Is it finally time to move forward and do business?

My industrial manufacturing clients tell me they are beginning to receive some positive signals from their customers.And just as they start to regain confidence to move ahead with planning and ordering, a big customer will slash volume in half over what was projected.It’s like manufacturers are taking two steps forward and one step back.

It’s hard to assess the risk-reward ratio of your business relationships when the dynamics of manufacturing are on a bit of a roller coaster ride. Do you move forward or stay put?

With so much hesitancy and second-guessing going on, it seems like industrial manufacturers are waiting for a signal that lets them know it’s OK to move forward and do business. Should manufacturers keep checking their Blackberries as though someone is going to issue you the code message that it’s officially the right time? Is someone going to give the official Tweet that you are free to do business?

And if you do move forward, do you have a robust plan of your own design? Or are you going back to relying on the same old wheel you’ve been rolling along on? Or are you simply rolling the dice and going after any and every opportunity to respond to an RFQ?

 

When’s the last time you built a robust business development strategy that’s based on Voice of the Customer methodology?

Yes, I know that this methodology was popular in the 1990’s. However, it’s time to rethink how these principles can be retrofitted and refurbished to complement current thinking on innovation and change management.What can we take from what we’ve learned over time and redeploy? Just as we are asking our best customers to redevelop their relationships with us, in some new directions, why not do a bit of remanufacturing on your approach to business development?

If you could design the perfect customer against a set of specifications, what would those specifications look like from your perspective? A Voice of the Customer Hierarchy defines, in outline form and in the words of the customer, the prioritization of those attributes and specifications which create the ideal customer for your business.

There are two types of customers you need to develop for your business: external customers and internal customers. External customers are companies with whom you currently do business or prospects with whom you’d like to cultivate a business relationship. The mirror image is internal customers.Your internal customers are members of your organization: your employees.

When is the last time you spoke to each type of customer and compared and contrasted their perspectives on business development? And no, this methodology isn’t about complaining about the way things are or should be or complaining about co-workers or the weather. It’s about figuring out how to align your organization’s structure and output with the types of customers – internal and external - who are ideal for your organization.

If you are a small to mid-sized industrial manufacturer, taking a high level look at the Voice of the Customer hierarchy for your internal and external customers is an important means of developing a perspective that can positively impact your business development strategy.Voice of the Customer methodology allows you to see your company from the outside looking in – as your external customers see you – as well as from the inside looking out, which is the way your internal customers see your organization.

This VOC hierarchy can address customer attributes such as:

  1. Type of product needed from the customer or type of performance required from personnel
  2. Amount of engineering required from the customer vs. amount of engineering provided to your company by the customer
  3. Lead times
  4. Raw material and machinery requirements
  5. Certification requirements
  6. Quality requirements
  7. Size of company , which is a function of number of employees, personnel requirements, manufacturing capacity requirements, and fiscal and financial health, among other factors
  8. Historical relationship with that customer, including rework required per past project, time to win that project, profitability of that project
  9. Assessment of risk in doing business with this type of customer OR the type of risk that customer assumes in doing business with you
  10. Target markets for your products and services: from which markets have you acquired customers in the past and whether new market development makes sense for your business development strategy

Gathering these data by talking to your current customers gives your company the opportunity to make a strong statement to past customers that you are moving forward - and will be there for them when they return as your customers. These companies are the cornerstones upon which you built your business. Understand the value of their relationship with you and the value that you bring to their table.

Gathering these data by talking to prospective customers gives your company the opportunity to communicate your business philosophy to them.Why will developing a relationship with your company provide value to both you and to your customers? Tell your prospective customers you are basing your relationships on your understanding of how your customers fit into your Voice of the Customer hierarchy. That’s news.

Gathering these data gives your company the opportunity to target specific types of companies for new business development – based on your understanding of how current customers fit into your Voice of the Customer hierarchy. Business development shouldn’t be like rolling the dice or foraging for food. Business development strategies should be focused and methodical based on your knowledge of the types of customers which are the cornerstone of past successes and the amount of risk you want to assume in developing these relationships with new customers.

The new business paradigm will favor those companies who have taken the time to examine business relationships and risk management from their current customer base and apply this knowledge to developing new customers. You can take a good customer relationship and make it better based on your understanding of your requirements from customers – and theirs from your company.

