There are many successful business strategists in the market at the moment sprouting the importance of having an Elevator Pitch.  So is this piece of promotional spiel essential for your business to prosper?

The short answer is yes.  It might seem simple, however, a successful Elevator Pitch will serve as a communication tool, a teaching tool and without a doubt, your business’s most cost effective sales tool.

An Elevator Pitch is a 30 – 60 second business description that provides an overview of an idea, product, service, project, person or business solution.  It is designed to be a conversation starter and a means for “cutting through the clutter”.  It is called an Elevator Pitch as it tackles the theoretical challenge of “how would you explain your business and make a sale if fate saw you in an elevator with your dream prospect?”

If your business doesn’t have an Elevator Pitch, you are missing an opportunity for making a powerful first impression.  Remember, the attention span of the average person is just 30 seconds before they start to drift.  Consider most of the people that you will be dealing with are busy and likely to know of or be using your competitors; you must make your point powerfully, quickly and clearly.

 So how should you create your Elevator Pitch?

1.  How’s your hook?

And no gentlemen, I’m not referring to your boxing style.  Every great Elevator Pitch should have a hook – that is something that will intrigue and engage your audience.  Review the unique aspects of your business to develop your hook.  As a point in practice, I’m an plumber really doesn’t compare to “I’m the only plumber within the region who offers a 24 hour call out service and service guarantee.”

2.   Make it exciting

Make your message memorable and convey your enthusiasm for your product.  Remember, you don’t need fancy words – just powerful ones!

3.    Keep it concise

Your pitch should stay under 200 words to ensure that you can adequately and clearly relay it within a 30 – 60 second timeframe.  Don’t use long, descriptive terminology – you only have a few seconds to capture your audience and you don’t want to risk boring or distracting them. If they don’t understand your terminology, you will lose the opportunity.

4.    Tailor to target

Your Elevator Pitch should be aimed for a specific audience.  If you have different audiences, you need to create individual pitches so that your hook and uniqueness remains relevant. 

5.    Be outcomes oriented

Remember the outcomes that you have in mind when designing your Elevator Pitch.  Do you want to make a sale, attract investors or get people talking about your brand?  

The samples below demonstrate effective but concise pitches that have a clear outcome in mind.

“It is our goal to connect people with their computers.  We create simple, effective programs to make it easier for people to do their jobs.  Would you like us to improve your workplace?”

“We help businesses reach a wider audience through creative and clever social media strategies.  Avoid wasting hours trying to unravel the ins and outs of social media – our team will set up your systems for you.  Do you know of any companies that might need social media advice?  We are but one computer click away!”

So seize the moment and get cracking on your Elevator Pitch.  Remember if you need a hand developing yours, our Business Edge team are specialists in business strategy and can help you to develop your pitch and a corresponding one-page business plan.  Click here to find out more.

Contributed by Amanda Hibberd.  Amanda assists our clients in public relations and marketing areas. 

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Ever wondered what the cash effect would be on your business if your target debtor days were reached?  Or you could keep your stock levels to your target minimum level?

We have begun using the review software Profit Optimiser to do just that for our clients.  With putting in the key information from your financial statements we are able to demonstrate just what cash your business is missing out on when your debtor control does hit the target debtors days.  Or when your stock system is at its most efficient cycle.

With the importance of getting your cash conversion cycle right shown to you in what dollars will hit your bank, you are then armed with great motivation to work on your Cash Optimisation Strategies – a concept from Verne Harnish, and covered within Peter’s Gazelles coaching service.

Essentially there are four areas within the cash conversion cycle to work on:

• Sales cycle – time from meet customer, get quote to obtain purchase order
• Make production & inventory cycle – length of time which takes from purchase order to product ready to send to client
• Delivery cycle – time to get finished product to client
• Billing & payment cycle – time for client to pay after invoice creation

Strategies to work on each are based on the following:

• Shorten Cycle Times
• Eliminate Mistakes
• Improve Business Model & Profit & Loss

The more efficient you can make all processes and procedures the improvements in each will result in cash flowing more quickly through the business.

If you are struggling with cash flow but your financial statements show that you are making profit, it may be time to take a look at the cash potential of your business.

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When comparing a businesses’ performance for the 2011 year against 2010 it was a great pleasure to see that their hard work had paid off during the year with a resulting 200% increase in profit over the last 12 months.

At the beginning of the 2011 financial year, we met to create the coming year’s budget.  At this point we took the opportunity to discuss the importance of setting leading KPIs behind their sales targets.  The aim of this was to focus their targets on an achievable activity rather than the total sale target.  Each month during the year, these KPIs were reviewed in consultation with us.

The above mentioned result proves there was a great turnaround for the business.

We recently met again to work on 2012 budgets.  They were again set around leading KPIs.

Leading KPIs are targets that are predictive of desired results.  In this case, the KPIs were centred on the number of customer contacts and/or quotes required. After applying a proven conversion rate, the desired (and achievable) level of sales can be decided.

This provides the business owner with a targeted activity which can be focussed on, in this case, the number of customer contacts and/or quotes.

So when you’re next looking at your budget for the coming year, think about the activity which is required to reach your targets.  It may help to simplify where to focus your energies to achieve your goals.

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We have been lucky enough to go through an IMP3rove process which is an assessment of innovation in our business as an SME.   The underlying principal of the process being that innovation drives profitable growth.

Through this process we analysed our “House of Innovation”, which essentially is an assessment of how we cultivate, nurture, strategise, and work on continuous improvement activities and new innovations. 

One item which is very important in the process of innovating and improving processes is the ability to capture organisation wide ideas, identify which have the best ‘bang for their buck’ so to speak, and then monitor their implementation.

