The NetSuds™ Report ©

The October 1, 2002 Issue:

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Definition:  "com and .com" = Telecom, Datacom, IT or Internet

In this Issue:

        1.0  Heard on the Net
        2.0  Jobs in the "com and .com" Market
        3.0  NetSuds and MedicalSuds Calendars
        4.0  Tidbits
               4.1 NetSuds on Tour -
                     Hoyt Properties, US Internet, Berbee, Caspian Networks
               4.2 Email Advertising - Part I
               4.3 Email Advertising - Part II
               4.4 Upper Great Plains Technology Conference & Trade Show
               4.5 BioTechnology Clusters
               4.6 Counterfeit Websites - A Legal View
               4.7 Visi.com Adds Great New Service
               4.8 "com and .com" Unemployment
               4.9  And Iowa Shall Lead Us
               4.10  SPVC Founding Partner Pat Hopf to Address NetSuds
        5.0  Calendar of Events
        6.0  Minnesota:  Taking Our Own Pulse
        7.0  Oversubscribing Broadband Networks
        8.0  Building your Referral Program
        9.0  The Security of Business and The Business of Security
       10.0 Building Predictable Revenue With Effective Sales Management
       11.0 Guest Writers for this Report

1.0 Heard on the Net

1.1 People on the Move:

Please email:  people@netsuds.com to report a change in your job status if you are moving from or to a company in the "com or .com" space.  Include your new work contact information, not just your personal contact information.

NetSudser and former ADC President & COO Lynn Davis has formed Tate Capital - www.tatecapital.com - in Minneapolis.  Lynn can be reached at 612 766 4074.

Please give details on the above including any information you do not want made public.  We are very discrete.

2.0 Jobs in the "com and .com" Market

Please email:  jobs@netsuds.com to report job openings in the   "com and .com" Market.  In the body of the message, give the name of the company and a URL link to the job postings.

*        Adtec Communications - http://www.adtecusa.net/employmentOps.htm
**       XO Communications - http://www.xo.com/careers/
**       palaia.com - http://www.palaia.com/about/jobs.htm
**       Orbit Systems - http://www.orbits.net/orbit/employment2.htm  

The web calendars for NetSuds and MedicalSuds continue to grow in popularity as more and more people use them for the definitive place to find high-tech events in the Twin Cities.  The Calendars are accessed at

http://mailman.netsuds.com/cgi-bin/calweb/calweb.pl

and are free to use.  If you want to post your events, there is a charge of $100and but you can post as many events as you like - if they are your own - for 2002 and 2003. 

4.0   Tidbits

5.0  Schedule of Events

You can also try our new online calendar by clicking here.

5.1 - Minnesota               

10/4    NetSuds Best of Business Breakfast - Minnetonka, MN
           http://www.netsuds.com/bob/2002/october/

10/8    UofM IT Alumni Society "Venture Capital and the Nanotube"
           http://www.it.umn.edu/itas/programs/lectures.html

10/9    MedicalSuds Entrepreneurs Breakfast - Burnsville
           http://www.medicalsuds.com/eb/2002/october9/

10/15   NetSuds & SMRI Workshop for Sales Managers - St. Louis Park, MN
 -10/16 http://www.netsuds.com/smri/

10/25   MedicalSuds Entrepreneurs Breakfast - St. Louis Park
           http://www.medicalsuds.com/eb/2002/october/

11/8    NetSuds Entrepreneurs Breakfast - Minnetonka, MN
           http://www.netsuds.com/eb/2002/november/

5.2 - Outside Minnesota

10/14    Upper Great Plains Technology Conference - Fargo, ND
 -10/15  http://www.uppergreatplainstechnology.com/

10/16    NetSuds Evening Gathering - Raleigh, NC (TBA)
            http://www.netsuds.com/rdu/eg/

6.0  Minnesota:  Taking Our Own Pulse

7.0  Oversubscribing Broadband Networks

Where Subscriber Experience Goes Head To Head With Broadband Operator Capital Costs 

By NetSudser Bruce Bahlmann, Alopa Networks 

Why is my broadband data connection getting slower? Broadband data subscribers increasingly find themselves asking this very question. Not so long ago the subscriber’s computer or even some Internet sites were largely to blame for a majority of broadband subscribers’ woes of slow service. However, those days are long gone, as bottlenecks are emerging in the access network as broadband service providers seek to rationalize the economics of offering flat rate, all-you-can eat service.