It’s definitely time to move forward and start doing business. Business development shouldn’t just “happen.” Regardless of the size of your business – or the role you play in your organization – you can implement Voice of the Customer methods to assist your company in moving forward. The American Society for Quality, as well as other resources, has many reference materials to assist you.

The only code message on your Blackberry or Tweet you need to be waiting for is from yourself.Talk to your customers. Validate yourself to yourself. And give yourself permission to move forward and do business.

It’s time.

5 steps to help you avoid getting thrown under your organization’s bus

It’s nearly the end of Q3. And it’s been quite a roller coaster ride for American manufacturing, engineering, technology and service industries. And no, we are not in Kansas anymore, Toto. If you or your employer have been in denial that we are heading towards a new global manufacturing paradigm, it’s time to wake up. Doing the same things the same way will, to paraphrase Einstein, still result in the same outcomes. So don’t -insanely - think you are going to get different results by holding true to your status-quo.

 

As end-of-quarter paranoia sets in, once again, and belts are tightened and names taken, start incorporating a plan of action to prevent your becoming a casualty of this inevitable paradigm shift. Instead of taking a defensive and protective posture, think pro-actively towards building upon what you already do well.

 

  1. Keep your ear to the rail

The engineering and manufacturing sectors on LinkedIn have started to pick up the banner with some truly provocative discussions. The Association for Manufacturing Technology LinkedIn discussion by Ron Schildge addresses “What is needed to support manufacturing in the US and the creation of new jobs? Is it tax policy or is an industrial policy needed at this time?”  This discussion is providing a forum on the dialectic between government incentives and the current industrial business development paradigm.If you are not currently a member of this LinkedIn group, I strongly suggest you join.

Maintaining a siloed approach to where and how you receive engineering, technical and business knowledge may keep you, well, siloed. Put yourself in a different situation. If you find yourself out of a job tomorrow, are you prepared to run your own business? Or will you be left looking for same old, same old in this devastated job market?As I’ve recommended in one of my recent blog posts: cross-train. Cross-training involves information gathering that allows you to incorporate WHAT YOU ARE LEARNING into WHAT YOU ALREADY KNOW to create a hybridized outcome that is stronger, more resilient and certainly robust.

If you enjoy these LinkedIn discussions I've referenced, join other groups such as NTMA, NAM, SPE, etc. Keep your ear to the rail and learn from listening to the Voices of the Customer: your peers. Think about how you can incorporate this information into how you evaluate engineering solutions for your company.Learn to put things into a bigger perspective than just your own backyard. The solutions you recommend will be more robust and impactful for your company.

 

  1. Understand your role as innovator, not order taker

In my original blog for Sales Aerobics for Engineers, I wrote about listening for the broader implications of every tactical solution you are asked to work on. Engineers, by nature, tend to take a tactical – as well as siloed – approach to problem solving. Root causes can have really large contexts. Let a discussion proceed beyond the identification of a tactical project and see what other projects develop because of issues being identified.

I read an interesting blog post from Industrial Interface recently, titled Cultivate Inovation: What Companies, Managers and Engineers Can Do. The blog post talks about the engineering persona and the areas of frustration for both engineers and employers with their companies. It's written from an inside-out perspective, a view from the trenches, as it were. Read what your peers have to say. Depending on where we all sit around the table, we see the same things from similar - as well as strikingly different - perspectives.

The workforce and workplace was changing long before the financial debacle of October 2008.The current state of the economy has underscored, if not completely accelerated, this paradigm shift. There is no job security. There is no job security in maintaining the status quo. And Gen Y’s, and some Gen X’s - particularly in the business – marketing and sales - arena have no problem with a fast-forward pace to career development.Which stands in glaring contrast to how engineers think.

So if you are feeling like you are standing in the middle of the Autobahn watching cars go whizzing by you at 130 k/hr, you should get out of the center lane and decide whether you are going to be a spectator, participant or victim. Because this trend is not going to come to a grinding halt anytime soon.

