3.0 CUSTOMER AND STAKEHOLDER FOCUS

3.1 KNOWLEDGE OF CLIENT, STAKEHOLDER, AND MARKET NEEDS, REQUIREMENTS, PREFERENCES, AND EXPECTATIONS
The Network made a strategic decision ten years ago to focus our efforts on the type of client who would have the potential to create jobs. We call these “impact-ready” clients (IRCs). They are the entrepreneurs and businesses who have the desire and the capacity to start and grow successfully, and are therefore the most likely to create and retain jobs. Job creation is our top KPI and network priority.

This decision to focus on IRCs created a greater awareness throughout the SBDC Network of the importance of assessing impact customers’ needs and deploying resources efficiently and effectively, in a manner that would maximize the benefit to both clients and stakeholders, and define our position in the marketplace. IRCs can be start-up or existing businesses, but they have characteristics in common: they have cash or in-kind equity, a good credit score, sufficient collateral, a workable business model, a partial or draft business plan or the understanding to craft such a plan, industry experience, and they are seeking capital – meaning they have a high potential for success. These will be the clients who will actually start their businesses, get financing, grow and create jobs.

We based our decision on an analysis of how we could best serve the needs of our customers, stakeholders and the small business market in our service area. The Network uses a number of systematic needs assessment tools to obtain input and feedback from customers, stakeholders, and the market in general. We utilize advising and training surveys, impact surveys, Advisory Boards, direct customer feedback, feedback from community groups, banks and Chambers of Commerce, host officials, negotiation with stakeholders, and have recently conducted several formal needs assessment projects.

With a good understanding of what our customers and stakeholders needed and wanted from us, our focus is on enhancing job creation from IRCs through our regular strategic planning process, as described in Section 2.0, with senior leadership setting the vision and direction of the Network within the context of key financial stakeholders’ needs and the sustainability of the program, directors and staff validating the strategies, and lastly converting strategies to action.

3.1(a) CLIENT REQUIREMENTS, NEEDS, AND EXPECTATIONS

Having a focus on IRCs does not mean that the Texas Gulf Coast SBDC Network does not serve other entrepreneurs and small businesses. The key is to determine effective and efficient ways to allocate resources so that best efforts are spent on activities that will generate jobs. This means having a good understanding of how we can best help all clients, including those who may not fit our target market definition.

To determine needs, we systematically survey advising and training customers:

Advising client surveys: 

Responses to these internal advising surveys are summarized by advisor and by center so that leadership can identify satisfaction trends, dissatisfaction data or unmet needs, and feed that information into the management system to evaluate learning opportunities. If a client has indicated on the survey response that he or she needs additional assistance, the center director follows up with that client. Leadership reviews summary data from the surveys to identify trends. For some time, we have not been satisfied with the response rate on either the 60 day or one year surveys, which until recently were conducted by regular mail – both expensive and not particularly effective; therefore one of our strategic goals is to improve communications and feedback from our clients and customers. About two years ago, we asked the folks at Center Dynamics, who provide our client relationship management system, to develop an electronic survey system for us that would:

We expect to have that system available sometime in September for testing, and hope to deploy soon thereafter. In the meantime, we have experimented with email surveys and have seen response rates increase.

60-day survey instrument is attached as Exhibit D; annual survey instrument as Exhibit E.

Impact study questionnaire:

The Network participates each year in the national impact study. Although the questionnaire for the study does not ask about needs, SBDC personnel systematically contact the participating long-term clients at the beginning and throughout the survey process to encourage them to send in their completed questionnaires, and this gives the Network an opportunity to ask them if there’s anything the SBDC can do for them. SBDC leadership uses the aggregated results and the detailed report provided by the researcher, Dr. Jim Chrisman, for future planning.

The Network’s most recent impact study report is attached as Exhibit F.