Broadband data service providers have raised the price for service, reduced the bandwidth available to subscribers, and implemented various measures of oversubscription in an attempt to keep capital costs in check. Broadband operators seek to balance these measures to provide a service that is within acceptable levels to their average subscriber rather than cater to the power users who were their early adopters.  

To better understand oversubscription and what it means to operators and subscribers we’ll work through something called a “busy hour calculation.” A busy hour calculation seeks to determine how much bandwidth is being used at the most congested time on the network and whether the network is sufficiently sized to carry that traffic. 

Regardless of whether you’re using Digital Subscriber Line (DSL) or cable broadband service, one encounters a number of traffic (bandwidth) bottlenecks. These can occur within your home network (if you have multiple devices connected), it can occur within the “last mile” of cable that connects your home to the service provider (note DSL is effected by this but in a different way), there can be a bottleneck between your service provider and the Internet, and between that link and your final destination.  

Oversubscription is mainly to blame for the bottlenecks between you and the service provider as well as between your service provider and the Internet. In this article we are only going to look at the former of these bottlenecks. 

Over Subscription in the Last Mile 

The first bottleneck due to oversubscription is within the last mile of service. The last mile connects subscribers to their service provider. For DSL service, this relates to the distance limitations of DSL transmission technology in providing residential data service to customers – basically the further you are away from the central office the less bandwidth your service is capable of delivering. Over subscription does not really come into play for DSL’s last mile because there is a one-to-one allocation of resources (hardware and transmission lines) between the service provider and each customer – however bottlenecks are possible on the network that aggregates DSL last-mile traffic. 

Cable modem services don’t suffer from distance limitations like DSL, but because cable is a shared pipe, bottlenecks can emerge from access network due to oversubscription. To offer advanced services like broadband Internet access, cable operators have segmented their cable systems into numerous small sections of cable feeding smaller numbers of homes. Each section of coaxial cable (or hybrid of fiber and coax called HFC) can facilitate connections for about 500 homes. If that stretch of cable can achieve 10-percent penetration for data services it would mean that about 50 of the 500 homes passed have become subscribers.   

Most residential data services (including DSL and cable) operate asymmetrically, meaning they have less upstream than downstream capacity. Cable operators use a standard delivery mechanism called Data Over Cable Service Interface Specification (DOCSIS) that was initially designed to deliver around *27Mbps downstream and about *2.5Mbps upstream, which is shared among users on a network segment. However, only about 75-percent of this bandwidth is actually usable in practice due to inefficiencies in the cable plant and outside interference. If you take this inefficiency into account there is about 1.92 Mbps usable bandwidth on the upstream and 20.73 Mbps usable bandwidth on the downstream on a typical DOCSIS 1.0 network. 

That still sounds like a lot of bandwidth in terms of allocating this to potentially 500 homes.  Not so fast. Cable operators like any other data provider attempt to squeeze as much throughput out of their equipment as possible.  Rather than allocating all of this bandwidth to a single node, operators combine several nodes together (sometimes 12 or more) to a single Cable Modem Termination System (CMTS) card, typically with one downstream and four, six, or eight upstream ports – See Figure 1.0. 

*Note that DOCSIS version 1.0 offers the bandwidth described above. Newer versions of DOCSIS (such as 1.1 and 2.0) offer increased bandwidth in the upstream but are not widely deployed. DOCSIS 1.0 still exists in 99% of the marketplace.

Figure 1.0 CMTS Connectivity with 12 Nodes

Node combining allows cable operators to reduce the number of CMTS units they initially require to deploy the service, lowering their initial capital investment. From a subscriber perspective, combining means that more subscribers could potentially share the same available bandwidth. During initial deployment, broadband operators do not typically know what kind of take rate each community will generate. Therefore it is extremely difficult to appropriately size the service (using combining) beyond making an initial stab at providing basic service coverage for a reasonable and affordable capital expense. Thus capital budgets dictate how dense each CMTS is combined with nodes.