Innovation drives revenue. Work towards understanding your company’s revenue stream. Who are the players? Who are your company’s major customers? What is the volume of work that these major customers bring to your company and what is the nature of this work: short term, low profit, rapid turnaround? Or are these projects longer term, highly engineered deliverables that require initial investment of raw materials and development of tooling on the part of your company which nets out to greater profitability over the long run?

What factors are impacting your company’s revenue stream? Do customers pay you net 90 or net 120, regardless of whether your employer likes it or not? How does this enlongated accounts payable situation impact cash flow for your organization, especially if your company has to fork out upon receipt or net 30 terms for purchase of raw materials?

Are the cars on the Autobahn starting to slow down? Can you begin to identify various makes and models? These factors, and many others, impact the daily running of your company and its future. Start to understand the critical factors impacting every project you work on. Think about developing innovative solutions that not only solve the tactical problem but also may positively impact revenue stream.

 

  1. Differentiate between Project Management and psycho-drama

Whether you are an Owner, Manager or support engineer, your job is to bring in a project on-time, under budget, first and foremost. Incorporating innovation into project outcome must be weighed against timeliness and finances. Especially in this new economic paradigm. Dumbing down a project is not an option. And sometimes the best solution is not the “perfect solution.” Keep in mind that you are not problem-solving inside a vacuum. You are in the middle of that Autobahn, remember?If presented to management in the context of how trade-off of deadline can result in greater cost-savings and productivity, your solution may just become the “best” or “optimal” solution. The more your solutions support your company’s bottom line and take revenue generation into consideration, the more value you to bring to your organization.

Project management is not about managing personalities or finding issues project team members have and focusing on those. It’s not about managing people. It’s about managing engineering outcomes. You’ve seen it yourself in project team meetings that degenerate due to difficult personalities and endless pushbacks. When personalities are the focal point of a project, instead of the well-being of your customer, this tactic is the fastest way to destructive and toxic work relationships and less-than-brilliant project outcomes. And you’d be surprised how many managers misunderstand this dynamic of the workplace. The business section of your local bookstore has lots of books on this subject. Whether you are a manager or not, learn to work and think like one.

 

  1. Do your own work and own promotion

Relying on other people to champion your thoughts and present them to upper level management is never the same as doing it on your own. And you don’t need to make end runs or play politics. Manipulation is NEVER an option. Find a way to incorporate (or at least invite) your manager into the presentation so it is a win-win proposition.He/she may share other information that helps your presentation become even more impactful. Are there other individuals in your organization who are tremendous resources to innovation and successful project outcomes?

Keep in mind when presenting your solution to higher ups that you are demonstrating you have a broad-based context in problem-solving.You are differentiating yourself from the rest of the folks sequestered in cubicles, focusing on tactical issues and short-order problem solving. You are allowing yourself to become a more versatile team member within your organization – which starts to create greater value for your organization. Learning and incorporating this strategy, while crediting all others who assisted you in your work, moves you from one skill set into multiple skill sets.

 

  1. Learn to think on your feet

The next time you are going into a project meeting, create a list of potential push-backs and objections. Then write down your answers. Even if these issues never surface during the meeting, you will be prepared. And being prepared in advance of the meeting, rather than winging it or being a spectator, differentiates you in your primary role as engineer.

If you think no one in your organization rehearses prior to a presentation to a new customer, think again. Do your homework. Learn how to present your homework in an honest and convincing manner, in a style that is natural, that is "you". And learn that it’s better to say “I don’t know the answer to that question” than “Yes we can do this.” Being a “yes” man or woman does not make you a resource. Letting folks know you are not Mr. Fixit – but you will research the issue and report back in a timely manner to all disciplines involved – adds to your value within that project team.

The next time you are in a project meeting, take note of who is well-versed, confident and rehearsed. Who preps well for meetings? Perhaps they can become a resource for you in developing your own version of this skill set. Perhaps this individual comes from the sales or marketing department. Cross those departmental lines and interview them! This strategy is not “asking for help.” In fact, you are acknowledging their skills. Who isn’t going to be flattered about being asked for input on how they do what they do so well? And this strategy also builds partners for you in other departments. Which in turn may result in information sharing that assists you in more robust and timely presentations which are in-tune with the critical factors impacting your company’slongevity in today’s global marketplace.