Engagement letters, Scope of Work, and Impact Results forms:

Advising sessions with each client are documented in Center IC, but documentation is also provided to the client to formalize the process, outlining why the client sought SBDC assistance, the anticipated results, and the actions both the advisor and the client will undertake to reach the desired results. During each initial advising session, the advisor develops a Scope of Work form detailing the work the client and advisor will do together. The client signs the Scope of Work, indicating agreement that the proposed activities meet his or her needs. After the session, the advisor prepares and sends an Engagement Letter, reiterating what was outlined in the Scope of Work. Once the client’s issue is solved or project is completed, the advisor prepares an Impact Results form, which the client signs to indicate the results and confirm that the advisor has successfully helped the client.

Sample Scope of Work, Engagement Letter and Impact Results forms are attached as Exhibits G, H, and I.

Training attendee evaluations:

Each attendee at training events receives and completes a training evaluation form which asks about the program they just attended, and also asks about their future training needs. The feedback from individual attendees is compiled into overall evaluation results that are included with SBA Form 888, the Management Training Report. 888s are reviewed by center directors and by the Region’s Director of Training, who use the information to improve current offerings and plan future events and alert the advising leadership of any emerging trends or needs.

Training evaluation form is attached as Exhibit J.

In general, our experience over the past ten years working with impact ready clients points to timely service, ability to identify success factors and customize solutions, and expedite access to capital.

3.1(b) STAKEHOLDER REQUIREMENTS, NEEDS, AND EXPECTATIONS

SBDC leadership is very sensitive to the interests of key financial stakeholders. These stakeholders are the State of Texas, U.S. Legislators and the U.S. Small Business Administration. Leadership readily identifies stakeholders’ priorities through regular interaction and annual negotiations which clearly set out expectations and results as follows:

State of Texas 

U.S. Legislators

U.S. Small Business Administration

Each host organization is asked why the SBDC is important to the institution and why the host provides support to the SBDC program. Host priorities are identified through Sub-recipient Agreement negotiations, regular meetings held between center staff and host officials, and meetings with host officials during onsite reviews conducted by the Executive Director and Deputy Director, Strategic Operations. Host priorities are as follows:

Network Host

Service Center Hosts

Stakeholder needs helped us identify two new business opportunities. The first was with clients engaged in exporting; the second was with clients involved in technology commercialization.

Many years ago we had a full-fledged International Trade Center, but over the course of time determined that the Center as it was structured was not producing impact, so we did not replace personnel when they left and the Center was eventually disbanded. We served international trade clients by providing training, information, research and referrals to other assistance sources when needed. Recently, however, with our stakeholder the SBA’s focus on export assistance, and with the Houston area becoming even more of a major exporting hub, we have reevaluated our position and are providing more significant international trade assistance. We continue to provide relevant training, information and research, but have also ramped up our capability to provide one-on-one assistance. All professional staff participated in NASBITE’s Certified Global Business Professional training and the majority of our directors and advisors were successful in obtaining the certification designation. We encourage new staff to obtain the certification and all certified staff to attend ongoing training in order to keep their certification active. This credential now serves to position us well in the marketplace and our staff has the capacity to meet the needs of export clients.

The need to provide assistance to the second group, the technology clients, was discovered largely through our relationships with community organizations that were focused on helping such businesses. Our Network host also wanted us to be involved in this area. We had several directors and advisors who were qualified to provide the necessary assistance, but when we identified this as a major business opportunity, we wanted more of a presence in the technology arena. We hired an advisor to focus solely on technology companies, who was later promoted to a director-level position, and provided technology commercialization training through the University of Houston to the majority of our directors and advisors. Most were successful in obtaining the resulting certification, significantly increasing our capacity to serve technology companies and meet the needs of this market segment. This initiative was a two year test pilot, and despite great efforts, we concluded that there was insufficient job potential to justify a dedicated director to this effort, nor did it satisfy our key stakeholders. Most of our directors and advisors are certified in Technology Commercialization and have the ability to provide that assistance to clients as needed.

3.1(c) MARKET NEED AND EXPECTATIONS (PREFERENCES)

With clear direction from stakeholders and hosts that new jobs are critical to the SBDC’s success, leadership identified the customer segment that would drive job creation and labeled it “impact-ready” clients, or IRCs. These can be either start-up or existing businesses; the common denominator is the desire and the capacity to start or grow. Capacity frequently translates into capital, and an injection of capital for a start-up or existing business typically means the business will either be hiring new employees, expanding operations -- which translates into more revenue and new jobs, or is growing by adding locations or products -- which also means job creation is likely. For a start-up, it may only be one job, that of the owner, but new business starts are an important part of this target market segment.