Upon this combining (which can be initially excessive) most (if not all) homes passed will be capable of supporting the service.  However, the node density on the CMTS is such that any one combined area can quickly become saturated with subscribers if not properly managed. Proper management includes watching subscriber levels on each CMTS blade and then relieving the ones that have become oversubscribed by splitting up the initial combining across 2 or more CMTS blades. Since cable operators are not positive where their subscribers will be coming from it is less risky to maximize coverage for their capital dollars than purchase and deploy additional hardware upfront in an effort to decrease node density. This practice may be the least expensive way to offer the service but creates problems down the road. The problem comes after this technology has been installed and customers have been added. At this point, the initial capital investment is spent but further capital investments must be made to maintain prescribed service levels. These capital investments appear to be more difficult – perhaps because they represent an additional cost to maintain existing services as opposed to the initial investment that was merely a cost to offer the service. 

Cable operators address this problem by either purchasing additional equipment to provide relief to the oversubscription or continue to add more subscribers to the over crowded CMTS. In an effort to keep additional capital expenditures low, the latter tends to be the road heavily traveled. Lets review the implications of this action by providing an example.  If a cable operator were offering a broadband data service with 512 Kbps downstream and 128 Kbps upstream access speeds, the available upstream bandwidth on the CMTS can support 15 (1.92 Mbps divided by 128 Kbps) simultaneous active subscribers and the downstream could support up to 40 (20.73 Mbps divided by 512 Kbps).

Of the 50 actual subscribers of the service within a single node, one can assume that not all are online at the same time. Operators typically estimate that up to half of the subscribers are online at the same time during peak hours. Of these online subscribers, perhaps a quarter are actively using the service (uploading/downloading) at the same time. Therefore, there would only be 6.25 of subscribers online and simultaneously active using the service during peak hours (50 subscribers x 50% x 25%) per 500-home node. Together, these subscribers require 3.2 Mbps (512 Kbps x 6.25) of downstream peak bandwidth and 800 Kbps (128 Kbps x 6.25) of upstream peak bandwidth. This traffic represents 42-percent of the available upstream bandwidth and 15-percent of the available downstream bandwidth supported by a single CMTS upstream and downstream port. 

Based on these numbers and using the example 512/128-Kbps service, the link would be on the verge of oversubscription when more than 320 subscribers were installed on the downstream and 120 on the upstream. When the technology was designed, it was believed that subscribers would download far more than they upload (thus the drastic differences in available bandwidth on the downstream versus upstream).  In practice, however, this has not exactly held true as new applications increasingly push the limits both ways. 

Current CMTSs port configurations allow a cable operator to balance upstream and downstream loading. The most common today is a 1x6 configuration, with 1 downstream per 6 upstream ports per CMTS card. Thus, in practice, an operator may take 12 nodes (500 homes each), combine them together and connect them to a single downstream port on the CMTS. In the upstream, they would then combine 2 nodes per port. The net result of this is that you no longer have 50 customers (using the example above) served by the available bandwidth. Instead you may have 12 times that number or more.   

The increase in subscribers per CMTS port as a result of by combining creates a potential problem for the downstream as well as the upstream in terms of consistently delivering the 512/128-Kbps service. For example, if the cable operator has 12 nodes combined with 10-percent penetration, the downstream port would serve 600 (10% x 500 x 12) subscribers, yielding a downstream port that is 188-percent (600 divided by 320) oversubscribed on the downstream and 500 percent (600 divided by 120) oversubscribed on the upstream.  In this example, the maximum bandwidth the cable operator can deliver to during peak times is 276 Kbps downstream and 25 Kbps upstream traffic to these subscribers.  

From the subscriber’s perspective this adjusted bandwidth during peak usage is about 53-percent (276 Kbps divided by 512 Kbps) of their subscribed downstream bandwidth and 19% (25 Kbps divided by 128 Kbps) of their subscribed upstream traffic. Essentially the service is no better than half as fast as what the cable operator advertises during peak times. Fortunately, subscribers only notice a slight drop in their downstream experience when their usable bandwidth drops from 512 Kbps to 276 Kbps due to limitations on the Internet itself – the Internet rarely (if ever) delivers better than 300k. But if a subscriber is uploading something large they will visibly notice the delays caused by the reduced bandwidth. In practice, 250-300 Kbps downstream is the sweet spot for residential data services, whereas it is only 64-96 Kbps upstream. A cable operator that can deliver that speed to the subscriber consistently will have very happy customers. However, those subscribers whose service level falls out of that sweet spot will begin to visibly notice a reduction in their speed and start to complain.  

