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Strategy

Position Yourself As An Authority, And Watch Business Boom

It is a pre-requisite in business these days that the founder, CEO or principal must become an authority in their industry.

Ken Dunn

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Let’s face it, it is tough building a business today. There is more competition then ever. There are new widgets and gadgets, that are confusing your clients, every day.

Long gone are the days when your customers would just buy because of a good product and a good price – they want more! Consumers are looking for an experience or a feeling. Your customers want more then ever for their money. They want to be emotionally stimulated.

Your competitors have already figured it out and they’re stealing your business. Twenty years ago, business owners made it a habit of holding all of their information “close to the chest.” It would seem insane for the principle of the business to go out and speak publicly about how they were different, why they were growing so fast or why new customers were flocking to their doors. We use to call this information “trade secrets.”

Related: 3 Brilliant Books To Help You Launch Your Business

Today, those same principals and CEOs have realised that sharing the secrets is the key to winning the loyalty of clients and customers. New terms like authority, expert and thought leader have completely changed how people do business today.

In the best-selling book Behind The Cloud, Salesforce.com Founder Marc Benioff goes into great detail on the strategy that he used to bring significant attention to his SaaS start up.  He positioned himself as an authority on anything to do with human resources, politics and business.

Whenever something was happening in the media, Benioff would reach out to TV and national radio and get himself on air to give his opinion. Sometimes, he would have to make up his opinion as he went on.

Benioff proved that becoming an authority would propel his business onto the world stage. Today, Salesforce.com is the market leader. They host annual events with over one hundred attendees from all over the world, and they are 10 times bigger then their closest competitor.

If asked, Benioff would undoubtedly agree that his authority status was worth millions of dollars in advertising and new revenue. If we dissect Benioff’s authority strategy, we can quickly see three good reasons for you to focus on becoming an authority in your industry.

Related: Business & Leadership Lessons from Kumaran of Spartan

1. Brings attention to you

Julius-CaesarYou are the principle of the business. This is one case where a little ego will go a long way. Any attention that comes to the founder or CEO of the business will inevitably bring more revenue to the company.

Every time you are introduced as an authority, the first thing said after your name is the name of your company.

The more you are speaking on stage, being interview on TV or giving an opinion on radio, the more people are going to learn about your business. If you’re really savvy, you will also figure out how to weave your business into then things you say as examples.

2. Brings new customers to your business

Consumers always want to be associated with the best-in-class product. If you have ever tried to launch a new product in a crowded space where there is a true market-leader, you understand how difficult it actually is.

What is most frustrating is when you know that the reigning “best-in-class” is an inferior product. The only thing that trumps the best-in-class spending habits of consumers is a new product being launched by the leading authority in the space.

Look at what is happening with Tim Fargo’s startup, Tweet Jukebox. Fargo has been one of the leading expert users (authorities) on Twitter for years. He recently launched a new tool to help Twitter users post better content, more often – and it’s an overnight success.

Now, I am addicted to Tweet Jukebox and think it’s a great product, but I wouldn’t have wasted a second looking at it, if it weren’t for Fargo’s authority status on Twitter.

Related: 8 Secrets Your Business Mentor Won’t Tell You

3. Increases loyalty in your customers

Loyalty-fansReal “authorities” will be incredibly passionate about a chosen subject. They will be publishing articles with their thoughts regularly. They will be Tweeting, Facebooking, Pinning and writing on Reader’s Legacy on a daily basis, and their customers will follow every word, loyally.

Ken Blanchard wrote a wonderful parable on the art of creating customer loyalty called Raving Fans. In it, Blanchard touches on the importance of authority positioning. It is becoming harder and harder to win the hearts of new customers, so you need to do everything you can to keep the ones you have.

Positioning yourself as an authority and communicating with your customers, through every means possible, will increase their loyalty.

Customers want to follow the champion.

I am going to spend the next couple of months studying and writing on the art of becoming an authority.

I am convinced that it is becoming a pre-requisite in business that the founder, CEO or principal must become an authority in their industry. If you don’t do it, you will be destroyed by your competition – because their principle is taking this stuff seriously. They are becoming an authority.

This article was originally posted here on Entrepreneur.com.

