. When things outside your control come at you in droves, it becomes difficult to cope with them. Entire organizations can be overwhelmed and pulled down by external circumstances, which if not dealt with promptly and correctly, can destroy the company.
The CEO’s role is to right the ship and rally everyone around a solution — and it most likely won’t be easy. People are always looking for the easy way out, but that path is rarely an option. When facing a difficult situation, you have to play the ball where it lies, which means the resources you have in people, dollars or equipment are all you may have to work with.
But challenges also present opportunities. Faced with a crisis, you and your leadership team will be forced to look at your assets in new ways. You’ll be required to take a careful look at your customer base, your market and your processes. This kind of in-depth evaluation may uncover not only a possible solution to your problem, but it may open your eyes to markets or applications you never considered before.
Take Netflix for example. The company was the king of DVD-by-mail, and had already knocked off the once mighty Blockbuster. With the increase in streaming video content, however, customers began moving away from DVDs, threatening Netflix’s main revenue channel. It reacted by creating not only streaming content, but also by creating its own unique content. Customers can stream video from many outlets, but it’s tough to beat Netflix’s reputation and ease of use.
Often, the resources you need are already at hand; they just need to be used in new ways. Netflix already had the capabilities; it just needed to apply them differently.
You may find that after assessing what you have, you have started to create a new path that leads away from the crisis.
At the beginning of a difficult time, you may not be able to see a way out, which can lead to despair. By starting with an initial step and continuing, however, you’ll soon see the light. Start by calling your bank or suppliers to ask for better terms or whatever it is you need, and then build from there.
No matter what you do, though, don’t compromise your integrity. Always do the right thing in the wrong circumstances, because depending on how severe your crisis is, your reputation might be the only thing you have to negotiate with.
If you work hard, do the right thing and stay positive, a solution will likely present itself. It may not always be in a form that you anticipated — you may need to change your products or your market — but if you keep an open mind and work with what you have, everything will work itself out. ●
Most weeks I get on a plane and attempt to have an out-of-body experience to deal with all the hassles of flying as I travel from point A to point B. When flying, I have a few simple rules. One, I almost never eat the food. Two, I attempt to talk to no one other than obligatory hellos. Three, I never argue with or say a cross word to flight attendants.
One other very important practice I follow on land, sea and especially in the air is that I constantly scan my surroundings for potential troubles and new ideas.
On a recent flight, upon boarding, I quietly and obediently proceeded to my assigned seat.
As I began to sit down, a gentleman asked if I would mind trading seats with him so that he could sit next to his wife. Like most seasoned travelers I try to accommodate reasonable requests. In this case it seemed a no-brainer to agree to move.
Notice the details
As I started to settle in and fasten my seat belt I noted that my new seatmate was very hot. No, it’s not what you’re thinking. I mean she seemed to be flushed and radiating heat, ostensibly from a high fever. I’m thinking, this is not good, plus it proves the age-old adage that no good deed goes unpunished.
In the next minute I had an epiphany, which happens frequently as I believe that many problems come disguised as opportunities.
I rang the call button and, when approached, asked the cabin attendant to please bring me two cloth napkins. I stated that the purpose was to construct a makeshift face mask by tying the two pieces together to prevent possibly contracting some dreaded disease.
I feared that my intentions could be misinterpreted if I were to don a mask without an explanation; this could cause a well-meaning passenger to drag me to the floor thinking I had nefarious motives.
The stewardess smiled, nodding approvingly of my plan. She then summoned all her co-attendants to my seat and proceeded to whisper what I was attempting. Otherwise, she explained, they, too, could misunderstand my appearance and cause me bodily harm.
As founder and CEO of Max-Wellness, a health and wellness retail and marketing chain, I’m always looking for that next special something to share with my team. Therefore, while burying my now masked face in a newspaper so as not to frighten or offend the sick seatmate, I began dictating a memo to my merchandise product group proudly asserting that I just had another “aha!” moment, for which I am well-known, among my colleagues. For full disclosure, however, I am sometimes known for being a bit “out there” on occasion — but no one bats a thousand.
