Tech and the Reluctant Employee: What Companies Can Do

By Gabby Menachem, CEO of Loom Systems.

Factories are humming. Unemployment is near historic lows. The stock market has been setting all kinds of records. While many people are happy about this, there are still some employers who are not, which holds them back from expanding and moving forward. A lack of skilled workers, known in popular parlance as the “skilled workers gap,” is making some employers desperate. I know from my own experience that finding the right people with the correct skill sets for particular jobs can sometimes be a Herculean task. One of the main things I attribute this to is the speed at which technology is evolving.

It’s going at such a pace that as soon as workers learn new skills based on new technologies, something more advanced comes along. A good example involves the computers used by NASA to launch its Orion Multi-Purpose Crew Vehicle in 2014, testing the spaceship that may eventually bring humans to Mars. Even as it was launched, the Orion was already outmoded. The simple 2014 smartphone was at that time more powerful than the computer that ran the Orion. Talk about a skills gap! What happened to Orion goes on every day in the corporate world.

Organizations need to help its workers bridge that gap — not for the workers’ sake (although many organizations don’t mind helping their people out) but for the organization’s own sake. If it doesn’t have enough tech-savvy workers, it won’t get its work done. It’s a matter of survival. To get workers on board, we have to first define what “on board” means.

Create a plan to present to your employees in an organized manner. Be on top of staff, ensuring they are working with new systems as they arise. Devise new metrics and benchmarks that will measure how workers are engaging with systems, like requiring workers to use Excel instead of a calculator. The results may be similar, but the process is important for record-keeping, file exports, etc.

When trying to get workers to do something they are not used to, your first instinct might be to use the “stick” approach. But a “carrot” approach in the form of gamification might be better. For example, artificial intelligence (AI) systems lend themselves to this strategy, as device-based games/contests can take advantage of AI modules. Quizzes that pose questions about company activities (such as: how many gigabytes pass through our servers every day?) require AI applications to answer.

Even among workers who are on board, there is an adjustment period. Many workers, as well as managers, see new technology as another component in the organization’s toolbox. They don’t realize that it is an overall new way of doing things. Stress in seminars and company material that in many cases, you are not simply talking about a new tool. Present a playbook or other guide (as opposed to a manual) with a vision of the technology in the work environment and what it can do, what you want it to be able to do and how you are going to use its tools to get there. This will go a long way in not only getting workers to accept the new ways of doing things but to embrace them, as they will want to be part of the vision.

Even when the vision is there, guidance is necessary to ensure that workers and the organization are getting the most out of new systems. For that, there should be a tech ombudsman — someone who knows the system well and who can advocate/supervise its implementation. The individual in question may be dedicated to the task or have another job title, but they should be seen as the go-to person in an organization to get answers, share concerns, make complaints, etc. It is not a supervisory position necessarily, but more of an information sharing/management position, in which the leader is the liaison between workers, management and the technology.

While all this seems like a great deal of work, it’s worth the effort. A system like this that brings workers on board can eliminate a lot of ugly and uncomfortable scenarios and contribute to the bottom line. New technology can be a great boon — but it can also be a great waste of money. Our objective is to ensure that it turns out to be the former, not the latter.

Gabby Menachem is the CEO of Loom Systems, bringing with him 15 years of technology innovation and entrepreneur experience.

Tech and the Reluctant Employee: What Companies Can Do

By Gabby Menachem, CEO of Loom Systems.

Factories are humming. Unemployment is near historic lows. The stock market has been setting all kinds of records. While many people are happy about this, there are still some employers who are not, which holds them back from expanding and moving forward. A lack of skilled workers, known in popular parlance as the “skilled workers gap,” is making some employers desperate. I know from my own experience that finding the right people with the correct skill sets for particular jobs can sometimes be a Herculean task. One of the main things I attribute this to is the speed at which technology is evolving.

It’s going at such a pace that as soon as workers learn new skills based on new technologies, something more advanced comes along. A good example involves the computers used by NASA to launch its Orion Multi-Purpose Crew Vehicle in 2014, testing the spaceship that may eventually bring humans to Mars. Even as it was launched, the Orion was already outmoded. The simple 2014 smartphone was at that time more powerful than the computer that ran the Orion. Talk about a skills gap! What happened to Orion goes on every day in the corporate world.