The Network’s prime resources and best efforts are its professional staff and long-term advising services. These are focused on the IRCs with the potential for significant job creation. When customers come to the SBDC who are lacking some or all of the attributes of an IRC, the Network’s strategy is to provide alternative paths of assistance to help them acquire the skills that will increase their likelihood of success. These alternative paths primarily consist of live training, research and library resources, and online information and training. The goal is to help the customer acquire the critical skills necessary to be successful in starting or expanding a business.

To substantiate our strategy, we have undertaken three formal needs assessment projects since our last accreditation review as described in Section 2.1(a), and are about to begin a fourth. In 2009, we identified and surveyed all clients who had been successful accessing capital and creating jobs during the prior five years. We then invited certain of those clients to participate in focus groups, making an effort to achieve Region-wide representation. We wanted to:

The focus group results were compiled and analyzed, and a follow-on written survey was sent to all impact clients to validate/invalidate the focus group findings.

In 2012, we participated with the other three Texas SBDC Networks in a statewide survey of both clients and non-clients. We wanted to determine their business outlook and growth plans, and the functional areas (financial, HR, green practices, strategy development, IT, legal and professional, sales and marketing, innovation and new technology) that were the most critical to them. We also wanted to learn how they preferred to receive assistance, whether through a private advising appointment, a workshop, or printed material, and what it was about SBDC advising services that would make them want to meet with an advisor. We had 477 client responses and 1,088 non-client responses. Both clients and non-clients responded that the fact that our advice is free, that our advisors are business experts, and that they will be provided a defined plan of action, were the top three factors in requesting a face-to-face meeting.

In 2013, we participated with the other three Texas SBDC networks in a formal needs assessment project sponsored by the Federal Reserve Bank of Dallas’s Community Development Office. The project took the form of a poll sent to businesses throughout the state. We partnered with sixty area Chambers of Commerce to send the poll to their small business members. The results identified challenges the small businesses face in sustaining and building growth, including access to credit and the reliability of employees, providing us with critical data we can use in our planning.

The Needs Assessment Poll survey instrument and report are attached as Exhibits K and L.

We also use two other approaches for needs and feedback. Each website has a feedback button for questions, comments, and suggestions. Most of the activity comes through the UH - Bauer College SBDC or the Network website and is reviewed by the Executive Director.

We also have a survey posted on every website to assess business needs, with responses and results reviewed periodically by the Executive Director.

3.2 MANAGEMENT OF CUSTOMERS AND KEY STAKEHOLDERS SATISFACTION AND RELATIONSHIP

3.2 (a) STAKEHOLDER RELATIONSHIPS

Relationships with customers and key stakeholders are built through repeated contact and quality service. The goal is to leverage resources, generate referrals of clients to the Texas Gulf Coast SBDC Network, and maintain program financial support by satisfying stakeholder needs.

Stakeholder relationships benefit the Network by providing funding and other needed resources, increased visibility and credibility, and referral of clients and other customers. Key relationships and results are as follows:

State of Texas Comptroller’s Office – A dozen years ago the Texas SBDCs developed a funding agreement with the State of Texas. SBDC state funding is heavily influenced by the Network’s new job creation data as validated by the annual national Impact Survey. The Comptroller’s office uses that data as a basis for a revenue neutral determination which identifies a level of maximum funding for the SBDC network. The funding determination is then communicated to the Appropriations Committee in both the House and Senate for consideration. The calculation is based on a rolling average of three years of job creation performance from the impact surveys. Leadership has periodic interactions with the Comptrollers’ office as does the Network host’s Office of Governmental Relations.

U.S. Legislators – Senior leaders visit at least annually with legislators and their staffers to share impact data and client success stories, and to ask what the SBDC could be doing, or doing better, to serve their constituents. We intend to increase our exposure to our U.S. House and Senate Members through a more rigorous calling program by our service centers as set out in the strategic plan.