The 5 strategies I present are cost-free, especially if you get business books from the library and access other source material online. And of course, do your own leg work. All these strategies take is a bit of your time and commitment. And if you are not committed to your career, who else do you expect will be?

Who is the first person you have to convince that you are “worth it” You already know the answer: YOURSELF.

What are you waiting for?

Bier Halls: the best place for networking for engineers!

I was in Germany last week and had an opportunity to network at a conference with biomedical engineers and physicists. Some pretty amazing engineering minds, let me tell you.Like you, they are engineers. Like you, these engineers and physicists feel there are certain venues and environments which make for more productive collaborative engineering experiences, especially during the conference.

If you think this blog is going to extol the magic qualities of bier to loosen the tongue, sorry to disappoint. What I noticed, however, is that depending on the venue for networking, these engineers were more gregarious, open to meeting and talking with strangers and to sharing collaborative ideas.

Why you may ask?.

It’s the venue.

Let’s take the opening night festivities in the exhibition hall. Lots of booths with vendors excitedly hoping these folks would stop by and ask about their products and services. Not so. In fact, there were the proverbial islands of 5’ tall, exceedingly small “standing tables” running down the length of major traffic areas for everyone to congregate about with their food and beverages. Which immediately sorted everyone into sets of four… since everyone was hungry and thirsty by that hour of the evening. So not a lot of networking going on under these conditions. Everyone stayed with the pod of folks with whom they came to the conference. And occasionally , they went out into disorganized, winding lines to forage for more food. A bit visually and logistically chaotic, to say the least.

Then there was the bier event later during the week. The engineers entered a huge bier hall at one of the fabulous local breweries. The high ceilings and stained glass of the room reinforced that this room had no other requirement from them than to fill its ROWS AND ROWS of tables. Each long table sat at least 50 people, 25 per side.The food stations were around the periphery of the room. And of course the waiters and waitresses were ready with beverages.

THE ENGINEERS KNEW WHAT TO DO.No hesitation. No confusion. They didn’t even break a sweat. The engineers picked a place at a table… any table… even if it wasn’t with their colleagues. And once their territory had been staked out, these biomedical engineers headed for the food stations. And started to talk with whoever was in line in front of them or behind them. And they made introductions and started sharing ideas. And that idea-sharing continued once these engineers sat back down at their table with their plate of food. In fact, some of these engineers invited the people they had met in line to sit with them at their table.

What a difference from the first night.

Once back at the long table where I was seated with colleagues and strangers, I remarked to these biomedical engineers about my observation of the beauty of the bier hall venue for networking. And they confirmed my observation. Once they saw the linear, orderly layout of the room, with its long orderly lines of tables for as far as the eye could see , they were comfortable. Period.

Now think about the next team meeting you are attending. How can you make that venue into a bier hall? No, I’m not talking about bringing in a keg to enhance creativity and the collaborative spirit. However, think about how you can use the room- and even re-arrange the room – to create greater comfort for everyone attending, especially you.

If everyone walked into every meeting they had with a bier hall mentality and felt comfortable instead of sequestered, collaborative instead of defensive, and had confidence that the discussion would be orderly and could be brought back into linear mode due to the venue, how much more productive would be the outcome of these types of meetings?

How does your work space and your meeting space impact creativity and collaboration? We are visual animals and take our cues from our surroundings. When’s the last time you took a look at your surroundings and considered whether they have a positive or disruptive impact on your performance?

You shouldn’t have to fight the venue to thrive in it. Make it yours. Own the space. Feel comfortable and confident.

What if all of your customers were like your “best” customer?

In this economy, engineering firms have bids tied up in engineering projects contingent on economic stimulus funding, which is slow to trickle down. There’s a lot of engineering work being promised as timelines for contract awards get extended further and further.Some engineering and design firms have been forced to transfer their business mix predominantly to public projects, which often end up being a low-ball bid “beauty contest.”And then there’s the accordion-like expansion and contraction of the construction engineering workforce which was the norm prior to the economic meltdown and is now combined with the contraction of the work week as well.

So where are you looking for new business development opportunities?Are you simply filling your pipeline with anything you can get your hands on? In these tough economic times, this situation is simply “the way it is.”