Organizations need to help its workers bridge that gap — not for the workers’ sake (although many organizations don’t mind helping their people out) but for the organization’s own sake. If it doesn’t have enough tech-savvy workers, it won’t get its work done. It’s a matter of survival. To get workers on board, we have to first define what “on board” means.

Create a plan to present to your employees in an organized manner. Be on top of staff, ensuring they are working with new systems as they arise. Devise new metrics and benchmarks that will measure how workers are engaging with systems, like requiring workers to use Excel instead of a calculator. The results may be similar, but the process is important for record-keeping, file exports, etc.

When trying to get workers to do something they are not used to, your first instinct might be to use the “stick” approach. But a “carrot” approach in the form of gamification might be better. For example, artificial intelligence (AI) systems lend themselves to this strategy, as device-based games/contests can take advantage of AI modules. Quizzes that pose questions about company activities (such as: how many gigabytes pass through our servers every day?) require AI applications to answer.

Even among workers who are on board, there is an adjustment period. Many workers, as well as managers, see new technology as another component in the organization’s toolbox. They don’t realize that it is an overall new way of doing things. Stress in seminars and company material that in many cases, you are not simply talking about a new tool. Present a playbook or other guide (as opposed to a manual) with a vision of the technology in the work environment and what it can do, what you want it to be able to do and how you are going to use its tools to get there. This will go a long way in not only getting workers to accept the new ways of doing things but to embrace them, as they will want to be part of the vision.

Even when the vision is there, guidance is necessary to ensure that workers and the organization are getting the most out of new systems. For that, there should be a tech ombudsman — someone who knows the system well and who can advocate/supervise its implementation. The individual in question may be dedicated to the task or have another job title, but they should be seen as the go-to person in an organization to get answers, share concerns, make complaints, etc. It is not a supervisory position necessarily, but more of an information sharing/management position, in which the leader is the liaison between workers, management and the technology.

While all this seems like a great deal of work, it’s worth the effort. A system like this that brings workers on board can eliminate a lot of ugly and uncomfortable scenarios and contribute to the bottom line. New technology can be a great boon — but it can also be a great waste of money. Our objective is to ensure that it turns out to be the former, not the latter.

Gabby Menachem is the CEO of Loom Systems, bringing with him 15 years of technology innovation and entrepreneur experience.

Adidas Reports 27% Growth in 2017 with Double-Digit Increases in Running

Apparel and shoe creator adidas has come out with its final numbers for 2017, which show the company (made up of adidas’ own brand and Reebok) being up 31% in Q4 2017 and up 27% in the calendar year 2017 overall.

What stands out the most is that brand adidas experienced double-digit sales increases in the ultra important running category as well as at adidas Originals and adidas neo. In the quickly developing training sector, adidas also improved by high-single-digit sales increases year-over-year.

Revenues at Reebok brand were not as strong as the brand continues to find its niche within a very saturated apparel and shoe space that is dominated by Nike, shared by adidas and has brands like Under Armour, Skechers and K-Swiss doing whatever they can to bite away some of the behemoths’ market share. In fact, Reebok’s sales in the U.S. declined in 2017, which the company says reflects a significant amount of store closures in the market.

Overall, adidas is happy with the results from 2017.

“2017 was a strong year – financially and operationally. We made great progress toward achieving our mission to be the best sports company in the world. Our strategic growth areas – North America, Greater China and Digital Commerce – were the main drivers of our performance,” said adidas CEO Kasper Rorsted. “2018 is a key milestone on the road to achieving our long-term targets for 2020. We expect quality growth, with overproportionate bottom-line improvements. This will enable an even stronger increase in profitability by 2020 and allows us to upgrade our long-term target yet again.”

In the past few years adidas has seen its brand bolstered by smart partnerships with influencers such as Kanye West and Pharrell, as well as a shift in focus from creating and selling basketball shoes to putting a premium on running. Now, the company will be challenged to continue its rapid rise up the leaderboard in the apparel and shoe category, and close the still large gap between itself and Nike. At the same time, it will need to prevent against Under Armour, in particular, eating away market share as it too begins to think about how it can access some of the growing running market.