Turn an idea into a product
This particular predicament gave me the idea to develop a product kit that we could sell to weary travelers in our stores and in airports. I suggested a handful of complementary products, including a mask, a disinfectant spray and, if all else fails, relief remedies. I also noted that it probably would be prudent to include a cigarette pack-type “Black Box” warning stating that the mask is not what some suspicious flyers might think, but instead it’s for prevention of disease only. I even proposed we market these kits directly to the airlines to dispense as an emergency prophylactic for passengers exposed to airborne (pun intended) pathogens.
Fleeting thoughts have value
A key role for business leaders is teaching a management team to use fleeting thoughts as a springboard, to pair common problems with sometimes-simple solutions.
Just because it is a simple fix, though, doesn’t mean the idea couldn’t be a lucrative breakthrough.
When something sparks an idea it needs to be taken to the next level before being pooh-poohed. Most likely the vast majority of these inspirations won’t see the light of day, but that’s OK. Just think — what if one transient idea translates into the next Post-it Notes, Kleenex or bottled water?
The next time you sit by a masked man on a plane, it most likely won’t be the Lone Ranger. Instead, you might be witnessing the incubation of the next best thing since sliced bread. ●
Michael Feuer co-founded OfficeMax in 1988, starting with one store and $20,000 of his own money. During a 16-year span, Feuer, as CEO, grew the company to almost 1,000 stores worldwide with annual sales of approximately $5 billion before selling this retail giant for almost $1.5 billion in December 2003. In 2010, Feuer launched another retail concept, Max-Wellness, a first of its kind chain featuring more than 7,000 products for head-to-toe care. Feuer serves on a number of corporate and philanthropic boards and is a frequent speaker on business, marketing and building entrepreneurial enterprises. “The Benevolent Dictator,” a book by Feuer that chronicles his step-by-step strategy to build business and create wealth, published by John Wiley & Sons, is now available. Reach him with comments at firstname.lastname@example.org.
Recently, President Barack Obama outlined a plan to combat rising college costs by holding colleges and universities more accountable for results. The foundation of this plan is a ratings system that would provide students and families with information to help them select a school that offers the best value. Ultimately, Congress may tie the provision of federal student aid to a college’s rankings.
What might the proposal mean for colleges and universities and the businesses that hire their graduates?
Smart Business spoke with Luis Ma. R. Calingo, Ph.D., president of Woodbury University, about the challenges of making college more affordable.
Will this proposal help colleges do a better job of turning out graduates who are prepared, for example, for a career in business?
The ultimate impact of the president’s proposal is difficult to gauge. However, the debate must begin with understanding the role of higher education.
Colleges and universities exist for one reason: to produce graduates with highly valued degrees who have the knowledge and the character to serve and lead. President Obama’s proposal enjoins colleges and universities to return to basics.
Doesn’t it make sense to focus curriculum on courses that are most essential to a student’s future career?
While that makes sense at the graduate level, there are benefits to a broader undergraduate liberal arts education, which is when students ought to be exploring their interests.
Businesspeople often say they can’t understand why any undergraduate student would pursue a history major or take a philosophy course. But the students who study history or philosophy are those who end up in law school, just as those who pursue biology may end up in medical school. These are the courses that enrich the mind so that students become better business executives by being more critical in their thinking and more socially responsible. All of those things come from a liberal arts education, which is why many professional degree programs have a strong foundation in liberal education.
On a personal note, my daughter is majoring in theology and minoring in Arabic in preparation for a career in law and foreign service. She’s a prime example of why it’s important to debunk the myth that a liberal arts education does not contribute to preparation for a business or other professional career. The dichotomy between liberal education and professional preparation is an artificial one.
What can be done to reduce the spiraling costs of a college education?
