Inside Small Business | Small Business & Home Business Marketing

Software as a Service (SAAS)

How does IT in a box sound?

That’s the vision of the latest trend in software development - called Software as a Service (SAAS). For small business owners - this model for technical support is very appealing - if you’re willing to accept the risk.

Software as a Service can be best described as outsourcing an entire business function. Typical SAAS functions are Payroll (Paychex.com), HR (Workday.com), Accounting (Quickbooks.com), Sales (Salesforce.com), and Customer Relationship Management (RightNow.com)

These vendors are part of a growing trend of software providers that allow you to subscribe to the service (typically about $100/month/user - but options vary greatly here). This allows you to run your business with some significant advantage. 1. You don’t have to develop these sorts of applications in-house. 2. You don’t have to have an IT staff to support you. 3. You don’t have to buy a bunch of computer hardware (SAAS vendors have the computers at their site - you just log in via the internet). 4. You don’t have to be an expert in these areas - the SAAS vendors support hundreds of small businesses - and their business model will typically work for you too.

The cost of these applications is typically very reasonable. The drawback is that you give up some of the control that comes with having your own in-house operations. In addition - you have to get over the fact that your Payroll/CRM/Sales/Accounting, information is hosted outside of your business - on your vendor’s website. To counter this concern - I would tell you that the worst thing for a SAAS vendor to have happen is a security breach - and I find that their security infrastructure is better than ANY fortune 500 company I’ve worked with. Security shouldn’t be an issue (although you should question the vendor to make sure you’re comfortable).

One other drawback in having your applications scattered across various vendor websites - is that they aren’t integrated. If you want a Sales order to feed your CRM system - typically you’ll have to re-type the information from Sales into the CRM application. However, web service technology is available to hook all these applications together…and for a bit more investment in some integration services (from great companies like ProCore Resource Group ), you can provide a seamless business process that is automated as well.

In short - if you’re considering some investment in technology to help your business grow - look at SAAS options. It provides state-of-the-market solutions for common business functions at a fraction of the cost it would take if you build it yourself.

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Customer Relationship Management

How much do you know about your customers?

It sounds funny, but you probably don’t know enough. Some of my most recent consulting engagements have been centered on Customer Relationship Management (CRM).

This term has been around for years, and it can’t be defined well. The latest way to define this term is to build a 360 degree view of your customer. This means that you understand all aspects of your customer - and have access to this information as you work with your customer.

CRM 360 degree view includes any orders placed, any problems called in, any invoices sent, and any other information gathered during ANY interaction with the customer.

If you’re not doing so - you should find a way to log every customer touchpoint.

Here’s why: One customer called in with an order. The service agent handling the order managed the transaction, and went about their day.

The customer, however, was dissatisfied with “normal” treatment, and called back. The customer asked to speak to a supervisor, and informed the supervisor that they had purchased over $10,000 in materials in the last 2 weeks. 20% of their ordered materials had been damaged or defective, and they were placing a new order because when they reported the damaged goods, the rep handling the damaged goods claim couldn’t place an order for new goods.

Wow! How different would the phone call have been if the rep handling the order KNEW that this was a top customer, and KNEW that there was a problem with the previous shipment. Perhaps a discount or other relationship enhancement techniques could have been employed. Instead - the customer is left feeling unimportant.

Even if you’re not at a scale where you can afford a CRM system, start logging your customer interactions in a single place (Excel spreadsheet if you must). Bills, inbound calls, outbound telemarketing offers, mail/email solicitations are all contact points…and all of these should help you gain that 360 degree view of your customer.

Use this informaiton to make each one of your customers a special customer. You’ll be glad you did.

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Using channels

I recently had an opportunity to talk to one of the software vendors that I was using on one of my projects. The account manager indicated that they had too much business in their installation backlog, and couldn’t meet all their demand.

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Hiring the right resources

I thought I’d write a bit about hiring the right people. I read Mike’s blog entry about hiring, and I wanted to add a few comments on that subject.

