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Most managers are excited by technology.

Technology enables us to get more done, faster. And technology is practical. Concrete. It’s not about ideas; it’s about execution.

This is certainly true in sales environments. It’s almost impossible to propose any initiative without prompting the question: is there software for that?

In sales environments, the answer to that question is yes. There is always software for that. In fact there are many thousands of software applications promising to automate every step in the sales lifecycle, from the generation of sales opportunities through to the provision of management information.

Broken promises

The dirty secret of sales environments is that, with few exceptions, this technology has done nothing to improve productivity. Nothing!

After a generation of investment in sales (and marketing) automation technologies, sales environments look (and operate) essentially the same as they did 20 years ago. There is little credible evidence that the tens (or, more commonly, hundreds) of thousands of dollars that a typical firm has spent on sales technology has caused a rise in revenues, a reduction in costs or even an improvement in customer-service quality[i].

This chapter addresses three critically important questions:

  1. Why is technology failing to produce the productivity improvements in sales that it has in other parts of the organization?
  2. What role should technology play in the design and operation of the sales function?
  3. What are the practical technology requirements of an organization transitioning to the new model?

At the end of the chapter we’ll tackle another more fundamental technology issue. We’ll explore who in the organization should accept which technology responsibilities and, more critically, which responsibilities should never be outsourced.

The sales software system

If the multitude of sales-related software applications was a planetary system, the sun around which all other planets would orbit would be called CRM. CRM stands for customer-relationship management. A CRM (application) is designed to automate the numerous workflows that exist in and around the sales environment – and to store the data that’s generated as a result of those workflows.

These workflows include the generation of sales opportunities, the prosecution of sales opportunities and the management of customer issues.

The other software applications that orbit the CRM in the sales system are dependent on the CRM, either because their reason for existence is to feed it data (new contacts, perhaps) or because they leverage the data that sits within the CRM to perform specialist functions (email broadcast, report generation and so on).

CRM is a subset of a larger class of software, known as ERP (enterprise-resource planning). ERP is the software that manages operational workflows in the organization as a whole. Things like the generation of orders, the scheduling of the production environment, the management of inventory, the processing of payables and receivables, and so on.

Although ERP and CRM are now intertwined, the two technologies had quite different beginnings. ERP evolved out of inventory control systems in the 1960’s. And CRM evolved out of contact-tracking applications in the 1980’s. Contact-tracking applications (like Act!) were software equivalents of salespeople’s day-planner calendars.

Although the two technologies have grown together over the years, their usage has not. In the modern organization, ERP is pervasive – if you removed it, the organization would simply cease to function. This is not the case with CRM. In fact, in many organizations, the removal of CRM would actually unencumber salespeople and increase their productivity!

What’s wrong with CRM?

Consider the list of standard promises made on behalf of CRM by CRM vendors:

  1. CRM will increase salespeople’s productivity
  2. CRM will cause an improvement in customer service quality
  3. CRM will drive a tighter integration of sales and marketing
  4. CRM will provide management with better quality information

As I mentioned earlier, most organizations have invested a king’s ransom in CRM but few have seen any (let alone all) of these promises realized.

Technically, however, there is nothing wrong with CRM!

As we’ll shortly discover, CRM has the potential to unleash enormous productivity improvements in sales environments. The problem with this technology is that it has been designed around the requirements of a sales environment that doesn’t actually exist.

It’s useful (and somewhat amusing) to understand why this has occurred.

A candid history of CRM

It’s arguable that the first contact-tracking applications solved a real problem for salespeople. These applications simplified the tracking of the numerous interactions between salespeople and their customers (appointments, phone calls, proposals and other tasks). Continue reading “The Machine > Part 2 > Chapter 10: Technology (why CRM sucks!)” »


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I’ve waxed lyrical about Mixergy before.

Andrew Warner is a successful entrepreneur in his own right and, every day of the week, he interviews a founder with a story worthy of note.

Typically, these founders have built (and very often sold) successful tech companies. Other times, they just have a particularly interesting story to tell.

The unbelievable thing about Mixergy is you can subscribe to Andrew’s site for free and watch each of his interviews as he posts them (all are live for a week before disappearing behind a paywall).

If my last story about Mixergy didn’t compel you to get over there and subscribe, you should probably do it now.