Interestingly, in the real world, many MSOs further cut corners by provisioning more than 1,000 subscribers per downstream port, cutting available bandwidth to each subscriber by half again.

A number of studies have offered projections for subscriber demand for bandwidth. Of these studies one completed by Randy Nash of Motorola Inc. (a CMTS vendor) suggests that the current (2002) bandwidth demand per home passed is 60 Kbps downstream and 5 Kbps upstream.  If we rationalize these numbers in terms homes passed in our first example of 500 homes passed we arrive at a bandwidth demand of 30 Mbps (60 Kbps times 500) versus our earlier calculation of 3.2 Mbps of bandwidth demand for 500 homes passed. If broadband operators were to build out their residential data service using Randy’s numbers they would essentially require a CMTS blade per node, where as if they used the busy hour calculations within this article the operator could combine up to 10 nodes per CMTS blade. While both approaches would work equally well, economics will dictate which method works best for each cable operator.  

One interesting data point that one can extract from Randy’s study is that broadband operators can expect to see about a 10-12 percent increase in bandwidth demand per subscriber per year. The increase can be attributed to a combination of things including increased usage, new applications, etc. and represents something useful to keep in mind for future capacity planning.

The over subscription numbers can get worst if not properly managed by broadband operators. For example, if the average number of subscribers online surpasses 25-percent or penetration tops 10-percent (in practice broadband operators see anywhere from 10-24 percent penetration per node) the amount of over subscription could more than double.  

Table 1.0 CMTS Subscribers Supported by Service Level 

Other factors will impact these numbers as well. For example, many cable operators have begun offering tiered services – different speed services for different prices (see Table 1 for how many subscribers could be placed on a CMTS without oversubscribing). Tiered services are the best overall value for broadband data subscribers because they allow them to only buy the bandwidth that meets their budget. However, in an over subscription situation tiered services can allow subscribers to migrate to the service tier that more closely represents the actual bandwidth that broadband operators are able to deliver when they most use the service. Why pay for a T-1 when 256 Kbps is the maximum bandwidth available (due to oversubscribing) during peak times or when subscribers most frequently use their broadband connection. Tiered services could have the opposite effect for some broadband operators as subscribers flock over to lower priced services that best reflect the actual bandwidth they can obtain during the times when they most use the service. However, while lowered bandwidth services can support more subscribers without oversubscribing so can the competition. Thus, operators seeing fewer and fewer subscribers paying for higher tiered services may find they are way oversubscribed. Over subscription reduces the value of the higher tiered services, lowers the quality of the experience for most of the subscribers affected, and creates opportunities for competing services to offer the same (if not better) quality service for a better price point.

When are the Peak Times? 

A number of traffic studies have been conducted that tracked subscriber usage. Although efforts continue on this front some preliminary results seem to indicate the “busy hour” tends to be from 8 pm to midnight on Fridays. Other than that, weekday traffic seems to increase during the afternoon, peak around midnight, and then bottom out around 5:00 am. Interestingly, all these studies seem to conclude that usage patters are seasonal, unpredictable, and yet steadily increasing. Some studies have gone to the extremes of attempting to profile subscribers and model usage patterns to the point where they can yield some type of traffic simulators. Creating sophisticated models to predict bandwidth usage based on subscriber profiles, network history, installation rates, and actively polling the network may be useful at some point in the future, but in terms of providing answers to today’s problems it is more like rocket science – which is perhaps useful to the progress of human kind but not of much use to the average person on the street.

