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The Melting Pot Newsletter | #53

HOW THE RIGHT PRICING STRATEGY CAN TRANSFORM YOUR BUSINESS

Wishing your business was more profitable?  You’re not alone. Many of the CEOs I speak to are frustrated. Their order book is healthy, staff are run off their feet – it all looks pretty rosy.  Until you look at their profits. Something is very obviously wrong.

This was top of my mind last week. I met a number of leaders from Managed Service Providers (MSPs) who were facing exactly this dilemma.  Some were curious to hear my ideas on pricing, their faces lighting up. Others dismissed them, telling me I was wrong. I could see they felt threatened by the radical change needed to move forward. 

All I can say is I’ve been there.  When I joined Rackspace as UK MD, the average lifetime value of our customers was £2000.   When I left five years later, this had shot up to £200,000. That’s a pretty stratospheric growth curve.  Were we doing anything differently? Not dramatically. Mostly, the building blocks of the business were the same.  We’d said to ourselves, given our expertise, what target market could we serve and how could we charge more for it? We wanted to grow our revenue and margin and that’s exactly what we did. 

So how do you work out a pricing strategy that increases profitability and drives growth?

The Melting Pot With Dominic Monkhouse - Featured Image

Helping Companies Fix Their Recruitment Challenge

This week’s guest is considered to be the world’s foremost expert on hiring, Dr Brad Smart. Brad is the founder and CEO of Topgrading Inc, a company that, amongst many things, interviews candidates for hire or promotion to senior positions ie. the top grade, ‘A players’.  

Brad’s methodology is so successful, he’s credited with tripling the hiring and promotion of high performers at companies such as General Electric, Honeywell, Barclays and the American Heart Association. Since the 1970s, Brad has conducted close to 7,000 in-depth interviews with executives and has authored 7 books. 


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WELCOME TO THE TEAM!  HOW DO YOU ONBOARD NEW PEOPLE TO YOUR TEAM?

Do you spend more money on going away parties when someone leaves the company than you do welcome parties when someone joins?  This was a question posed by Jack Daly a few years ago at one of the Fortune Growth Summits.  Our team really connected with the idea of treating a new employee’s first day like a celebration, and over the past few years we have created an internal process called “Great First Day” as a critical part of their employee onboarding process.  How do you make employees feel welcome from their very first day?

DELEGATION

It’s 8:00pm on Friday night after a long week and you are the only one at the office. You were hoping to get home and take your wife out on an impromptu dinner date, but there was just way too much to get done before the weekend. Yes, you know you’re doing too much.

And yes, you know you need to delegate things to other people. But you’ve tried it, and it doesn’t work. Every time you try to trust someone else with a task, it backfires big time. Consider this: is there any chance that it’s not delegation that doesn’t work, but the way you delegate that doesn’t work?

SHARING STORIES AND SNACKS AT TAKE YOUR PARENTS TO WORK DAY

When I was a kid, I loved when my dad took me to work at his office in downtown Milwaukee. He had good views for parades on the streets below, and had one of those handheld games with water and, like, little marbles that you’d try to move down chutes. He had a set of office keys that had this one super-cool blue key on it that, as far as I knew, was for some top-secret treasure closet, maybe? (Or the bathroom, probably.) I’d sit and play the game and watch some TV and hang out, while my dad did what I only assumed was Important Adult Stuff, and then we’d go home. Man, what good times!

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Don’t waste your time on bullshit business plans. Forget sales. Ignore advice. Put everything on the line for what you believe in. These mantras have turned BrewDog into one of the world’s fastest-growing drinks brands, famous for beers, bars and crowdfunding.

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