But first, maybe you should take some time to watch Andrew’s interview with yours truly on September 26!

In almost an hour and a half (yep, it’s an in-depth interview), Andrew covers a lot of ground. From my first vocation (ballet dancer) to my introduction to business (selling insurance) and the long story of Ballistix, including the four pivots (as they’re now called) that have lead us to our current model.  I think it’s a great interview (but I’m biased, of course).

Oh, and a big thank you to Maria Sipka (who has her own exciting start-up) for recommending me to Andrew.

The finest day of my life

In case you’re wondering why it took me so long to post news of the Mixergy interview, I have more news I feel compelled to share.

I don’t normally share personal stuff but this is so momentous, I’ll have to ask you to humor me.

On October 3, on the Sunshine Coast in Queensland (Australia), Bo and I were married.

bo_justin_wedding

I met Bo at LAX about four years ago. We were both checking baggage and we got chatting about software development and quality assurance (Bo leads the quality initiative at Guthy Renker).

Obviously, with such a gift for casual conversation, we couldn’t stand to spend much time apart – and so we’ve chosen not to!

(As I write this, Bo is working on a little Ruby on Rails application for Ballistix and I’m pestering her with unwanted advice on system architecture!)


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I love webinars and, increasingly, our clients are learning to love them too! In this post I’ll share some of our experiences with webinars over the last 7 months and show you why we’re so enthusiastic about them.

The results

In a previous post, I told you how we build our list (generate new relationships).  And I shared how our overall lead-generation machine is self-liquidating (the revenue from Solution Design Workshops  is more than the total costs associated with the generation of the sales opportunities for these workshops) – meaning that it costs us (less than) nothing to generate sales opportunities for our Outsourced Sales Operations engagements.

What I didn’t tell you is how we convert new relationships (people who have requested an extract from The Machine) into sales of Solution Design Workshops.

The key to that is webinars.

I’ll explain the why and how of webinars shortly. First let me share the results.

image

Since March this year, we have run 9 events.  Roughly half have been run in the morning (LA time), to suit our US subscribers and the other half in the evening, to suit our Aussie audience.

Across those nine events, 797 bookings have yielded 380 attendees and 116 requests for Best Practice Briefings. A Best Practice Briefings is the intermediate step before a Solution Design Workshop.

That means our conversion rates from booking-to-attendee and attendee-to-briefing are 48% and 31% respectively.  Actually, in recent times, we’ve pushed both conversion rates up to almost 50% which is much better than standard rules of thumb.

In the spirit of full disclosure, the following chart shows our numbers across all nine events.

image

And, in case you’re wondering, here’s the breakdown across each event type.  These numbers are of limited value because we have promoted the Death of Field Sales event more heavily than the other two. (We did this because the Death of Field Sales headline outperformed the others in tests we ran with pay-per-click advertising.) Continue reading “The wonder of webinars (our stats revealed)” »


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I’m so happy to post this video!

On the one hand it demonstrates that organizations can implement SPE without the assistance of Ballistix.

On the other hand it suggests that we’ve made huge progress in our efforts to codify and communicate both the principles and the practice of SPE.

Aside from reading our books and attending our events, Daniel Dunsford had no help from Ballistix. But that didn’t stop him from following our prescription (almost to the letter), and, as a consequence:

  • Slashing his sales-related costs
  • Boosting his sales revenues
  • Multiplying his firm’s profitability

Daniel is the principal of AR Cash Flow, a provider of receivables financing, based in Sydney, Australia. One of the things that I found striking about this interview is that Daniel made the correct call on a number of tough decisions:

  • From day-one, he established the critical 1:1 ratio between sales coordinators and salespeople – and scaled-down his sales team to make this possible (rather than under-resourcing the sales coordinator role and rendering the transition impossible)
  • He saw the light and eliminated sales commissions right away (rather that allowing them to cast a pall over the team-based structure)
  • He bit the bullet and took-on the business development role himself – until he had proof of concept (rather than relying on indirect feedback)

Anyway, that’s enough from me. Here’s Daniel telling the story, in his own words.