Recommendations for Improving Last Mile Over Subscription 

You may have noticed that nowhere in this article did I mention any type of monitoring or active polling as a tool to gather information about networks to help make combining or bandwidth allocation and planning decisions. Monitoring is a terrific tool for Network Operation Centers (NOCs) to watch the availability of service critical network hardware and applications in an effort to keep everything working and reliable. Beyond that, monitoring or active polling is of little significance in determining planning events that have future economic and customer experience implications. Bandwidth planning is not an exact science so having up to the minute information is not worth the expense of gathering it – having it is merely a luxury. Instead, having simple planning models that can project the maximum number of subscribers that can be supported by a CMTS is good enough. Occasionally, it may be useful to run some bandwidth consumption reports across all your CMTS to check the accuracy of your numbers, but not to make planning decisions. Such sanity checks need not occur more than once a year.   

If you’re going to offer a broadband data service make every attempt to ensure that your subscribers receive what they are paying for no matter what hour. In this scenario everybody wins and your subscribers remain happy.  Perhaps a good way to manage your peak traffic is through properly sizing Internet Protocol (IP) subnets across your CMTS blades. Managing the population of subscribers using IP address techniques is a very simple means of managing over subscription without having to actively poll devices in the field to determine your next course of action. A relatively safe hard point is a class C subnet per CMTS blade. This hard point allows for up to 253 subscribers on the network – well below the 320 supported on the DOCSIS downstream channel and twice that of the 120 supported on the DOCSIS upstream channel. Future versions of DOCSIS will provide relief to the upstream and further solidify this class C hard point. 

Another recommendation is to only offer services that you can support effectively on a CMTS. Cable operators interested in offering tiered services can easily forget that each subscriber they provide with a T-1 service costs them three 512-Kbps subscribers or six 256-Kbps subscribers. Almost every cable operator initially began offering residential data services advertising a T-1 speed to lure subscribers, but few of these types of services remain because they are impossible to support from an economical standpoint unless cable operators fetch 3-4 times their normal subscription rates. In addition, these services become so over subscribed that subscribers rarely ever see much more than 256-512 Kbps anyway. So, if you offer tiered services make sure there is value in what your offer at the upper tier or subscribers will seek out the lowest cost for the service delivered.  

Future versions of DOCSIS will include variations of Quality of Service (QoS) that allow cable operators to allocate bandwidth to sensitive services such as Voice over IP (VoIP). Of course, making these reservations impacts the available bandwidth to other services. If oversubscribing didn’t exist best effort would still work beautifully for all services including VoIP.  Unfortunately, QoS further complicates the problem of handling oversubscription so voice services can traverse cable networks at the expense of best effort traffic.  

Bruce Bahlmann is director of technical market development at Alopa Networks and owner of the broadband information site Birds-Eye.Net. He can be reached at bruce@alopa.com.

8.0  Building your Referral Program

by NetSudser Brad Canham, f4rword@aol.com

How can you encourage your clients to give you more referrals?

First, realize that you deserve referrals because you have an excellent service or product, are convenient and valuable for your clients. Referrals are a normal part of any dynamic business. People like to talk and people like to refer other people.

With that in mind, your job is to insure your clients who like to talk can say things like “you should talk to THIS company/person” as a piece of conversation. Second, you must ask for referrals.

During every interaction with a client let them know that trusted referrals are your preferred method of conducting business. (And who doesn’t prefer referred clients?)

Here is how you do it. Part I

1. Referrals are all about the great exchange of info that occurs around any good business relationship. Leave a little time at the end of your interactions with current clients to talk with them about referrals and building their business and your business.

2. Get the ball rolling by letting your client know much you appreciate them and by setting the stage properly. You do this by mentioning a possible referral for them and hand them your latest “freebie” pen, new brochure, business cards, a magazine subscription, etc…

And then be honest with them…

3. You say:  “I’m wondering if you could help me. Trusted referrals are the most important way of building my business. If you know of someone whom would benefit from my services I’d really appreciate it if you’d pass them my card…”

Trigger the client’s mental search of a person like that with something like the following light hearted question.

You say: "Do you know of someone/a company that needs a little extra marketing help these days?”

To encourage the client to make referrals, help them isolate people or companies in his or her mind. Is there a business associate who you can talk to? A relative?  A supplier? Is there a tennis buddy? Listen for names that come up during your conversation.

Script a brief profile or description of what you are looking for in a prospective client, and then describe a specific person or company, such as:

You say: “Like a law firm in the Twin Cities that is looking for new clients who would benefit from a focused marketing campaign?”