Regardless of how you are “getting by,” ignoring what you do best, and for whom, is not an option as we move toward the new economic business paradigm.

Who is your best customer? What makes that company your best customer? Are they a good customer simply due to the volume of repeat business awarded during the year or profitability of the work awarded? Is the work awarded a multitude of small jobs, with less-than-inspired-engineering, brought to you at the last minute, with expectations of rapid turnaround? Or is this engineering and custom design and fabrication work profitable because you understand that customer’s mindset and requirements and they have trust and confidence in your ability to take the time to deliver well-thought out, collaborative engineering solutions?

What if all of your customers were like your “best” customer? What if you took the time to understand the persona of your “best” customer and developed a set of specifications for what a “best” customer brings to your table? How’s that for turning the tables and creating a different type of business development strategy for your company?

As we head towards the new economic paradigm, engineering-intensive companies who have used their slow periods and downtime to take a good look at what they do best and for whom are going to be ahead of the curve in terms of business development.

Most companies have a mixed bag of customer types. Take a look at all of your customers and gain a handle on what makes the “best” the “best.” Instead of being all things to all people, what if your company targeted the “best” types of companies with whom to do business in the future?

What would the economic impact on your company be if the majority of your customers fell into the “best” customer category?

Ask yourself these questions:

1.Who are your customers? Do you truly understand who they are?

2.Are your best customers your target customers? Or did you just “fall” into them?If your best customers simply “happened” to your company, it’s time to find out what makes that relationship work so well.

3.What are the strengths, weaknesses and gaps in your company in terms of successful business development practices? Is business development endless response to RFQs or a result of relationship building, knowledge management and long term, multiple phase projects?

4.What skill set is required for you to target “best” customers? How many individuals in your organization currently have this skill set?

5.Is your company the “best” vendor of your “best” customers? Why or why not?

6.If the majority of the customers you served were in the “best” customer category, would your production runs be predictable with longer lead times? How might that situation impact quality, productivity and scheduled maintenance… let alone cash flow?

7.If the majority of your customers were “best” customers, could you allocate certain lines or a percentage of capacity for rapid turnaround projects for “other” customer types while devoting greater resources to your “best” customers?

8.How could you shift the percentage of your customer base to “best” customers within the next six months and what would the impact be on personnel, equipment and once again, cash flow?

Targeting “best” customers requires some work on your part. You will need to identify the types of discussions with the types of customers resulting in the best return on investment for your company. You will need to identify those individuals within your company who already have the skill set which allows them to be “naturals” at these types of discussions. And you will need to make an investment of time and, yes, cash, to develop these skill sets in other individuals who may have the potential for developing business with “best” customers.

Having someone pick the short straw and telling them they are now a “sales engineer” – without the benefit of training – is no longer an option. And for small to mid-sized companies, this practice has been the norm.

The new business paradigm requires different habits and attitudes for engineering-intensive companies:  Sales Aerobics for Engineers, if you will. Engineering-intensive companies need to recognize the gaps in their current palette of offerings.  Enlightened engineering and industrial manufacturers, distributors and service companies should be willing to re-train and cross-train themselves and their staff to incorporate sales questions into engineering discussions. These types of companies will be at an advantage vs. their competition.

Using the economy as an excuse to do nothing is no excuse at all. It’s time to regroup, retrain and redeploy. If your company has made it this far, you are well-managed. Now take what you do best and add the skill sets to your engineering staff to make your company better, even “best.”

You don’t need more customers. You need more customers like the ones you do your best work for.

Find out what makes your “best” customers, well, “best.”

 

An Interview with Matt Barcus of CivilEngineeringCentral.com

This week’s post features an interview I did with Matt Barcus, Managing Partner with A/E/P Central, LLC, home of CivilEngineeringCentral.com. His complete profile appears at the end of this post.

 

Babette: As a recruiter for the civil engineering job market, what’s your perception on how the economy has displaced civil engineers as a whole, regardless of generation and longevity with their current company?’

 

Matt: This economy has really brought civil engineering down to a new low.Many companies have experienced multiple rounds of layoffs, mainly in the specialized areas of land development and transportation.With the real estate market in its tumultuous state, building has come to a near standstill, especially in the residential market. So those engineers who have made a career of designing subdivisions and master planned communities are left fighting for their lives for any new projects that do become available.

