25 Years of Small Business Know How

1. 25 Years of Small Business Know How St. Albert Chamber May 13, 2014

2. Who we are and what we do Office Space Campbell Building – 200 Carnegie Drive Mission Building – 13 Mission Ave. Home to 30 offices Home to 40 offices Support Services: Admin, meeting/board rooms, VOIP Phones, High Speed Internet Programs Virtual Space Coaching Monthly Lease Terms Mentoring

3. Getting to 25 It’s all about the people. Joe Becigneul Chair Ron Grainger Vice Chair/Treasure Jeanette Bancarz Past Chair/Director Rod Schatz 2nd Vice Chair Al Henry Director Lynn Carolei Director Joan Barber Director Dar Schwanbeck Managing Director Dr. Anshuman Khare Director Yves Lussier Director Brian Stewart Director Malcom Parker Director

4. Why is Incubation Important? • Good for most businesses • Improves chance of surviving 5 years from about 20% to 80% • Foster innovation and commercialization • Matchmaking with investors and customers • Mentoring & coaching • Holistic environment • Better use of capital.

5. 25 Years of Small Business Know How So what are the things we don’t know we should know?

6. Do We Have the Right Stuff? • Entrepreneur Test Probably • Immigrant to Canada • Average student • Work alone • Lemonade stand • Stubborn child • Risk taking kid • Don’t give a s**t • Commit savings • Borrow from others • Okay to fail, would start again • Willing to learn • Know about cash flow • Optimist • Willing to prepare Probably Not • Born in Canada • Top student • Groupie • Cautious kid • Hate to work alone • Take break between projects • Opinions matter • Like to work 8 to 5 • Tempted to look for a job • Easily bored, love to shop • Analytical, trouble with personal goals • Pessimist • Prefer silver bullets

7. Personal Readiness Ability to learn? Flinch? Over-analyze? Blind spots? What business outcomes? Personal goals? What assumptions? Examine your own “theories in use” Domain Knowledge?

8. Too Much Tactics NOT Enough Strategy • A new way to shovel? Tie shoes? • Feast or famine? • Working in the business versus on the business ? • Routinely plan? • Trends? • Two scenarios for your business? • Are you thinking growth?

9. Relevant Trends • Pets, pets & more pets • Armored cocoon (it’s a dangerous world) • Mancipation (man as mom) • Gluttonous Gourmet • 24-tainment • Sex-E (but not on my cell phone) • Manity • Life Lifting (if you’ve got it, flaunt it); fuller is in • Evolution • Busy and broke urbanites • Modification free foods: highly valued assets • Antibiotics: more harm than good? • Biology and stock markets • (Source: Faith Popcorn) • The rise of the solo-citizen • Internal technologies • Streams of information • Beer stocks always increase in December • The nest empties • Food Vaping • The waistline widens; • overweight is sexy • Service boom (lawn care) • Home renovations • Drier future; wacky weather • Replace vs. repair

10. Customer-Centered Culture 4 Key Questions What do you do? Who do you do it for? What do they want? How can we improve? Source: Creating a Customer-Centered Culture Author: Robin L. Lawton

11. Customer-Centered Culture, cont.

12. Competitive Advantage Do You Stand Out in a Crowd? • What is your value proposition? • What is the market space you compete for? • Do you have real competitive advantage (competitive weakness is • the reason for 21% of business failures)? • Too heavily focused on products and weak on customers & markets?

13. Competitive Advantage, cont. Red Ocean Strategy Blue Ocean Strategy Compete in existing market space Create uncontested market space Beat the competition Make the competition Exploit existing demand Create and capture new demand Make the value-cost trade-off Break the value-cost trade-off Source: Blue Ocean Strategy Authors: W. Chan Kim & Renee Mauborgne Align the whole system of a firm’s activities in pursuit of differentiation and low cost Align the whole system of a firm’s activities with its strategic choice of differentiation or low cost

14. Leaching vs. Selling • Do people buy from you just to get you off their back? • Please, please go take a professional sales course • …but first, work out your marketing strategy

15. Marketing Ideas • 75% of all small businesses don’t have enough customers • Most small businesses don’t know why customers buy from them • Marketing attracts customers and sets up the sale • Lack of focus • Over-use of discount pricing • Half of all sales on black Friday were on-line • 70% of buying decisions are made online…before people even show up at your store • Poorly integrated strategy (the hood ornament doesn't match the car)

16. Focus on Throughput vs. Cost • What is the vision or major goal for your organization? How do you measure performance? Have you considered Throughput Accounting? • Biggest leverage point? (e.g. increase throughput, improve ROI, or reduce operating expenses) • Early warning system?

