CUSTOMERS - What Do They Want????!!!

Have customers changed since the downturn in our economy? You bet!

What's different? Plenty but mostly it comes back to lack of confidence in what's ahead (as in predicting what will happen during the next 90 days or so) and hunkering down in response to recent events (like investment loss and non-availability of funds).

The organizations that are successful are the ones which are asking their customers and clients what they want and need, then providing it. Others are doing 'business as usual' in these unusual times - seems like an oxymoron to me - and wondering why sales are lagging (or missing).

'What can I do to help' is a productive start to a conversation that can end in a sale - sure is better than 'we're here when you are ready to buy.'

So as leaders, what how do we proceed?

• Realize it is NOT business as usual, but that the fundamentals continue to be valid;

• Initiate conversation about what is wanted and what is needed (may be different);

• Be open and flexible and adaptive to new approaches and ideas, BUT also take counsel from your 'gut' and experience;

• Keep in clear focus that the desired outcome is a successful result -- do not let ego or saving face frustrate achieving it; and

• Know that in a service business, you are providing service - and its effectiveness is in the eyes of the recipient, not in the energy or activity expended. 

If we apply these elements to addressing our customer's needed, will we be overwhelmed with success and business lined up at the door?  Well, there is no magic here, but it will yield far better results than pretending that the world and its markets are the same as they were.

What can you add to the discussion?

Recommendations – Honor & Obligation

The other day a long-time friend and professional colleague ask if I would arrange an introduction to one of my clients and give a recommendation of him as well. Two assignments easily done, as I know and respect the skills and abilities of the individual.

With this fresh in mind, I did some thinking about recommendations – they carry both honor and obligation for both parties.

For the person asked to offer the recommendation, it is an honor to be considered someone whose opinion carries weight and credibility with others; a person recognized as accomplished, knowledgeable, and trustworthy to speak in real terms about the subject person. For the requester, the honor is a notable person stands up for you and speak to the accomplishments and skills you possess.

There is also a dual obligation associated with a recommendation. For the requester follow-through is very important – if a recommendation has been offered you must follow-up promptly – sounds obvious doesn't it?. To ignore the individual, perhaps changing your mind about their relevance after being recommended to them, does damage at some level to the relationship between your recommender and the individual – 'you said that Sam is a good guy and wanted to speak with me about an idea – what happened?' No follow-through is likely to have a negative effect on your relations with your champion as well – after all, she had to expend some effort and time to offer up the recommendation and lack of action simply negates that time investment.

There is a concept in Eastern philosophy that if you save someone's life you are then responsible for them. There is a similar axiom in business and human relations – if I stand up for someone, my reputation and credibility are on the line, based on the actions of that individual. Obviously, you are not a surrogate in her place, but if you said 'Nancy is a wiz with spreadsheets and analysis' and she can't boot a computer, you appear foolish! Once you have offered a recommendation you retain some responsibility for the actions of that individual – at least initially AND your reputation is on the line too.

As the recommender, give some thought to who you recommend and the scope of your comments. Keep in mind that at least some of the goodwill and credibility you've earned is in play when you offer a recommendation – do not take it lightly. When writing a letter to an individual, you are thinking about how the reader will receive the information and how they will view you for recommending the person. However, who you recommend is also a consideration when writing a Linked In recommendation as well – while this may seem more indirect, like a passing nod to the individual (or a shout-out at a rally), IT IS NOT. These recommendations will be seen by many people, not just one, and will hang around forever. Give it the same care as you would a letter to a specific individual.

Harvey Mackay (I like him a lot and have followed him for decades) tells a story in his book We Got Fired about a referral/recommendation this father made for him when he was a teenager and Harvey got a summer job at a men's store. Shortly after he started to make sales, he would 'trim' time from the day by coming in late, leaving early – and quickly developed a reputation as unreliable (and unlikable by employees covering for his absences). When he asked for a day off to play golf, the owner called his father saying Harvey had to go! As he tells the story, Mr. Mackay had a discussion at top volume with Harvey that evening and the wayward son learned an important life lesson – he had failed to live up to the recommendation to the store owner and both Harvey's and his Dad's reputations suffered as a result!

Recommendations are an honor and an obligation for both parties – however discretion and diligence are required.

Any life lessons about recommendations and referrals you'd like to share?

There are Three Kinds of People – Which One Are You?

