Mistakes to avoid with your business planning… - ACEC of ...

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Mistakes to avoid with your business planning… - ACEC of ...

ACEC Washington May 20 Seminar

“Marketing in Today’s World”

Staying Alive

‘til the Economy Rebounds

By Mark C. Zweig

Founder and CEO, ZweigWhite

Friday, May 20, 2011, 8:30‐5:00 p.m.


Welcome!

Introduction


Thanks ACEC Washington for having me today!


I’m

Mark Zweig


A little about..

ZweigWhite


The schedule for the day

• 9:00 Where A/E firms go wrong in their marketing

• 10:00 Break

• 10:30 Why marketing is really a management problem

• 12:00 Lunch

• 1:00 Big trends in our industry right now.

• 2:00 Break

• 2:15 Creative presentation techniques for technical people

• 3:00 Case workshop

• 4:00 Case presentations

• 4:30 Conclusion

• Q&A/Open Discussion


What We’re Going to Cover Td Today

• Where A/E firms go wrong in their marketing.

• Why marketers in our business don’t get the

respect that they deserve!

• Fun facts about marketing in A/E firms.

• What marketing is really all about.

• Why marketing is really a management problem!

• Developing a good business plan that works in

today’s market.

• Big trends in our industry right now.


What We’re Going to Cover Today …

• Getting the right marketing person on‐board

for your firm and what that person should be

doing for you.

• How to make everyone a seller in your firm!

• Particular issues related to using technical

people as marketers.

• Targeting your markets! kt!

• Creative presentation techniques for technical

people.


What We’re Going to Cover Today …

• Using PR effectively!

• Ui Using social ilmedia as part of your marketing kti

program.

• Working visibility.

• Finding new leads for projects in a bad market.

• How to stay ahead in a down market.

• What a good marketing director should be doing

today.

• Other things to consider.


Where A/E firms

go wrong in their

marketing!


Where A/E firms go wrong in their marketing…

They don’t believe there is a

relationship between marketing

spending and dactivities t vs. results


Where A/E firms go wrong in their marketing…

They treat

marketing as

an overhead

expense to be

minimized


Where A/E firms go wrong in their marketing…

They promote people into the

job who shouldn’t be there.


Where A/E firms go wrong in their marketing…

They don’t give their people p any

training in marketing and selling


Where A/E firms go wrong in their marketing…

The technical

owners/principals

ipals

don’t listen to or

believe in marketing.


Where A/E firms go wrong in their marketing…

The

marketing kti

people don’t

sell internally

(more on that later)


Where A/E firms go wrong in their marketing…

There’s no recognition of how critical the marketing

database is to all promotional efforts


Where A/E firms go wrong in their marketing…

There’s a lack of understanding of the probabilities

that drive all promotional efforts so the efforts that are

undertaken fail (not working backwards from desired

results to activities that will create them)


Where A/E firms go wrong in their marketing…

Too little of everything—

target client list too small,

number or frequency of

promo efforts too low


Where A/E firms go wrong in their marketing…

Any complainer li

can stop the

process!


Where A/E firms go wrong in their marketing…

Too much

chest

pounding!


Where A/E firms go wrong in their marketing…

Overuse of tired

clichés in promo

materials,

websites, etc.


Where A/E firms go wrong in their marketing…

The principals think

marketing is only about

promotion, when really, it

is very broad‐based and

includes the specific

services you offer, your

pricing, your people, and

your office locations

our amazing services!


Where A/E firms go wrong in their marketing…

They don’t have an

internal marketing

culture that makes

marketing as

important as it

should ldb be!


What

marketing is

really

all about


What marketing is really all about…

Marketing

vs.

Business

Development


What marketing is really all about…

Market life cycle and importance of differentiation


What marketing is really all about…

The “marketing kti concept”

• Focusing on client needs!

• The whole firm is a system!

• Goal orientation!


What marketing is really all about…

Four


What marketing is really all about…

It is a science!


Why marketers

in our business

don’t get the

respect that t

they deserve?