Ken Dunn is the author of five books on sales, marketing and business and has sold more than 250,000 books in 10 languages around the world. Dunn is the founder and CEO of ReadersLegacy.com and Next Century Publishing.

Strategy

You Are Your Own Client

Before you can build a start-up that takes over your industry, you need to treat yourself as your own best client.

Allon Raiz

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In business, when you have a client, the relationship is formalised into a structured one where there are defined expectations and regular meetings. For example, if you are a consultancy and have a one-year contract to deliver services to a client, the relationship will be formalised, structured and possibly include monthly status meetings. Some may be report-back meetings while others may be briefing meetings.

Your client will receive a monthly invoice and there may be quarterly reviews of the work you have done. Your general mindset is one of service to the client because they are important and worthy of the effort. Crudely speaking, most service-provider arrangements work in a similar way because the structured model works.

In contrast, as entrepreneurs, our relationship with our own business is often far more chaotic or ‘organic’ than formal. My contention is that it is also much less effective. When I work with SMEs, one of the first things I do is encourage the entrepreneur to treat his or her own business as a client by formalising meetings, ensuring that there is a feedback loop and having a service-provider mindset. By making these philosophical and structural changes, you will create a far more efficient and well-run business.

There are four aspects to any business which, in my view, should be formalised.

1. Partners

It still astounds me how informal the meetings are between partners in SMEs, especially when they operate from the same office. There are no set times, no agendas and no outputs required. The fact that you might sit in the same office or chat regularly is the problem because it’s interpreted as proper communication while it’s actually a very undisciplined and unstructured process. Casual chats do not ensure that all the requisite items or issues are being properly discussed and dealt with.

Related: How Investors Choose Who To Invest In

2. Staff

The often-given excuse for not holding weekly, biweekly or monthly meetings with team members at the same date and time is that the business is fluid and the entrepreneur needs to be responsive to their clients’ urgent needs whenever these might occur. And so non-rhythmic meetings are occasionally inserted into the gaps in between the chaos.

The discipline that I try to imbed in the SMEs I work with is to hold rhythmic meetings at a certain time and day every week, month or quarter. Should there be a need to cancel this meeting for whatever reason, it should be rescheduled. The simple discipline of rescheduling and not cancelling allows for a compromise between the practical reality of an entrepreneur’s life and the discipline required to build a sustainable business.

3. Agendas

Agendas are often seen by entrepreneurs as an icon of the structure of the corporate world. They smack of rigidity, stuffiness and boredom so they are often discarded and replaced with warm and fuzzy chats. In reality, in order for it to be an effective use of time, every meeting requires a structure, outline or agenda.

This can be a comprehensive agenda similar to that used by corporates or as simple as each person in the meeting talking about their three top-of-mind issues. What is important is that there is structure and outputs, otherwise the meeting’s output is merely that it’s nice to know. The output from a meeting with a formalised agenda is that it’s nice to do.

Related: Why Reading Is The Most Important Tool In Your Arsenal

4. Product review

When last did you, as an entrepreneur, formally ask yourself if your products are still relevant and effective in the market? One of the greatest oversights made by SMEs is not regularly reviewing the appropriateness of their existing products or services. In a high-growth, chaotic environment that is attuned to constantly producing new products, existing products soon become the ugly stepchild, only getting attention when the client cancels the contract because your competitor has a faster, shinier and cheaper iteration of your product. An incredibly important discipline in any business is the regular and formalised review of products and services.

We resist structure as entrepreneurs and the price of that resistance is ineffective and inefficient businesses. By simply treating ourselves as we would our clients, we are able to imbed a level of structure to our businesses that will create a far more effective and enduring business.

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Strategy

What’s The Worst That Can Happen With A Disgruntled Silent Shareholder?

Whether a shareholder brings capital to the business, experience or connections, you need to ensure everyone has the same vision and values.

Kyle Torrington

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While we often hear that it can be bad to have a silent shareholder that does not want to play ball, it is not often that we make enquiries about how the governance of a company can be hindered by a disgruntled shareholder.

