Target Markets, Contact Spheres, & Power Teamsstring(51) "Target Markets, Contact Spheres, & Power Teams"

Everyone who is in business wants to do well. Successful entrepreneurs and professionals understand the importance of a strong network to help their business grow. However, building a strong network is an investment of time – time to build relationships and time to educate fellow networkers about what you do and who are your best customers.

There is also the investment of time in ourselves; we need to be really clear about our own target market which will help us identify our Contact Spheres, and then help us to strategically develop our Power Team.

Target Markets

What is your target market? Most simply defined, it is the specific set of clients whose needs you are trying to meet with your business. Instead of trying to sell to everyone, focus on those people who have the greatest potential to need or desire your products and services. When you try to be everything to everyone, you end up being very little to anyone.

Many people struggle with identifying exactly what their target market is and are often too general when talking about it. A good starting point is to have a clear understanding of who your ideal customers are. Look at your past sales to identify the types of clients that are the best fit for what you want to do. Most businesses have a couple of specific target markets for the services or products they provide.

Contact Spheres

A Contact Sphere is a group of business professionals who have a symbiotic relationship. They are in compatible, non-competitive professions. For instance: event planner, caterer, photographer, florist, and travel agent. I recently talked with my good
friend Tom Fleming, who has been involved with BNI® since 1996, about Contact Spheres and Power Teams. He shared his definition of a Contact Sphere:
Those companies in non-competing industries that serve the exact same target market that you have, which means their client list is a list of potential customers for you, too.

Tom said he thinks that the concept of Contact Sphere is a noun. It’s that list of industries that don’t compete with you but serve that same target market. And a Power Team is that Contact Sphere in action. So, he thinks of Power Teams as a verb.

I also view them as concentric circles, where the Contact Sphere is all the potential people that you could be working with, and the Power Team is the people that you are actually working with. 

Power Teams

A Power Team is a group of people that are in complimentary professions. They work with the same client without taking business away from each other. How do you build your Power Team? The first step is to get to know the people in your Contact Sphere and get to know their industries. Begin to build a mutually beneficial relationship with them. It’s important to find out as much as possible about these potential referral partners so that you can send them the type of business they are looking for. You can find a list of 10 questions to ask your Power Team partner here.

Successful Power Teams recognize that they need structure – preset meeting days, times, and locations – at least twice a month, with an agenda for the meeting. They have accountability and engagement, too. Are people showing up to the Power Team meeting and are they participating? Are they engaged in proactively generating referrals for other people on the Power Team? Effective Power Teams also have leadership and communication. Tom shares a link to a Power Team meeting agenda in BNI Podcast #775.

Start with defining a target market to be able to give your referral partners a mental picture of the best customer to refer to you. Then identify all of the professions and industries who share that target market, and who are not your competitors, to build your Contact Sphere. A Power Team is where you put the Contact Sphere to work. You work together with intention and commitment, to help each other by identifying referrals and connecting those referrals to fellow Power Team members.

Are you part of a Power Team? I’d love to hear your success stories.

 

 

 

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Why Do Businesspeople Help Others?string(34) "Why Do Businesspeople Help Others?"

There are only a few basic ways to inspire people to care about your business and help you build it. Basically, it comes down to relationships and rewards.  

Some people, typically family or friends, will want to help simply because they like you and want you to do well. They are motivated by the relationship itself.

In most other cases, the long-term motivation for people to want to help you and your business is not based solely on whether they like you. Business partnerships, including referral relationships, almost always include some type of mutual reward, typically in the form of financial or social gain. Both you and your networking partner have something to gain, and you are both willing to help each other achieve it.

Some people are motivated by the potential for business referrals you can give to them, while others are motivated by the prestige and opportunities created by having a relationship with you. Regardless of the underlying motivation behind them, business networking relationships can take some time to reach profitability in a substantial way. However, they are certainly worth cultivating. Ultimately, strong relationships will steer opportunities back to you because of the nature of networking itself.

Referrals are Not Reciprocal

I remind networkers that there isn’t a rule that says, “For every referral you give, you can expect one in return.” When you give more referrals, it does not mean that others will automatically do the same. It just doesn’t work that way in referral marketing.
A referral is not always reciprocal.

Effective business networking is about strong and deep relationships with your referral partners. Professionals who focus on giving first and asking, “What can I do to help you?” rather than having an attitude of “What’s in it for me?” usually find more success in their networking efforts.

I believe that most relationships will prove rewarding in the long term, even in cases where you don’t receive referrals in return. There are a few extremely successful people to whom we send referrals and who never reciprocate with a referral back to us. We’re motivated to continue helping them because they will work with the people we refer to them. That makes us look good, as it is often difficult for the average person to start a working relationship with these very successful, very busy professionals.

