From Greg's Head

I’m not going to rehash the hundreds of stories in the media this week about the first anniversary of Katrina. The Houston Chronicle is full of survival stories, articles about what happened and many other related stories.

What I’d like to concentrate on is disaster preparedness – are we really ready if another disaster like Hurricane Katrina – or even Rita – occurs? Think about it. If a hurricane or other natural/man-made disaster were to happen right now, is your business prepared for a loss in productivity, revenues and personnel? Do you have adequate software and hardware backups or even a hard listing with a phone tree that all employees have on their PDAs and at home?

An interesting phenomenon that is springing up in Houston, and most likely around the country, are businesses that focus on helping companies survive disasters, but more than that, give them the tools to put themselves in a disaster-ready position.

For example, Employee OUTPOST is a Houston-based company specializing in building Web-based communication “outposts” for businesses that are in trouble through a natural of man-made disaster. This site comes from Easterly & Company, the same people who brought us KatrinaPeopleSearch.com (and incidentally, Easterly offers communications and marketing services).

A press release in PDF describes what Employee OUTPOST offers. Especially interesting to me are two of their services: “Employers have the ability to contact employees using blast e-mail by text messaging (SMS)” and Graphical Mapping of employee contacts using Google maps.”

Hmm. Proactive rather than Reactive. Who would have thought this possible? 

Posted In In Our Community , Observations 1 Comments Permalink

Many of you know about my association with Texas A&M’s Mays Business School and the Center for New Ventures and Entrepreneurship (CNVE). So it should come as no surprise that I am actively involved with the Aggie 100 Program.

In 2005, the Mays Business School and the CNVE created the Aggie 100 Program. The program identifies, recognizes and celebrates the 100 fastest growing Aggie-owned or Aggie-led businesses in the world. The Aggie 100 not only celebrates their success, it also provides a forum to pass lessons to the next generation of Aggie entrepreneurs.

PKF Texas provides the accounting services for the program and we recently finished reviewing over 200 applications submitted by the nominees and provided the official 2006 list to the CNVE. The winners will be announced at the annual Aggie 100 Awards Luncheon on Friday, October 13, 2006 at the Zone Club on Texas A&M’s College Station campus. Here’s an excerpt from the CNVE Newsletter highlighting the 2006 class:

“The preliminary information we know about the leaders of these fast growing companies indicates that, once again, almost every college on campus will be represented along with class years spanning decades. The make up of the list will remain a surprise until the on-campus ceremonies in mid-October. In the meantime, we can give you a little glimpse into the makeup of the group:

• 29 are “repeat offenders” – they were also members of the class of 2005
• Like last year, the fastest growing companies experienced triple digit compound annual growth in revenues
• The threshold for inclusion moved up from a 1% compound annual growth rate to over 20%
• The average growth rate was over 52%, up from 30% last year, and the median was about 40%
• The companies are from four countries
• Within the USA, 10 different states are represented”

To read the rest of the newsletter click here. 

Aggie 100 is a great event and I am looking forward to the awards luncheon in October. Stay tuned for more posts about the Aggie 100 closer to the awards luncheon.

Posted In In Our Community 1 Comments Permalink

Note: Running most Fridays in FromGregsHead.com, is a continuing series of tips brought to you by Greg Price. These run Saturday mornings during the BusinessMaker’s Radio Show on Supertalk 97.5. Audio files can be found on the Entrepreneur's Playbook page of the PKF Texas website.

Do you know your corporate financial DNA?

Are people asking for a Benchmark Report on your business?  As your company grows, are you treading water?  Are you ahead or behind of your competitors?  Success leaves clues, so do you know where to look?

If you know your corporate financial DNA, you can adapt to changing business demands more readily.  There are several areas that make up corporate financial DNA.  These include but are not limited to: revenue growth, operating income margin, percentage cost of good sold, days sales outstanding, days in inventory, and days purchases outstanding.

Corporate DNA must be combined with performance metrics to drive success.

No matter what metric you use, make sure it is easily understood by many managers throughout your company.  Use the metrics to reward performance of your employees.  Also, make sure your corporate DNA relates to shareholder value.