Our business is defined by knowing and hiring the right resources always. The best source for quality people is always from the personal network - as most of our best resources come from those we know. Quality people tend to know other quality people, and there’s still no substitute for personal recommendation.

However, when you can’t rely on the network connections for people, I thought I’d pass along some screening tips I learned as a recruiter during my stint in Big 4 consulting.

We had a pre-screen interview (30 minutes or less) and it had 4 questions on it. I think those 4 questions are able to identify the best quality candidates, and here’s why:

Question 1: What does the company do? This question demonstrates that the candidate has at least done some research about your company, and may even demonstrate some surprising understandings based on what they might find out about you. You can judge interest and understanding from this question.

Question 2: What extracurricular leadership activities do you take part in? Everyone has a “day job”. That may be as a student (if you’re doing new hires), or a current position (if you’re hiring an experienced candidate). If someone is willing to devote their time & talent outside of work to something else (in a leadership role), then that person may have leadership qualities you can tap into. If the person is neighborhood garage sale coordinator, soccer coach, youth club leader, or any other leadership activity, this demonstrates two things that are valuable: Leadership, and initiative - both vital qualities in a successful candidate.

Question 3: How many hours do you work in a typical week? For new hires, we determined that a full time student that also held a 20 hour/week job (regardless of the nature of that job), showed the ability to schedule, time manage, and demonstrate responsibility. This question is obviously geared for student recruiting - but the same can be applied to experienced hires as well, just with different frame of reference. Ask those questions that demonstrate the ability to multitask, or hold a disciplined work schedule (ask anyone with kids this question, and you’ll know what I mean).

Question 4: Tell me about a time when you were NOT able to perform a task you were instructed to do. What did you do? This question is one designed to reveal their problem solving ability. You will learn a lot about the person based on the situation they explain to you (can they even explain themselves well?). The solutions to overcoming their difficulty will tell you something about their ability to solve problems for you. Answers like “I got help” or “I researched the problem until I found the answer” are generally good, while “I quit”, “I yelled at the customer because they were stupid”, “I told the boss to deal with it”, (all answers I’ve received in interviews) may not indicate the best person for the position.

These 4 questions typically take about 20 minutes, and can tell you the factors about an employee that have the best indicators of success: Interest & Understanding, Leadership, Initiative, Time Balancing, Scheduling, Responsibility, and Problem Solving ability. You’ll also likely be able to assess if the person would be a good fit with the team that you’ve already got in place, because those same skills you’re interviewing the candidate for, will also be valuable skills for fitting in with your current team.

I’ve seen fancier interview techniques, but these 4 questions seem to be an accurate indicator of success in my field, and I think you’ll see that most of these traits are the ones that are the best indicators of success in any field.

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The Tyranny of the Urgent

Wow! I just got a reminder today about what should be important about running a small business. Making our clients happy!

Instead - I got a lesson in marketplace competition (where I was on the losing end).

Here’s the situation: I had a client that had an open job posting for a project manager. I had the PERFECT candidate. I forwarded the resume in via the regular channels, and then I tried to set up a meeting with my client to discuss the opportunity, my perfect candidate, and the value proposition my client would receive from having a resource with skills from my company (vs. anyone else’s company).

Then - my client postponed due to a conflicting meeting. Then I couldn’t meet, we traded a few emails trying to arrange schedules, but I never got to give any of those valuable marketing messages to my client.

We finally managed to set up a meeting for next week, and I was all ready to give my wonderful marketing messages.

Then - I got an email from the client’s Human Resources director (who manages the hiring). They sent out a generic email stating that the company had just filled the position - and thanked us for sending in resumes. I got shut out.

So - I think it’s a great lesson in letting the day-to-day urgent tasks get in the way of the important tasks - like building relationships, and performing long term planning.

Make sure you’re not caught up in the day to day so much that you don’t do the things you need to grow.

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What’s your plan?

