External Environment

Scaling Your Revenue through Alliances and Stakeholders

By Tom on June 10, 2022

My thoughts on using alliances to enhance your business development follows on from my previous post on the external environment.

When I started work as a State Manager for a national asbestos removal company, I had very few contacts within that industry. Much to my surprise, we had no recurring customers in our geographical territory either. While assessing the Sales Ecosystem it became clear that the consultants, who set up and oversaw the projects, needed a removals contractor whose work reflected well on them. In turn, we as the contractors needed good consultants —the relationship went both ways.

I quickly identified a series of consultants whose work ethic mirrored our own. Thereafter, began forging mutually beneficial relationships with them. This introduced us to projects and clients that we had no prior relationship with. In turn, we provided an additional source of jobs and the certainty of our professional service to the consultants. Both our revenues increased as a result.

This taught me that alliances with key players in the market can have a strong influence on your success.

A lady discussing business with three stakeholders. Perhaps there is an alliance in the making. — Alliances must be Mutually Beneficial

Assess Your Stakeholders

Take some time to really understand the market ecosystem. Firstly, who does what and why? Secondly, who are the key players within your Sales Ecosystem and how much influence do they have? Thirdly, do any of these influencers align with your organizational mission and values? Finally, is there a gap that can be filled in a way that benefits both parties?

Similar to the exercise for internal stakeholders in my previous post, a matrix can be developed for those stakeholders external to the company.

Who Are Your Stakeholders?

A simple external stakeholder matrix should cover the following groups:

Industry Experts. Technical experts with a strong positive reputation within the industry. Their opinion carries a lot of weight with industry groups and customers. Often a great source of market intelligence, technical advice, and referrals, if they like your company offering.

Key Influencers. Not always the industry experts. These individuals have a large industry-wide network and always know what is going on. An invaluable source of industry intelligence, and vital to have regular contact with at least one of these.

Consultants. Providing specialist advice is a critical part of any industry, and consultants can be found for almost any topic or service. These can be customers themselves and are often the gateway to more prominent end-user customers. Forming an alliance with a consultant who shares your principles and values your company offering, is an excellent way to get access to specialist skills and a different stream of opportunities.

Government Departments. While not relevant to all industries, government departments provide valuable insights into industry trends and legislative requirements. They can make excellent recurring customers. Proving to these stakeholders that your offering is best-in-class can make your company the benchmark from their point of view. If this becomes the case, government departments can often become a good source of unofficial recommendations.

Industry Groups. Most industries have groups, clubs and peak bodies that form a hub for professionals to network and share ideas. Joining and attending these groups can provide up-to-date news on the industry and face-to-face access to customer contacts. Attending networking events and talks by these groups can place you in a relaxed setting allowing you to form connections with people that would be difficult to contact during their busy working hours.

Choose Your Alliances Carefully

Looking at your stakeholder matrix it will become apparent which ones should be considered the Key Players. Have a look at my previous post for strategies to nurture these stakeholders. Ultimately, your alliance proposition must be beneficial to both parties. It has to encompass a true win-win relationship.

Think about the external stakeholders in your industry. Are there any opportunities for alliances or closer working partnerships?

I’m always keen to hear your thoughts on this. Drop me a comment below or get in touch via the usual channels.

How the Lewis Model can help me Understand Culture

By Tom on June 3, 2022

In my previous post about the External Environment I talked a bit about things to consider when developing business in different geographies. In addition, culture forms a massive part of business in different countries that often gets forgotten about. It is an all too common mistake to expect others to think and act the same way you do. Taking time to understand any differences in culture and behavior and considering approaches to bridge them is very worthwhile. For example, a business development campaign in Australia would take a very different form to one conducted in Indonesia.

The Lewis Model

Social and hierarchical behaviour varies significantly from place to place. Therefore, if company operations span multiple geographies and cultures, read around the Lewis model. It will really help you gain an understanding of how to navigate any potential communication pitfalls. In short, Lewis broadly divides the world’s cultures into three communication styles: Linear-active, Multi-active and Reactive and describes how each style behaves. A summary of each style is provided in the table below.

Linear-Active	Multi-Active	Reactive
Talks half the time Does one thing at a time Plans ahead step by step Polite but direct Partly conceals feelings Confronts with logic Dislikes losing face Rarely interrupts Job-oriented Sticks to facts Truth before diplomacy Sometimes impatient Limited body language Respects officialdom Separates the social and professional	Talks most of the time Does several things at once Plans grand outline only Emotional Displays feelings Confronts emotionally Has good excuses Often interrupts People-oriented Feelings before facts Flexible truth Impatient Unlimited body language Seeks out key person Mixes the social and professional	Listens most of the time Reacts to partner’s reaction Looks at general principles Polite, indirect Conceals feelings Never confronts Must not lose face Doesn’t interrupt Very people-oriented Statements are promises Diplomacy over truth Patient Subtle body language Uses connections Connects the social and the professional

Summary of Lewis Model Communication Styles (from crossculture.com)

Working across geographies – always consider the cultural differences

What Does This Mean

Each of the three groups can be applied to different parts of the world. The Linear-active group comprises the English-speaking world—North America, Britain, Australia and New Zealand, and Northern Europe.