“A few years ago, we decided to put a lot of energy, resources and investments in the North American marketplace — at a level that we had not done in the past … What we’re doing is focusing on key cities and in America — those are New York and Los Angeles — which set the trends for young consumers,” said adidas North America president Mark King in 2017. “We’ve [done this so far] with all kinds of activations that make those cities come alive with our brand. We take advantage of sporting events, local athletes and leagues, and we launch a lot of our products in these key cities — [which] keeps our brand cool.”

Will it remain cool as it grows even further?

Adidas Reports 27% Growth in 2017 with Double-Digit Increases in Running

Apparel and shoe creator adidas has come out with its final numbers for 2017, which show the company (made up of adidas’ own brand and Reebok) being up 31% in Q4 2017 and up 27% in the calendar year 2017 overall.

What stands out the most is that brand adidas experienced double-digit sales increases in the ultra important running category as well as at adidas Originals and adidas neo. In the quickly developing training sector, adidas also improved by high-single-digit sales increases year-over-year.

Revenues at Reebok brand were not as strong as the brand continues to find its niche within a very saturated apparel and shoe space that is dominated by Nike, shared by adidas and has brands like Under Armour, Skechers and K-Swiss doing whatever they can to bite away some of the behemoths’ market share. In fact, Reebok’s sales in the U.S. declined in 2017, which the company says reflects a significant amount of store closures in the market.

Overall, adidas is happy with the results from 2017.

“2017 was a strong year – financially and operationally. We made great progress toward achieving our mission to be the best sports company in the world. Our strategic growth areas – North America, Greater China and Digital Commerce – were the main drivers of our performance,” said adidas CEO Kasper Rorsted. “2018 is a key milestone on the road to achieving our long-term targets for 2020. We expect quality growth, with overproportionate bottom-line improvements. This will enable an even stronger increase in profitability by 2020 and allows us to upgrade our long-term target yet again.”

In the past few years adidas has seen its brand bolstered by smart partnerships with influencers such as Kanye West and Pharrell, as well as a shift in focus from creating and selling basketball shoes to putting a premium on running. Now, the company will be challenged to continue its rapid rise up the leaderboard in the apparel and shoe category, and close the still large gap between itself and Nike. At the same time, it will need to prevent against Under Armour, in particular, eating away market share as it too begins to think about how it can access some of the growing running market.

“A few years ago, we decided to put a lot of energy, resources and investments in the North American marketplace — at a level that we had not done in the past … What we’re doing is focusing on key cities and in America — those are New York and Los Angeles — which set the trends for young consumers,” said adidas North America president Mark King in 2017. “We’ve [done this so far] with all kinds of activations that make those cities come alive with our brand. We take advantage of sporting events, local athletes and leagues, and we launch a lot of our products in these key cities — [which] keeps our brand cool.”

Will it remain cool as it grows even further?

Inside A $333 Million Founder’s 20 Year Journey To A Rocketing 146% Post-IPO Stock Jolt

If you start your company outside of Silicon Valley, you may get more time to achieve an initial public offering. What’s more the leadership style that gets you there can keep growth going long after the funding event.

 

That’s the story behind Irvine, Calif.-based Alteryx. Since its March 24, 2017 IPO, shares in this analytics software as a service (SaaS) provider have soared 146 percent to a market capitalization of almost $2.3 billion on March 12.

 

Alteryx is growing fast while losing money — but it has turned cash flow positive recently. Since 2014, revenues have risen at a 51.4 percent annual rate to about $132 million in 2017 — while posting a $19.5 million net loss. During that time, the company has gone from negative free cash flow of $4 million to positive free cash flow of $15.3 million, according to Morningstar.

 

Alteryx’s most recent results — for the fourth quarter of 2017, were strong with a boost in sales and higher gross margins. According to Motley Fool, revenue soared 55 percent and its customer count rose 46 percent to 3,392 in the quarter.

 

While the company is unprofitable, its gross profit of $32.3 million represented a gross margin of 84 percent — up one percentage point since the year before.

 

For the first quarter of 2018, management expects sales to be in the range of $39 million to $40 million and a net loss of $4 million. For 2018, Alteryx expects revenues to rise between 33 percent and 36 percent to a range from $176 million to $179 million, according to Motley Fool.