In organizations, on boards, in social and business groups, and other similar entities, there are three kinds of people who are show up as busy and active – the PBR’s of group activities.  Each is vastly different but each has a strong influence on the group achieving success.

What’s PBR?  Planner…Buyer…Results Getter are the informal titles I use for these folks.

I can recall a project by a committee of volunteers several years ago - shortly after inception we each received a bound stack of legal-size paper about a ½ inch thick – what an impressive surprise!  Without input, one of the committee members had developed a detailed project plan to meet the project goal of increasing participation in the organizations activities.  The architect was dogged in pursuing updates to this plan and many, many hours of meeting time were spent on updates and reviews of the plan.  In the end, the committee may have had a minor effect on increasing participation but the project had morphed into maintenance of the Plan as the goal of action, instead of a tool for action to increase participation.

The Planner:  This person is usually quite organized, imposes order and structure to every situation, develops detailed documents for deadlines, dependencies, materials, and other resources – typically in minute detail.  As the project transactions grow, this information is useful as a tool to guide the progress of the project to a timely and complete conclusion.  However it is a tool not an end in itself.  The Planner tends to be so invested in process that the individual loses sight of the actual work to be done.

In the early days of the new technology explosion (early 2000’s) when my organization was going through the next upgrade of networks and internal systems to connect all locations, we were supported by an excellent network design and support firm.  When a problem developed, one tech would run a variety of diagnostics and poke around in the various computers and servers for a while and then go on-line for some research.  The eventual outcome was his recommendation to replace a piece of equipment or purchase some new equipment to solve the problem.  Acting on the recommendation we would often get up and running again for a while only to have a related problem develop.  {Would this individual keep buying new computers to correct the fixed format problems when revising written document which have hard returns after each line of text…just like the Selectric the typist used to have?}

The Buyer:  This person is quite knowledgeable about technology, equipment, software, and other aspects of business process tools that are evaluated and purchased.  In a project when the need arises, this individual is indispensable for collecting detailed information such as specs, capabilities, scalability factors, related resource requirement, and delivery timeframes.  This is put up in multiple spreadsheets and a presentation results with recommendation(s) and a purchase decision.  The Buyer is done with the project once the purchase decision has been made, but may return to check off the packing list at delivery time.  Cheerfully humming the tune “no one has been fired for buying IBM”, in their mind the project is done when the BUY decision is made.


Think for a moment about those projects you worked on or know about that were wonderfully successful.  I can picture my favorite project leader who immediately goes to what outcome is needed for a successful project and worked backwards to structure an approach to get there.  The emphasis is laser beam focused on outcome and how to achieve it on-time and in budget.  The measure of progress is based on what’s now in place that accomplishes the outcome.  The tools and aids to move the project forward are useful and necessary, but are not part of what is measured – outcome is measured and it is the target for all activity.  It is downright impressive when this person sings the single note song of results, results, results.  It reminds me of playing golf – you know the desired result and each stroke must advance you toward that result, even if behind a tree or in the weeds; you overcome the obstacle and advance. 

The Results Getter:  This person is focused on outcome and results, but is skillful in using project tools and aids (often written on the back on an envelope or napkin) to move the project forward toward the outcome.  The individual expects an update to begin with the achieved results, not a catalog of process steps working toward them.  He or she will do everything possible to obtain needed resources to complete aspects of the project, but will expect results in return.  No worries about micromanaging here – create top quality and timely results the best way you can, typically by drawing on the detailed knowledge of the doer to be creative and innovative in how it is done.  The Results Getter is there at the conclusion of the project congratulating the team for their excellent work.

People have different perceptions of what a project is and what is expected of them.  As a leader, we must be clear about the outcome expected from a project and match the results with this goal to monitor and evaluate it.  All too often we receive updates that catalog process rather than progress, in part to document activity justifying the worker’s continued employment.  If these are the ‘results’ offered, we have not been clear in what the expected project outcome is and must articulate the project vision and outcome differently until real results are achieved.

Have you worked with these three before?  Which one are you?