Additionally, if we refer someone, it opens a door that might never have otherwise opened. The new person that we are referring to our very busy friends or associates is the one who now goes out of their way to reciprocate. That becomes our motivation for helping our networking partners achieve their goals. And, in true Givers Gain® fashion, it usually winds up coming back to us in some way or another.

The Philosophy of Givers Gain

Givers Gain is not only a great way to get business, it’s an even better way to do business. These are some of the motivations that fit with the philosophy of giving.

  1. We give because we understand that in a community, what we do, others will do, and we all benefit.
  2. We give because we know that in the same situation others would do the same for us.
  3. We give because we want to give back where we have profited before.
  4. We give because when we work together, we get bigger and better results than working on our own.
  5. We give because we enjoy it.

A key element of giving is having ethical motivation. You can always give once and justify your motivation, however, giving over and over again requires a motivation that is understood by you, and by the people you surround yourself with.

Remember, in business networking, successful referral relationships are mutually beneficial with both parties being motivated by some type of reward that helps them, and their business, grow.
Can you think of some way that you have benefitted because of caring about others’ businesses and helping them achieve their goals?  

 

 

 

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Are Networking Referrals a Coincidence

Are Networking Referrals a Coincidence?string(39) "Are Networking Referrals a Coincidence?"

When it comes to business networking, “luck” is where persistence meets opportunity. There is no coincidence about repeat referrals. Those referrals come about because of the everyday activities that successful networkers consistently do to build strong referral relationships. Although it can’t be measured as easily as tracking cold-call ratios – the results are dramatic and almost never coincidental.

A misconception occurs when someone focuses on the referral rather than on the relationship that produced the referral. This leads people to the wrong conclusion that the result was coincidental. Networking is not about luck. It is about relationships.


It is unlikely that one single person is going to turn a business around or have a dramatic impact on a company’s success. However, by building relationships with a diverse group of professionals, over time those combined relationships can make a significant difference in one’s business success.

In this video, I share the story of a networker, Chris, who regarded the referrals he received from his fellow members as “chance occurrences” and failed to understand that they were the result of his relationships within the networking group.

Focus on the Relationships

As you heard in the video, Chris’s challenge was two things: repeatability and understanding. His training told him that the way to get more business was to target a certain kind of customer by calling a demographics-based list. If he didn’t have enough business, he needed to make more calls. How many more? He could figure that out, too, because the amount of business he got was directly proportional to the number of people he talked to. It was a repeatable process that he fully understood.

On the other hand, clients he got from referrals always had a story line that he couldn’t see being repeated. Sally knew Jim, who ran into Sue, who happened to be in his group and referred Chris the business. This led him to conclude that the results were coincidental and couldn’t possibly be repeated.

The reason that he focused on the referral and not the relationship is because he didn’t understand the process of building effective and profitable relationships. This led to his conclusion that all the referrals from his networking group, and the subsequent new clients he gained from them, were simply a coincidence.

His reasoning wasn’t entirely off track, as far as it went. If you focus on the specific people who gave you the referral, rather than the process and relationships that allowed it to happen, then you couldn’t consistently get more business from networking. Or to put it another way: Sally knowing Jim, who runs into Sue and ultimately gives Chris a referral is probably never going to happen again in exactly that way. Yet, if you step back and ask, “Is it possible that somebody will know someone else who’s looking for my services and will then give me that referral?” It’s a whole other story—especially if you focus on building relationships so that there is always a “somebody” in your network who knows you and what you do.


Networking with a Net

Referral networking is a lot like catching fish by casting a net. Each fish comes to the net by a different path; each has a “story” that is not repeated. You don’t focus on a particular fish and then try to get it to come to the net. Instead, you focus on the action of setting the net. You know that consistently setting a net will provide fish, regardless of what path they take to get there.

The same is true for getting referrals. The process of meeting people, staying in touch, and then asking for business is something you can do time after time. You don’t have to worry about how a specific referral got to you, because you understand the process of setting your net.

Here’s the best part: Just as with fishing, your net – your network can be working for you all the time. You don’t have to be there whenever somebody you know runs into someone else who could use your product—which means you can be “fishing” in many different ponds simultaneously and reaping the rewards of new business referrals on an on-going basis.

Remember, the fisherman concentrates on the action of casting the net, not the individual path of one fish that swims into it. If they based their success on that one random fish, they could conclude that it was a coincidence.

There is no coincidence about the referrals gained through successful business networking. Your networking results are the inevitable cumulative result of the day-to-day activities related to relationship building and an indication that the system is working. Consistent referrals happen because you’ve laid the groundwork through mutually beneficial, professional relationships.