Most of us assume that as long as they own more than 50% of their own company, they are entirely in control of all aspects of the company and how it is governed. This is not true: Even if you are a majority shareholder, holding less than 75% of all the shares in your company can still result in headaches if a minority shareholder, holding at least 25% of the company, becomes disgruntled and neither participates in the decisions of the company, nor consents to the decisions being made.

What is set out below highlights, among others, why it is so important to give shares in a company to prospective shareholders over a period of time, rather than from the outset. This allows for shareholders to prove their worth without you potentially placing your company in a position where it could be held at ransom for many years.

Related: 7 Factors To Determine Who Are Your Employees (And Who Aren’t)

The illusion of holding more than 50% of the shareholding in a company

  • Many people assume that by holding more than 50% of the shares in a company they are free to do with the business as they please. This generally only holds true for basic decisions of the shareholders, such as the removal and appointment of directors. The most important decisions of a company are based on special resolutions. A special resolution requires that shareholders, either individually or collectively, holding at least 75% of all the shares in a company, vote in favour of a specific decision.
  • Examples of decisions that require a special resolution include:
    • Amending a company’s Memorandum of Incorporation
    • Approving the issuing of shares or granting of other similar rights
    • Authorising the basis for determining directors’ salaries
    • Disposing of company assets
    • Mergers and acquisitions.

So, what does this mean for you and your company?

  • If you are a start-up looking to raise funds, apart from some exceptions, you will not be able to issue further shares to new shareholders or anyone other than existing shareholders if there is a shareholder that is effectively dead weight.
  • Should you manage to vote a new director to the board, you will not be able to determine the basis on which they are compensated (their salary) without a special resolution.
  • If you intend to merge with another company, you will not be able to pursue this without a special resolution.
  • If you plan to raise money by disposing of or selling most of the assets of your company you will, once again, be prevented from doing so.

Related: Reality Check: You Probably Don’t Own That Work You Outsourced

Accordingly, it is always best when starting a venture to vest your shares over a period of time. This means that, for example, shareholders are only entitled to have their shares allocated to them after a certain period of time to avoid a situation where you have a dead-weight equity shareholder hindering the governing of your company, and requiring possible litigation to remove them.

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Strategy

There’s More To Team Management Than Leadership

When you’re running a business you need to ensure that your employees are on your side, helping you to make profits. Giving them job security, taking them seriously and treating them with respect, will go a long way in enhancing loyalty and productivity.

Henry Sebata

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The staff that work for you determine:

  1. How happy your customers are with your business
  2. The quality of the things that you sell
  3. The costs that you incur to sell your products and services
  4. Your risks – the things that can go wrong and how much it costs you

All of these things determine your profitability and how competitive your business becomes. How do you ensure that everyone is on the same side and helping you to make profits?

At work everyone believes that they are getting something (such as money) and are giving something in return (such as time and effort). They are weighing up in their mind “how much am I giving, how much am I getting in return and is this fair?” If they believe that they are:

  • Giving too much or
  • Getting too little
  • Then this is unfair, and they won’t work well (poor productivity – how much they produce).

Related: Why Innovative Employee Benefits Are Your Competitive Advantage

The manager needs to:

  • Know what people are thinking about what they are giving and getting and
  • Manage the giving or getting side
  • So that people become more productive

In a smaller business you sometimes cannot afford to pay more or provide the sort of benefits (pensions, medical aid, bursaries etc.) that larger firms can and so the staff may be unhappy, not be productive and be on the look-out for something better.

How do you increase happiness without money?

Everyone wants:

  1. Job security – knowing that you will still have a job next year – and that you will get paid on time.
  2. Contributing to the success of the business. If you train staff to have the knowledge and skills to do a better job and you then encourage and support them to do this then they are happier, and you increase profits. If you then share some of these profits with the staff that helped you to make them then everyone wins!
  3. To be taken seriously and treated with respect. If you do this then staff are happier, and they will also treat your customers with respect.
  4. To be part of the team. You can often do this by having a regular briefing on what your plans are and discussing ideas. Because staff are doing the actual work they will often have good ideas and then will be motivated to implement them – it was their idea after all!

Staff leaving you all the time is a can destroy significant value. If you implement the strategy above, you will have happier staff that are more productive and a more profitable business.

Read next: Understanding Your Responsibility As An Employer

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