Our next two Sales Lab Leadership events are The New Management Is Leadership, July 20th http://newmanagement.eventbrite.com  and
What is Web 2.0 And Why Should You Care? July 21st http://what-is-web2.eventbrite.com

Build…Borrow…Buy… An Optimal Growth Strategy

Mother Nature gives us the cobalt blue skies with white fluffy clouds to enjoy.  She also provides the variety of the four seasons and the consistency of their renewal cycle.  However, Mother Nature hates a vacuum and will seek to fill any occurrence.  In addition, she is constantly in motion – blowing wind, rotating earth, flowing rivers,  orbiting sub-particles in the atom – everything is in motion at all times.

In business, these same natural laws also apply, although observing them in action may not be as simple as with the wind and rivers.  Once established a business is always in a cycle of motion – it grows; it contracts; it replicates; it splits…it does pretty much anything but stand still.  Business can’t be motionless – except just prior to launch and as a placeholder in the history of failed organizations.

A popular axiom is a business must always grow.  In recent times, growth has been hard to achieve.  Leaders who have been successful in growing their organizations have had to navigate world competition, a world labor market for knowledge and administrative workers, changing market demands and a contracting domestic & world economy.  Whew!  What a collection of factors to juggle while trying to successfully lead an organization.

Let’s assume away all the things that can not be changed or influenced in a definitive way by an individual or single organization – this is most of the list in the preceding paragraph.  These factors can not be ignored of course, but the leader can not plan them away either – they are dynamic constants but are external to any plan – so we will assume they are not in play for this discussion.

How does an organization grow?  Traditionally, growth was by adding new employees and resources when needed, or in advance when positioning to get ahead of the curve.  This requires capital investment and committing to increased labor costs – affecting flexibility of the organization when agility is needed.  During expansionary times, the firm ‘grows into’ meeting the additional production needs.  Thus, the organization was building to create growth.

When I opened a new regional office, this was the way we developed additional capacity – building it by hiring and training new employees and transferring experienced staff to the office, and purchasing capital equipment to outfit the facility.  We launched the office and very quickly came up to full production.

As times changed, growth looked more like an accordion – the economy expands; the markets contract; new hiring; rounds of layoffs.  So leaders would borrow people and resources when needed through strategic alliances, joint ventures and use of contract employees and leased equipment. In volatile times this approach provides the flexibility to expand quickly when appropriate and contract quickly when circumstances change.  This flexibility through borrowing people and equipment does carry an extra cost – in most cases, the unit cost to ‘borrow’ is greater than the unit cost to ‘building’ - BUT…when flexing up and down the combined cost of alliances, contract labor and leased equipment will be less expensive overall than the carrying costs of under-productive employees and capital assets during a downturn.

My approach to launching a new service line included leasing experienced talent and using an external contractor with the required equipment and trained technical staff.  Doing so permitted immediate entry into a new market and mitigated the financial impact of substantial investment before expanded cash flow.  As the volume grew, we developed our own creative staff and obtained the technical equipment and hired technical staff with a comparable reduction of ‘borrowed’ staff and equipment.

The third leg of this stool is to buy growth through merger and acquisition.  There are many sound examples acquisitions and business combinations that have created an entity which is greater then the sum of its individual parts. The key to successful M&A activity is a vision, which clearly conveys how the combined organization will have superior results compared to the independent organizations operating in a loose confederation of equals, AND detailed comprehensive due diligence.  In practice, the implementation plan (who does what on the first day of the New Organization and the transition thereafter) is a critical element for the success in operating it.

Mergers and acquisitions are costly ventures – legal, management and staff time to document the existing organizations and to create the new one; focusing only on short-term activities which enhance immediate returns; the unknowns & uncertainties during the planning reduces productivity and cause key staff to investigate other employment opportunities.  That said, a well conceived and executed merger can leap-frog the organizations ahead by as much as a decade what they could accomplish pursuing only a ‘build’ approach.

As a key staff member in a merger, I experienced first-hand the intricacies of the preparatory stage, merger plan development, and the elaborate due diligence process.  This is an exhaustive and all-encompassing activity, during which we gained incredible knowledge of both our organization as well as the other organization.  With this information at hand, the detailed planning for a combined entity was far more comprehensive and innovative than merely combining the accounting & HR departments and acquiring some additional clients.  The experience gave me a keen understanding of the place for mergers in organizational growth.