No help from Ballistix: AR Cash Flow goes it alone and multiplies profits


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When Megara – a Melbourne (Australia) based manufacturer of polypropylene products – was contemplating radical changes to the design of their sales function, a list of concerns was identified:

  • Would customers be happy dealing (by phone, rather than face-to-face) with account managers who were located in another region?
  • Would customers tolerate the requirement to interact with multiple specialists – rather than with a single generalist?
  • Would customers be comfortable with the idea of an assistant scheduling meetings for a field-based salesperson?
  • Would telephone contact be as effective as face-to-face in most selling situations?

Today, only a few months on, the results are in. And, without exception, the answer to each of the questions above is YES.

Something had to change

As Andrew explains in the video below, the decision to reengineer sales was not one that the Megara management team took lightly. The team was well aware of the magnitude of the changes – and the associated risks – the new direction entailed.

But, there was no question that the standard model was broken. Attempts to grow revenue by building-out the sales team (11 salespeople and an experienced sales manager) had failed. In the wake of that failure, the maintenance of the status quo was starting to feel like a more radical option than the Sales Process Engineering message espoused in the workshops the Megara team had been attending!

Video: Andrew Rundle (who leads Megara’s packaging division)
discusses the SPE journey with Justin Roff-Marsh

New model

Today, in place of 11 field-based salespeople (and one sales manager), Megara has the following specialist functions:

  • Inside sales: a team of head-office based account managers (all accounts and opportunities are now owned by internal personnel)
  • Business-development manager: in the near-term, this (field-based) role will be filled by Andrew, who will dedicate two days a week to new-account acquisition

Continue reading “Radical restructure for plastics manufacturer drives costs down and sales activity up” »


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A little over a year ago, I posted on our initial experiments with “social media” (or, more specifically, with pay-per-click advertising).

That post was well received so this one is an update. Actually, it’s more than an update: it’s a review of our entire US lead-generation machine. I hope it provides you an idea or two – or, perhaps, the courage to run some of your own promotional experiments with new media.

So, back in February 2011, I talked about how we launched our US operations at the depth of the recession and struggled to generate sales opportunities the way we do in Australia. The problem was that, in Australia, we had a house list containing many tens of thousands of executives – and in the US, we didn’t (and still don’t)!

I talked about how, when we launched here, we squandered a small fortune on PR, tradeshows, traditional advertising and traditional direct mail campaigns. And I related some encouraging results we were getting using pay-per-click (PPC) advertising (predominantly on LinkedIn) to give away reports and, in so doing, generate sales opportunities.

Since then we’ve done quite a bit of additional experimentation and automation. Here are the results. (If any of this doesn’t make sense, it’ll pay to read – or re-read – Chapter 9 of The Machine, which I posted last week.)

Offers

We tested a number of offers early in 2011 and the clear winner (by a ridiculous margin) was a sampler of The Machine (the first three chapters).

Of course, I love the fact that this offer is our best-performing because it means that we’re building the audience for the upcoming book at the same time we’re generating sales opportunities.

Because this is our best performing offer, pretty much all of our campaigns over this period point to versions of the one landing page, offering copies of The Machine (the sampler), along with a DVD containing a copy of my first book, a 2.5hr luncheon presentation and other good stuff.

Experiences with Lead Gen2

It makes sense to have all campaigns point to the one ultimate offer as we have done because it simplifies opportunity management and enables you to automate your lead management to a greater degree.

On that note:

  1. We use AWeber  to automate our lead-management process (form generation, auto-responders and list management)
  2. We have automated the import of sales opportunities into our CRM
  3. We pay a person I found here in LA (on Craigslist) to do all of our mail handling (she mail merges letters direct from our CRM and uses stamps.com to generate postage labels)

Audience (media)

The following chart shows most of the sales opportunities we have generated since January 2011, broken-down by campaign category.

Experiences with Lead Gen1

You can see that PPC advertising on LinkedIn turned out to be a winner. It’s not our least expensive form of promotion (in terms of cost-per-opportunity) but it’s certainly the most scalable.

You can also see that we’re getting great value from this blog (with SEO referrals increasing steadily over the period) and from referrals. The Fortune Summit entry exists because Verne Harnish was kind enough to invite me to the stage to speak about our approach to sales commissions after Dan Pink’s presentation last year.

Creative execution

One of the great things about PPC advertising is that the creative component (words and pictures) is easy. Most media (e.g. Google, LinkedIn and Facebook) provide you with a limited amount of space and strict controls on how you can use it.

