Economy Flutters
I'M STARTING TO HEAR STORIES about construction companies that are closing down. It hits harder when you recognize the firm's name, or maybe even know the people involved. I wonder to myself if it could have been avoided. I wonder what steps were taken on the inside to prevent that decision of letting everyone go and shutting the doors. Then I drive past other construction companies and I wonder what steps they're taking. Are they also in trouble, I wonder?
One important strategy to understand is that
Marketing and Business Development in tough economic times is different from a
normal economy. Companies that understand this concept gain a staggering strategic advantage.
One of the remarkable marketing misconceptions of
construction companies and design professionals is that they believe once you
get your marketing program up and running, you're done. Worse yet, many
companies CUT their marketing budget when they start to have
difficulties. They cut programs, they cut marketing managers and in some cases,
valuable business developers. What they don't understand is Marketing MUST Change;
it must reflect what is happening in the current economic climate. Marketing
must be evaluated based upon the a)
the current economic condition,
b) your company's goals and objectives, c) your
company's services, and d) your company's ability to perform.
All of these parameters can change at any time;
consequently, they must be constantly monitored relative to current marketing
efforts. Based upon the idea that there will always be change, following are
SIX STEPS you can take to MANAGE your Marketing and Business Development in Tough Economic
Times:
1) Market your Value
2) Manage your Services
3) Strengthen your Relationships
4) Evaluate your Markets
5) Expand your Company Wide Marketing Efforts
6) Develop a Promotion
This can all be summarized by the word POSITIONING,
which is an important part of the business planning and strategic planning
process. Ask yourself these questions: Why is it that some contractors prosper
and other suffer under the same economic conditions?
Why is it that some contractors or designers always
have the ability to attract and hire the best people, while other equal
companies can't seem to get the right people in place?
Why can't some companies retain the right people?
Why is it that some companies build in several well-defined market niches, and
others can't? Even architects have a significant positioning challenge, as they
all seem to look alike. Sorry architects, but I'm an architect, and that's what
I see, and that's what I'm told. The secret to surviving in tough economic
times is positioning: the secret to positioning is unquestionable unfaltering
flexibility.
Unquestionable unfaltering flexibility means constant management. It means there must be a
core management team in place. This team represents the future of the company;
it reflects a training program for managers you are bringing up through the
ranks; it reflects a forum where ideas are discussed; it reflects the place
where tough decisions are made; it reflects strategy, business development and
marketing.
The core management team members are charted with one goal, and one goal only: To implement
annual business plan based upon a current strategic plan. A team such as this
that is trained in setting goals and implementation, will be far ahead of the
pack when there are significant change in the economy. They would have talked
about it, planned for it, and taken the necessary steps.
Six Steps you can Take in Tough Economic Times
1) Market your Value. It is important to understand what prospects buy.
Prospects buy Value. In the seminars I have spoken at I get the objection that
prospects buy price. Low price gets the job. While sometimes this is true, this
doesn't explain why often, the second, or even third lowest price wins. Why?
The answer is that another contractor has developed a RELATIONSHIP where
they have been able to CLEARLY
establish in a prospects mind
the VALUE they bring to the table. Prospects buy VALUE,
and Clients come back for VALUE. Surround your services with VALUE.
2) Manage your Services. Are your services competitive? Are you are losing work to contractors that are offering design/build or construction management? If you're an architect and feel that the contractor is getting more and more architectural work through the design/build process, then it is important to look further at your services.
3) Strengthen your Relationships. The biggest change in construction is the development of relationships that can lead to work. This has had a huge impact in construction because no longer is it a rule that the low bidder gets the job - public work not included here, but even that is changing. Many States are going to a Point system in evaluating the contenders: certain number of points for your bid; certain number of points for experience and other criteria.
4) Evaluate the Markets. At the end of each year in every major city, in every major construction related and real estate related publication there are economic forecast issues. There are special reports you can obtain, and numerous other sources for what is going on in your market. These need to be read and reported to/by your core management team. Are there changes in the economy and what industry sectors are being hit? If you can identify trends then you can be in position to take advantage of it.
5) Expand Company Wide Marketing Efforts. Everyone in a company is responsible for marketing. Everyone should be able to tell a company story. Everyone should have a "vision card" that can be used to tell the company story. Everyone has a network, and it is important to communicate in your internal marketing program that everyone can help.
6) Develop a Promotion. In a tough economy you must take action. You must do something out of the ordinary to get your name in front of exactly the group of prospects that you can help. One can no longer say, we are on time and on budget. If you do, you just lost. Now you have to truly understand the Value you bring to your different market niches, as discussed above, and you must bring that message to them. You must be creative your approach; you must present your message within the arena of relationships you're creating; you must surround your promotion with other mini-promotions so that your name surfaces in front of them on a regular basis; you must, in short, become as interested in them as you would like them to be interested in you. It is important, because this is the reason why some companies prosper and some don't.
It's all about determination.
FOR MORE INFORMATION, go to www.compassconsultantscorp.com