Look back at your successes.  What did you do right and how can you apply that to the future?  Success is measurable, but it takes the right combination of people, process, and technology to become effective.  Make sure you map SCM initiatives to financial performance gaps and link gaps to SCM Business Processes and Strategies.

Studies have shown, that for certain industries, using your corporate financial DNA to improve performance in reducing your Days Sales Outstanding from the median to the 1st quartile has a bigger impact on your cash flow than increasing sales from median to the 1st quartile.

Make sure you know the comparison between your corporate financial DNA and your industry.  If you do, you can implement improvement plans to put money in your pocket.

Posted In PKF Texas - The Entrepreneur's Playbook Comments Permalink

Yesterday, I received the following email from Paul Frison at the Houston Technology Center:

“I have the pleasure of sharing with you wonderful news from HTC: the much anticipated new building addition to our Midtown facility is finally completed and ready to house new emerging technology companies in the heart of Houston’s technology business community.
 
The new expansion brings to completion the 50,000 sq. ft. building originally planned for the HTC in 1999 by the City of Houston.
 
During the long wait for the facility to be completed, HTC was able to establish its position as the center for entrepreneurship in Houston, build a large community of technology and business professionals and become the largest technology business incubator / accelerator in the state of Texas.  We have helped more than a thousand companies expand their business and achieve milestones of growth, maturity and success, assist scores of companies collectively raise in excess of $500 million dollars, while assisting the economic development of our city.
 
More than just a building, The Houston Technology Center is a hub for personal and business networks, providing emerging technology companies the opportunity to connect with the people and services to expand their business to the next level. HTC is also home to many technology entrepreneurs, sharing space in a community of exciting and innovative companies. For more information on the HTC and our facility please visit our website at www.houstontech.org.
 
We would like to extend special thanks to HP and JP Morgan Chase Bank who helped us equip and furnish more than one half of our new building.  We STILL need furniture for the other offices, however.  If you have or know of anyone willing/able to donate chairs, work stations, tables, etc., please contact Sheila Whanger at swhanger@houstontech.org or (832) 476-9284.
 
I would like to extend an invitation to you to visit our new building. You can also learn more about the building by visiting our web site, provided courtesy of Informetrics, at http://www.htcbuilding.org/. Finally, take advantage of the special savings we are offering, for a limited time, on office space. To learn more about the HTC Grand Opening discounts or schedule a tour, call or email Sheila Whanger.
 
I hope to see you soon at one of our upcoming events or at our building at 410 Pierce St. (between Brazos and Bagby).
 
Regards,
 
Paul M. Frison
President and CEO
Houston Technology Center”

Congratulations to the HTC!  I know this has been a long time coming and hopefully my readers have been/will be able to benefit from all the HTC has to offer. 

Posted In In Our Community 2 Comments Permalink

You would have to be living under a rock not to have heard about Dell’s recall of its laptop batteries. I did a quick Google News search and hundreds of stories popped up – literally extolling and scolding Dell for this problem that, in actuality, is a Sony problem – not Dell.

The pundits are already out. ABC news recently ran a story, “Has Dell Lost its Way?” in which the writer says:

‘Dell as poster child did a remarkably good job of getting in front of the problem, with open talk about where and how they think the Lithium Ion batteries failed and a Web site that made it dead simple to figure out if you had a conflagration-prone battery.”

“Yet questions persist. Why did Dell tell the media last month that the Japanese businessman's exploding Dell laptop was an isolated incident? Why did it take two solid years of laptop sales for Dell to identify the problem and do something about it?”

Regardless who takes the blame, I think Dell has a unique opportunity to improve its reputation. The ABC news story begins to talk about how Dell did a good job of facing the problem head-on, but what Dell can do with the immense task of receiving the goods, replacing batteries and shipping them back out, a timely basis, can be a huge PR fete for them.

I think this speaks to customer service in a different way than we usually see it – in that Dell can atone for its mistakes, but also can seize the opportunity to come out shining. I know Dell’s dollar per share price dropped dramatically at the end of last week, but we know these things are cyclical.