As you are aware, the ASCE Report Card handed down a grade of “D-“ in regards to the state of our country’s roads and highways.There is MUCH work to be done, but state DOT’s across the country are having a funding crisis and the stimulus funding from the federal government to help fund these projects is slow in its trickle down.Because of this, many highway and transportation engineers are feeling the pressure and fighting for any piece of work they can get.The firms suffering the most are those that had all their eggs in one basket (i.e. land developers or transportation). The toughest regions hit seem to be FL, VA, CA, NV, AZ and GA.

Babette: Some of the companies typically have an “accordion” structure: they traditionally ramp up or down depending on workload. Is the impact of the economy changing the dynamics of even this traditional expansion-contraction structure of support personnel?

Matt: To some extent. Where you traditionally see this “accordion” structure is in the construction industry – more so than in civil engineering.Traditionally, civil engineering is a very conservative industry, so their ramp up/ ramp down mentality is not at the same level as the construction industry.That said, many firms of course did experience some tremendous growth during the boom years, and all they saw were dollar signs which led them to staff up significantly which blinded them to the long term impact.The economy was so great and the civil engineering industry was so robust really that it was hard to see this far ahead.Actually, if anyone was paying attention they could have seen this coming, but everyone was so buried with work that they never looked up.The firms who are surviving and still thriving in this economy are those who had effective and well thought out long term strategic plans already in place.

Babette: What are three recommendations you would give current civil engineering students who will be graduating in 2010 and looking for jobs?

Matt:

  1. Don’t become discouraged with this economy – continue to follow your passion of civil engineering and be patient. Before long, we will begin to see a long term rebound and the industry will be much better prepared come the next recessionary cycle.
  2. As an engineer, we know you are very technically oriented, that is a given.But focus on your social and sales and marketing skills. Take courses, attend seminars and read books on sales and marketing.Your ability to understand the marketing and business development component of becoming a consulting civil engineer will have both an immediate and long term impact on your career.
  3. Find an internship during your undergraduate years with a civil engineering company or within a governmental agency.Any pre-graduation experience you can put on your resume will help you stand out from those who were just waiting tables.

Babette: What are three recommendations you would give to established civil engineers, Gen Y or even Boomers, who find themselves looking for jobs?

Matt:

  1. Work your network.Past co-workers, clients, and fellow association members are great places to start.
  2. Be proactive.Don’t just submit your resume to an online ad and sit back and wait.Find out who the hiring manager is, call them and introduce yourself and let them know you have recently applied, that you are interested in exploring their advertised opportunity and offer to send your resume directly to them.Then be sure to follow up.
  3. Be prepared not only with a chronological resume with dates of employments, titles and duties, but make sure you take a step back and compile a detailed list of some of the more significant jobs you have worked on during the course of your career and what your specific role was on those projects. Don’t be afraid to invest in a professional resume writer either.

Babette:What appears to be the biggest “gap” in skill set for today’s civil engineers, regardless of generation?

Matt:The ability to effectively be involved in sales, marketing and business development.

Babette: Overall, what is the most rewarding aspect of what you do?

Matt: As a search consultant to the civil engineering industry, the most rewarding aspect of my job is successfully filling a difficult search that a client has thrown up their arms on. When they have utilized all of their resources but have come up empty, we are able to use our network and search skills to bring to the table the highly qualified candidates that will help take their division or their company to the next level.

About Matt Barcus:

Matt Barcus is a managing Partner with A/E/P Central, LLC, home of CivilEngineeringCentral.com. CivilEngineeringCentral is a niche job board, resume database and blog catering exclusively to the civil engineering industry.CivilEngineeringCentral.com hosts one of the largest pure civil engineering discussion groups on LinkedIn and also produces a monthly e-newsletter.Matt is also the President of Precision Executive Search, a search firm specializing solely in the civil engineering industry here in the United States. Matt has been recruiting civil engineers since 1997 and he opened the doors to Precision Executive Search in 2001. His URL is www.CivilEngineeringCentral.comHis user group on LinkedIn features the same brand name.