In this commentary we will discuss: How Small and Mid Sized Firms Grow we will discuss creating intellectual property.
So what is intellectual property (IP)? It is the essence of what you do and how you do it. It can set you apart from your competition and help avoid pricing your services as a commodity. You likely have a nucleus of IP already but have not recognized it, enhanced it or capitalized on it to your full benefit. It can start out as something very basic that can be converted into something of substantial value and even copyrighted for your protection. All larger companies have lots of IP that they have cultivated over the years. This ranges from little more then puffery to substantial IP that are valuable trade secrets. The former IP may be as mundane, offering superior quality and service, such as “our Super VX Platinum services package will meet your full satisfaction or your money back”. That package is documented and defined and can be copyrighted even though it may not be particularly unique. If properly marketed however one can carry a certain panache and image which can be sold at a premium.
We would rather concentrate on creating real value that is documented to save your client money. Lets take our sample platinum VX services package and add some tangible value, where if the client buys a certain minimum $ volume they will achieve significant savings and you will become a profit, not a cost center to them. The service here will be providing staffing services to a client, but this is applicable to most any business. Every employee has a cost and the economic benefit of hiring them must outweigh that cost. Here are just five profit improvement tools, although this has been customized to 20+ points:
#1 is that we find highly qualified people more quickly then internal searches or our competition and since time is money this can be quantified.
#2 is if you hire 5 or more of our people/year we will provide you with a 15% rebate (similar to airline frequent flyer programs where customer loyalty is rewarded.
#3 is where we demonstrate that via our vigorous testing program our people out produce typical hires by 20% which is converted into annual $ savings.
#4 is that we can use our testing procedures on a limited amount of client employees to test their proficiency.
# 5 is that we have a free outplacement program for those employees that need to be terminated in a humane way, with significant cost savings.
The amount of value added service provided depends on a client’s volume with us. The total profit impact is tallied and typically becomes an eye opener for the client that now gets much more value in doing business with you then he ever anticipated.
In our next blog we will discuss controlling a MSP/VMS program vs. being VMS supplier. We welcome your questions as to the challenges you face in order to grow.
To see all articles in this series please go to http://optimal-mgt.com/blog.
Optimal Management is the premier management consulting company to the staffing industry. We act as mentors to owners and managers to maximize their sales, profits and value of their company. We become an extension of our clients operations and are there for all of their staffing and business needs, from sales, marketing and compensation plans, to finance, M&A, general management and everything in between.