So, how does this affect today’s leaders?  Successful organizations must retain flexibility and agility to meet the challenges of doing business in the existing world economy and world markets (we can no longer focus solely on the domestic market).  Leaders will judiciously use a combination of each of the three elements of growth … build – borrow – buy … to optimize  the size and capacity of the organization to meet the market demands and satisfy client needs.  Tending to the core products and services (always with an eye to improvement & production efficiency) is a given, but seeking to identify new or different client needs and develop effective ways to meet them should always be on the radar screen.  This final element of what is needed is really a primary focus of the successful leader, trusting the managerial staff for delivery of the core products and services.  And one of the more important tools at hand is what combination of the B-B-B will yield superior results satisfying the evolving needs of current and future clients and customers.   What a great time to be in the leader’s seat!

Do you agree?  What’s been your experience with managing growth in these economic times?

Hull-Speed – What If More Canvas Won’t Make It Go Faster

Hull speed is, from the viewpoint of design considerations, how fast a boat can move through the water.  There are all kinds of complex explanations and really neat formulas about why there are limits and how fast a hull can travel, but in simple terms the boat makes a hole in the water (displaces water) and when under way it pushes the water out of the way in the front (creating a bow wave) and it fills that hole when the boat passes (creating a stern wave).  The maximum hull speed is reached when the bow and stern waves coincide – and at that point the boat will not go any faster, no matter how much more sail or power you add – it just cannot go faster unless the boat is modified.

Think about a tugboat for a second – this squatty small boat has two huge engines – up to 1,000 horsepower each and do a great job of pushing the freighters and oceanliners around.  So with all that raw power one might think that the tug could scoot across the water at breakneck speeds when not engaging the big boats.  Can’t happen – even with the throttles full open.  Same is true of the tall ships – with their miles of canvas above deck – adding more will not get it to travel beyond its hull speed.

If more speed is your goal, the design can be modified to increase the hull speed – but at some cost…trade-offs of capacity, functionality, range and stability.  Some of the design methods to wring out more speed are to lighten the boat so it displaces less water, or to change the amount of hull that is in the water (catamaran or hydrofoil).  So, more speed is bought by less cargo capacity or maneuverability or stability in rough seas.

How does this apply to leadership of an organization?  It seems apparent to me that, after the organization has fine-tuned its processes and captured efficiencies, it has hit the equivalent of maximum hull speed.  Adding more canvas will have virtually no effect:
·    Sales are down – sales force is told to work harder…do more of the same things
·    Production capacity is at 100% - production is told to make more…using the same processes & equipment
·    Hard times> expense & staff cuts – everyone is told to hold to the original throughput – applying pretty much the same methods & controls
Typically most members of the organization will try to ‘push harder’ to meet the new reality until fatigue and frustration bleed away their energy.  Quite often there may even be an unsustainable short-term spike in results – but it is short-lived.

Whoa – is doom & gloom the only thing to look forward to???  Of course not!!!

As in the boat analogy, there are a number of things that can be done to improve things – leadership is recognizing what will have the desired effect to meet commitments with existing resources.  Some ideas:
·    Eliminate deadwood processes & procedures which do not directly add value – such as that report which is produced and ignored…if there is one or two key items of value, generate those and scrap the wrapper (i.e., all the rest of the report)
·    You may not be able to increase the capacity and output of existing equipment, but training for efficient use of the equipment will make a difference (I am still finding old documents files with hard returns after each line – just like the Selectric days)
·    Introducing a weekly status meeting – same time, short and mandatory – among and between related teams will increase accountability and collaboration…AND RESULTS
·    Applying the simplicity principle (KISS) wherever possible to whatever possible
·    Innovation comes from the ‘doers’ – seek their input
·    Use focused training – for specific results – to better prepare for accomplishing new responsibilities; mentoring is a great way to shorten the ramp-up period and get superior results
·    Do NOT expect technology to yield significant productivity gains, but do keep computers and similar equipment reasonably current and uniform (I still recall when my organization had 5 different versions of WordPerfect and 4 versions of Word on 3 generations of computers – compatibility was a pipedream and conversion was a nightmare).

To wrap up – let me return to hull speed for one more time – before making major design modifications and suffering the trade-offs of speed for functionality, why not scrape the barnacles from the hull (the list above)… this may give you that extra boost and make traveling toward your goals faster and a more pleasant trip.

Where have you seen this happen?

If this subject interests you, our next free event is "Harnessing Disruptive Innovation", in Rockville MD, June 22! Sign up at http://innovative-disruption.eventbrite.com