Perfect Practice Makes Perfectstring(30) "Perfect Practice Makes Perfect"

When it comes to business networking, practice alone is not enough. It must be effective practice. Simply attending meetings and going through the motions will not improve your networking or help you grow your business.

For those to whom networking doesn’t come easy, it is imperative that you continue striving to perfect your networking skills. The saying “practice makes perfect” comes into play here, but not how you might expect because that saying is only half true.
In actuality, only perfect practice makes perfect.

I once heard a music teacher tell their students, “Lousy practice makes a lousy musician.” The same is true for business networking. You can practice day in and day out networking the wrong way, and what will happen is you’ll get really good at incorrectly networking. 

Lessons From Martial Arts

In martial arts, the sensei (master) says, “Perfect practice makes perfect.” If you’re just going through the motions, you are not learning and growing. Each time you do a kata (a system of basic body positioning and movement exercises in karate), it must be done as though you were in a tournament, or as though the sensei were there observing you. It is only with that intensity of focus does one improve. The same applies to your business networking efforts. If you apply the techniques halfheartedly, you get less-than-acceptable results. 

Practicing the skills necessary to become a good networker is important. However, would-be networkers cannot expect to become master networkers by doing things in a perfunctory way, without commitment and effort.

Consider the short weekly presentation you make when you attend networking groups or various other organizations. Many people go to their meeting unprepared and unrehearsed, having only a vague idea of what they will talk about. While other members give their presentations, the unprepared person isn’t listening. They are thinking about their own upcoming presentation and how to say what they need to say. When their turn comes, they often stumble through an amateurish and marginal presentation. Yes, they practiced, but it was far from perfect practice, and the results prove it.

Lessons From Teachers

Do you think teachers wing their lesson plan? The better teachers set goals and objectives for what they want their students to learn. They spend time planning exactly what they are going to talk about in class. They prepare visual aids and handouts that reinforce the subject matter and facilitate learning from their presentation.

I recommend that, as a businessperson, you have similar goals and objectives. Ask yourself: What, exactly, do you want your listeners to learn about your business that they can pass along to prospects to create a possible referral for you?

If you are vague about your lesson plan, if you are unprepared to stand and deliver, your potential referral partners are going to leave the meeting without a clear idea of how to refer you to the people they know. You need to practice delivering your message. Standing up and winging it is not going to get you what you want. You must practice it perfectly to achieve your networking goals.

Business networking success comes with time and effective practice. You can do a review of your networking attempts and presentations with yourself or with a close business confidant after the meeting or event. What strategies did you use? Did you make a lasting impression on those you interacted with? What worked and what can you improve upon?  Perfect practice is a commitment – to you and your business.

How has practice improved your networking skills and your results? I’d like to read your comments below. Thank you.

 

 

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The 4Csstring(7) "The 4Cs"

My friend and co-author of Work Your Network with The 4Cs, Dr. Oudi Abouchacra, joined me on the BNI Podcast to talk about his networking journey and how he developed the concept of The 4Cs, which it led to us writing the book together.

He shared that is started when he was 27 years old and had just opened his chiropractic clinic in Toronto, Canada. His father told him he needed to go out and network instead of waiting for new patients to find him. Dr. Oudi says, “I’ve got to tell you, the word networking was intimidating. I don’t even think I really knew what it meant. I just knew it meant getting out of my office, the comforts of my walls, and going out there and meeting people and strangers and having to talk about what I do.” Well, he took his dad’s advice, began to network and was introduced to BNI®.

What are The 4Cs?

As a new BNI member, Dr. Oudi wondered why some people got more referrals than others did. After 20 years in BNI, he was able to distill the answer down to The Four Cs, which are the foundation of all relationships. I believe that understanding them is critical to generate referral business.

COMPETENCE
Is someone good at what they do? We need to know that their skillset enables them to do what we need them to do to help solve our problem.
CREDIBILITY
Do you trust them? In personal and business relationships, we have to know that our
loved ones and our projects are safe and in good hands.
CLARITY
Do they communicate well? We want clear communication with the people we engage
with. And we need clarity of what our networking partners need in order for us to give them referrals.
CONNECTIVITY
Who does this person know? Connectivity has to do with the quality and quantity of their connections. People who are well connected can help their referral partners make the connections they need.

Challenges with The 4Cs

As a new business networker, Dr. Oudi found his biggest challenge was Clarity of communication. He struggled to be concise and precise, and really get a message across in a networking context. He felt that the lack of clarity cost him time because it took longer for his referral partners to clearly understand how he could help the people they knew. He says that it also cost him confidence because every time he spoke ineffectively, he would second-guess himself and lose confidence for the next presentation.

