2010 Market Trendsfor Small Businesses

Dave Haviland

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Trend Framework

2

Broadsocial

&marketforces

Industry forces

Segment forces

Companyforces

Company strategies

Presentation Plan

• Objectives

– Provide insight into broad market trends

– Provide guidance on applying the trends to strategy

• Agenda

– Strategy background

– Market trends

– Applying the trends

– Michigan trends

– Q&A

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Phimation Strategy Group

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• Management consulting for small businesses– Everything but finance

• Focus on Stage 2

• Strategy development and strategic execution– Business– Marketing– Operations– Innovation– Funding

• Experience– Former COO of Stage 0/1/2 businesses– Worked with about 4 dozen companies since 2001– On the Boards of 4 companies– Raised $30MM in private and public capital

How Phimation works with CPAs

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CPA Firm

Client

Improved performanceHealthy clientBroader engagement

CPA Firm

Client

Improvedunderstanding /

performance

Increased trustImproved relationship

CPA Group

FirmFirmFirm

Client

Client

Client

Client

Client

Expertise

Education

Increased trustImproved relationships

STRATEGY BACKGROUND

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Trend Framework

7

Broadsocial

&marketforces

Industry forces

Segment forces

Companyforces

Company strategies

Strategy Development

8

BusinessStrategy

MarketStrategy

FunctionalStrategies

Why

What

How

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Strategy Framework

Mission/Purpose

Vision Value Principles

Goals

Strategies

Objectives

TacticsMetrics

Planning Doing

Orienting

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Strategy Framework

Mission/Purpose

Vision Value Principles

Goals

Strategies

Objectives

TacticsMetrics

Planning Doing

Orienting

1

2

6

4

3

5

THE TRENDS

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Trend #1: Negative Social Mood

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Source: Socionomics Institute

Rising Social Mood Falling Social Mood

Optimism Pessimism

Benevolence Malevolence

Liberality Restriction

Search for joy Search for pleasure

Togetherness Separatism

Praise Criticism

Confidence Fear

“Human emotion is rhythmical.” – R.N. Elliot

What this trend means…

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TheOldWay

Credit

NewOpportunities Be Nimble

Trend #2: The Expectation Economy

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Source: Trendwatching.com

“An economy inhabited by experienced, well-informed consumers who have a long list of high expectations that they apply to each and every good, service and experience on offer.”

What this trend means…

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Look outside your industry for

innovation and competition

Clarify your value proposition, and align your whole

organization toward it

Trend #3:Bigger Role for Government

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Source: McKinsey & Company

“Previous crises have resulted in permanent changes in government’s role, and this one is likely to do the same…Prepare to compete under new regulatory regimes…[and] recognize that the public sector will grow in importance as a major customer for many industries.”

What this trend means…

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Think bureaucratApply standard

sales and marketing practices

Commit long-term

Trend #4:Hyperspecialized Professions

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Source: World Future Society

“There are already significant knowledge gaps and communication difficulties between specialties and subspecialties, and these divides will only become larger and more difficult to surmount.”

What this trend means…

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Growing value in translation,

bridging, and generalization

More specialists available…

the right one harder to find

Trend #5:Open Platform Everywhere

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Source: …everywhere…

What this trend means…

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Openness and collaboration

add value

Understand your differentiation

More, better, and cheaper (or more valuable) options

It’s about the customer experience

OR

APPLYING THE TRENDS

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How Trends can Impact your Business

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GrossMargin

OperatingExpenses

BusinessValuation

Impacts in Strategy Development

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BusinessStrategy

(Business Valuation)

MarketStrategy

(Gross Margin)

FunctionalStrategies

(Operating Expenses)

TRENDS OF THE NEW MICHIGAN

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New Michigan Economy

Core Strengths

New Economy

High Value

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New Michigan Economy

Core Strengths

New Economy

High Value

High-value manufacturing

Engineering

Transportation

Materials

Pharma

Water

Agriculture

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New Michigan Economy

Core Strengths

New Economy

High Value

Information

Engineering

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New Michigan Economy

Core Strengths

New Economy

High Value

Context

Nexus

Q&A

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Business CardL = Links to Trend SourcesE = Phimation Email List

BoothStage 2 Management Mysteries Revealed

Drawing for copies of Trusted Advisor

Phimation.comCEO Briefings, blog posts

Crain’s Detroit BusinessSecond Stage Focus

www.crainsdetroit.com

Dave Havilanddave@phimation.com

734 717 4955