Innovation Strategies: Part 2 – Product and Services Innovation is presented by expert strategists Erica Olsen and Howard Olsen of M3 Planning. This part of the series looks into how the current economic times are making organizations look at their products and services trying to find ways to cut back. Instead organizations need to be looking at how they can provide the right products and services that their customers need. Many people have changed their focus as the economic downturn continues to effect everyone.

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Innovation Strategies: Part 3 – Business Model and Behavioral Strategies presented by expert strategists Erica Olsen and Howard Olsen. This part of the series is a deep dive into how innovation needs to be a part of your business model and how looking at behavioral innovations can help your organization grow during this economic downturn.

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1. Strategy Stat: Strategy Stat: Marketplace leader-board shuffles at double rate in downturn
2. Topic/Question: Planning in Turbulent Times: How do you do strategic planning looking out 1-2-5 years when there is a real threat of a dbl dip recession?  How is it applicable?  How do I adjust?
3. Topic/Question: Running Mid-year Reviews: How do I run an effective Mid-Year Strategy Review meeting?
4. Topic/Question: Leadership & Strategy: I’m new to the “strategy leader” for our mid size company.  What are 2 pitfalls that I need to watch out for?

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Harvard Business Publishing recently posted the results of an employee survey to their Daily Stat blog, claiming that employees are more appreciative and enthusiastic about their jobs than a year ago. From 2008 to 2009:

• Employees who take pride in their jobs rose from 71% to 79%
• Those who recommend their employer rose from 53% to 58%

Since MyStrategicPlan is frequently used as an employee engagement tool or performance management software, we take a close look at the general level of engagement found across the US. But just like the writers at the Be Excellent blog, I question whether these findings truly indicate a more engaged workforce.

During the recession, with jobs being scarce, it stands to reason that employees would take pride in their jobs; they actually have jobs, unlike many of their unlucky neighbors.

…And about whether they’d recommend their employer, with so many people out of jobs, almost everyone has a friend who has asked for help looking for employment. If a job opens up at someone’s place of business, they’re far more incentivized to tell their friends about it than they were when jobs were plentiful.

With other recent reports and pundits warning that a recession recovery will present challenges in employee retention, I don’t believe Harvard’s rosy take on their daily stat should be a signal to employers that their people will stay put.

More than ever, it’s time to make sure that your people are engaged, that they see where they fit in your organization and they know how you plan to get where you’re going- together.

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Three topics of focus:

1. Strategy Stat: The Effect of Global Economic Turmoil on Companies .
2. Question: Leadership Buy in & Engagement:
   1. Our CEO wants a plan in place, but he won’t set the strategic direction.
   2. When you have a champion in a closely held organization, how do you communicate to the other owners their role in the process?  They want strategy but it seems like they want others to be responsible for it & other objectives continue seem to have higher priorities.
3. Question: Planning in a Dynamic Environment:
   1. The economy is volatile. Our industry is going through major change.  How do we plan in such a dynamic environment?

Download Presentation Here

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• Leadership and Strategy: Pitfalls in the Strategy Leader Role (20 mins) This is part of our Strategy Huddle series from July...

But, what if you lose a bunch of your employees?

Wait, losing employees? Aren’t they happy they even have jobs in an economy like this? True, right now you could look at the economy as an employer’s market- for every job posting right now there’s several times the applicants than there were a couple years ago. We recently caught this bit on a New York Hospitality Services Blog:

One consequence of the severity of the recession has been a surfeit of talent across industries looking for opportunities as few, if any, employers were hiring. That may change sooner than later as this survey by Intuit, a provider of payroll services finds that “that (of) nearly half of small business owners surveyed, 44 percent, are planning to hire new employees within the next 12 months. At the same time, many small business owners believe that benefits are key to attracting new hires but are finding them difficult to afford.”  Interesting findings of that survey include the fact that family and friends of current employees make for good new hires as well as that long term relationships with employees matter.

So, as the economy eases out of recession, we may see a massive surge in hiring- which means it’s more important than ever to keep your employees engaged. Forbes.com also weighs in on the issue with an analogy and some wise words:

Employees are like elephants: They watch, and they remember. They know how they were treated in the bad times, and how their fallen colleagues were treated, too. They form long-lasting impressions of their employers. And they are already planning what to do about it.

I’m not sure that your employees will want to be compared to elephants, but the fact remains that businesses need to be serious about employee satisfaction and employee engagement as the recession lifts, or else they could find their best and brightest lured away.

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(reprinted from RLife Magazine)

Over the last several months there’s been a lot of talk of economic woes, a slowdown, or some other soft-peddling term for the possible coming recession. This evening, listening to NPR I heard an economist say that it’s no longer a question of whether we’re facing one, but for how long and how severe. Whether you’re a business owner concerned about this year’s profits or an employee concerned about the future of your job, we all feel some sense of uncertainty about what the looming economic dip will throw at us.

But it doesn’t have to be all doom and gloom. Just because the economy may be slowing doesn’t mean we need to panic. Anyone who has been in business long enough understands that this is just one of several regular cycles that can be painful, but also beneficial – kind-of like a forced spring cleaning.

At our firm, we’ve dusted off and are cleaning up three fundamental areas to help us get out ahead of what is coming: taking the slack out of the line, marketing on-the-cheap and proactive client service.

