Verne Harnish is founder and CEO of Gazelles,
a global executive education and coaching
company, Verne has spent the past 30 years
educating entrepreneurial teams. He’s the
author of Scaling Up that uses approaches
honed from over three decades of advising
tens of thousands of CEOs and executives.
sucked into all the challenges of
running a much larger operation which
had reduced his field time to less than
a week every quarter. The minute he
said it, the CEO looked at his head of
operations, he looked at me, and we all
looked at the division head and we knew
our answer had been found. We then
spent the next hour figuring out how
to get some activities off the division
head’s plate so he could get back out
in the field.
Results? When I checked back three
months later, though the division head
had not yet achieved a week/month of
field time, he had managed to get out
a lot more than he had been and in the
process found a new product that may
likely add $10 million in revenue next
year! Now the company is faced with
finding the cash to support the added
inventory and again, when explored how
they had successfully accomplished
this in the past.
DEFINING AND FOCUSING ON THE
CORE CUSTOMER
While discussing the downturn of
company profitability over the past few
years, Certified Gazelles Coach Andy
Buyting brought a new client, in the
security guard industry, through a core
customer exercise. After analyzing the
hard numbers and the gradual shift in
customer profile in recent years, it was
found that approximately 76% of their
customers made up less than 5% of
their revenues.
What they concluded was they were
wasting far too much (76%) of their
time, attention and resources servicing
clients that were simply not profitable.
This was taking them away from their
larger clients, clients they were better
equipped to service well, and would
most likely contribute to larger and more
profitable growth in the future. study the A’s, not dwell on the F’s, if you
have any hope of supporting your child
in a positive way.
Result? Within a three week period, they
essentially fired (transferred out) three
quarters of their customer list. This freed
up their operations and admin people
to focus on their large profitable clients.
It also provided their sales team with
clarity on their core customer, and has
allowed them to grow larger, faster and
with much stronger profitability. “YOU DON’T IGNORE
YOUR PROBLEMS,
BUT IT’S FAR MORE
PRODUCTIVE TO
STUDY WHAT’S
WORKING...”
TURNAROUND STRATEGIES
Another friend who turns around
business said he uses a similar process.
He simply asks for a graph of the
company’s financial performance for
the past decade or so, looks for a point
where the performance was stellar,
and then brings together leaders and
employees who were around during
that period and spends a couple days
inquiring into what the company was
doing then that they aren’t doing now.
The same with your company. You don’t
ignore your problems, but it’s far more
productive to study what’s working,
in your own company or others, as
the best way to solve the challenges
facing your growing firm. u
In one recent turnaround, he found seven
distinct activities the firm was doing
during the boom times that they weren’t
doing now and he simply focused the
firm on doing those activities again,
even though the market and products
had shifted over time. Results? Another
successful turnaround.
FOCUS ON STRENGTHS
Marcus Buckingham, the strengths
movement guru (Go Put Your Strengths
to Work), notes that if you want to help
your children with their F’s, ask them
about their A’s – what did they do to get
their A’s, why they like that subject more
than the other, what the teacher does,
etc. You don’t ignore F’s, but you must
SPRING 2017
| 7