Or

You say:  “A telecom integrator who wants to move beyond their current sales goals and needs marketing to reposition themselves in their channel market?

If  your client hesitates to give a name, say this.

You say:  "That’s all right, Roberta. I think I understand how you feel. If someone you know comes to mind, you have my card to pass along to them. I promise you I'll never mention your name."

Here is how you do it. Part II

Also as part of your newly revised brochure and other marketing material you list referrals in “Note to the clients,” such as:

 "Our business is built on excellent service and trusting relationships. Please consider referring to us two or more potential people or companies whom you believe would benefit from our services and products." 

The fact that you prefer to conduct your business in trusting relationship manner is established at essential to the way you conduct your business in all your company literature.

Here is how you do it. Part III

Third, show appreciation for people who provide referrals. This is your key to continuing receiving leads from a client. Thank the client for making the referral. Write a thank-you note. Also, let the client know the results of their referral.

 Let your client know what a wonderful thing they have done. Give thank-you gifts in appreciation: send flowers, a pound of coffee, a shiny new pen, a subscription to a magazine.

Apply these same principles to your co-workers and business associates, as well as receptionists and delivery people. Its amazing how much business these folks can send your way.  Give them a gift package – again, flowers, a magazine subscription -- and let them know that they are a source of “trusted referrals.”

Frankly, its quite likely that your trusted referral sources – be they current clients or the FedEx driver -- are the bread and butter of your business.  

Here is how you do it. Part IV 

And for when you reach your goal for the year: Hold a Client Appreciation Event and also include your trusted referral sources.

Some businesses do this kind of thing monthly and send a letter to the home address to insure the family of the “trusted referral source” is aware of how much that trusted referral is appreciated. If your source is a quieter-type make sure you let them know they are appreciated in a low-key manner, such as a personal letter or a gift that they might especially appreciate (how about a good bottle of Cabernet sent to their home?).

If you’ve ever been invited to one of these events as a “friend of the business” or received such a gift you know how rewarding it can be to know you’re helping to build someone’s success.  Imagine how much your trusted referrals will appreciate your own event or special acknowledgement of their help on your behalf.

Brad Canham started Vientus Group www.vientus.com , a marketing management practice, after working in Corporate Marketing at ADC Telecommunications until 2001.

9.0  The Security of Business and The Business of Security

by NetSudsers James P. Cavanagh - jpc@consultant-registry.com and Don Flanagan - dflanagan@consultant-registry.com

Success in business has always been elusive. More businesses have failed than have succeeded. It has been so since the first cave dwellers performed the first service or bartered the first product. Today's business leaders must apply an unusually large set of skills to succeed. . They must be visionaries, strategists, and motivators, but they also need to have something of the accountant, lawyer, forecaster, marketer, and personnel manager. They must focus on brand value, shareholder opinion, and a fickle market. No wonder security has rarely been "top of mind" with business leaders and owners. Of course, business leaders have always needed to oversee the security of their enterprise, in the sense of assuring its continuity, the safety and security of employees, and the confidentiality of the most important asset of the organization, after its people: information. This is the "security of business."

The other aspect is the "business of security," which encompasses the specific techniques that are used to secure an enterprise. Historically, security in this sense has been for larger companies a 'black box' affair, with the security team cloaking their budgets and activities in secrecy and invoking the corporate equivalent of 'need to know'. Since 9/11, that is no longer the case, and perhaps it never should have been.

Today, corporate leaders need to scrutinize security issues as they have never had to before; the good news is that they can use the same criteria that are applied to other areas of the business. Concepts such as "acceptable risk," "return on investment," and "cost / benefit analysis" come into play. In this column we aim to demystify security issues and make it easier for business executives to make sound, business-based decisions that make sense in today's changed world.

To comprehend security in a way that can render it manageable, today's executive must have the big picture -"the fifty thousand foot view." The complete domain of security can be viewed as three overlapping rings. The first ring represents physical security, tangible items like locks and card-entry systems for doors. Physical security includes operational security whihc in turn includes such things as personal security or "workforce protection." It encompasses executive security (both at the office and at home, employee security, travel security, and security awareness.