How people respond to the cost question depends on their perspective.
If you are a parent or student who relies on federal Pell and/or state grants, any move that reduces public funding for higher education is of great concern. It also depends on where you live. A state university education in Ohio costs two or three times what it costs in California.
At Woodbury, what we do and what we spend is related to producing quality graduates. As with most universities, we spend 70 to 80 percent of our budget on personnel. We consistently apply a student-to-faculty ratio to determine new faculty hires. Any inflationary increases are generally tied to the Consumer Price Index. That’s how we establish the bulk of our budget.
In fact, Woodbury is doing a business process improvement study of our student services and business processes to improve our operational efficiency. Other colleges, large or small, should do the same.
Of course, universities like Woodbury could reduce the numbers and kinds of courses offered to focus on those required for majors. That, however, would be counter to the argument that business and other professionals benefit from a grounding in liberal education. ●
For more of Calingo’s perspective on the challenges facing colleges and universities today, visit his blog, Pursuing Excellence in Higher Education, which debuts in October.
Insights Executive Education is brought to you by Woodbury University
Additional blogs and articles with Luis Ma. R. Calingo:
Whether your wish list includes manufacturing, medical, transportation or technology equipment, how you finance major purchases may not only impact the return on your investment but the success of your entire company.
“Financing decisions impact cash flow and a company’s ability to capitalize on opportunities or respond to adversity,” says David Beckstead, Pacific Region sales manager for the Equipment Financing Division at California Bank & Trust. “Executives need to weigh their options carefully before making a decision.”
Smart Business spoke with Beckstead about the need for prudent financing decisions when purchasing machinery and equipment.
What should executives consider as they are reviewing various financing options?
The rule of thumb is to match the financing terms to the life of the asset. In other words, it’s best to use short-term financing for short-term business needs, and longer-term financing for long-term business assets such as equipment that will generate revenue or reduce operating costs for the foreseeable future.
You can avoid finance charges and interest by paying cash, but leasing the equipment or borrowing the funds lets companies preserve capital for other purposes. You should also consider the tax implications and the ultimate cost of the equipment along with your ability to make a substantial down payment to secure a traditional bank loan.
When does leasing make sense?
Leasing makes sense when companies want to preserve cash for future growth or expansion, they need flexibility or they don’t have a lot of cash to put down. Since leasing companies usually maintain ownership of the asset, companies can upgrade or return the equipment should their needs change. For example, you can align the lease terms with a customer agreement or upgrade to a bigger, faster model as your company grows. Plus, most leasing companies don’t require a down payment and it may be possible to negotiate a longer-term payment plan, improving cash flow.
With leasing you can usually deduct the lease payments as a business expense on your tax return, and on short-term leases the rental expense may provide a better tax benefit than depreciating the asset. You may be able to transfer the risk of ownership to the leasing company depending on the type of lease.
How can executives research the market and secure favorable leasing terms?
Prioritize your needs, and then search for the best combination of rates, terms, flexibility and customer service by contacting several firms. Bank leasing companies usually have high underwriting standards but lower rates, while finance companies can be more lenient lenders but generally charge higher rates. Vendor finance companies are a third option and are generally the most flexible about taking back or exchanging equipment. However, they usually charge higher rates.
Beware of upfront payments and fees, hefty residual payments, pay-off fees and other clauses that may boost the overall cost of the equipment. In fact, it’s a good idea to ask a knowledgeable third party to review the agreement so you don’t forsake the benefits of leasing by accepting disadvantageous terms.
What should executives look for in a leasing firm?
Always consider a firm’s reputation, check its references and read its contract before requesting a quote. Contracts differ between companies and impact everything from tax deductions and residuals due at the end of the lease to the responsibility for servicing the equipment. Finally, select someone you trust. Your financing partner should provide funding and be committed to your success. ●
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It is a little known fact that there’s a strong connection between the success of a deal and the team assembled to get it done.
