Vistage Reveals Top Business Trends for 2007

WebKnowHow
Tuesday, November 21, 2006; 04:51 AM

Increased globalization, heightened merger and acquisition activity and an increasing divide between Baby Boomer and Generation Y workers are three key trends for small businesses in the coming year, according to Vistage, the world’s largest CEO membership organization. These trends are based on feedback and issues raised by Vistage members. Vistage International has more than 13,000 members worldwide who meet regularly to discuss their most pressing business issues and opportunities.

Small biz turns to global markets

“The global economy is increasingly being fueled by small businesses,” said Rafael Pastor, Vistage CEO and Chairman of the Board. “In 2007, more small businesses will not only experiment with global opportunities, but significant percentages of their growth and ability to compete will depend upon it.”

In 2006, two-thirds of Vistage members polled were conducting some business outside of the U.S., with Canada, Europe, Mexico and China registering as the most popular markets.

Vistage member company PLAYTIME, a manufacturer of children’s playgrounds based in Denver, Colorado, anticipates that eight percent of its total revenue in 2007 will be from international sales, an increase from two percent in 2006. Six of 10 qualified leads from the company’s Web site come from overseas. The firm was recently awarded a contract to complete a project in Slovakia.

“We see international markets as a real growth opportunity for us,” said Mike Evans, President and CEO of PLAYTIME. “We’re focused on establishing strong networks of representatives in key markets, as well as understanding the logistical and cultural differences of doing business overseas.”

New technologies are driving down costs of doing business overseas. Voice-over Internet protocol (VoIP) calling has significantly reduced telecommunications costs, while Web-hosted software applications eliminate the need to establish consistent operating systems in multiple locations.

Mergers and acquisitions not just for big players

Once thought to be limited to larger businesses, more and more small businesses are becoming targets of mergers and acquisitions. Vistage sees many of its members in the $50 - $100 million range either recently having gone through a merger or acquisition, or are anticipating one.

In fact, a recent poll of Vistage members revealed that more than 50 percent are considering a merger, acquisition or both in 2007 as a way to help their businesses grow.

“This used to be the exclusive domain of $100 million-plus companies, but no longer,” said Pastor. “Either from the necessity to grow, or since many Boomer-aged business owners will be looking to transfer their businesses upon retirement, this trend will escalate in 2007.”

Workplace culture clash between Boomers and Gen Y

With staffing the No. 1 concern of small and medium-sized businesses executives, a new challenge will impact their ability to hire and retain skilled employees in 2007: a clash between work styles and expectations of Boomers vs. Gen Y.

In many cases, Boomer executives are not creating work environments that fit the Gen Y mindset. Other Boomers are actively seeking out and catering to younger, less experienced employees because of their creativity, knowledge of new technologies and different viewpoints on business.

Vistage member Erich Hanson, Chief Executive of August Ash, Inc., an Internet marketing and Web development firm in Minneapolis, Minnesota, has eight employees under the age of 25.

“They’re ambitious, creative and tech-savvy, but they also have a different work style and are less refined than more mature employees,” said Hanson. He utilizes group team development meetings to provide structure and guidance, and an open “cube-free” workplace that encourages interaction and creativity.

November 2007 will mark the 50^th anniversary of Vistage, started by a Wisconsin businessman in 1957 as a way for executives to share business knowledge and experience. In 2006 the company held its first regional member conferences, bringing together more than 1,500 CEOs in Irvine, Calif., Chicago and New York to discuss the key issues and trends facing small businesses in the coming year. Vistage also publishes the CEO Confidence Index, a quarterly measure of economic, market and industry trends based on the feedback of nearly 2,000 CEOs.

Results of the 2006 Q4 CEO Confidence Index will be released the first week of December.