 

CEO Dean Stoecker — whose 9.1 million Alteryx shares were worth about $333 million on March 13, said in a press release, “Demand for our complete end-to-end analytics platform for the enterprise increased, driven by our land and expand strategy. We added a meaningful number of net new customers and continue to have a very strong dollar-based net revenue retention rate.”

       

Underlying demand for its product is demand for good data analytics coupled with a shortage of data scientists.

 

Langley Eide, Chief Strategy Officer at Alteryx, said “Most large organizations understand that data and analytics can provide a powerful competitive advantage, but many are struggling to (i) leverage many disparate data sources; (ii) adopt a growing number of machine learning and artificial intelligence services; and (iii) find enough skilled workers to develop an analytic advantage. We are seeing increased demand for a common platform that enables citizen data scientists in the line-of-business to take full advantage of their data assets, whether users prefer a code-free or code friendly experience.”

 

Alteryx has taken over two decades to get to this point. As Mr. Stoecker explained in a March 5 interview, the company was founded as SRC in 1997 before changing its name to Alteryx in 2010. Alteryx shunned venture money until 2011 — ultimately raising $163 million in three rounds before taking the company public in March 2017.

 

Stoecker’s family is from Boulder, Colo. where the company maintains its engineering team. As he said, “My father was an entrepreneur who built A-Frame houses. I was the youngest in the family and we would see the life of the entrepreneur at the kitchen table — collecting money from customers, paying bills, and investing for the next stages of growth.”

 

After graduating from college, Stoecker went to work for a unit of Dun & Bradstreet Nielsen where he learned the challenges of monetizing publicly-available data. As he said, “Companies tried to be good at three core competences — data, software, and analytics. I realized that to be successful you needed to own one of those.”

 

At 40, Stoecker decided to venture out on his own. As he said, “I told my wife I am either going to buy a business or get a pink slip. At 3:30 in the afternoon I called my wife and said I had gotten the pink slip. With three partners in 1997 we decided to focus on the analytics. We took money in 1998 from a customer who wanted us to stay alive. We realized that the dot-com boom would bust so we didn’t touch the money. For 14 straight years we were growing at a 20 percent to 25 percent annual rate, never lost money, and always paid our bills. We offered an insanely great analytics product and delighted our customers with our SaaS model.”

 

Alteryx’s growth strategy evolved as the company grew. As he said, “Getting to the first million is about will and skill and having the right organizational culture. You need discipline — keep heads down on the product — and ignore shiny objects.”

 

When the company reached $25 million, Mr. Stoecker realized that he would have to let go. “I began hiring middle management and trusting others to tell our story. When we reached $40 million in revenue I wanted to see if we could go public or be a $100 million private company. A lot of the team was not into it so between 2015 and 2017, I replaced senior leaders.”

 

When Stoecker went out on the IPO road show, “three older gentlemen working for a hedge fund took a look at me and said, ‘You’re not the young, spry Silicon Valley entrepreneur we’re used to seeing.’ I said, “We didn’t do it the same way but we’re one of those companies blasting off for the moon.'”

 

Though he’s turning 61, Stoecker is not slowing down. He expects the company to get to $500 million to $1 billion in revenue by “building out the platform with machine learning and making acquisitions that extend the product for the citizen data scientist.”

.

How to Make Your Company Look Like a $100 Million Brand

When you start a business, you almost always face the reality that it takes money to make money. Yet that idea sparks a common question I hear all the time: “What if I don’t have any money.” The default logic is to assume that you must raise millions from name-brand VCs and make some big splash. While that helps, it’s not common for most early stage startups.

Successful entrepreneurs find a way to make their own success before they have the money. One way they do this is by understanding that one way to make money is to act and appear as if you already have it – or the success that comes with it. While this idea sounds like “fake it till you make it,” it’s actually rooted in fundamental concepts about consumption, perception and scaling.

Here’s a look at three ways that you can appear stronger, more successful and more funded than you might be at different stages of your business.

1. Boost the Appeal of Your Products

One of the simplest and most impactful ways to improve a company’s perception of success is to make its products appear luxurious and high-quality. If the items themselves look like something someone would want to buy, logic follows that people are buying those products — and people want what others have.