The second ring represents network and information technology security, the bits of information as they are stored and processed in data centers or transported between computers.

The third ring represents our national homeland security and common infrastructure of buildings, highways, waterways, mail delivery, utilities, etc. Of course, businesses do not control these public institutions and infrastructure, but they need to understand how these institutions affect business operations and vice versa.

All three rings are interdependent, though they may overlap, indicating areas of mutual interest. The exact pattern of overlap for any organization will differ. To help launch a discussion on organizational security, get key staff members and executives to draw (independently) the three circles with the degree of overlap they feel exists in your organization now, and then repeat the exercise for what they see as a desirable balance. If this exercise does not generate enough discussion, ask them to repeat the process but vary the size of the circles based upon their opinion of both present and desirable budgets and timing. You will be amazed at the range of different opinions and observations that this exercise will reveal, and it will be an excellent starting point for the development of an organizational security policy. In particular, this is where "gaps" or "seams" in your security can be found and remedies developed to address them.

The business executive must consider both threats and vulnerabilities. Threats are active, while vulnerabilities are passive; they are two sides of the same coin. Threats represent actions that may be taken against your business, while vulnerabilities are the weaknesses exploited by the threats. Let's look first at the types of common threats that can be expected, or postulated.

Threats

• The people WHO might wish to compromise your information, do harm to you or your employees or exploit your products or assets to attack other organizations or even compromise our national defense.

• WHAT these attackers might do, and what they have done to other organizations.

• WHY the security situation is as it is today, why the attackers do what they do and might select you as a target for their attacks.

• WHEN the attackers are most likely to strike.

• WHERE their attacks are most likely to occur and ...

• HOW they could go about perpetrating these attacks.

With threats better understood, common vulnerabilities will make more sense in the overall view of business security.

Vulnerabilities

The people WHO are in your organization, or close to it, and who can be exploited by outsiders for gain. This category includes individuals who may, themselves, be threats, such as malicious insiders, or unwitting accomplices who provide information or access.

• WHAT the attackers may target. This includes everything from doors that are not properly secured to Internet servers or firewalls that have not had their software properly installed or "patched'" against known security vulnerabilities.

• WHY the organization has not properly hardened its defenses against exploits. The why can range from lack of training and awareness to lack of support by upper management to insufficient budget, and is often a combination of these factors.

• WHEN the organization is most open to attack. What are the naturally occurring times at which defenses are weaker? Holidays? Do essential people travel together?

• WHERE the softest spots are in the defenses. Are the weaknesses in the small office/home office or are they at the corporate firewalls, for instance?

• HOW the security policy is written and enforced. How is security managed and how highly has the company prioritized security in its organizational values?

Now is the time to stimulate discussion and debate, and to kick-start security awareness and planning within your organization. To aid their planning, some companies categorize their assets as Protection Level I, II, II or IV depending on the impact the loss or disruption to the company. Why not gather your key personnel and possibly business partners around the table, draw some overlapping circles, inventory your assets and discuss the appropriate protection level to which to assign them and begin the process of assuring your own organizational security. The organizational security policy has taken its place beside the business plan in importance to the healthy, sustainable business.

This column is an excerpt from an upcoming book by James P. Cavanagh and Don Flanagan entitled Threats & Vulnerabilities: Security and Your Business. Don and Jim are pre-publishing condensed chapter excerpts as a series of management-focused free security white papers. You can retrieve the free security white papers from:  www.consultant-registry.com/cgi-script/CSMailto/forms/freewhitepapers.htm

10.0  Building Predictable Revenue With Effective Sales Management

by NetSudser Ken Thoreson, ken@acumenmgmt.com.  Ken will be conducting the October 15-16 ClairVantage Sales Management Workshop in St. Louis Park - www.netsuds.com/smri/  

No matter what the size, truly effective businesses use a systematic approach to all aspects of their operations—from telephone calls coming into the office to shipping products out to the end-user. They consider details and measure quality. Sales management is no exception.

In the early stages of a business, the entrepreneur may do seat-of-the-pants selling along with everything else from product development to shipping the finished product. Yet, as a business progresses, effective and systematic sales management becomes increasingly crucial. Understanding the sales management process—documenting it and executing it effectively—separates the merely average companies from those that exceed their corporate revenue goals.