The Reactive group is located in all major countries in Asia, except the Indian subcontinent, which is a hybrid.

The Multi-active group are more scattered and comprises Southern Europe, Mediterranean countries, South America, sub-Saharan Africa, Arab and other cultures in the Middle East, India and Pakistan and most of the Slavs.

Please remember that these are generalizations. However, understanding them can really help bridge communication across cultures.

Understanding culture can help you work well within a multicultural team

Why This Is Useful

The importance of understanding cultural differences became apparent to me in the first two weeks of starting a new role. I was reporting through to Singapore and we had a huge variety of nationalities working in the same team. Experiencing some urgent technical issues with one of our customers I tried to push things through quickly outside of our regular operating process. To me this seemed the obvious thing to do. Not so to the rest of the team. I met resistance. Moreover, they would tell me that they would help, but didn’t. It was infuriating.

Luckily for me a great mentor of mine, Shirley-Anne introduced me to the Lewis model. I was operating as a Linear-Active whilst most of my colleagues were Reactive. They weren’t happy that I was circumventing the work process and as Reactives wouldn’t confront me about it. As a Linear-Active I was becoming impatient and the logic of bending the work process seemed obvious to me.

Importantly, Shirley-Anne helped me see that what was infuriating for me was also exasperating for the Singapore team. I gained insight into how the team members operated and adjusted my style and expectations to suit. Ultimately, a good outcome was reached for our customer.

What Next

If you find yourself working across geographic boundaries take some time to investigate the working cultures in each. This is important for both your customers and team. Gaining this understanding early will give you a better chance of avoiding any future communication pitfalls.

Check Out Your External Environment

By Tom on May 27, 2022

Having gained a good understanding of the inner workings of your organization, it is time to define the external environment of the Sales Ecosystem. Where are the customers and competitors, and how does your company fit?

A simple market analysis gives an idea of market size and customers. However, the External Environment includes much more. At the basic level we want to understand the setting that our team, organization, and customers operate within. This includes looking at the industry, geography, external stakeholders, and of course, those competing with you for your customer base. In this post we’ll have a quick look at the industry and geography. The external stakeholders and competitors will form their own posts in the coming weeks.

Operating Industry

In the context of the Sales Ecosystem your industry comprises the habitat that your target customers operate within. Additionally, this includes their sources of influence. Starting with the broad industry consider the following questions:

Who are the visible influencers of this industry internationally, nationally and locally?
Which industry bodies are the most popular and the most active?
Where do members of this industry go for information and advice?
Which segments of the industry are most applicable to your company offering?

Lets take the construction industry as an example. There will be well regarded individuals who regularly talk and interact at the industry level. They will be active on blogs, social media, webinars and industry discussion panels.

Here in Australia some of the construction industry bodies to investigate and interact with include the Australian Construction Industry Forum, Engineering Australia, and Institute of Architects, to name a few. If your company focuses on the engineering side of the industry, Engineers Australia would be an ideal place to start.

Answering these questions around your operating industry will begin to give a picture of the key influencers and most influential organizations. This information is essential in developing your External Stakeholder Matrix. That discussion will be saved for a future post.

Geography

Where in the world are you doing business? How does this impact your approach? This is usually straight forward to answer when you are operating within your home country. But, a thick layer of complexity is added if the business is developing overseas.

For each geography in your portfolio develop an overview of the broader environment that your Sales Ecosystem sits within. Determine how business is done there, what the culture is like and how to navigate it. The PESTEL analysis is a simple tool that helps shape our thinking in this regard.

P	Political
E	Economic
S	Social
T	Technology
E	Economical
L	Legal

PESTEL Analysis (Kaplan et al 2008)

The PESTEL analysis covers the following:

Political

What is the political environment like? Is the government stable, are there trade restrictions and is corruption rife?

Economic

Is the economy of the area growing? Are companies thriving and do customers have disposable income? Are the exchange rates favorable (particularly useful if you are importing/exporting products)?

Social

Is the population growing, and what are their attitudes to safety, health and career? Are they socially aware?

Technology

Is new technology and innovation widely accepted and actively encouraged? Are there incentives in the advancement and introduction of new technologies?

Environmental

What is the environment like? Does it suffer from harsh conditions, and is it protected properly?

Legal

How robust is the legal system and how strong is the focus on discrimination, consumer laws and health and safety?

If you are operating within multiple geographies the PESTEL can give a good feel for the differences. While coarse in its approach it does get you thinking along the right lines.

For more depth on the PESTEL analysis check out this website.

More external environment content coming up…

More on the External Environment

This post focuses on the operating industry and geography and has introduced the PESTEL model as a practical tool. Of course, there is much more to this topic and my next few posts will continue on this theme. We will be exploring, differences in geographical culture, external stakeholders and competitors in more detail over the coming weeks.

In the meantime I’m keen to hear your experiences with understanding the external environment that your company operates within. As usual please get in touch through the normal channels.