Most business owners have a lot of ideas, and so will their employees.  But how is the decision made to do one idea and not the other?  Is it a gut feel?  Quick calculations on a napkin while you’re at a business lunch?  Sometimes this can work and with great results.  But how great was it?

One tool we are working on now to better formalise our idea implementations is a capital assessment model.  The main basis is to analyse the idea against written guidelines on what return on investment is expected from the innovation.

The aim being to quantify cost savings on purchasing a new asset, estimated efficiency improvement of a change in process etc.  This done, implementation of great idea can go ahead.  And how many times has this happened without reviewing how much return was really made for the resources put in?  The assessment tool will also help keep a monitoring tool on ensuring return on investment, and not just sinking valuable resources into an unknown result.

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I read an article in the BRW recently which made me marvel at the courage of one business owner in Sydney.  Originally trading on the top floor of one of Sydney’s Shopping Arcades, she made the decision to move down to level one, which was a big stretch for working capital with the rent increase.

Although revenue did increase, after all the extra work and stress, she was left expecting the business growth to feel better.  A familiar feeling to some business owners I bet.

This prompted her to work on implementing a five year plan of where she wanted her business to be.  With other steps taken stretching her capital, but with more focus, this has gotten her to where she wants to be.

It may seem a good process to take a big step in business, but if it’s not part of a larger strategy or plan, it can sometimes feel like extra work for not much more reward.  Preparation and constant review of strategic plans can provide you focus which enables you to make calculated steps in business and ensure that your activity is working towards an overall strategy. 

This approach more often than not yields results, and finds you taking calculated, interdependent actions rather than ad hoc giant leaps, the latter which can find business owners feeling unsuccessful.

If you require assistance with the development or review of your current strategic plan, please give me a call on (07) 4639 1957.

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I attended a seminar recently which had a session on Detailed versus Dashboard Reporting.  The presenter worked in the finance department of one of the top 30 ASX listed companies.  It was quite fascinating to hear him explain how a business so large is able to produce one report weekly, which is communicated to all staff and drives the performance of the business.

The company developed the report in response to what most companies would like; timely reporting, simple communication of performance to all staff, a single report for all departments in one common language.

The process involved to develop the report included considering the following:

• Factors critical to success
• Key drivers of the business
• Buy in from all staff
• Identifying a common language across the company
• Simplicity in use and preparation

The result is a one page “Run Rate Report” which communicates two key performance indicators – ‘run rate’ and ‘in the bin’.

In the bin represents a sales indicator to date – for example, how many contracts have been signed, or quotes made.

Run rate gives you an average of what activity you have been doing, and the required rate to achieve target.

The reports success is in its use – all staff can identify and work towards results by these two terms.  This is because it has been developed with the involvement of staff and based on business activity.

In the long run, it is the activity engaged in by a business that makes it successful.

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I have noticed numerous emails currently being sent providing various formats of government funding available for disaster recovery, which is fantastic to see.
However, it was refreshing to discover the “Managing a business following a disaster” toolkit on CPA’s website this afternoon.
This provides a wider perspective on issues to be considered in getting back to business following a disaster, going beyond the issue of government funding available.

Along with standard items such as:
*    Overall asset damage assessment
*    Insurance coverage and processing claims
*    Government assistance

It also looks at some more difficult issues:
*    Evaluating your financial position – making a decision on whether to reopen, and if so, how to operate in the new environment
*    Recovery planning – what resources and processes are critical to re-opening (plan template is available within the toolkit)

Also available is a checklist for re-opening business after disaster which asks a multitude of questions to ensure thought and all available information has been used to continue operations and prepare business owners for difficulties faced after disaster.

It is a fact that some businesses may never reopen after disaster, so it is an important economic decision to consider once clean up has been finalised.

Please follow link to CPA Australia Disaster Recovery Toolkit for Business.
Also see our Cash Flow Forecast Template for assistance in preparing forecasts with recovery plan.

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One of the key areas of long term business success is people.  Most would agree, people are your greatest asset.  If you get it wrong, people can also be your biggest liability.

Have you noticed when you have got all the right people in the right roles in your work place, things just seem to work?  It is great to be on site at a business buzzing with this kind of team work.

If you have the right people, but looking for a model to get the team work between them at an optimal level, I recommend Patrick Lencioni’s Five Dysfunctions of a Team.  This model looks at a team through the following elements, building on each level:

• Trust
• Conflict
• Commitment
• Accountability
• Results

With these elements of your team in place, you should see results, and your people working effectively.

Like most things in business, the model should be revisited from time to time to ensure the team does not retreat back to old behaviours which could have a negative impact on the team.  As a leader in your business, Lencioni recommends you go first, mine for conflict, force clarity and closure, confront difficult issues and focus on collective outcomes.

Effort put into implementing Lencioni’s model will be repaid by success of your business and its people.

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 My sister is working on the invite list for the Baptism of her son. These will be people, who are part of his life, to guide him.

This got me to thinking of who is around us to support us in business life. It usually includes a good quality accountant, respectable solicitor, cooperative banker and selective recruitment agency.

I respect the way we have begun to build on these to now have access to a team of other very important business specialists. The aim is to provide clients a network of business consultants for every solution. Currently, this includes a human resource consultant, marketing manager and, just recently, a business consultant for Australian and international markets (especially useful if you are looking to service Surat Basin mining activities).

These are all areas of business that are imperative to get right. Yes, we can start work on these areas of business. But once you get to a certain level of detail, it is much more effective to bring in the specialists. And we are certainly looking out for more to join.

And in case you were wondering, I will not be thinking of business on the day of my nephew’s Baptism – he is just way too cute to think of anything else!

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