Our first focus centers on improving efficiency. By “taking the slack out of the line,” we mean that every one of us tries to make sure that what we’re working on is contributing to growing the company. When cash is abundant, it’s easier to occasionally go off track without anyone noticing. But when you’re facing lean times it’s important to stay focused on growth and productivity. As drill sergeant-like as our staff meetings can be, everyone on the team is responsible for move the dial on one or two key metrics. If the dial isn’t moving, we are digging into why, why not and what are we doing about it.

Next to cleaning up our efficiency, we also practice “marketing on the cheap.”  It’s easy to throw money at a problem; it is harder to make that money work for you. There’s never been a time in history when we as businesspeople have had such an abundance of opportunity to reach potential customers so cheaply- all because of the web.  The single most powerful tool that we have employed to attract customers to our online business has been search engine optimization, SEO. Roughly translated, that’s making sure your website is set up to show up favorably when people search for the services or products you provide.

Next to SEO, we’ve also had success reaching our customers through blogging and any other online visibility we can find through press releases or social media outlets. Many businesses still overlook these tactics because they don’t see immediate returns in the traditional sense, but you’re not going to get all your new business by going to the same old local networking events.

Besides using only the above marketing tactics that are yielding results, we’re also dusting off best practices around managing a sales funnel. Generating leads from marketing activities is half of the equation, closing those leads is the other half.  Throwing some rigor and consistency behind our sales process is something all businesses can do right away and see quick results. Who should you follow up with this week?

Of course, none of these will be able to keep your company thriving during a slow economy if you don’t take care of your current customers. Everyone knows it costs much more to find new customers than to keep your current ones happy. There’s no more important time to make sure that no one slips through the cracks. We’re not waiting for clients to call – instead, we’re being proactive, making sure that we are providing value to their organizations. Our job is to help our clients grow their businesses. After all, we’re in this together.

There will be feasts and there will be famines. Right now, facing what may be a slowing in the nation’s and our local economy, the important thing is not to panic or agonize over what we as business people cannot control. It is time, however, to focus on the right things. And if you do, you and you team will be polished and sparkling when the economy picks back up.

Erica Olsen is a founder and VP of Marketing of M3 Planning, a strategic planning and performance management company. She is the author of Strategic Planning For Dummies

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The release, titled “Small Business Owner Optimism at Five-Year Low” says that the latest 35 point drop in the Small Business Index brings it to an all-time low, spelling out major concerns for businesses. What are the major worries?

• Small business owners’ present revenue situation
• Future expectations for cash flow and financial situation

According to Wells Fargo’s senior economist, this doesn’t speak well for a swift recovery from our current course. On a positive note though, the report did mention that while business owners are concerned about their future, they feel successful.

So, What Does this Mean?

• If you’re a small business owner: Having a plan you can act on is imperative. Your strategic plan wasn’t likely crafted during a downturn, so a recession-plan is essential right now. Visit MSP’s free recession planning toolkit for more info.
• If you market to small business owners: Let them know you’re here to help them make it through this downturn. Any message of security or loyalty is welcome during a downturn
• If you’re a friend to a business owner: Buy them a beer & do your best to spread the word about them. There’s no better time to be supporting our local small businesses!

Like we’ve said, this downturn will pass- but very few of us will get through it without having to make quick decisions and some pretty tough ones. Having a great plan in place now is the best step you can take for your organization.

Photo by jurvetson

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Well, when’s the last time you put your budget on the scale? Just like our bellies, our spending can start to grow over time without much notice, and we don’t know how bad it is until something exposes it- like being invited to the beach, or a meeting with the accounting department!

In our recent “Ultimate Recession Planning Toolkit,” MSP outlined several great ways to get your business’s budget- especially marketing- into shape for the coming economic downturn. We give you specific exercises that can trim the “holiday fat” and get you ready for anything- like the following advice about advertising during a recession:

• Temporarily switch media: In order to stay in the public’s mind for less, look into moving your budget from TV to a less expensive medium like radio, print or in some cases the internet.
• Buy in Bulk: Find out what kind of discounts you can get now by making a large purchase before your budget shrinks.
• Negotiate Long-term Deals: Media outlets will feel the pinch as well, and will be looking to make money. If you prepare by saving now, you can meet with them to lock in a low price for a long-term contract.

So go check out our advice on the heavy lifting, stretching and other activities that’ll get your balance sheet all sexy for the beach season, er, recession.

“Does your Marketing Budget Make you Look Fat? Five Exercises for a Leaner Organization“

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The last recession on record for the US was 2001-2002. Since most of the Generation Y workforce took to the streets in the last couple years, that means that they’ve never had to deal with one.

A Harvard Business Review article from October has 4 great pieces of advice for Gen-Y-ers who are weathering their first recession.

Question Everything: The point here is to make sure you’re reading the signs. Watch for leading indicators like those watched by the conference board.

Favor Agility: When deciding between buying or renting, it may be best during a recession to rent- you can easily move to another town for work when you don’t have to worry about selling your house first.

Watch your Cash: Planning on a heavy purchase? You may want to wait. In the case of layoffs, that extra cash may come in handy.

Develop a Plan: Most importantly, you need to sit down and begin recession planning for yourself. What’s your backup in case things go south? Do you have an account where you’re storing up for a rainy day- or a rainy week?

We’ll be covering more on recession planning in the coming weeks, so stay tuned.

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