Why marketers in our business don’t get the respect that they deserve…

They aren’t setting tangible goals that the other firm

members understand and then showing them how

they are achieving them


Why marketers in our business don’t get the respect that they deserve…

They have too much “fun” at work therefore the

perception may be that it isn’t “real” work


Why marketers in our business don’t get the respect that they deserve…

Technical people think their

discipline is the only real

science and don’t really

believe there is a body of

knowledge on marketing just

like there is on how to design

a sewer or plan a new

roadway


Why marketers in our business don’t get the respect that they deserve…

We load them

down with so much

proposal response

duties that t they

never have time to

advance some of

the other

marketing/

promotional efforts


Why marketers in our business don’t get the respect that they deserve…

They’re

Reactive

vs.

Proactive


Fun facts about marketing in A/E firms


Fun facts about marketing in A/E firms…

• 79% of firms have a marketing director.

• The average ratio of marketing staff to other

employees is 1 to 23.

• The typical marketing kti director is 43—equally

split between men and women.

• 33% of marketing directors also have a

technical or design degree.

• 20% of marketing directors have no college

business education whatsoever!


Fun facts about marketing in A/E firms…

• 39% of marketing directors are firm owners.

• 11% of marketing directors DON’T participate

in the business planning process!

• 28% of marketing directors NEVER coach

presentation teams.

• The median base pay for a marketing director

is $90K.


Fun facts about marketing in A/E firms…

• The typical marketing coordinator is 32 years

old—and 90% of marketing coordinators are

women.

35% f k i di h

• 35% of marketing coordinators have no

formal business education!


Fun facts about marketing in A/E firms…

• Only 34% of firms have BD reps of any kind.

• The average BD rep makes $89K 43% got

zero bonus at the end of 2009. (2010 data

not yet available).

• 65% of firms have a CRM.

• 56% of firms use Deltek, 9% ACT.


Fun facts about marketing in A/E firms…

• Only 42% of firms have a centralized file on

clients!

• Of direct marketing tactics used, mail and

telemarketing were tied for effectiveness,

with email way behind.

• Only 11% of firms have a blog on their

website.


Fun facts about marketing in A/E firms…

• 47% of firms DON’T track website visits!

• The average firm gets 202 unique web hits on

their site WEEKLY!

• 43% of firms claimed to receive qualified

q

leads via their websites!


Fun facts about marketing in A/E firms…

• 17% of firms don’t send out any press releases.

• The median press list has 20 names on it!


Fun facts about marketing in A/E firms…

• 35% of firms have a newsletter, and 65%

distribute them electronically.

Th t i l ltt i bli h d th

• The typical newsletter is published three

times a year!


Fun facts about marketing in A/E firms…

• 44% of firms offered free client workshops kh

last year, and they get an average of three

qualified leads per event.

• 52% of “advertising” A/E firms do is with

professional associations!


Fun facts about marketing in A/E firms…

• Only 58% of firms budget marketing costs!

• The median marketing budget is 3.9% of NSR,

yet the typical firm spent 5.6%. 56%

• 43% of firms expect to spend more on

marketing next year.

• 27% of firms had a Facebook site, with only

12% on Twitter!


Fun facts about marketing in A/E firms…

• 30% of firms use outside marketing consultants, most

frequently for brochure design and PR (35%), and only

15% for client perception surveys.

• The SINGLE most effective marketing kti strategy

t

employed by firms is personal selling at 27%. Only 3%

cited focusing on client needs as the most successful

strategy!

• The least effective marketing strategy employed is

advertising at 24%!


Fun facts about marketing in A/E firms…

The “biggest marketing challenge

today” cited by firms was the

economy and increasing competition!


Why marketing kti is really a management problem?


Why marketing is really a management problem…

Because it is so broad‐based, wide reaching, and easy to

spend money on‐‐ it touches virtually every area of the

firm. That makes it a management problem.

And because the problems are often higher‐order than

just promotional in nature.


Developing a good

business plan that works

in today’s market


Developing a good business plan that works in today’s market…

Why do a business plan?

• You do it to build a common sense of philosophy and direction

amongst principals, managers, and all employees

• You do it to help guide your future

• You do it to reduce the stress of owning and operating a business

• You do it for lenders and creditors, for investors, for current and

potential employees

• You do it for clients

• You do it to help train a wider group of employees in how your

business operates and makes money


Developing a good business plan that works in today’s market…

What goes into a business plan?

• Vision

• Mission

• Strategies

• Goals

• Actions


Developing a good business plan

that works in today’s market…

Plus..