Dell can improve its image, don’t you think?

Posted In Tecknowledgy , Observations 1 Comments Permalink

Note: Running most Fridays in FromGregsHead.com, is a continuing series of tips brought to you by Greg Price. These run Saturday mornings during the BusinessMaker’s Radio Show on Supertalk 97.5. Audio files can be found on the Entrepreneur's Playbook page of the PKF Texas website.

If supply chain management, or SCM, has so much potential, why does it often fail to deliver a return on capital?  Recent studies have shown that return on capital is down thirty percent for 1,500 manufacturers, distributors and retailers.  Is the hype driving us all to move in a direction that we believe will help our businesses?  Or it is something else?  It is something, or a process that seems so simple, but elusive to most businesses.

There are several reasons SCM can fail but three key reasons are consistently found:
First, SCM project managers often lack access to C level executives.  C level personnel are crucial for success and must be involved in any SCM project.  The C level person must be engaged in the oversight and management of the SCM project.  If they don’t, they have shirked their responsibilities and the SCM will have to battle priorities and commitment from others.

Second, SCM project managers don’t necessarily speak the language of finance.  In order to be successful, they have to have the tools to communicate information effectively.  They don’t know the key elements of their Corporate DNA.  Corporate DNA being defined as the metrics by which you measure success beyond the software implementation.

And third, SCM cannot be done in a vacuum.  You must take into account entity wide issues.  Getting departments to work across company lines and getting input from the appropriate key people sounds easy.   But as many SCM project managers will attest to, getting this cooperation is much more difficult than one might expect.
In short, everyone has to be active and committed to an SCM project for it to be a success.

Posted In PKF Texas - The Entrepreneur's Playbook Comments Permalink

I’ve already commented several times on our addiction to technology, and, yet, here comes another twist. Just yesterday, a journalist friend of mine directed me to an article making its way across the Web that deals with the psychological interpretation of inbox clutter.

Jeffrey Zaslow of The Wall Street Journal wrote an article, “Inbox Offers up Glimpse of You,” and, although it appeared in The Journal, you do need an online subscription to access it. Instead, it is syndicated in various publications, including Southern California’s Press-Enterprise.

Ok – so just what does a crowded inbox suggest about you and your psyche? Turns out a cluttered inbox means you have “excess baggage.” To quote psychologist Dave Greenfield, founder of the Center for Internet Behavior (and check out Mr. Greenfield – his site is full of what he refers to as “Virtual Addiction”:

“If you keep your inbox full rather than empty, it may mean you keep your life cluttered in other ways … do you cling to the past? Do you have a lot of unfinished business in your life?”

On the other hand, if you “obsessively clean out your inbox every 10 minutes, you may be so quick to move on that you miss opportunities and ignore nuances. Or your compulsion for order may be sapping your energy from other endeavors, such as your family.”

Where are these people? Are you one of these people?

I’d like to meet just one who is so obsessive about a crowded workspace that he or she earnestly attends to the online inbox all the time! Either these people don’t have enough to do, or they only get one e-mail every hour.

I’d also like to see a study done on those who call to see if I received their e-mail – you know the ones … they expect an answer right away – like within moments of sending their note.

How do balance your inbox clutter? Do you really think your cluttered e-mail inbox is representative of clutter in other parts of your life?

Posted In Tecknowledgy Comments Permalink

The July issue of Business 2.0 had a really good article, “The 50 People Who Matter Now” that I think everyone should read.

Interesting mix of personalities – from politicians to business “name” to entertainers. Here are a few of my favorites:

·         Ben Bernanke – chairman, Federal Reserve Board. Stepping into Alan Greenspan’s shoes can’t be an easy task.

·         Bill Gates – what’s most interesting about his entry in the aricle is that it lists him (accurately) as “Benefactor of the Bill & Melinda Gates Foundation.” He’s already started the transition process … let’s see how high profile he continues to be this time next year.

·         Steve Jobs of Apple – I guess any list with Bill Gates wouldn’t be complete without a mention of Steve Jobs. Business 2.0 calls him, “Easily the greatest marketer since P.T. Barnum.”