Here’s a sample of one of our many LinkedIn ads. (We have many because we’re regularly trialing new versions and because the response to individual versions fades quite quickly.)

Experiences with Lead Gen3

The other creative component of these campaigns is the landing (or squeeze) page. You can see a sample of one of them above.

Here, creative execution can make a big difference. For example, we recently more than doubled our on-page conversion by adding a video of yours truly, imploring visitors to request the book.

The results

Let me tell you the results of just our LinkedIn activities. It makes sense to focus on LinkedIn because it’s the source of more than 50% of our opportunities and also because it’s the one media that we can readily scale.

Here’s a chart of our sampler requests over the period.

Experiences with Lead Gen4

It’s important to note that much of the variability in these numbers comes from us running experiments and – in many cases – deliberately throttling-back our LinkedIn expenditure, either because Charlene (my sales coordinator) is overwhelmed or, more recently, because we have run out of delivery capacity here in the US (we’ll be adding more shortly).

Okay then, enough with the pretty pictures; let me show you how all this activity translates into money!

The economics

Over the period we’ve spent $29,071 with LinkedIn. From 24.3m impressions (showings of our ads), we’ve generated 5,687 clicks, at a cost of $5.11 each.

An average of 11% of these clicks have converted into sampler requests (this rate has risen markedly in recent times), meaning that we gave away 607 samplers (and generated the same number of sales opportunities).

It has cost us a little under $8 to fulfill each book request, meaning our total LinkedIn-related promotional expenditure is $33,927.

Now, this may sound like a lot but we need to compare it with the income we expect these opportunities will yield over time. Understandably, I wouldn’t give you this number even if I knew it, but I am prepared to admit that the lifetime value of a new client is significant enough to easily justify all this expenditure (and more).

The interesting thing in our case (and many of our clients have followed our lead here) is that we sell a Solution Design Workshop as part of our engagement process (i.e. before we ask for the ultimate order).

This means that our opportunity-management process generates income as well as incurring costs. This also means that it’s possible – at least in theory – to build a self-liquidating opportunity-management process and drive the overall cost-of-sale down to zero.

In our case, over the period in question, we can attribute at least six Solution Design Workshops to our LinkedIn campaign. These have generated an average (net) income of $6,160. If divide our total LinkedIn-related promotional expenditure by six you can see that it has cost us $5,654 to sell each of these workshops.

In other words the promotional cost of each is negative $500!

There’s no question in my mind that this analysis grossly undervalues our LinkedIn campaign. It ignores the Solution Design Workshops we have yet to sell to the 607 new people we’ve added to our house list. It ignores all the income we will earn over the years by introducing a percentage of these people to our Outsourced Sales Operations engagements. And it ignores the audience we are building for my upcoming book – and all the knock-on benefits that will ultimately flow from that.

But I have little interest in trying to quantify any of that right now. After all, a couple of years ago we were bleeding red ink in the US and struggling to generate any sales opportunities. Now, our constraint has shifted to where it belongs (our consultants), meaning that we can knuckle-down and focus on replicating the simple model we have operating right now.

I must admit that, moving to the US and starting here without a captive audience (outside of the TOC community) has forced me to learn lessons that I could have learned back in Australia, but probably wouldn’t have. If you’re not running these kinds of promotional experiments now I encourage you to do so – while you don’t need to!


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If you’re not in the fortunate situation where promotion is easy, then the odds are that it’s really difficult.

If you’re in the latter category, this chapter will introduce you to the magnitude of the promotional challenge ahead and explain why (fortunately) moderate success is probably more than sufficient in the early stages of your transition to the new model. It’ll also walk you through the process of creating your first set of promotional campaigns.

Now, if it sounds like I’m trying to recalibrate your expectations at the start of this important chapter, then you’re absolutely right: I am!

In my experience, most managers underappreciate the magnitude of the promotional challenge and, consequently, fail to make a sufficient commitment to it. Campaigns are launched with unrealistic expectations and then initial successes are overlooked. The end result is that promotion is regarded as a black art and management places occasional bets on whatever happens to be the promotional flavor of the month, motivated more by a sense of obligation than by any real expectation of results.