• Definition of markets being pursued.

• Client research.

• Competitive research.

• Employee research.

• SWOT analysis.

• Financial modeling (pro forma income statements,

balance sheets, cash flow, stock value).

• Org charts.

• Other back up materials and exhibits.


Developing a good business plan that works in today’s market…

Strategic Plans vs. Operational Plans

• “Strategic” plans are all about the

higher‐order, longer‐term, values and

aspirations‐type stuff.

• Operational plans are all about the

details. How will you accomplish what you

set out to do in the coming year or so?

• You need both. Philosophy hl h and

practicality. Neither is sufficient

by itself!


Developing a good business plan that works in today’s market…

How to develop your plan

• You may need different marketing,

staffing, and operational plans for

each market your firm serves.

• You have to do your homework and

get the info you need.

• You have to keep good records of

everything.


Developing a good business plan that works in today’s market…

Building enthusiasm

and acceptance of your plan

• SELL, SELL, SELL. Constantly sell the firm

to the employees!

• Let everyone contribute to developing the

plan in some way!

• Share the highlights of the strategic plan

with everyone in the firm,‐‐clients,

suppliers, investors, creditors, and

potential ti employees.

• Refer back to it‐‐compare actual to goals.

• Be vigilant in your efforts to keep the B.S.

language to a minimum!


Developing a good business plan that works in today’s market…

Mistakes to

avoid with

your

business

planning


Mistakes to avoid with your business planning…

• Don’t allow the few principals

who believe it’s not

entrepreneurial rial to plan to rule

your planning process!

• Don’t use overly academic, B.S.

words/terms that turn design

and technical people off.


Mistakes to avoid with your business planning…

• Don’t have too many people

trying to work out details of

the plan at one meeting

• Don’t ask only the principals

for their input, or restrict tit

participation in the planning

sessions to just them


Mistakes to avoid with your business planning…

Don’t make

the whole

thing harder

than you

have to!


Mistakes to avoid with your business planning…

• Don’t do the pieces of the plan in isolation of

each other and then roll them up into one

plan with no oversight.


Mistakes to avoid with your business planning…

• Don’t have an unrealistic sense

of the size of the market.

• Don’t have an unrealistic sense

of how long it will take to

break into an established

market.

• Don’t have unrealistic

marketing, HR, and overhead

budgets for the growth goals

you are setting out!


Mistakes to avoid with your business planning…

• Don’t endlessly tolerate poorly‐performing business

units because of personal relationships

• Don’t allow a bottom‐up versus top down directive

on mission, vision, strategies, etc.

• Respect the planning process—things have to be

done on time (before the new year starts!)


Mistakes to avoid with your business planning…

Do your research

prior to putting

the plan together!

(market research, financial modeling,

surveys of employees and clients, etc.)


Mistakes to avoid with your business planning…

Stick with your meeting agenda! (and have one in the first place!)


Mistakes to avoid with your business planning…

Don’t tolerate boring

planning/retreat

meetings instead of

"charge" meetings. Fight

the tendency. We have

too much historical

review, no theatre, and

no excitement.


Mistakes to avoid with your business planning…

• Don’t allow those who never

contribute in a meeting to fill up

a precious seat at your planning

meetings.

• Don’t employ wimpy facilitators

t

who are related to one of the

owners or who are afraid to

alienate their clients (you).


Mistakes to avoid with your business planning…

• If you set specific goals or

objectives, make sure you

commit adequate resources

to make them a reality.

• Don’t allow your process to

be way too complex and

cumbersome.


Mistakes to avoid with your business planning…

Don’t fail to confront tenured partners or

managers when they need to be confronted!


Mistakes to avoid with your business planning…

• Don’t allow the hidden

resentments some people

have to be a barrier to

effective planning!

• Be on guard for a lack of

creativity throughout the

entire process!


Mistakes to avoid with your business planning…

Dispel the notions that offices

take so many years to be

profitable, or all successful

people fail multiple times

before they succeed, or that all

ideas are good ideas.


Developing a good business plan that works in today’s market…

Making people p accountable

• Share the plan with everyone in the firm.

• Track and report status of goal achievement

throughout the year.

• Track and report status of action items

established in planning process throughout the

year.