Most people think that they are effective communicators. However, if you were to ask peers, they may say, “I don’t really get what they do. I don’t really understand them.”
To get better at each of The 4Cs, it’s important to ask the members of your business networking group and/or the people that you are very close to for honest feedback.

Keep in mind however, that many people find it hard to give critical feedback and may not necessarily tell you what they really think. So, Dr. Oudi developed the Peer-to-Peer Assessment, an anonymous survey that can be sent to your BNI chapter members, or to members of other professional groups.

Imagine if every member of networking group rated you anonymously on each of The 4Cs. You could have a scorecard showing that you’re 9 out of 10 with Credibility, Competence, and Connectivity. However, you scored 3 out of 10 with Clarity. Now you have real feedback from people you know, which helps identify what you need to work on for better networking success.

The Peer-to- Peer Assessment is in our book, Work Your Network with The 4Cs, which is available at amazon.com. I’ll be talking more in-depth about the other 4Cs in future blogs.
I’d love to hear your thoughts about The 4Cs and your results of the Peer-to-Peer Assessment. Feel free to come back and share in the comments.

Exceptional Performance is Not Achieved by Looking for Exceptionsstring(65) "Exceptional Performance is Not Achieved by Looking for Exceptions"

Throughout my business career I have been reminded countless times that exceptional performance is not achieved by looking for exceptions. There are numerous people who want “great” results but don’t want to put in “great” effort. I truly think that if people spent half as much time focusing on the fundamentals of success in the areas they are interested in – they would get twice the results that they are currently getting. Instead, I see way too many people searching for ideas and then arguing with people about what works (especially with people who have already achieved success in that area).

Taking Exception

I once read an article by a friend of mine who was talking about Tony Alessandra’s Platinum Rule (treat people the way ‘they’ want to be treated, not the way ‘you’ want to be treated). The piece was well written about Tony’s material. Then I saw that some guy posted a comment saying this was a horrible idea because people don’t always know what’s best for them. Really? That seemed crazy to me but in case I was overreacting, I checked out some of this guy’s other writings. I looked at his comments on other people’s posts and he was ALWAYS the guy taking an opposing position. He disagreed with virtually everyone about virtually everything. I then looked at his original posts and discovered he was a total loser! He clearly jumped from business to business and didn’t appear to be successful at anything. The best thing this guy seemed to do was argue about everything; he seemed to be an expert at taking exception to other’s views.

Results Without Effort?

Shortly after I read my friend’s article about the Platinum Rule, I received an email from a person who had visited some BNI® networking groups. They wrote me to say:

“I am interested in how I can provide my extensive list of contacts to a local networking group without having to attend the weekly meetings… we can [only] attend once a month to a meeting… but we still [want to] adopt the group’s ethos and principles of such a well-structured program.”

That request got me to thinking…
I’d like to win the Tour De France, but I don’t like all that peddling.
I’ve always thought it would be amazing to win an Olympic medal but come on, is all that conditioning really necessary?
I would have liked to become a medical doctor but, can I do it without all the blood and internal organ stuff?
I would love, really love, to be a military General – but boot camp? Seriously, do I have to do boot camp?
And most coveted of all – a Nobel Peace prize. That would be so amazing! But must I change the world in some important way? Surely, there must be something less I can do and still get the same results – right?

If only wishing made it so. But it doesn’t. 

Looking for exceptions to what’s been proven to work seems to be the norm for many people. However, those who are constantly searching for exceptions to validate their reasons why the disciplined hard work that has made others successful won’t work for them, will, in my experience, only find one overriding truth–the exceptional people who have achieved success through consistent, disciplined action are, in fact, the only real exceptions to the norm.

I’d like to know your thoughts. Feel free to share your comments below.

 

 

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Crucial Conversations

Crucial Conversationsstring(21) "Crucial Conversations"

Most of us have heard the phrase “It’s not so much about what you say, it’s more how you say it that really matters.” I learned the hard way how true that phrase really is. Conversations can be tricky–especially when one or more of the people involved are upset.

When I first started BNI® in the mid-1980s, there were only a handful of chapters while the organization was in its very beginning stages, and it was still small enough that I was able to make personal visits to chapter meetings. One day, I got a call from a chapter president who asked if I would come to their next meeting and offer some insight into how they could improve because they were having some challenges keeping their networking group running smoothly and effectively.

I was happy to help however I could, so I went to their next meeting, sat back, and observed. When the chapter president called me to the front of the room and asked me to offer my feedback, I stood up and began to go over my list of suggestions and changes they should make to improve their effectiveness. Suddenly, one of the chapter members raised her hand and said, “Excuse me but who in the heck do you think you are, sashaying in here and telling us everything you think we’re doing wrong?!–You don’t know anything about us!”