“Management needs to be very diligent about selecting members of its internal and external deal team; it’s critical that the teams have the right fit, experience and industry expertise,” says Goody Agahi, a shareholder at Stradling Yocca Carlson & Rauth.
Smart Business spoke with Agahi about what it takes to assemble a strong mergers and acquisitions (M&A) deal team.
What is a deal team and how is it composed?
A deal team generally consists of key employees at the company, M&A attorneys, accountants and, in certain circumstances, other outside advisers such as investment bankers. The first step in assembling a deal team is to identify the key employees at the company who are intimately familiar with the company’s operations and financial matters. The next step is for the company to identify, interview and ultimately select its M&A attorney and other outside advisers.
In selecting an M&A attorney, the company should be focused on an attorney’s M&A experience, industry expertise, reputation and fit. An experienced M&A attorney will be able to assist the company with identifying other service providers. For example, if the company is considering an auction process to effect a liquidity event, an M&A attorney can refer the company to multiple investment bankers that, based on the attorney’s experience, he or she believes has the right experience and will be a good fit for the company. Investment bankers can assist the company by performing an analysis of the M&A landscape and identifying prospective buyers. The auction process provides the company an opportunity to see how the market values the company and, depending on the level of interest by prospective buyers, gives the company leverage in negotiating definitive transaction documents. An auction process, however, may not always be appropriate.
What qualifications are important to have in each team member?
Extensive deal experience is critical when considering whether or not to hire a particular service provider. An experienced M&A attorney will be able to advise the company on substantive issues, potential exposure and acceptable compromises. An experienced investment banker can help prospective buyers appreciate the investment opportunity, and an experienced accountant or CFO can give a prospective buyer comfort with respect to the company’s accounting methods, policies and procedures, as well as quality of earnings.
Unfortunately, too often we see companies using legal counsel that is ill-equipped to handle an M&A transaction. This is normally the case when management doesn’t fully appreciate the value the right M&A lawyer can bring and, conversely, how costly it can be to use a lawyer with little or no M&A experience.
When should a company begin assembling the deal team?
Once management begins considering strategic alternatives, the company should start the process of assembling a deal team. Even if a sale transaction is years away, it is prudent for a company to engage advisers to position the company for a liquidity event. For example, a company’s M&A lawyer can perform a review of the company’s organizational documents, equity incentive plans, compensation arrangements and third-party contracts in order to identify and address any potential issues. By addressing such issues in advance of a liquidity event, the company can potentially avoid unnecessary delays, valuation adjustments and special indemnities in connection with negotiating a liquidity event. The better organized a company is, the more desirable the company will be to prospective buyers.
Why is a strong deal team important to an acquisition?
An experienced deal team will work closely with one another to showcase the investment opportunity, and identify and address potential diligence issues in advance of a transaction. Seasoned professionals have been through the process; they understand the issues and offer solutions that can bridge gaps between the company’s and a prospective buyer’s positions. As a result, the right deal team can maximize the purchase price, minimize the back-end exposure and facilitate a quick closing. ●
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Business owners tend to put off succession planning if they don’t intend to exit in the near future. But circumstances can change quickly, and not having a plan in place could be a costly mistake.
“Every business, large or small, will reach a point where a decision needs to be made as to the next step regarding ownership,” says Corinne Baughman, a partner at Moss Adams LLP. “Whether the transition is one year or 10 years away, it needs to be part of the overall plan for any company.”
Smart Business spoke to Baughman about the process of succession planning and how it provides benefits before a transition occurs.
Do most businesses have succession plans?
The main problem with companies’ succession plans is that they don’t exist. Owners have plans to increase sales or add personnel, but they don’t have a strategic plan as it relates to a successor because it’s something they can kick down the road. It takes most companies years to implement a succession plan, and delaying limits options.
