5 5 KI C K-ASS THE Finally, a Business Guide 5 E H That KICKS ASS! K T5 I C K orget the confusing jargon and hype: there are five—and only five—ways to F STRATEG I ES - achieve exponential growth in your business.Are you ready to kick ass? A The 5 Kick-Ass Strategies Every Business Needs is the ultimate business-growth S guide. Fliled with actual case studies, visual elements and strategic steps, this book S will set you on a course to reach—and exceed—your growth goals. In this no-holds-barred handbook,Robert Grede gives you the essential strategies S for improving each area of your business. T R A Every Business Needs Along the way you’ll discover: T nHow to create a strategic nHow to sell more to your E G growth plan current customers I nThe benefits of buying nStrategies for mergers and E EXPLODE market share acquisitions S TO nWays to hunt for business nHow to introduce new products E S A L E S , V E Praise for Robert Grede’s Naked Marketing R “No jargon.No hype-speak.Simple and direct as a laser beam…a no-nonsense,easily Y readable tool for business managers and entrepreneurs.” — SACRAMENTOBEE B STUN THE COMPETITION, n n n U “A clear-cut description of the most important ingredients in marketing…a good S CUSTOMERS addition to any business library.” — MILWAUKEEJOURNALSENTINEL I N E Robert Grede,author of Naked S Marketing,is the founder of S oob The Grede Company,which Business $16.95 U.S./$23.95 CA N D ACHIEVE EXPONENTIAL R consults start-ups to Fortune N han 500 companies in marketing NG R O W T H at C E on and strategic planning.He P A by J also taught marketing and U E oto entrepreneurial management D Ph at Marquette University.He is ISBN 13:978-1-4022-0640-5 ISBN 10:1-4022-0640-2 S R OB E RT G R E DE a graduate of DePauw University and the Goizueta School of Business at Emory University. N A Grede E KICK-ASS E H T STRATEGIES Every Business Needs EXPLODE TO S A L E S , STUN THE COMPETITION, CUSTOMERS, ACHIEVE EXPONENTIAL D NG R O W T H A R OB ERT G R EDE Copyright © 2006 by Robert Grede Cover and internal design © 2006 by Sourcebooks,Inc. Sourcebooks and the colophon are registered trademarks of Sourcebooks,Inc. All rights reserved. No part of this book may be reproduced in any form or by any electronic or mechanical means including information storage and retrieval systems—except in the case of brief quotations embodied in critical articles or reviews—without permission in writing from its publish- er, Sourcebooks, Inc. This publication is designed to provide accurate and authoritative information in regard to the sub- ject matter covered.It is sold with the understanding that the publisher is not engaged in rendering legal,accounting,or other professional service.If legal advice or other expert assistance is required, the services of a competent professional person should be sought.—From a Declaration ofPrinciples Jointly Adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations All brand names and product names used in this book are trademarks,registered trademarks,or trade names of their respective holders.Sourcebooks,Inc.is not associated with any product or ven- dor in this book. Published by Sourcebooks,Inc. P.O.Box 4410,Naperville,Illinois 60567-4410 (630) 961-3900 FAX:(630) 961-2168 www.sourcebooks.com Library of Congress Cataloging-in-Publication Data Grede,Robert. The 5 kick-ass strategies every business needs:to explode sales,stun the competition,wow the customers,and achieve exponential growth / Robert Grede. p.cm. Includes index. ISBN-13:978-1-4022-2024-1 978-1-4022-0640-5 ISBN-10: 1-4022-2024-3 E-1-4022-0640-2 1. Management—Handbooks,manuals,etc.2. Strategic planning—Handbooks,manuals,etc. I. Title:The five kick-ass strategies every business needs.II.Title. HD38.15.G74 2006 658.4’012—dc22 2006003650 Printed and bound in the United States of America. VP 10 9 8 7 6 5 4 3 2 1 For Cammy and The Nate,my reasons for being. C O N T E N T S ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ix INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 CHAPTER ONE:Defining Your Business . . . . . . . . . . . . . . . . . . . . . .7 This chapter introduces the concepts behind strategic planning, the importance of defining your organization’s strengths,and how to translate those strengths into benefits for your customers and prospects. CHAPTER TWO:Understanding Marketing . . . . . . . . . . . . . . . . . .33 This chapter helps you understand fundamental marketing principles used throughout this book,including product differentiationand branding. CHAPTER THREE:The Strategic Marketing Plan . . . . . . . . . . . . .57 This chapter describes how a strategic marketing plan is written and where to find the information necessary to develop reasonable assumptions about your industry and its growth potential. CHAPTER FOUR:The 5 Kick-Ass Strategies . . . . . . . . . . . . . . . . . .93 The fundamental principles behind the 5 Kick-Ass Strategies, how they were developed,and why there are five and only five ways to build your business.Each of the 5 Kick-Ass Strategies is then explained in greater detail in the succeeding five chapters. CHAPTER FIVE:Kick-Ass Strategy #1:Buy Market Share ......97 Building your business in a mature market,“selling more of the same stuff to the same people.” CHAPTER SIX:Kick-Ass Strategy #2:Hunt . . . . . . . . . . . . . . . . . .133 Every organization needs to hunt new customers— “selling the same stuff to different people”—to remain viable. CHAPTER SEVEN:Kick-Ass Strategy #3:Farm . . . . . . . . . . . . . .167 The easiest and most cost-effective methods of increasing your business:“selling different stuff to the same people.” CHAPTEREIGHT:Kick-Ass Strategy #4:New Products . . . . . . .191 The benefits of developing new products,how to avoid the most common reasons for new product failure,and why “selling different stuff to different people”is critical to the success of your business. CHAPTER NINE:Kick-Ass Strategy #5:Merge or Acquire . . . . .209 Various methods of acquisition,a growth strategy that incorporates all four of the other strategies. CHAPTERTEN:Managing Your Growth . . . . . . . . . . . . . . . . . . . .219 Outlines the fundamental techniques for better purchasing, negotiating,operations management,distribution,and quality. CHAPTERELEVEN:Cash Is King . . . . . . . . . . . . . . . . . . . . . . . . . .253 This chapter examines the financial constraints inherent in a rapidly growing company with a review of debt and equity capitalization,different business entities,and techniques for better cash management. CHAPTER TWELVE:Managing Your Human Assets . . . . . . . . . .275 Your people make or break your business. This chapter explores human resource management, including hiring, termination, leadership styles, motivation, corporate culture, and the benefits of outsourcing your personnel needs. CHAPTER THIRTEEN:Social Profit .........................299 This chapter examines why ethical behavior is good business and how to encourage ethical behavior at all levels of your organization. GLOSSARY OF TERMS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .309 INDEX ...................................................323 ABOUT THE AUTHOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .325 A C K N O W L E D G M E N T S As with any book, the written words often stem from ideas germinated in the minds of others. My gratitude to Tim Blumentritt for his input on Succession Planning; to Phil McGoohan for his insight on Mergers and Acquisitions; to Bernard Hintzke for his explanation of Business Legal Entities; to Mark Ehrmann for his thoughts on approaching Merger and Acquisition candidates (and for his jump shot);to Tim Johnson for his Human Resources input;to Dick Grady for his creative contributions; to Marilyn Allen for her guidance and support; and to Dominique, Peter, and all the folks at Sourcebooks for their faith and patience. A special thanks to Aye Jaye for sharing his Schmooz. And,as always,I am grateful to Terry Firkins,who showed me how.