Respond or React

How did I respond?  I didn’t respond . . . I reacted. I went with my gut reflex, which was to defend myself, saying that I was the founder of the organization. I tried in vain to argue that my points were valid and that they needed to listen to what I had to say if they wanted to improve. The way I handled it was completely ineffective because, in a heated situation where somebody was obviously very upset and already convinced I was the enemy, I had no strategy for guiding the conversation in a positive, solutions-focused direction.

That day, on my commute back home from the meeting, I spent the first twenty minutes fuming about how rude the woman was to me. I had gotten up early to drive over to their chapter meeting, taking time out of my day to go above and beyond to help them! In the privacy of my own car, with my blood boiling, I drove through traffic flaring my nostrils, vehemently muttering several choice words (which I will not detail here) while I verbally bashed them for being so ungrateful.

Then I started to calm down and think about how I might have handled the situation differently and it was during that same car ride that I came up with BNI’s corporate policy on customer support and handling customer complaints. Here are some of the points from that policy.

Important Points

  • Remember–people don’t care how much you know until they know how much you care.
  • Listen and let them talk.  Then . . . listen, listen, listen.
  • Ask questions.  Then . . . listen!
  • Acknowledge the information.
  • Understand their complaint and ask how you can help.
  • Follow up.
  • Thank them.
  • Remember–diplomacy is the art of letting someone else have your way.  Be diplomatic!

Some years later, I came across the book, Crucial Conversations, which teaches people how to prepare for high-stakes situations, transform anger and hurt feelings into powerful dialogue, create situations where it is safe to talk about almost anything, and to be persuasive not abrasive.

Some of the tactics and strategies in the book were right in line with what I outlined for BNI’s policy on dealing with tense situations. It also has additional tactics that are immensely helpful for ensuring that whatever it is you are trying to say in any given situation is presented in the best possible way (i.e., “how you say it”) to achieve the best possible results for everyone involved.

I think that ALL conversations are crucial on some level because once you say something you can’t take it back and saying the wrong thing may have tremendously negative repercussions. Whether you are conversing with your fellow networkers, your business associates, or with loved ones that are closest to you, it’s always best to know what you want to say and how you want to say it before anything comes out of your mouth.
Take it from someone who learned this the hard way.

 

 

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Five Myths About Flexible Work

Five Myths About Flexible Workstring(30) "Five Myths About Flexible Work"

This blog is from an article that Manar Morales and I co-authored. A variation of the article was originally published with the Harvard Business Review at this link.

“Flexibility might be great in theory, but it just doesn’t work for us.”

We have literally heard this statement hundreds of times over the years. It doesn’t matter what industry we’re talking about — whether it’s tech, government, finance, healthcare, or small business, we’ve heard it. There’s always someone who works from the premise that “there’s no way flexible work policies can work in our organization.”

In reality, flexible work policies can work in any industry. The last two years have proven this. A 2021 Harvard Business School Online study showed that most professionals excelled in their jobs while working from home, and 81% either don’t want to go back to the office or would choose a hybrid schedule post-pandemic. It’s important to recognize, however, that flexibility doesn’t always look the same — one size definitely does not fit all.

The Myth of the Five C’s

You may be wondering, “If you can recruit the best candidates, increase your retention rates, improve your profits, and advance innovation by incorporating a relatively simple and inexpensive initiative, then why haven’t more organizations developed flex policies?” This question will be even harder for organizations to ignore after we’ve experienced such a critical test case during the Covid-19 pandemic.

We believe fear has created stumbling blocks for many organizations when it comes to flexibility. Companies either become frozen by fear or they become focused by fear. It is focus that can help companies pivot during challenging times. In the years that we’ve been working with companies on flexibility, we’ve heard countless excuses and myths for why they have not implemented a flex policy. In fact, the Diversity & Flexibility Alliance (DFA) has boiled these myths down to the fear of losing the 5 C’s:

  1. Loss of control
  2. Loss of culture
  3. Loss of collaboration
  4. Loss of contribution
  5. Loss of connection

Addressing the Fears

Myth #1: Loss of Control

Executives are often worried that they’ll open Pandora’s box and set a dangerous precedent if they allow some employees to work flexibly. They worry that if they let a few employees work from home, then the office will always be empty and no one will be working. The answer to this is structure and clarity. We can virtually guarantee that any organization that correctly designs and implements their flexibility policy will not lose anything.

To maintain control and smooth operation of your organization, it’s imperative that you set standards and clearly communicate them. Organizations should provide clear guidelines on the types of flexibility offered (for example, remote work, reduced hours, asynchronous schedules, job sharing and/or compressed work weeks) and create a centralized approval process for flexibility to ensure that the system is equitable.