·         Janus Friis and Niklas Zennström – co-founders of Skype. With the recent news about security issues surrounding VoIP, the future of this still-new technology to most of us should be even more in the news this coming year.

Who are your favorites? Business 2.0 already received some reader feedback. One person, for example, indicated the absence of Thomas Friedman on the list, while another thought Comcast CEO Brian Roberts should have been included.

Let me know what you think and I'll post your suggestions.

Posted In Observations Comments Permalink

Wow, it seems like only yesterday that I was part of literally a handful of folks who sat down on a Saturday morning during the fall of 1999 to attend my first Rice Alliance event.  And yesterday we had the 7th Year Kick Off Celebration.  It was great to see some old friends I had not seen since the Rice Business Plan competition and meet several new folks as well.
 
I am guessing by the size of the crowd that we had in excess of 250 participants and it included a nice group of: entrepreneurs, angel investors, venture capital investors, academic and professional personnel.  Brad Burke and the staff of the Rice Alliance at the Jones School always put on a first class event and yesterday was no exception.  Thanks for the plug on the Fast Tech 50 event Brad!
 
As a side treat I got to meet my congressman, Honorable John Culberson who gave a brief overview and introduction to the keynote speaker of the evening, Dr. Mauro Ferrari.  I was particularly impressed with Congressman Culberson's understanding of the science and funding aspects of local research and the area of discussion for the evening, Nanotechnology.  Good job Congressman, you understand the topic very well.  Too bad more of your colleagues on the hill can't get it together as well.
 
And the keynote, Dr. Ferrari, well all I can say is WOW.  I truly believe I was in the company of greatness.  A person one day that may be included among the ranks with other well known innovative scientists (Bell, Westinghouse, etc.).  I thought he did a fantastic job of explaining what he was hoping to accomplish in the Nanotechnology arena.  He also took a moment to introduce his family and the were just adorable as well.  We welcomed them to Houston and I hope they have an enjoyable time in our community.
 
Stay tuned, there will be more coming from this area of Houston in the near future.

Posted In In Our Community Comments Permalink

Note: Running most Fridays in FromGregsHead.com, this is the first in a continuing series of budgeting tips brought to you by Ventana Research and PKF Texas. These run Saturday mornings during the BusinessMaker’s Radio Show on FM Newschannel 97.5. Audio files can be found on the Entrepreneur's Playbook page of the PKF Texas website.

With all the advances in technology, software and collaboration tools, one might think the budgeting has risen to new and more effective higher levels.  However, recent research has shown that executives in mid-sized companies have not focused on the potential benefits of more effective budgeting and are unaware of possible solutions that can be quickly implemented.

Questions to Ask About Your Budgeting and Planning Process

Is the process strategic?  The CEO of you company has a strategy, but how well does the financial budget reflect it?  Is you budget realistic or just update of last year’s amounts by a factor of inflation?

Is it accurate?  Are the budgets as accurate as they should be?  Does the budget process itself create systematic errors?

Does it increase your company’s agility?  Does the company respond quickly to changes in the environment or changes in the competitive landscape?  When things don’t go as planned does the company have a coordinated response?

Does it provide deeper insight? What assumptions are being made in forecasting? Can you drill down to ascertain consistency, assumptions, etc?

Does your budgeting and planning process improve process quality?  How quickly can you prepare your budget?  Is it consistent from year to year and department to department?  What tools are you using to help in this effort?

We recommend that you start to improve your budgets by looking at three key areas:
1) Making strategy explicit;
2) Increasing collaboration
3) Optimizing resource allocation. 

With this focus, you can improve your budgeting process and your results.

Posted In PKF Texas - The Entrepreneur's Playbook Comments Permalink

Have we become a society that only communicates via technology?

Here’s a twist on making technology work for today’s modern, connected society. A new story out of London reports that a young woman was “sacked” by her employer – but what makes the story compelling is how she was told: by text message on her cell phone!