• Make sure the boss “gets it” when it comes to

planning and treats it seriously.


Developing a good business plan that works in today’s market…

Business planning retreats

t

(CHARGES!)

• Get out of the regular office environment to

somewhere you can bond and focus!

• Get a room with natural light.

• Have some entertainment or a shared activity.


Business planning retreats (CHARGES)…

• Do your homework first,

before the meeting.

• Have the right people there

(not just owners)!

• Get a professional note‐taker or someone

you know you can trust.

• Set a reasonable time for the meetings.

• If you use a facilitator, get an insultant!


Big trends in our industry right now


Big trends in our industry right now…

• Big firms getting bigger

and better able to

manage themselves.

• Lots of ownership

transitions are underway.

Baby boomers starting to

get out.


Big trends in our industry right now…

• Increasing M&A activity—

includes foreign firms

buying U.S. firms and even

portions of U.S. firms.

More small firms are even

getting into it.

• Commoditization (but it

has been going on as long

as I’ve been in this mature

business).

• Reduction of suppliers by

biggest buyers.


Big trends in our industry right now…

• Many markets affected.

Development overall way down.

More competition in hotter

govt./institutional markets as a

result.

• Staffing is down—U.S. A/E

industry lost as many as 150‐

200,000 jobs. Some won’t be

back for a long time though job

market is starting to rebound.

• Offshoring/low cost production

centers.


Big trends in our industry right now…

Firms reorganizing around

Firms reorganizing around

market sectors/lines of business


Big trends in our industry right now…

More PPP


Big trends in our industry right now…

• Shifts in project financing

models. More developer‐led

led

project teams.

• Design‐build gaining favor

even in some public sector

markets (led by contractors

as many A/E firms got

burned some years back and

are scared).


Big trends in our industry right now…

Vertical integration!


Big trends in our industry right now…

Working in Asia, the

g ,

Middle East, and

Latin America


Big trends in our industry right now…

• Social media marketing

gaining popularity.

• After years of decline, direct mail

After years of decline, direct mail

is making a comeback!


Getting the right marketing person

on‐board for your firm and what that

person should be doing for you

L t f ibl N t

Lots of variables. Not everyone

wants or needs the same type of

marketing person.


Getting the right marketing person on‐board for your firm…

Problem #1: Limited talent

pool in our industry! We don’t

want to wait 2‐5 years to get

someone up to speed on our

business yet the most creative

marketing people probably

aren’t in it.


Getting the right marketing person on‐board for your firm…

Problem #2: We

don’t/won’t t pay

what good

marketers outside

our industry make

plus don’t offer the

variety of creative

activities that a firm

that sells marketing

services can offer.


Getting the right marketing person on‐board for your firm…

Problem #3: Do you

want a marketing

person or a business

development person?

Disagreement over

what is needed.


Getting the right marketing person on‐board for your firm…

Problem #4:

Disagreement over basic

decision—is marketing a

support group or are

they really supposed to

set the strategic

direction for your firm?

These are radically

different jobs that take

much different types of

people.


Getting the right marketing person on‐board for your firm…

Problem #5: If we want

someone who is at top it

should be a principal level

opportunity. Yet, some

firms reserve all those jobs

for people with design or

technical backgrounds.


How to make

everyone a seller

in your firm?


How to make everyone a seller in your firm…

• First accept one thing—

not everyone will be a

seller!

• That said, everyone has a

marketing role. It is a

system.

• Everyone represents the

firm in their own capacity.

All employees should be

able to give an elevator

pitch on what the firm

does.


How to make everyone a seller in your firm…

• Be a purpose‐driven firm.

• Don’t let principals keep nonprincipals

from selling!

• Demonstrate—best sellers show

people how to do it. Take them out!


How to make everyone a seller in your firm…

Keep people happy!

Avoid demotivation!


How to make everyone a seller in your firm…

• Share successes with everyone in the firm!

• Celebrate successes!


Particular issues related to using

technical people as marketers


Particular issues related to using technical people as marketers…

• They didn’t go to school to be sellers—they went to school to be engineers.

• There’s a basic belief that marketing and sales people have to be

dishonest to be successful and they themselves aren’t dishonest!


Particular issues related to using technical people as marketers…

• They may think people should lddo

what they want them to because

they have a particular technical

background or knowledge.