U. S. Small Business Administration – Regular face-to-face, email and phone communication with SBA leaders on both the local and national level results in a clear understanding of expectations from both perspectives. Annually, the Executive Director negotiates goals for business starts, capital infusion and long term clients. The Project Officer provides updates at every Directors’ Meeting. Throughout the program year, SBDC staff meets with SBA staff to learn about SBA loan and certification programs. SBDC centers use SBA staff to teach workshops on SBA programs and other topics. The result is that clients are referred to the SBDC through the SBA website and by SBA staff. To enhance our relationship and for SBDC staff to gain critical knowledge of SBA programs, the SBDC sponsors and participates in the annual Mid-America Lender’s Conference. The Network has an excellent relationship with personnel at the local district office and the entire team at the OSBDC resulting in open communications and feedback regarding our relationship.

Host officials – The Executive Director meets regularly, usually twice yearly, to inform host officials about their center’s performance, provide an update on programs and strategies, and discuss feedback and suggestions as well as respond to any operational or strategic issues. Hosts appreciate being kept in the loop and provided an opportunity to provide input and feedback. Center directors are required to meet regularly with their host officials to keep them informed of their center’s activities and to reinforce the value of the SBDC to the organization.

Banks – The Network actively pursues relationships with area banks and bankers to generate referrals of small businesses who are applying for loans. These relationships facilitate learning about the specific needs and challenges small businesses face in accessing capital, enabling the Network to develop solutions and/or alternatives for the clients. Leadership develops a better understanding of what the banks require from the small businesses and can help them through the process. SBDC personnel are active members of HAGGL, the Houston Association of Government Guaranteed Lenders, attending association meetings and events, which provides the SBDC the opportunity to interact with all the member bankers. The Texas Gulf Coast SBDC Network’s long experience with this banking group has resulted in an effective referral network for clients.

HHCC – The Houston Hispanic Chamber of Commerce has partnered with the University of Houston – Bauer College SBDC to provide programs and services to the growing Hispanic population in Southeast Texas. Center personnel regularly attend their meetings and provide their members with access to advising services, including loan packaging assistance. This provides the Network with intimate and in-depth knowledge of issues facing the growing population of Hispanic entrepreneurs and small businesses.

Other Chambers of Commerce – Network directors and advisors regularly participate in Chamber meetings and on their small business committees. SBDC service centers have satellite offices in many Chamber offices and use their facilities for meetings with clients. The benefit to participation is access to small business owners and those interested in small business development. Chamber relationships provide an open forum for discussing small business issues and needs.

Houston Chronicle – For fifteen years, the Texas Gulf Coast SBDC Network has maintained a close relationship with the city’s only daily newspaper serving the fourth largest city in the U.S. Each Sunday, the paper features a small business page in the business section which among other things includes a bi-weekly Q&A column by Deputy Director Jacqueline Taylor and a calendar section which markets SBDC training classes. In addition, there is often a story on an SBDC client or a story where SBDC personnel are quoted as subject matter experts. We are currently in discussions with Hearst Digital Media to partner on digital training and rolling out a major SBDC social media initiative for the Network.

HTC – The Houston Technology Center is a large, well-funded organization which focuses on growing companies in a variety of technology sectors – principally as an accelerator helping more established firms. HTC membership includes key executives from most of the successful technology companies as well as the support of the Greater Houston Partnership which is Houston’s key driver for recruiting new companies to the area. The Texas Gulf Coast SBDC Network has had a relationship with HTC for many years which in the last couple of years has become more formalized and integral to both organizations, resulting in a partnership with cross referral of clients and joint projects. In addition, the two organizations are co-sponsoring events and engaging in regular strategic discussions. Deputy Director, Advising Operations Roberta Skebo regularly presents to new HTC clients, and is working with HTC on a new initiative in the port region to support targeted business advising and training services to startup and expanding businesses in the petrochemical industry. The relationship with HTC provides the SBDC with additional visibility and credibility within the technology sector and results in referrals of entrepreneurs and innovators.

Houston Angel Network – Executive Director Mike Young and Deputy Director, Advising Operations Roberta Skebo represent the Texas Gulf Coast SBDC Network with the Houston Angel Network, a group of high net worth influential businessmen/women who invest in businesses with high growth potential and possible lucrative returns for investors. This relationship enables the Network to have a clear understanding of requirements to position and shape businesses that are candidates for angel investor funding.