According to the report: “Katy Tanner, a 21-year-old sales assistant, received the message while she was off work with a migraine. The text message said: ‘We will not require your services anymore ...Thank you for your time with us.’"

I wonder what Houston’s own Miss Manners would say about that?

The report continues: “Store director Ian Besbie added that the dismissal method was fair because texting was a part of ‘youth culture.’” Besbie: We are a youth business and our staff are all part of the youth culture that uses SMS (text) messaging as a major means of communication.”

Turns out the store handles tattoos and body piercing.

Although this example is somewhat satiric, I hope you get my point. We should make more of an effort to communicate in person versus mostly with technology. It’s like a friend of mine says, “What did we do before e-mail?” I usually respond, “We had Fedex.”

What do you think? Have we become a society exclusively mired in technology to communicate?

Posted In Observations 3 Comments Permalink

Following up on my posting last week urging us not to forget that we’re all not connected and my efforts to solicit feedback, one reader, Tracey Segarra of Citrin Cooperman, an accounting and consulting firm based in New York, suggested a site for review – Geekcorps.

Interesting stuff. Geekcorps is an international nonprofit organization whose goal is to promote the interchange of information through technology. Geekcorps is part of the International Executive Service Corps.

Sounds like an ambitious effort – and it is! However, the site is worth checking out.

Take a look at Geekcorps’ Success Stories and the Economic Sector Development featured in Our Programs. There’s also a signup for a free E-newsletter.

Thanks Tracey. If others have suggestions, send them to me and we’ll post them in a future blog.

Posted In Tecknowledgy 1 Comments Permalink

Note: Running most Fridays in FromGregsHead.com, this is a continuing series of inventory control tips by Jon Schreibfeder. These run Saturday mornings during the BusinessMaker’s Radio Show on FM Newschannel 97.5. Audio files can be found on the Entrepreneur's Playbook page of the PKF Texas website.

What is Effective Inventory Management?

“Effective inventory management allows a distributor to meet or exceed customers’ expectations of product availability by maintaining the amount of each item that will also maximize their company’s net profit.”

Effective inventory management is the result of outstanding inventory control and inventory management. What is the difference between “inventory control” and “inventory management?” Inventory control involves managing the inventory that is already in your warehouse, stockroom or store. That is, knowing what products are “out there,” how much you have of each item, and where it is.

Inventory management involves determining when to order products and how much to order, as well as identifying the most effective source of supply for each item in each stocking location. Inventory management includes all of the activities of forecasting and replenishment.

The most common question we are asked is “where do we start?” The answer is: You must begin with inventory control. Unless you know exactly what inventory is in your warehouse and that material is in usable condition, you can’t accurately determine when to reorder products.

Stay tuned for future segments on effective inventory management. 

Posted In Guest Spotlights , PKF Texas - The Entrepreneur's Playbook Comments Permalink

I know we take technology for granted. We plug in, log on and expect it to always work – and be available at the same time.

Did you ever stop to think that not everyone has DSL, cable modem or even dial-up?

I opened up my new Inc. Magazine and found an interesting article, “Pioneering the Web’s Last Frontier: A Plan to get Rural Businesses Online” (the magazine is so new that the article isn’t even online yet – as soon as it is, I’ll provide the link). The article is about Brandon Spear, senior vp of operations for Quadrem, based in Plano, Texas. Quadrem is an online marketplace for buyers and suppliers of products and services used in the mining industry.

I think he, too, took the Internet for granted when he traveled to South Africa:

“Spear expected rural suppliers to be behind in terms of technology, but he didn’t realize that, in many cases, phone and fax machines were their only means of communication.”

It’s a rhetorical thought – of course – to imagine that the entire world is connected. Hey, the cable and wireless ads tout this, so don’t we all believe it?

As business leaders, we can make an impact by encouraging telecommunications providers to finally increase their infrastructures so that countries like those in Africa can get connected. If we’re supposed to be living in the global economy, then let’s start acting like it.

As business professionals, how do you think we can make more an impact? I’d like to hear your comments.

Posted In Tecknowledgy , In Our Community , Observations Comments Permalink