Every business should have a succession plan. You might think you’re going to pass the business on to management, sell to a strategic buyer or gift it to your children. That can change, but you need a plan in place to start addressing the issues that arise no matter which way you’re going to exit the business.
What is involved in succession planning?
The first step is to consider your long-term goals. Is it to grow larger, or expand the product or client base? Whether it’s a single owner or a private equity group, what are their business goals? Do they want to retain a certain amount of ownership, pass it on to family members or step away completely?
Once you’ve answered those questions and determined what everyone wants, it’s time to get into specifics and identify your way of getting to liquidity, whether it’s a sale, private equity backing, going public or whatever.
Then you need the right people in place to move the plan in that direction. That’s where many companies fail; one person calls the shots and succession drops to the bottom of his or her priority list. It’s important to spread the wealth of responsibility internally and develop the right support group of attorneys and CPAs. Everyone on the team needs to understand how to grow the value of the company — until you have good strategic financial and business plans, you’re not going to be ready for succession. You’re looking to get the most value out of a transition, but you should be doing that on a daily basis anyway and working on ways to increase the value of the business.
What are the most common mistakes companies make?
The biggest one is timing — the tendency is to put off succession, but fewer opportunities are available the closer you get to a transaction. You might be in the wrong legal structure or find out you should have had additional training for management personnel.
This becomes crucial when something unexpected occurs, such as a death or someone leaving the company. A key component of the succession plan may be gone, and without a strong team you may not have a backup plan.
Another mistake is that owners think a certain dollar amount is a home run that will set them up for life, and don’t plan for the net impact. It can be eye opening to owners when they realize what they end up with after taxes isn’t what they were expecting. You need to forecast future needs and assume whatever cash you receive on the day papers are signed will be the only cash you’ll receive. Many clients had deals with earn-out provisions and didn’t get another penny. Just as you do for your business, you need to create a financial model and budget for your personal needs.
Some people don’t like to think about succession and hang on too long, especially when they built the business themselves. But at some point you’re going to have to step down, and you should have a plan with goals and a time frame for that transition. ●
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Corporate governance has become a popular topic. While it primarily pertains to the governance of public companies, it can be a useful set of policies and procedures to help guide a private company by fostering discipline and informed decision-making.
“Historically, private company boards have been more casual in how they’re organized and how they act, but more recently private company boards and their stockholders are looking for more accountability,” says Christopher Ivey, shareholder and co-chair of the corporate and securities practice at Stradling Yocca Carlson & Rauth.
Smart Business spoke with Ivey about corporate governance for private companies and best practices for its implementation.
How does corporate governance operate in a private company setting?
The primary roles of a company’s board are supervising management, providing strategic direction and approving material actions. These roles are enabled through good corporate governance. A fully functioning, independent board that’s not controlled by the founder is more likely to exercise authority to make difficult decisions, including management changes. Beyond management changes, good corporate governance instills a level of discipline and accountability that the board may not otherwise be inclined to undertake. It also sends a good message to stockholders.
Should the board of a private company have legal or contractual obligations?
Corporate governance is not required in a private context with the exception of some regulated industries. Board members do, however, have fiduciary and legal obligations to stockholders to fulfill their duties of care and loyalty. Good corporate governance facilitates board members adhering to their fiduciary duties.
Corporate governance should be principle-based as opposed to operating by a rigid set of rules. However, codes of conduct and good committee charters can act as a guide.
Generally, what are some best practices for corporate governance?
Establish policies that help create an effective board of directors, such as director independence.
Form an audit committee of independent board members to oversee audits — internal control systems, risk management, detecting and preventing fraud — and meet alone with auditors. Also, if practical, get audited financial statements, as banks and institutional investors may require them. But whether audits are required or not, having accurate financials leads to better-informed business decision-making.
Consider having a compensation committee of independent board members to recommend senior officer compensation and structure, and administer equity incentive plans. Officers on the board shouldn’t be making their own compensation decisions.