Advisory Board – Local and regional advisory boards are specifically tasked with helping the Network identify the needs of the communities within the service area. The boards identify resources, programs and services to add to the SBDC’s toolbox for small business. The number and type of members on boards and the frequency of meetings varies throughout the Region, but all board members are small business owners and/or key members of the small business community.

3.2(b) CLIENT RELATIONSHIP

We attract clients through our website; training, outreach and networking events; regular media presence; general and targeted marketing campaigns; and referrals, primarily from existing clients and bankers. Several years ago, we developed a brochure headlined “Bringing Banks and Businesses Together,” to facilitate meetings with bankers. We have also been greatly helped by our SBA Project Officer, Russell Hughes, an ex-banker, who has frequently accompanied us on banker visits to encourage referrals. To keep our pipeline of impact ready clients full, however, we felt we could strengthen our calling program even more, and have included an action item in our strategic plan to require all centers to hold educational banker meetings on an annual basis at minimum. We are also working on identifying additional product and service pathways to help us attract and retain IRCs.

The client relationship is formalized at the initial client session when the client signs a Request for Advising Services form. At that time, the advisor and client also develop a Scope of Work detailing what each will do to achieve the anticipated results. Within days of the first session, the advisor will send the client an Engagement Letter, thanking them for becoming a client and reiterating the work to be done together. When the project is completed or outcome is achieved, the advisor will again contact the client to complete an Impact Results form. Each touch point is designed to keep the SBDC and the client’s relationship with the advisor top of mind.

We have several routine processes in place to provide continuing value to our existing clients. Our Star Member program enables members to register for workshops and events online, receive discounts and special offers, be eligible to win giveaways, and receive our Star Member e-newsletter. The monthly newsletter features a story about a successful client and also typically includes a business article on a topic of interest, often reprinted from the America’s SBDC Biz Blog. Although the client story is intended to highlight SBDC services, clients chosen for the feature story are always delighted with the promotion. Another value-add are the special events we offer at least annually and at no charge to impact clients. In the past three years we have offered four events:

The special calling program we have implemented prior to each year’s annual impact study increases contact with clients and helps build strong relationships. Before we send the survey, we contact each client to verify contact information and find out if they have any current need for our services. We then send the client a postcard letting them know the survey is coming, and if necessary, send three mailings of the survey, contacting them between mailings to encourage them to respond. This process has been in place for more than a decade.

We also offer clients access to professional service providers at a discounted rate. We have developed what we call our Professional Services Network, or PSN, which is a network of professionals such as attorneys and CPAs who have agreed to provide a free initial meeting to SBDC clients, followed by continued discounted access to their services.

The second goal in our strategic plan is to “Strengthen Communication and Feedback from Customers.” We have recognized for some time that although we were systematically requesting satisfaction/dissatisfaction feedback, we were not getting as large a response from clients as we would need to enable us to adequately analyze and assess staff performance and program strengths and weaknesses. To improve, during our most recent strategic planning process we laid out specific action steps to enhance communications with advising clients and training customers and are in the process of deploying the new processes. We do not plan to abandon the current survey process as outlined above, but will move to a more efficient and effective electronic system and perhaps add additional feedback mechanisms immediately following the initial advising session, as well as communication through phone calls, emails, post cards and other means to encourage clients to respond to our requests for feedback.

In addition to direct communication with customers, SBDC websites contain several mechanisms for market and customer feedback. Any input is channeled through the appropriate person or department for action. The online form for Suggestions/Feedback for the UH – Bauer College SBDC and Network websites goes directly to the Executive Director for consideration and action. In addition, an easily accessible needs survey is linked on most of the service center websites. Any feedback and/or complaints received by staff are reported to leadership for resolution and action.

We recently installed a suggestion box at the Region Office to let clients know we welcome feedback, and are in the process of placing comment cards at each service center to be given to each client encouraging them to email our Executive Director with any feedback or suggestions.

