A Roadmap to Improving Cash Flow Previous item The Top 5 Things to Stay... Next item Cisco’s Intercloud Offers...

Starting and growing a successful business takes a herculean effort, and there are a myriad of issues that often trip up even the most experienced resellers and vendors. Having worked with hundreds of resellers and vendors, both large and small, I have found the key to success lies in an organization’s ability to effectively incarnate its business strategy into the operation.

Through years of helping resellers minimize operational disconnects, we have created a proven construct called Executive Relevant Partnering (ExRP) that enables us to better understand partner objectives and align their activities in such a way that unlocks their true financial potential.  ExRP has four components that, when used together, are proven to help an organization decrease operational disconnects and ultimately increase its cash flow. The ExRP components are

  1. Financial Objective

At the top of the model stands the financial objective.  The purpose is to understand an organization’s financial objective and how it plans to achieve.   While many reseller organizations have a sound understanding of their objectives, most lack solid plans to execute.  In the words of the great Yogi Berra: “If you don’t know where you are going, you might end up someplace else.”  This couldn’t be closer to the truth for many resellers.

  1. Customer Value

Next in the model we want to understand the value the reseller brings to the market, for example: “Why customers buy from them?”  Inevitably, we find that 99.9% of all resellers base their value on their engineers ability to service the customer.  This begs the question:  “If every reseller has the excellent engineers, then what differentiates each one of them from the other?”  The answer – not much.  Without solid differentiation in the market, resellers are destined to enter the price war fighting for every scrap they can.  Unfortunately, this lack of differentiation has, in the words of the affable Mr. David McNicholas, led partners to Darwin’s waiting room.

Once a differentiated value is identified, this along with the financial objective becomes the North Star for all efforts that follow.  If an activity does not quantifiably help drive a financial result consistent with the objective AND deliver value to the customer, then it is scrapped.  ALL EFFORTS MUST DRIVE A FINANCIAL AND/OR POSITIVE CUSTOMER RESPONSE.

  1. Business Processes

THIS is where cash flow resides.  Business processes fall into four distinct areas: 1) acquisition of new customers 2) retention of existing customers 3) cost control and 4) productivity.  Improve any one or more of these and your business will realize an increase in cash flow.  The objective is to identify those processes that have the potential to drive maximum impact on the’ ability of the business to improve customer interactions and ultimately cash flow. If you were to focus on one area in your business to improve results, this is the one.

  1. Resources

Lastly in our model is resources.  Stating the obvious, resources are those individuals, technology, reports, and collateral elements that execute the business processes.  It’s one thing to have effective processes; it’s another to have them fully integrated with the resources.  This is the second area where operational disconnects reside.  If you want to differentiate your business from your competition, you must implement intentional processes and effectively integrate your resources.

We use a discovery engagement model to better understand the business needs of our partners.  This discovery enables us to deeply understand the above and to create transformational plans to building a reseller’s Cisco practice.

I look forward to sharing more insight into creating a successful business in future EDGE360 posts. From best practices to lessons learned, I hope this site will become a “go to” resource for you and your team as you grow your own business.

In the meantime, if you have a specific area you would like me to cover or if you have a question for me, please add a comment.