Additionally, you may want to have a corporate governance and nominations committee that can identify director candidates, evaluate board performance and establish a code of ethics/conduct. Similarly, other committees can be formed to handle special tasks as appropriate.
How insulated should the board be from the rest of the company?
It’s important to have transparency. At a minimum, transparency ensures clear disclosure of conflicts of interest so everyone understands each individual’s potential personal gain or interest in the matter being deliberated. Beyond that, clear communication among board members and management is important to make good, clear, strategic decisions with the best information available.
Should all private companies establish corporate governance policies?
Avoid having governance policies and committees solely for governance sake. Corporate governance should facilitate allowing the board and management to focus on running the business. You don’t want to consume all of your time just checking the corporate governance boxes.
Private companies should choose elements of corporate governance policies that work best for them. Don’t do it just because everyone else is doing it. Do it to the extent it’s appropriate for your context.
Christopher Ivey is a shareholder and co-chair of the corporate and securities practice at Stradling Yocca Carlson & Rauth. Reach him at (949) 725-4121 or email@example.com.
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Business succession is the one thing many companies fail to address for fear of relinquishing control, a lack of time, the feeling that successors aren’t ready or other reasons. But, it’s never too early to start succession planning.
“Statistically, roughly only 30 percent of family-owned businesses are effectively transferred to the second generation and just 10 percent make it to the third generation,” says Julianne Cruz, managing director of Advisory Services at CB&T Wealth Management. “There are myriad reasons for this, but one recurring issue is a lack of effective succession planning.”
Smart Business spoke with Cruz about how to effectively position your chosen successors for success.
How should business owners get started?
You need to consider the three ‘T’s of successful transition:
- Transferring management.
- Transferring ownership.
- Tax consequences.
In all cases, having a plan that is strategic and well executed is key, but that takes time. The most successful transition plans take place over a number of years, as successors develop the skill sets required to run the business.
How is management transferred?
It’s important to select an independent adviser who is highly experienced with planning issues to arrive at the best plan for you and the next generation.
Some areas to consider are: If more than one child is involved in the business, how will contentious decisions be made once you exit the business? If you want certain key, loyal employees to be cared for, as they are likely necessary for a smooth transition, what assurances do you have this will happen? What happens if unexpected health issues force the transition early? A well-developed plan ensures the business will thrive without interruptions, helps the next generation grow into their role at a reasonable pace and promotes future harmony among family members.
A short-term plan ensures there’s enough liquidity and insurance to hire necessary experts and avoid a fire sale. A mid-term plan must prepare developing successors or key employees to be in decision-making roles initially. It also would have a timeline for family members to step into their new roles with certain targets. The long-term plan is ultimately what you want to happen — the best of all circumstances.
After discussing your plan with advisers and successors, involve your key employees, who may be more satisfied knowing the company’s future.
What are some factors to consider with transferring ownership?
Once the management transition plan is established, plans for transferring ownership can occur. Usually this begins with your retirement plans. How much income will be needed and what’s the timeline? If you need cash from the business, are you willing to bear the ‘investment risk’ of the business as a source of income once you’re not involved?
Then, consider estate-planning issues. Are all your children involved in the business? If not, do you desire to ensure each child will ultimately receive an equal estate share?
How do tax consequences factor in?
Taxes are the tertiary consideration once decisions have been made regarding the general retirement and estate plans. As is the case with investment portfolios, taxes should never drive the decision-making process. Tax-reduction strategies should only be considered after other issues are decided.
Business owners in general, and particularly family-business owners, should begin now and get an experienced, independent adviser to guide them through the process. The earlier you plan, the better the results. Sound, experienced advice will make the process that much easier, and maybe even bring family members closer. λ
Julianne Cruz is managing director of Advisory Services at CB&T Wealth Management. Reach her at (310) 258-9301 or firstname.lastname@example.org.