This, of course, is a vicious cycle. If we’re to break the cycle we need to replace the sequence above with this one:

  1. Engineer a sales function that can operate quite comfortably with little more than your existing organic opportunity flow
  2. Run small promotional experiments and evaluate all outcomes objectively
  3. Iterate rapidly, but be prepared for the development of an effective promotional function to take many months (if not years)
  4. Steel yourself for the journey by reminding yourself, regularly, that a sales function without a scalable source of opportunities is not much of a sales function (just as a business without a scalable source of sales is not much of a business)

Why promotion is either easy or really, really difficult

It’s instructive to examine those rare businesses that find promotion easy. I think it’s fair to say that these organizations tend to find themselves in this enviable position for one of two reasons:

  1. They have invented a breakthrough product (the proverbial better mousetrap) and the world genuinely is beating a path to their door
  2. They have invented a space in the mind of the market and, within that space, they are regarded as the thought leader

It’s easy to see that promotion will be easy if you are a product or thought leader (think of Apple after the launch of their game-changing iPad or HubSpot and their Inbound Marketing method).

However, if you’re not in one of these categories, it’s also easy to see why promotion is difficult. Absent a breakthrough product or a position of thought-leadership, you lack either a compelling message or an attentive audience, or both.

That’s not to say that you can’t emulate the promotional activities of Apple and HubSpot. You can: you just can’t expect those activities to yield the same results.

The thing is, if you have established a leadership position in your market, then your promotional activities need only communicate that good news. However, if you lack this leadership, then your promotional activities are the news. Consequently, they will be less effective and more likely suffer from rapidly-diminishing returns.

A bitter pill

In case you’re wondering, there’s a reason why management tends to underappreciate the magnitude of the promotional challenge. Under the standard model, the responsibility for the origination of sales opportunities rests with salespeople. Management may recognize some responsibility for tilling the soil via marketing activities but the general assumption is that prospecting (as promotion is typically called) is just part of selling.

In the new model, this responsibility is transferred inside – leaving management no choice but to confront the challenge head-on.

Now, here’s a bitter pill. If you find yourself in the position where promotion is really difficult, it’s likely that you will need to look outside your marketing department for a solution to this problem (in the long run). Without a leadership position (product- or thought-), your promotional activities are severely handicapped – meaning that you will struggle to find campaigns that generate better than marginal returns.

What I’m suggesting then – lest there be any confusion – is that, in the long run, if you are not currently either a product or a thought leader, it’s easier to become one than it is to attempt to compensate with acts of promotional gallantry.

Of course the development of either product or thought leadership is outside the mandate of this book. Both require innovation – and this innovation must be driven from the very top of the organization. And both require initiatives that cross many divisional boundaries – involving engineering, sales, production and finance.

Why moderate success is more than sufficient

Fortunately, there is good news! Continue reading “The Machine > Part 2 > Chapter 9: How to generate sales opportunities” »


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This is the title of a Harvard Business Review article that has caused a bit of a stir in sales circles.

The authors divide (B2B) salespeople into five groups and argue that, of the five profiles, one significantly out-performs the others – and that one under-performs, to a similar degree.

Here are the five profiles (in the authors’ own words):

Relationship Builders focus on developing strong personal and professional relationships and advocates across the customer organization. They are generous with their time, strive to meet customers’ every need, and work hard to resolve tensions in the commercial relationship.

Hard Workers show up early, stay late, and always go the extra mile. They’ll make more calls in an hour and conduct more visits in a week than just about anyone else on the team.

Lone Wolves are the deeply self-confident, the rule-breaking cowboys of the sales force who do things their way or not at all.

Reactive Problem Solvers are, from the customers’ standpoint, highly reliable and detail-oriented. They focus on post-sales follow-up, ensuring that service issues related to implementation and execution are addressed quickly and thoroughly.

Challengers use their deep understanding of their customers’ business to push their thinking and take control of the sales conversation. They’re not afraid to share even potentially controversial views and are assertive — with both their customers and bosses.

The authors’ research suggests that while salespeople are distributed evenly across these five categories, 40% of high-performers are Challengers while only 7% are Relationship Builders.

While this study’s methodology is questionable, it does remind me of an interesting (and painful) story from our own history.