17. Complicated decision making • Use three global parameters to measure the impact of decisions: • Impact on throughput (T) • Impact on operating expense (OE) • Impact on investment (I), and • NP = T – OE • ROI = NP/I or ROI =(T-OE)/I • ROI=(^T-^OE)/^I We Can Fix That!

18. Constraints and Tunnel Vision • What is your BIG Goal? • What would you say is the main constraint? What impact is it having on the organization? • How long have you had this problem? • What solutions have you tried? Why have they worked (not worked)? • How is performance measured?

19. Don’t know where you fit… • Your organization is composed of links in a value chain... • just as your organization itself is a link in a (bigger) chain. Sales Purch. Engr. Mfg. Shipping Distr. Others Your Org. Cust's Your Your Cust. End-User Cust. Vendor

20. Disasters you should see coming • Inadequate sales • Competitive weakness • Excessive operating expenses • Receivables collection difficulties • Inventory difficulties • Excessive fixed assets • Insufficient assets • Scale is wrong

21. All Roads Lead To Finance • If a company is promising enough, the capital for it can be found… • Additional capital will always extend survival … but, it is rarely clear that additional capital will lead to success. • Capital is often wasted through premature marketing of products whose further development can not be afforded with the existing stake.

22. Organization - Right People & Capabilities(Who is on your team?) • Does your organization structure work the way you want it to? What is your requisite necessary organization? • How many employees are performing in roles below or above their capability (underutilized & bored or over their head and anxious)? • Are there some employees in jobs that they should not be? • Are supervisors competent? • Is there equal pay for equal work? • How would you describe morale? • What values are at work?

23. Technology Accelerators • Where does (might) technology play a role? • Business Services: Scheduling systems • Retail Services: Integrated POS systems • Widget Maker: Mobile Apps. • Hotel Industry: Sound Proofing • Ford Trucks: Sound Proofing • Incubator Programs: WKI Commercialization

24. Driving Improvement • What percent of your projects finish on time and budget? • Is accountability for projects clear? • Do you suffer from “student syndrome (leave it till the last minute) and “Parkinson’s Law” (work expands to fill time available)? • Have you ever heard of critical chain (versus critical path) project management?

25. Measurement(A car without a gas gauge?) • Do you measure the drivers for satisfaction and whether customer expectations are met? • Do you measure throughput (progress toward the organization’s primary goal)? • What is the organization’s main constraint? Do you measure progress toward overcoming this constraint? • How many measures does your organization have in total? • Are measures communicated throughout the organization? • Do you act on the data you collect?

26. A house (business) plan? Or a house of cards? • Do you have clear goals and a viable vision? • Does your business model work? • Is there buy-in to the plan? • Is it a financial plan or a roadmap for success? • Do you have specification sickness? • Are you trying to do to much? • Are you focused on a few core products? • Do you know your customer as well as you think you do? • Are you engaging end users vs. brokers? • Is your market research sufficient? What is your “available” market? • Are you spending too much time on production, finance and business process? • Are you using throughput thinking to support decision making and concentrate resources appropriately? • Do you have a plan for implementation? My goal for 2014 is to… accomplish the goals of 2013 which I should have done in 2012 because I promised them in 2011 and planned in 2010.

27. A house (business) plan? Or a house of cards? One More Time • The business owner that plans is the business owner that succeeds. • The business owner that thinks strategically will outdo the competition that only thinks tactically. • Businesses that have a plan grow quicker than those that do not have a plan. • Business owners with a plan have a survival rate 5 times that of non-planners. • Banks prefer to deal with planners not reactors.

28. Figure out how to put fun and entertainment into your business A business has to be involving, it has to fun, and it has to exercise your creative instincts. Richard Barnson

29. Prepare “The will to win means nothing without the will to prepare” • Goal, objectives • Route Knowledge • Timing • Team • Weather Conditions

30. Come To Our Party Join us for our 25thBirthday Party and enjoy the Inspirational Hilarity of Zandra Bell and her ability to Enhance Human Potential! June 11th, 2014

31. Thank You & Good luck with taking your business to the next level! For more information on what NABI has to offer your Business, please visit our website or give us a call. www.nabi.ca 780-460-1000