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Wealth management services are offered through Contango Capital Advisors, Inc. (Contango), which operates as CB&T Wealth Management in California. Contango is a registered investment adviser, a nonbank affiliate of California Bank & Trust and a nonbank subsidiary of Zions Bancorporation. Some representatives of CB&T Wealth Management are also registered representatives of Zions Direct, which is a member of FINRA/SIPC and a nonbank subsidiary of Zions Bank. Employees of Contango are shared employees of Western National Trust Company (WNTC), a subsidiary of Zions Bank and an affiliate of Contango. #CCA0813-0090
Say the word “innovation,” and immediately you think about business legends like Steve Jobs and Jeff Bezos, as well as the companies they created – Apple and Amazon. Too often, however, we focus on the people who have been tabbed as innovators and the companies that develop those breakthrough products, services and solutions, such as Apple’s iPod and iTunes, or Amazon’s marketplace and unique ecosystem.
True innovation goes much deeper than a single leader’s vision. It is an all-encompassing philosophy that permeates an organization and defines its purpose for being. For me, at least, I prefer to think about innovation in its broadest terms, extending its definition to include corporate cultures and innovative management styles. Think about how Facebook and Microsoft are run, and how at both organizations employees are a key factor in the idea creation, or ideation, process.
Now, think about the breakthrough products that eventually went bust. Hopefully, you don’t have a basement full of Beanie Babies, boxes of Silly Bandz, or a home library filled with laser discs. It is more common to land on a singular breakthrough product that temporarily revolutionizes your industry rather than develop a product through a process that’s repeatable or scalable. And, just as true, no matter how innovative and creative your management team’s style may be, without the proper processes in place to push ideas through a system that takes them from mind to market, you’ll eventually have trouble keeping the lights on.
It all comes down to developing a culture imbued with innovation at its core. But this also requires having a servant culture in place where every person who works for the organization thinks about the customer first.
Consider San Francisco-based Kimpton Hotels, where employees strive to create “Kimpton Moments” by going above and beyond with guests and delivering memorable experiences.
Kimpton overcomes the inherent limitations for creating new innovative products that being a boutique hotel chain includes by approaching innovation through its employee interaction – and then rewarding employees for their creativity. For example, when team members put in the extra hours to ensure world-class service delivery, the hotel chain has sent flowers and gift baskets to their loved ones. And when they create an innovative service experience, the company rewards staff members with such things as spa days, extra paid time off and other goodies.
And then there’s the Boston Consulting Group, a management consulting firm that’s known for developing innovative business processes and systems for its high-end clientele. Part of BCG’s internal process is a focus on team members maintaining a healthy work-life balance. When individuals are caught working too many long weeks, the company’s management team issues a “red zone report” to flag the overwork.
Talk about innovation! And no product, service or solution was developed, marketed or sold.
And finally, few organizations are more innovative than DreamWorks Animation. But beyond plugging out groundbreaking animated movies, the studio’s culture embraces empowerment and innovation. Employees are given stipends to personalize their workstations so that they create whatever inspirational atmosphere they need to succeed. And, as the story goes, after completing Madagascar 3, the crew presented a Banana Splats party, where artists showed the outtakes.
Not only are these three companies known for being innovative in their respective industry spaces, they also share the honor of being members of Fortune’s 2013 “Great Places to Work” list.
So how do you take the first steps toward transformation or put those initial building blocks in place to begin the journey? There’s no magic formula, but there are some common traits – and they revolve around empowerment and establishing a culture that cares.
- Are open-minded and ask “What if?”
- Teach team members how to see what is not there and identify opportunities in the marketplace to take advantage of those gaps.
- Develop cultures where innovation thrives through open and honest communication.
- Flatten the organizational structure and recognize that innovation can come from anyone and anywhere.
- Make innovation, itself, a cyclical and continuous process.
Stop and take an internal assessment of your organization, your team and of yourself. If you can’t check a box next to each of these five traits, stop and ask yourself why. Then begin your own journey to greatness.