A real salesperson

Years ago, I decided to experiment with the addition of a professional salesperson – someone who could free me to start work on the book that I’m in the process of finishing currently.

I was in two minds as to the nature of the individual who we should employ.

One option was to employ someone like yours truly. Someone who was naturally skeptical of the status quo. And someone who enjoyed conflict – who viewed it as a necessary and healthy ingredient in the problem-solving process.

The other option was to employ someone who fitted the mold of what I (at the time) regarded as a real salesperson. Someone who was agreeable and inoffensive. Someone who who would love customers into buying from us (as opposed to terrorizing them!)

I chose the latter.

I really wanted Arthur (not his real name) to succeed. I gave him my executive assistant – along with the promotional support required to fill his calendar with 15-20 sales meetings a week.

And I travelled with him for weeks, demonstrating to him exactly how I went about selling.

The conversations we had between appointments were interesting. Arthur would scold me for being demanding, abrasive and aloof in meetings – and I would agree with him that my conduct was somewhat heavy-handed and reflect on the fact that everything would be better once Arthur was firmly in the driver’s seat. We both concluded that we were making sales in spite of – and not because of – my boardroom antics.

When Arthur was firmly in the driver’s seat, everything proceeded to plan – except for the sales, that is! In the five months Arthur was with us, he sold only one engagement (and that was with my assistance). Aside from that, he sold NOTHING.

During this period, I managed to stumble across 10 or 12 new clients, in spite of the fact that I was doing my level-best to avoid selling (and stay home and write a book).

I’m ashamed that it wasn’t the total absence of sales that convinced me to get rid of Arthur. It was the steadily-increasing volume of calls from potential (and existing) clients complaining that Arthur added no value whatsoever in his meetings.

The message from the chorus was clear. They didn’t need a good-looking, personable, well-dressed fellow to warm a seat in their boardroom and agree with everything they said. What they really wanted was someone with a critical eye who’d challenge their base assumptions and compel them to think differently.

“This”, and I heard these words over and over again, “was what attracted us to Ballistix in the first place.”

Obviously, a single data point adds no weight to the argument above but, in my experience, at least, it’s true that selling is NOT about relationships.

The death of field sales

You may have already gotten word that I’m presenting a webinar in a couple of weeks with this title.

There’s more than a touch of hyperbole in the title, of course, but I will  be arguing that, in many cases, organizations should be moving the sales front-line inside.  I’ll present both an economic and an effectiveness argument for this.

The link is here: http://ripfieldsales.eventbrite.com/

The initial batch of tickets for this event sold-out overnight but I’ve upped the capacity of the webinar service and released more tickets. If you miss-out, please join the wait list and we’ll either up the capacity again or we’ll schedule another event soon.


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“We’ve seen a really dramatic increase in sales …”, Joe explains.

“A good sales growth for us … in the industrial glove market … would be 5%. But, even through the recession, we’ve seen a pretty dramatic increase in sales. This year we’re about 25% up in our sales over the previous year.

“I think some of that is the economy but some of it has to be attributed to the sales process [engineering] as well”

Below you’ll find a link to an interview with Joe Geng of Superior Glove. Superior Glove distributes gloves throughout North America from its home base in Acton, Ontario.

In the interview, Joe discusses both the successes and the challenges they’ve faced implementing SPE. What’s particular interesting is the discussion of salespeople’s reaction to the radical changes in their operating environments.

Enjoy!

Justin Roff-Marsh interviews Joe Geng of Superior Glove

New SPE blog features simple design and discussion forum

I’ve been busy over the holiday period redesigning and rebuilding my blog.

You’re looking at it right now!

The change I’m most excited about is the addition of a forum (integrated with the the existing commenting system). The problem with comments is that, traditionally, they’re attached to posts – meaning that all the discussions are disconnected from one another.

Well, my blog now has the best of both worlds. You can still comment on posts, but comments also appear in the forum, along with all other discussions. I’m hoping to recreate some of the lively discussions that used to occur before I transitioned to the blog from a Yahoo Group.

So, please humor me. Take some time to participate in the couple of existing discussions (including the one attached to this post) – or go ahead and start your own discussion by posting a new topic. If you want to register (so the blog remembers you for future visits) you can do that but it’s not required. You can participate just fine without registration.


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