It is also helpful to have a calendar system for tracking when and where each team member is working. You must also commit to training everyone on these standards — from those working a flexible schedule, to those supervising them, to all other coworkers. Education and training will help your team avoid “flex stigma,” where employees are disadvantaged or viewed as less committed due to their flexibility. Training can also help organizations to ensure that successful systems and structures that support flexibility are maintained.

Myth #2: Loss of Culture

While you may not see every employee every day, and you may not be able to have lunch with people every day, culture does not have to suffer with a flexible work initiative. However, it is essential that teams meet either in person or via video conference on a regular basis. DFA recommends that companies and firms first define what culture means to their individual organization and then determine how they might maintain this culture in a hybrid or virtual environment.

Many organizations with whom we’ve worked reported that they found creative ways to maintain culture during months of remote working during the pandemic. Many DFA members organized social functions like virtual exercise classes, cooking classes, happy hours, and team-building exercises to maintain community. Additionally, it’s important to take advantage of the days when everyone is physically present to develop relationships, participate in events, and spend one-to-one time with colleagues.

Myth # 3: Loss of Collaboration

As long as teams that are working a flexible schedule commit to regular meetings and consistent communication, then collaboration will not be compromised. It’s important for all team members to maintain contact (even if it’s online), keep tabs on all projects, and be responsive to emails and phone calls. We always recommend that remote teams also meet in person occasionally to maintain personal contact and relationships. For collaboration to be successful, remote employees must not be held to a higher standard than those working in the office. Additionally, technology should be used to enhance collaboration. For example, when companies are bringing teams together for brainstorming sessions, virtual breakout rooms can facilitate small group collaboration and help to ensure that all voices are heard. Some organizational leaders have also incorporated regular virtual office hours for unscheduled feedback and informal collaboration.

Myth #4: Loss of Contribution

We have often heard leaders say: “If employees are not physically at their desks in the office, then how will we know that they’re actually working?” But with endless distractions available on computers these days (from online shopping, to Instagram, to Facebook, etc.) you really don’t know what your employees are doing at their desks, even if they are in the office. In fact, they could be searching for a new job (that offers flexibility!) right before your eyes. It’s important to clearly communicate what is expected of each individual and trust that they will complete the job within the expected timeframe. All employees should be evaluated on the quality of their work and their ability to meet clearly defined performance objectives, rather than on time spent in the office.

Myth #5: Loss of Connection

Technology now enables people to connect at any time of the day in almost any location. Meetings can be held through a myriad of video conferencing applications. Additionally, calendar-sharing apps can help to coordinate team schedules and assist with knowing the availability of team members. Even networking events can now be done virtually. For example, one of our team members created a system for scheduling informal virtual coffee chats between partners and associates to maintain opportunities for networking and mentoring during the pandemic.

It’s important to know what your employees and stakeholders prefer in terms of in-person, hybrid, or virtual-only connection. In a survey conducted by BNI of over 2,300 people from around the world, the networking organization asked the participants if they would like their meetings to be: 1) in-person only, 2) online only, or 3) a blend of online and in-person meetings. One third of the participants surveyed said that they wanted to go back completely to in-person meetings. However, 16% wanted to stick with online meetings only, and almost 51% of the survey respondents were in favor of a blend of meeting both in-person and online. This is a substantial transition from the organizational practice prior to the pandemic, with a full two-thirds of the organization saying that they would prefer some aspect of online meetings to be the norm in the future.

Perhaps a silver lining of the pandemic will be that corporate leaders have overcome their fears of the 5 C’s and will now understand how flexibility can benefit their recruitment and retention efforts — not to mention productivity and profitability.

Accountability-for-Business-Success

Accountability for Business Successstring(35) "Accountability for Business Success"

For a business organization to be successful, there must be accountability. If there must be accountability, then it follows that some systems and rules have to be in place.
This is also true for business networking groups such as BNI®.

I have found that one of the strengths of a network is that most of the members are friends, and one of the weaknesses of a network is that most of the members are friends. And friends don’t like to hold friends accountable.

 

Think about it like this: Ice hockey without rules would be boxing on ice. Without rules, your networking group would be chaos.

BNI chapters without rules and guidelines would be a coffee klatch of socializing around a table or a social club chit-chatting in a video meeting. You have to have rules, you have to have a system. The rules are important for long-term success.

 

Applying the Rules

Quality leadership is about having a positive attitude while maintaining accountability with diplomacy. It is about coaching people by guiding and helping them. Good leaders apply the policies and rules like Mandela, not Atilla. They use tough love, they show people that they care, and they make sure that the members of their team or of the group understand the why behind the accountability.

Remember: People don’t care HOW until they understand WHY. Accountability is critical for business success. Effectively maintaining accountability in a business or networking group leads to long-term success for the organization and its members.