We put this to use at my company and we invested in higher quality photography. When consumers are unable to physically handle your company’s goods and assess the weight, comfort, sturdiness, durability, or softness, they rely on images to provide the information they’d normally derive from their five senses. Employing a designer, conducting a high-quality photo shoot and investing in expert photo retouching can help your products look as good as any other company in the world – increasing your brand quality and increasing conversions.

Pixelz co-founder Thomas Kragelund explains, “E-commerce is built on imagery — billions of product images are being clicked, swiped, and compared by customers every day.” In fact, he says, “Companies like Google, eBay, and Amazon have conducted studies that conclusively state higher-quality images improve sales.”

Another way to boost sales while simultaneously improving visitors’ perception of your brand’s success is to enhance your product descriptions. Consumers rely on product descriptions to determine which offering will best meet their needs, and a discussion of an item’s functionality or an article of clothing’s fit can lock down a sale — while poor and insufficient copy can prompt a customer to find a different website with more detailed descriptions and more confidence in its copy.

2. Associate Your Brand With Big Names

Relationships take real effort to establish, but some of your existing or developing relationships and partnerships could enhance your company’s standing in the public eye.

One way to do this without waiting to close those big B2B sales is to to look at your board of directors or advisors. Board members with experience in your industry or knowledge of where your company is at in the growth stage can guide your company past potholes and over obstacles. And having a big name on your board — an executive who successfully launched multiple businesses or a leader at a name-brand organization — can signal to others that your burgeoning company is the real deal.

Humm Kombucha, for example, attracted some big names to its board in its early years, including Bill Owens, the chairman of CenturyLink Telecom, and Gary Fish, the founder of Deschutes Brewery. Having a leader who had served a big, thriving corporation and a leader who had launched a successful business within the beverage industry itself certainly helped Humm’s growth; it’s currently the fastest-growing kombucha brand in the nation.

An additional way to create big-name brand associations that signal success is to recognize your partnerships or current clients. Has your brand connected with a software provider to offer integration? Have you co-hosted a webinar with an industry heavyweight? Does your company provide the holiday gifts for a well-known organization? These are all great relationships to celebrate through website badges, testimonials, or content.

3. Outsource to Increase Your Capabilities

A simple, but savvy, way to increase your brand’s clout is to expand your capabilities through outsourcing. Leveraging third-party skills or resources can help you offer higher quality products or services without the costs of raising money and scaling a team. Also, I’ve enjoyed increases to my personal productivity by hiring a virtual assistant. To borrow a boxing phrase, outsourcing helps you “fight above your weight class.”

In a PwC survey, 76 percent of respondents said that outsourcing lowered their costs, and 70 percent noted that outsourcing gave them access to talent and skills they didn’t have previously. This, in turn, allows the companies doing the outsourcing to focus on what they do best, showcasing improved products and services alongside expanded offerings.

Many business owners fail to overlook the everyday and repeated processes that can be outsourced affordably effectively. Supply chain, logistics or IT are great places to start looking. Jordan Egertson, the vice president of operations at Sheer, explains, “Third-party logistics providers are experts at what they do, and they have access to the latest and most effective transportation technology. They are trained to identify problems with your transportation footprint and provide effective solutions for transportation accounting and freight claims, among other areas.”

The key is to isolate the parts of your business that can be outsourced on a cost-effective basis, and, the parts of your business that you dislike the most. Accounting is another common example.

Final Word

It takes money to make money, and there are effective ways to give the impression that your company has money — and stands to make more. By boosting the appeal of your offerings, associating your company with big names, and outsourcing to expand your capabilities, you may just be able to convince others that you’re managing a $100 million brand. No matter which path you take, remember to always treat your customers well and stay focused on providing real value.

How to Make Your Company Look Like a $100 Million Brand

When you start a business, you almost always face the reality that it takes money to make money. Yet that idea sparks a common question I hear all the time: “What if I don’t have any money.” The default logic is to assume that you must raise millions from name-brand VCs and make some big splash. While that helps, it’s not common for most early stage startups.