• They over focus on past

experience, features vs. benefits,

and details that may not be

relevant to sellers.


Particular issues related to using technical people as marketers…

They “know” too much!

They can talk tlkthemselves

out of a job because they

can see all the reasons to

NOT hire their firm.


Targeting your markets

Know who you are trying to sell to!

This is fundamental. Show example.


Targeting your markets…

Market sectors

• Market sectors are groups of clients (or potential clients)

who have common wants and needs.

• Examples would be “Higher Education,” or “Healthcare” or

“The U.S. Army Corps of Engineers.”


Targeting your markets –Market sectors…

Geographic markets are NOT market sectors. There is no

“Seattle Market” as far as I am concerned. It is a geographic

area made up of clients from many different market sectors.


Targeting your markets –Market sectors…

Service types or disciplines are NOT market

sectors. There is NO “environmental

market” nor is there a “mechanical

engineering market.” “Environmental” is so

broad it is not even a service type, besides

the fact that every type of client one can

imagine buys environmental services of

some type.


Targeting your markets…

Why is it critical to be

Why is it critical to be

positioned to serve

market sectors?


Targeting your markets –Why is it critical to be positioned to serve market sectors?

• So the clients in that sector hire your

firm in the first place

• So they pay you a decent fee

• So you have credibility and they listen

to your advice which ultimately makes

you and them more successful

• When the market declines, the

“dabblers” are the first to go.


Targeting your markets…

How can you position

your rfirm to serve e a

specific market sector

(or sectors)?


Targeting gyour markets – How can you position your firm…

Your organization structure

•Organize your firm around market sectors vs.

disciplines or departments, or cities or regions.

•Set it up around the sectors you serve (or want to serve).


Targeting gyour markets – How can you position your firm…

There are ways to still ensure you product high quality

discipline‐wide. Don’t forget that one of the major

distinguishing factors amongst market sectors is

DIFFERENT expectations about quality! One standard,

firm‐wide, could work against your positioning efforts!


Targeting gyour markets – How can you position your firm…

Your people

• Do they come out of the organizations you want to serve?

• If not, do they have lots of experience serving the organizations or

y p g g

types of organizations that you want to serve?


Targeting gyour markets – How can you position your firm…

Your geographic diversity

• Different market sectors require differing

degrees of proximity from their professional

services providers.

• If you are going to serve municipalities with

largely generic water‐sewer‐street‐gradingdrainage

stuff, you probably will need to be

located in or very near that city.

• On the other hand, if you do nuclear plants

worldwide, there is probably little

expectation that the firm have a local or

even regional presence.


Targeting gyour markets – How can you position your firm…

Your pricing strategy

• Different market sectors have

entirely different pricing and billing

expectations. Percentage of

construction cost fees may be

appropriate for one sector but

hourly billing what is expected in

another.

• Some market sectors won’t support

a labor multiplier higher than 2.5

and others will pay a 5.0.


Targeting gyour markets – How can you position your firm…

Your PM and production processes

• The level of the PM in terms of where

they fit into your firm’s organizational

hierarchy, the frequency and type of

communication you have with the client,

the number of meetings, stage of

submittals, software requirement, etc.,

ALL vary based on the market sector.

• Group people p who work in same sector

together.

• Don’t have a firm‐wide quality standard—

may not be appropriate for all sectors.


Targeting gyour markets – How can you position your firm…

Your business development and promotion strategies

• These vary greatly based on market

sector.

• Starts with the right people.

• Some client types respond to email,

others to personal calls.

• Some won’t even let you buy them

a meal, and others expect to be

taken on fishing trips to Iceland.


Targeting gyour markets – How can you position your firm…

Your graphic image/corporate identity/brand

• Is it appropriate for the sector you are trying to serve?

• Is it consistently conveyed in all materials and correspondence?


Targeting gyour markets – How can you position your firm…

Your cards/titles/email signatures!

What do they say on them?


Targeting gyour markets – How can you position your firm…

The organization of your

website/press releases/social

media communication has to

reflect sectors!


Targeting gyour markets – How can you position your firm…

Y i i f i

Your unique information—

coming from primary research!


Targeting gyour markets – How can you position your firm…

Education/gathering opps


Targeting gyour markets – How can you position your firm…

Other positioning ii i tactics you can employ for

your chosen market sectors!