The-Importance-of-Price-and-Profits

The Importance of Price and Profitsstring(35) "The Importance of Price and Profits"

This is a GUEST BLOG from Per Sjöfors who is a long-time business associate and friend of mine. He has done work for me and is a trusted expert in the field. Per is a Pricing Strategy Consultant, the Founder of Sjöfors & Partners, and a best-selling author.

Profits drive every company. I know that sounds very fundamental, but, in my experience, is something that many business owners and executives do not consider enough. Consequently, in this blog post, I will provide a few practical tips on how a company can use its pricing strategy to increase profitability.

I know we all know this, but it is worthwhile to be reminded that profits provide the resources for a company to grow. Yes, investors can provide growth capital, but this will not support a company forever. Eventually, the company needs to become profitable. And it is those profits that enable companies to spend more on product development, marketing, and sales and increase competitiveness. To grow the business.

Pricing Has the Highest Leverage on Profitability

Further, consider that profit only comes from three variables. It is the total cost of running the company, the sales volume of what the company sells, and the price of what is sold. And of these three, pricing has the highest leverage on profitability. So, let’s do a thought experiment – changing each of these three by only a single percent; how will that affect profitability? Well, for the average company, it turns out that if sales increase by 1%, profitability goes up 3½%, if costs are reduced by 1%, profitability goes up 5½%, but if the price is increased by 1% or discounting is decreased by 1% profitability goes up with 11.3%. Again, this is for the average company. But no company is average.

I have created something that I called the 1% challenge. It is straightforward. The challenge: did you ever fail to change anything a single percent? Of course not. 1% is tiny.

To find out how this works in your company, we developed a calculator you can access here (registration required).

Profit Calculation

This profit calculation is valid for Fortune 500 companies, but it’s also equally valid for a hair salon, an accountant, a personal trainer, etc. And any company in between. You only need the top-level revenue and the total cost, and the calculator will tell you how much a percent price increase will increase profits in your company. 

When you start to look at your company from a profitability and pricing point of view, a lot will change. You will start thinking, “Do I have to give a 20% discount to close the deal? Maybe I should try with only a 15%, or perhaps only a 10% discount?” Likewise, you will ask yourself, “Which of all my products or services can I increase prices on, even if it’s just a little bit? Which product or service has the lowest nearby competition? Which products or services are unique and not exactly like my competitor, so if I raise the price, I will not see a loss in sales volume?” If the company has a sales force, consider reducing the discounting they can give away!

Price Walls

But, as you consider price increases, I also have one word of caution. There is something called Price Walls. These are psychological price points where sales volume changes dramatically, should you cross them. Price walls are often, but not always, on “even” numbers. Such as 5, 10, 20, 25, 50, 100, 500, etc., and this means that if the price for a product or service already is, say, $87, it is very likely that the price can increase to $97 without any change in sales volume. Likewise, if the price of a product or service is $503, reducing the price to $497 is likely to generate an increase in sales volume that could be pretty substantial. I say “could” because it is impossible to know how severe, or not, a Price Wall is without doing the willingness-to-pay research we do in my company. But you try by changing price, if done carefully.

More on Pricing

We are all familiar with how grocery stores and other retailers many times price “on the 9,” such as $9.99 or $49.99. But there are a few things to consider. First, if the product or service you sell is unique, and the price is aimed to be a message of quality and benefit, pricing “on the 9” denigrates that value. Thus, pricing “on the 9” should only be used for commodities, i.e., products or services that are equal to those sold by the competition. Furthermore, ending on a 7 is more effective in driving sales volume than ending on a 9. Ending on a 6 or an 8 is even less effective.  

Finally, consider Price Anchoring. Whenever you expose your price to a customer, ensure they first see a high price, then a lower price. As humans, we cannot not compare numbers, and if a buyer first sees a high price, the lower-priced item will appear more affordable. Since we read from top to bottom and left to right, the high price should be in the top left corner of your price list, menu, or website. It will increase your growth rate by several percent.


There is much more on this topic in my book “The Price Whisperer – A Holistic Approach To Pricing Power.” Here is a link to the Kindle edition.

Creating Organizational Culturestring(31) "Creating Organizational Culture"

This is a question that I am often asked:
“How do you create a great culture in a business or in a networking group?”

It’s a fantastic question about a topic that I love to talk about.
Culture is a critical key to an organization’s long-term success. It is one of the most important things in a company or group, and it applies to all levels throughout the organization. There are many factors that go into building an organizational culture. The variety of contributing factors includes a blend of attitudes, beliefs, mission, and philosophy that help to create and sustain a successful brand.

