What happens when you put a group of chief executive officers from a variety of companies in a room to share business problems and solutions regularly?
“One of the fascinating things about putting people from totally different industries together in a confidential setting is that you get a very diverse approach to dealing with a similar problem,” says Ed Weems, co-founder and director of Venture Management Inc. (VMI).
VMI brings together CEOS from 15 non-competing companies together in two programs, one for companies in the $750,000 to $1 million range, and a second for those with annual revenue of $2 million to $50 million.
“The diversity of the companies VMI works with is broad,” Ed says. VMI clients in the programs range from a pharmaceutical manufacturer to a veterinarian clinic, from a software company to a Durham company that makes a high tech wood-working machine.
Clients include Triangle-based companies WebSourced, Oral Therapeutics, ShopBot and Steel Networks, among others.
“None of the companies can be competitors or suppliers to each other,” Ed says. “That leads to an interesting phenomenon. They all have the same issues in business, but different perspectives on how to deal with them. It challenges them and broadens their horizons.”
VMI runs two programs for executives, TEC, a program developed by a 47-year-old San Diego based company with operations in 16 countries, and its own Entrepreneurial Advisory Board. The first costs $750 a month, and latter, for smaller company CEOs, is $425 a month. The CEOs bring in an issue, problem, or opportunity they want to discuss and present it in a formal session and then hash it over in the group.
Because the TEC program is international, it has a network that can provide contacts to members in 16 countries. “We can put a question on the network and see if anyone has an answer or recommendation,” says Weems. “If they want to get into Australia, we can provide a contact. The reach is international.”
However, the group sessions are where the real work gets done.
“In the confidential environment we provide, they really lay it out there and say, “Guys, this is what I’m dealing with, what are your thoughts,” says Weems. “We call it working on your business instead of in it.”
Group members also develop, pursue and track each other’s progress on BHAGS — “Big Hairy Audacious Goals.”
The groups also deal with primary issues. One Weems says most have to deal with now is “developing compensation based on performance. The days of paying people just for showing up are gone,” he adds.
Another common issue is how to accomplish expansion into new areas. “If companies only worked in the Research Triangle, they found out that’s not such a good idea in the last two years,” Weems says.
Other issues are how to establish teamwork, preparations to obtain financing or bank loans, alternative financing methods, and establishing strategic planning to look at how their market is changing. “Some meet monthly with their staff to set performance goals clearly and people are not just running in place,” says Weems.
VMI also conducts strategic planning sessions for companies. “They’ll bring in the whole staff,” says Weems, who points out that the need for “continuous strategic planning” and teamwork to adapt to changing market conditions. He cites NC-based Krispy Kreme, which blamed losing $24 million on the popularity of the Atkins diet as what happens when a company fails to address market changes.
Ed and his co-founder, co-director Sue Weems founded VMI six years ago after they sold their software company, Election Technology Co. to Election Services and Systems of Omaha, Nebraska. The two have started five companies together since 1974.
ETC made software that help city, county and state election offices register voters, process petitions, and other tasks. “We made it the leader in that software market and sold it for cash,” says Ed.
They started VMI because Ed perceived a need to help companies do strategic planning.
“VMI is built on a unique model,” says Sue. “We nurture people who own and run businesses. It’s broader than just the groups. We do retreats, facilitations with management teams, and do specific consulting.”
VMI is also acting as an informal incubator for software startup Vidicom, which is seeking $5 million to develop its video-conferencing system that works smoothly over Local Area Networks (LANS) without degrading its operation.
VMI has a demonstration model in its office that Sue says “didn’t take half an hour to set up.” The system would cost about $500 a computer and would allow a company president to talk to all his employees at once or a selected group. He would see up to four of them at a time on his monitor while addressing all and they would all see him.
“The potential market is huge,” Ed says.
Among other services, VMI also offers a useful newsletter. It recently redesigned its extensive Web site. Ed says a book is also in the works.
Venture Management: www.Venturemanagementinc.com