Successful entrepreneurs find a way to make their own success before they have the money. One way they do this is by understanding that one way to make money is to act and appear as if you already have it – or the success that comes with it. While this idea sounds like “fake it till you make it,” it’s actually rooted in fundamental concepts about consumption, perception and scaling.

Here’s a look at three ways that you can appear stronger, more successful and more funded than you might be at different stages of your business.

1. Boost the Appeal of Your Products

One of the simplest and most impactful ways to improve a company’s perception of success is to make its products appear luxurious and high-quality. If the items themselves look like something someone would want to buy, logic follows that people are buying those products — and people want what others have.

We put this to use at my company and we invested in higher quality photography. When consumers are unable to physically handle your company’s goods and assess the weight, comfort, sturdiness, durability, or softness, they rely on images to provide the information they’d normally derive from their five senses. Employing a designer, conducting a high-quality photo shoot and investing in expert photo retouching can help your products look as good as any other company in the world – increasing your brand quality and increasing conversions.

Pixelz co-founder Thomas Kragelund explains, “E-commerce is built on imagery — billions of product images are being clicked, swiped, and compared by customers every day.” In fact, he says, “Companies like Google, eBay, and Amazon have conducted studies that conclusively state higher-quality images improve sales.”

Another way to boost sales while simultaneously improving visitors’ perception of your brand’s success is to enhance your product descriptions. Consumers rely on product descriptions to determine which offering will best meet their needs, and a discussion of an item’s functionality or an article of clothing’s fit can lock down a sale — while poor and insufficient copy can prompt a customer to find a different website with more detailed descriptions and more confidence in its copy.

2. Associate Your Brand With Big Names

Relationships take real effort to establish, but some of your existing or developing relationships and partnerships could enhance your company’s standing in the public eye.

One way to do this without waiting to close those big B2B sales is to to look at your board of directors or advisors. Board members with experience in your industry or knowledge of where your company is at in the growth stage can guide your company past potholes and over obstacles. And having a big name on your board — an executive who successfully launched multiple businesses or a leader at a name-brand organization — can signal to others that your burgeoning company is the real deal.

Humm Kombucha, for example, attracted some big names to its board in its early years, including Bill Owens, the chairman of CenturyLink Telecom, and Gary Fish, the founder of Deschutes Brewery. Having a leader who had served a big, thriving corporation and a leader who had launched a successful business within the beverage industry itself certainly helped Humm’s growth; it’s currently the fastest-growing kombucha brand in the nation.

An additional way to create big-name brand associations that signal success is to recognize your partnerships or current clients. Has your brand connected with a software provider to offer integration? Have you co-hosted a webinar with an industry heavyweight? Does your company provide the holiday gifts for a well-known organization? These are all great relationships to celebrate through website badges, testimonials, or content.

3. Outsource to Increase Your Capabilities

A simple, but savvy, way to increase your brand’s clout is to expand your capabilities through outsourcing. Leveraging third-party skills or resources can help you offer higher quality products or services without the costs of raising money and scaling a team. Also, I’ve enjoyed increases to my personal productivity by hiring a virtual assistant. To borrow a boxing phrase, outsourcing helps you “fight above your weight class.”

In a PwC survey, 76 percent of respondents said that outsourcing lowered their costs, and 70 percent noted that outsourcing gave them access to talent and skills they didn’t have previously. This, in turn, allows the companies doing the outsourcing to focus on what they do best, showcasing improved products and services alongside expanded offerings.

Many business owners fail to overlook the everyday and repeated processes that can be outsourced affordably effectively. Supply chain, logistics or IT are great places to start looking. Jordan Egertson, the vice president of operations at Sheer, explains, “Third-party logistics providers are experts at what they do, and they have access to the latest and most effective transportation technology. They are trained to identify problems with your transportation footprint and provide effective solutions for transportation accounting and freight claims, among other areas.”

The key is to isolate the parts of your business that can be outsourced on a cost-effective basis, and, the parts of your business that you dislike the most. Accounting is another common example.

Final Word

It takes money to make money, and there are effective ways to give the impression that your company has money — and stands to make more. By boosting the appeal of your offerings, associating your company with big names, and outsourcing to expand your capabilities, you may just be able to convince others that you’re managing a $100 million brand. No matter which path you take, remember to always treat your customers well and stay focused on providing real value.