Culture Takes Time

Creating culture is a journey, not a destination. You can’t get there overnight; you have to be patient. I believe that culture is created in three primary phases:
Organizational traditions lead to organizational core values which lead to organizational culture.

To me, the creation of culture is straightforward. First, understand the healthy traditions of an organization. Second, consistently implement and practice the organizational core values, then share them, discuss them, and write about them. When you do these two things well, you create an amazing culture.

Get All Levels of the Organization Involved

Collaboration encourages engagement. When everyone in the organization knows the core values and participates in the traditions, they help create a positive culture for the group. In BNI®, the worldwide referral network I founded more than 37 years ago, we have focused on getting a high level of engagement throughout the company. This includes a Franchise Advisory Board to address organizational challenges, a Founder’s Circle to provide feedback about issues concerning the organization, a Board of Advisors made up exclusively of clients to ensure engagement regarding policies that affect the organization globally, and several other entities to help ensure full participation at all levels. Engagement can sometimes be messy, but when done correctly, it encourages a collaborative culture.

Culture Eats Strategy for Breakfast

Remember, if you are part of an organization with a great strategy and a marginal culture, you’ll struggle. If you are part of an organization with a marginal strategy but a great culture, you can do well. However, an organization with a great strategy AND a great culture will be an industry leader. Culture is the secret sauce for organizational success, and as I’ve said many times – Culture eats strategy for breakfast.

Business schools often talk about Strategy and typically make it a primary focus. However, culture is much less understood, and it is even more important than strategy for success. Organizational culture affects the way people within an organization interact with one another and the people they serve.

I’d like to know your thoughts about culture – in a company, BNI Chapter, or in another business organization. Share in the comments below.

 

 

 

The Confidence Pointstring(20) "The Confidence Point"

For business networking success, it is important to understand that referrals take place over time. In BNI®, we use the educational concept called the Referral Confidence Curve. It takes time to receive referrals from networking partners. There is little-to-no chance that someone is going to refer you if they don’t know anything about you. You have to invest the time to build business relationships before you can expect to get referrals from your network.

In my book, “Work Your Network With The 4Cs,” my co-author Dr. Oudi Abouchacra and I share how each of The 4Cs affects the referral quality and quantity within your network. We discuss how Competence, Credibility, Clarity, and Connectivity impact the Referral Confidence Curve and I’ll share more about each of the Cs in future blogs.

Initially, referrals start to happen on a limited and gradual basis. However, everything begins to change when the threshold, called the Confidence Point, is met.
The Confidence Point is depicted as the red X on the graph above.

This point represents a threshold that, once it’s established, changes the curve thereafter. When your network has complete confidence in you, referrals will begin to flow your way with a greater magnitude, and as a result, the curve steepens after the confidence threshold is reached. The Referral Confidence Curve assumes that when people are not confident in you, or your business, or your service or product, you’re not going to get many referrals. And when the Confidence Point is reached, referrals increase more steeply. 

Quantity AND Quality

It’s interesting to note that not only do those referrals increase in quantity, they often increase in quality, too. When networking partners have confidence in you, they refer others to you with that confidence and begin passing higher quality referrals.
Whatever the type of your business, it will take time before people have enough confidence in your abilities to know that referring other people to you will not hurt their own reputation. Think about it – none of us want to give our best clients and our best customers as referrals until we know that the person is going to do a good job with them.

It’s common for networking group members to test you out, to see if you’re good at what you do. They may use your product or service occasionally to find out how well you do what you say you’re going to do. When a member uses you, that’s really important because they can then confidently refer you to their network. It helps you reach that confidence threshold much quicker.

Earning Confidence

Most professionals know that the results of the business interaction with a potential referral partner and/or their fellow networking member can lead to more referrals from them. They think: this is a friend of mine, I’m in a networking organization with them. I want to make sure and do a good job for them.

I learned this for myself years ago when I bought my house in Los Angeles, California.
I had a lot of work done on the house by a number of contractors, and almost all of them

were BNI members. However, there was one specialty contractor I hired because there was no BNI member for that category in my area. Afterward, I found out from one of the BNI contractors that the specialty contractor had asked the rest of them, ‘Why are you guys busting your butt so hard on this job? I mean, you guys are working really hard.”  And one of them replied, ‘Yeah, well, this is the Founder of BNI. You know, we want to do a good job because he’ll refer us to other people.”  And they were right, I did.

The key takeaways from the Confidence Point on the graph are that if you have not established confidence with your network, you should not expect many referrals. If you HAVE established confidence within your network, you should expect a steady stream of high-quality referrals over time. Remember, it is critical to your business that others have confidence in you.

Have you experienced more referrals after reaching the Confidence Point with your networking partners?

 

 

 

 

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