Further, as outlined in the Sub-recipient Agreement, any complaints, allegations, grievances or other accusations against any component of the Texas Gulf Coast SBDC Network must be reported verbally and then in writing to both host officials and to the Executive Director. After investigation, a report is required outlining the results of the investigation and recommendations for resolution and corrective action.

Feedback, suggestions and complaints received by the Executive Director are brought forward at Managers’ Meetings for discussion and a decision on whether or not any action needs to be taken. Overall, we receive generally positive satisfaction results. The occasional dissatisfaction with a particular individual or center is dealt with at that level. Other items are discussed in general terms at Region Staff and Directors’ Meetings to facilitate organizational learning and improvement.

3.3 MARKETING AND PROMOTIONAL PROGRAMS

Our strategic plan contains a goal to “Magnify Visibility and Awareness of all SBDC Centers within the Texas Gulf Coast SBDC Network with a focus on Attracting Impact Ready Clients and Training Customers.” To do that effectively, we determined that we needed a more interactive website and new marketing materials, as well as a more intense marketing campaign. We decided to hire professionals rather than try to develop and implement the projects in-house. We also decided to fully adopt the new America’s SBDC brand and utilize the America’s SBDC logo in conjunction with our new name, the Texas Gulf Coast SBDC Network. As this guide is being written, we are well on our way to a roll-out of our new brand, website and marketing materials. As with many initiatives, it has taken longer than anticipated. We were not satisfied with some of the contractors’ initial efforts, and asked them to go back to the drawing board. In the meantime, our existing brand and logo, website and marketing strategy are in compliance with the accreditation standards. As we transition, centers are encouraged to utilize or recycle any materials with the old logo. As has been the case with the old logo, centers will be required to use the new logo format on signage, printed materials, websites, advertising and even email signatures, sending the message that the fifteen service centers that comprise our Network:

In addition to using our common logo, centers are required to place a statement on all materials that they are “A business advising and training center of the Texas Gulf Coast Small Business Development Center Network. The Texas Gulf Coast SBDC Network serves 32 counties in southeast Texas.” Further, all centers are required to have any promotional materials, whether in hard copy or electronic format, approved by Network Publicity Manager Kimberly Smith to ensure branding complies with Network requirements. Branding requirements are outlined in the Sub-recipient Agreement with each center. We acknowledge that we are an accredited member of America’s SBDC on all materials where appropriate.

A master Sub-recipient Agreement is attached as Exhibit M.

As the Network moves to the America’s SBDC brand and all centers are required to use the new logo, this will help develop even broader recognition of the SBDC brand and showcase each of our centers as part of a strong, nationwide network of SBDCs.

The key message the Texas Gulf Coast SBDC Network communicates in all marketing and promotional programs is that the SBDC can help businesses start smart and grow smart. The SBDC message is meant to reinforce that the SBDC is staffed with experts: entrepreneurs and small businesses coming to the SBDC for help have a better chance of succeeding than those that don’t seek SBDC assistance. The image is one of a professional, credible, results-oriented organization. Our new marketing message and associated collateral material will continue the theme of helping business work smarter by taking advantage of our expertise. Leadership uses regular Managers’ and Directors’ Meetings as a forum to discuss marketing strategy and evaluate successful practices.

The team visit will fall in that period when we may not have fully deployed our new brand, messaging, marketing materials, and signage. Even though our former brand met the standard, we just couldn’t wait to start implementing our plan until after the team visit.

In addition to websites and standard collateral materials, marketing and promotional programs include a significant presence in the area’s most highly regarded publications:

SBDC media presence also includes guest appearances and interviews on various TV and radio shows, as well as paid cable TV ads featuring success with clients.

SBDC programs and services are also promoted through strategic relationships with community partners that lend credibility and position the SBDC as experts, such as service center hosts, area Chambers of Commerce, area economic development organizations, Houston Technology Center, the Houston Hispanic Chamber of Commerce, the National Association of Women Business Owners, Houston Minority Supplier Diversity Council, Port of Houston, Women’s Business Enterprise Alliance, and the Houston Association of Government Guaranteed Lenders. These relationships are built through regular participation at their meetings and events, and by co-hosting and co-sponsoring events that are of benefit to the client base of each organization.