Rate Your Company
The more the company grows and changes, the more the person in charge of sales must put systems in place and create order from chaos. Over many years as a sales person and sales manager I have developed a theory that I call the Situational Matrix of Sales Management. In short, the more the company has the potential to grow with new products or services, the more thoroughly the company must define and manage its sales system.

This theory revolves around four components: the company’s overall business position, the maturity of company’s products and service, the effectiveness of its distribution channels and the sophistication of the sales management systems.

To understand the concept, consider a graph with equal horizontal and vertical axis.. The left horizontal axis represents the company’s overall business position and the right horizontal axis the effectiveness of the distribution channel. The upper vertical axis is defined by the product/service maturity and the lower vertical line describes the sophistication of the sales management systems.

Rate each component 1 through 5 for your company. The company’s business position: 1 = Development Stage, 2 = Growth, 3 = Turnaround, 4 = Steady, 5 = Mature. On the right horizontal side we describe the maturity of the Distribution Channel (Direct or Indirect): 1 = Nonexistent, 2 = Weak, 3 = Growth, 4 = Established, 5 = Dependable.

On the upper vertical axis rate the Service/Product position: 1 = Creation Stage, 2 = Launch, 3 = Market Awareness, 4 = Market Acceptance, 5 = Refinement. On the lower vertical axis rate the sales management sophistication: 1 = None, 2 = Testing Concepts, 3 = Minimal Systems, 4 = Established Process, 5 = Sophisticated Reporting.

In the past, when markets and opportunities did not move as quickly as they do in today’s business climate, most companies’ management processes would move along all four axes at about the same speeds. So, if one component worked at a four then the others would work at similar levels.

Not so with rapidly growing companies launching new products. Things get out of balance. The situational matrix demonstrates this basic premise. If a new product or service affects the company’s maturity in terms of growth or turnaround it requires a more sophisticated sales management process.

A development stage or growth company entering new markets with new products must establish sales management systems to attract, build and manage a distribution channel. For example, even in a mature company with an established distribution channel, a new Web-based e-commerce product quickly changes all aspects of sales management including recruitment, compensation, account management and measurement tools.

The overall situation of the company affects all aspects of its sales management process including strategies, sales goals, compensation and much more. It provides a framework to begin developing or refining your current sales management plan. A solid plan enhances the sales leader’s ability to clearly communicate vision, strategy, tactics and set standards for the performance of the sales team.

Individuals responsible for successful and effective sales management undertake the necessary research, think through possible actions, develop focused processes and set standards of measurement. If an organization’s revenues have flattened or declined, sales managers have clearly failed or missed critical links within the sales management structure.

Components of a Sales Management Plan
The question is how to start developing this structure. A sales management plan must coordinate with the corporate business and marketing plans. People often ask, "How do marketing and sales differ or how do they work together?" A common answer is that marketing does the product positioning and planning and if the plan doesn’t work, the company fires the sales force. What this attitude reveals is that we measure sales by how well the sales force executes the company’s overall business and marketing plan.

These are the areas that must be defined in the company’s sales management plan:

• Business and market overview
• Monthly activity tactical plan for the next six months. This includes: trade shows, new product promotions, customer promotions
• Target account plan
• Sales organizational plan for the next 24 months
• Definition of the sales process, measurement targets and channel strategy
• Sales technology plans and process
• Recruitment strategy, process, goals
• Development of strategic partners and alliances
• Revenue and quota forecasting tools
• Compensation plans and objectives.

Sales Management Resources, Inc.  provides sales management seminars that improve the performance, execution and skills of sales leaders worldwide. A Minnesota seminar is scheduled for October 15^th, and 16^th. For more information call 952-846-4186 or visit www.netsuds.com/smri/. 

11.0  Guest Writers for This Report

I have opened up the Monthly NetSuds Report to guest writers. If you have a passion for a topic, and you can write (at least no worse than me), send an email to me matt@netsuds.com.  You can even send copies of your work.  It needs to be on "com and .com" topics and can include entrepreneur/investor activities.  Good information from our    service providers and vendors is also welcome so long as it is not a "commercial" for any one company or individual.

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Matt Noah

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matt@netsuds.com

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