Targeting gyour markets – How can you position your firm…

Other issues to consider

• Everything is different marketing‐wise based on the sector.

• Not everyone will get the benefits of this idea!

• Most clients don’t care what you do for other sectors. The more you talk

about other sectors the more convinced they will be that you don’t

specialize in clients like them.

• Market and account this way BEFORE changing structure!

• Anticipate objections to changing your org structure.

• Announce change and get people used to idea before you actually make

the change.


Creative presentation

techniques for

technical people

•Think different!

•Look different!


Creative presentation techniques for technical people…

p

•Who should attend?

•Communicate i a personality!


Creative presentation techniques for technical people…

p

• Demonstrate cohesiveness/

collaboration within the project team.

• Make a bond with each audience

member!


Creative presentation techniques for technical people…

p

•Features vs. benefits!

•Why hire your firm?


Creative presentation techniques for technical people…

• Turning things

upside down!

• Taking some risks!


Creative presentation techniques for technical people…

Practice/video/critique!


Using PR effectively

• What’s so great about PR? It’s free—and it is effective!

• What does a good press list look like?

• What kinds of numbers should you expect?

• Resources you should consider.


Using PR effectively…

Press release hints—how to

• Man bites dog!

• News/statistics/ original research/quotes.

• Media release!

• Contact at bottom!

• Electronic distribution vs. mail.


Using PR effectively…

PR consultants?


Using social media as a part of your marketing program

• FB

• Twitter

• Linked‐in

• YouTube

• Others…..


Working visibility

• Signage

• Vehicles

• Clothing


Finding new leads for projects in a bad market

• Get out of the

office!

• Get on the phone.

• Beat the other

guy—what htis their

weakness?


Finding new leads for projects in a bad market…

• Are you going to be an

eater or be eaten?

• Offer help—

demonstrate insight!


Finding new leads for projects in a bad market…

• Current clients best!

Current clients best!

• Past clients next best!


Finding new leads for projects in a bad market…

• What else can you sell? Not sub out?

• Recruit sparkplugs from competitors

who are making it happen!


Finding new leads for projects in a bad market…

• Buy a troubled firm for their

clients and people!

• “Assumed need” cold‐calling

approach.

• Get your best people selling—

your principals!


How to stay ahead

in a down market

• Overfund marketing!

(30%+ more than peer firms)

• Be loud and proud—lots of

marketing campaigns and tactics!

• Hire the competition!


How to stay ahead in a down market…

• Be uber‐responsive!

• Analyze and improve every single client touch point!

• Use ongoing client perception monitoring/interviewing and share

the unedited data firm wide.

• Get your top people reengaged!


What a good marketing director should be doing today

• Be a voice of hope and optimism at all times.

• Trying lots and lots of new things, g,quickly.

• Setting goals, tracking results, sharing, and

making changes based on the data.

• Forcing people to get more creative in their

proposals, presentations and overall selling

efforts.


Oh Other things to consider

• No one strategy, approach, or tactic is a panacea!

• You have got to keep trying new things!

• CRM must be decentralized!

• Don’t underestimate the power of tracking and reporting

marketing data!

• You can’t do it all with promotion. You also need new

things to sell!


Case workshop


Case workshop…

You have just inherited your father’s engineering

firm. You worked there as a kid but not since. You

not only have a civil engineering degree and PE

license, you also have an MBA and have often

wondered what could happen if you applied

modern management and marketing strategies in a

firm like this…


Case workshop…

Now is your chance. The last three years haven’t been

too kind to the firm. Just tthree years ago, staff tffwas at

200, more than twice what it is now. And profits went

from 20 percent to 3 percent last year. As soon as you

got the firm under your control, you realized that what

was happening was a problem that could be solved by

more work. Your good friend in college just happened

to be a marketing director in a successful, smaller firm.

The two of you have often thought it would be fun to

work together. th So you brought hther on board and are

now going to develop a plan of attack to reverse the

revenue and profit slide.


Case workshop…

• What are five key marketing strategies

(philosophies) that you will employ?

• What are ten specific actions that you will take

marketing‐wise?


Case Presentations


Conclusion

Conclusion


Q&A/Open Discussion

Q&A / Open Discussion

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