Probably the most critical skill that a business owner (and especially a consultant) needs is the ability to plan. Surprisingly, this isn’t a skill that many people can do well. Everyone says they can plan- but in reality, the plan is a collection of random items without structure and is effectively a “to do” list.

Why plan? Because you can set dates, milestones and budgets (all these things should be available from your plan). Most importantly - you can set expectations.

So what makes up a good plan?

The plan needs structure, and it needs to tell a story. I typically break a plan into 3 sections - Plan, Prepare, Execute.

Plan is just that - list out the tasks that you need to complete the plan. This includes research, structure, and other activities necessary to develop your plan.

Prepare is the section devoted to gathering the materials you need to actually perform the plan. This includes gathering materials, preparing documentation templates, and identifying remaining details about execution of your plan.

Finally Execute - these are the steps that actually make something happen.

What are the guidelines to creating a plan?

First - EVERY step in the plan has a deliverable. There should be a document, or some other tangible result of each step on your plan. “Think about marketing” isn’t a plan step - there’s no deliverable. “Develop Marketing Questionnaire” is a plan step - the deliverable is “Draft Questionnaire”.

Second - In order to define the plan - you have to be able to count everything. “Perform Market Research” is open ended - and you can’t count the deliverables. “Perform 3 target market studies”, with deliverables as “under 18, 18-35, 35 and up” are quantifiable and definative.

Third - assign effort, duration, due date and dollars. Each deliverable should have a number of hours associated with it, and an expected delivery date (example - performing market research may take only 8 hours of time, but the surveys will be conducted over a 2 week period. Both facts should be included in your plan. That way you can budget the time, and also have an expecation of when things should be complete. You should also assign cost to each line item (even if it’s your own time - put your expected hourly rate). That way you can really see that “time is moneY”.

Fourth - Manage. You’ve created the plan. However, no good plan is ever executed the way you drew it up. Some things will take longer than expected (an estimating problem). Some things won’t be available when you expect them…causing delay (a resource allocation problem). Some things you won’t know how to do - and you’ll need help (a skills problem). That’s where your skills as a manager come to play - you need to react to these things, juggle time, resources, and external factors to make sure that your end goal is achieved.

Fifth - Mitigate. Think about all the things that can go wrong in your plan. Make contingency plans for these items, or at least acknowledge the risks associated with them. You’ll be surprised how much thinking about “bad stuff” will cause you to re-think your plan and tackle something differently - in order to reduce the risk profile of your plan.

Good luck!

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Meet ProCore Resources

Who are we? ProCore Resource Group is a professional services consulting and staffing resource provider founded by four former Big 4 consulting executives. We started our company in July of 2004, and two of the four founding members are continuing our operations today by providing excellent resources to our clients at a price point that cannot be matched by larger consulting houses. We provide both consulting services as well as staff augmentation; however, our goal is to provide value-added consulting services to ALL of our clients, regardless of why or how they originally wanted to do business with us.

I hope that through the story lines provided in this blog – I’ll be able to outline our initial startup days (also known as 4 guys and a laptop), talk about some of the challenges as two of our founding partners left the company, and also provide some insights and thoughts about being a small consulting shop in a Big 4 world. I’ll try to provide some views about the consulting industry as a whole, and also provide some tips & help for those that wish to be consultants (or start a consulting business). Finally, our company was founded to bring a unique value proposition to our clients – one that helps our clients navigate strategic change. We found that companies that are trying to execute on change, are not capable of doing so. This is largely because they have Operations people performing their roles. The job of Operations people is to keep things running – not to change the way things operate. To implement change – it requires a completely different set of skills & resources. Our passion lies in helping people navigate strategic change – and we believe we’ve got the necessary tools and resources to provide a better service to our clients in this area than any Big 4 consulting firm can provide. I hope to explain some of our “secret sauce” for navigating strategic change….and perhaps provide some helpful insights that will be useful for others.
If at any time, a blog entry causes some comment or thought that you’d like to share – please email me at bhattaway@procoreresources.com .

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