Archive for June, 2011

Smooth or Deep?

Monday, June 27, 2011 by:David Zahn
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While perusing the Sunday New York Times, an article jumped out at me for a quote it contained (and apparently, I was not the only one as a daily blog that tracks the grocery industry also thought it was noteworthy).  The quote was made by John Rowe, CEO of Exelon, a Chicago-based electric utility company):

“I know too many people who think that smooth is a substitute for deep.”

That thought is worth assessing as it relates to how businesses decide what to reward, what  it values, and what it encourages.  Are employees to be judged on the surface appearance of efforts or on the more complex ability to deliver results?  In the world of the boardroom Powerpoint presentations that incorporate all of the glitz and glamour that the technology can provide, are managers and executives willing to ask:

  1. How will the objective be achieved?
  2. What metrics or evaluative criteria will be used to judge success?
  3. Who is/will be responsible for managing?
  4. What resources will be needed?
  5. What potential dangers exist that may prevent success?

Or, will the presentation be judged on how well it is delivered, how creatively it is developed, and on the “edutainment” aspects (the education and entertainment value it offers to executives stifling yawns and grabbing a second doughnut during the presentations)?

Leadership

 He explains that his view of his own leadership style includes: 

  1. Giving specific and detailed direction vs. ambiguous goals.
  2. Action is everything.  Rowe believes that remaining still is a strategic mistake.  His feeling is that, “it is better to be a moving turkey than a sitting duck.”
  3. Not being impatient to wait for the perfect (and nonexistent) level of information before making a decision.

Interviewing

Rowe believes that when it comes to selecting employees to join his company that the concept of responsibility is of paramount importance.  He suggests that employees think of their role in the same terms as the character, Ishmael in the Gregory Peck movie, Moby Dick.  When asked if he is “man enough to pitch a harpoon down a live whale’s throat and jump after it (a workplace situation that few of us ever confront in our office environments no matter how many ‘sharks’ we work with),” Rowe believes that Ishmael’s response represents the perfect reply that he wants to hear from his employees as well:

 ‘Well, I am, sir, if it be absolutely indispensable that I do so.’”

Do your values represent what you seek in employees?

In Rowe’s estimation, the ability to take responsibility for one’s actions (and results) is what differentiates an employee worth keeping from one that is not as valuable.  The employee who does not feel good about doing a less than optimal job is not one worth holding onto, according to Rowe.

So, when thinking about your company – what is it you value?  What would be the “what counts factors” that you would use to assess the appropriateness of an applicant?  How important is the sheepskin from the major university versus practical experience?   Are you unknowingly communicating the wrong values to your employees (and to think that employees don’t listen, watch, observe, and mimic the senior executives is to be unaware of the power that modeling behaviors have)?

Smooth or deep – take your pick.

Going with the Flow

Tuesday, June 21, 2011 by:David Zahn
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The nature of the business owner and a source of pride for them is that they are relentless in their desire to see the weaknesses in current products and services available in the market (including their own products and services) and exploit an advantage they believe their offering can provide.  In order to maximize the identification of the weaknesses and opportunities in current choices available to prospects and customers, it lends itself to thinking in terms of problems, failures, and negative outcomes.  Once identified, the thinking would be to modify or change some component, process, ingredient, or factor within the product, service, delivery mechanism, etc. to provide an improved offering. This conventional approach to building a business has proven successful for the duration of commercial transactions, but is not the only method to achieving success.

Positive Psychology

There is a relatively new stream of psychological thought called, “Positive Psychology.”  For most people, they traditionally think of the application of psychology as the response to mental illness, emotional distress, depression, or people suffering from some deficit in their life that has prevented them from being all they can be and accomplish.  Just like the business owner seeks to take a negative and turn it into a positive, the assumption that many people have is that psychology is best applied to situations and people who are struggling, weak, or suffering. 

However, the field of Positive Psychology chooses to look at building on positives and leveraging current strengths.  Sometimes referred to as the study of happiness, the concept of “Flow” emanates from the recognition that people can become so fully immersed in one’s work that they experience:

  1. intense concentration
  2. loss of self-awareness
  3. Challenged (neither bored nor overwhelmed).

The suggestions are not to solely focus on addressing the areas that are not currently at expectation, but rather builds on strengths, interests, and passions.  One of the founders of this branch of psychology, Mihaly Czikszentmihalyi has identified nine elements of “Flow:”

  1. There are clear goals every step of the way,
  2. There is immediate feedback to one’s action,
  3. There is a balance between challenges and skills,
  4. Action and awareness are merged
  5. Distractions are excluded from consciousness,
  6. There is no worry of failure,
  7. Self-consciousness disappears,
  8. The sense of time becomes distorted,
  9. The activity becomes “autotelic” (an end in itself, done for its own sake).

How to Integrate it in Business

By looking at common business tactics differently and through a lens of positive actions, it can be influential in changing how decisions are reached.  For instance -

  • Meetings – rather than beginning with meetings with the introduction of some crisis, failure, or competitive encroachment; begin meetings with a review of successes and what made them successes. Acknowledging efforts, recognizing achievements, and sharing effective responses in an effort to improve future performance has been shown to be successful.
  • Performance Appraisals – commonly, the performance appraisal process focuses on providing a score or grading on various competencies and discussions around areas of improvement.  A positive psychology approach would look at strengths and interests of the employee and try to align tasks with skills and abilities that are challenging and in synch so that the employee can thrive and be productive at the highest levels of their potential.
  • Selection – rather than strictly reviewing a resume for highlights of job skills, a positive psychology approach would also incorporate looking for emotional strengths (sense of purpose, optimism, and emotional health) as those characteristics may have equal or higher indications of future success.

Businesses can be helped by looking at happiness factors at work

The Payoff

There have been studies by everyone from Abraham Maslow through Martin Seligman, to many others who have research that indicates that happpiness does have a positive impact on revenue, profitability, customer service, staff tenure, reducing accidents at work, etc.  And no matter what approach taken – be it looking at weaknesses to improve, or strengths to leverage; isn’t the bottomline something every business person can agree upon?

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LeBron Lessons

Monday, June 13, 2011 by:David Zahn
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The NBA Finals have now concluded and the water cooler conversations offering post-mortems have begun.  The Miami Heat had acquired LeBron James during the off-season and then added Chris Bosh as well to their long-tenured star – Dwayne Wade and there were those that were prepared to call off the season before it even began and just annoint the Heat as the winners of the Championship.  As we now know – it did not quite happen as planned.

The Dallas Mavericks, a skilled and highly respected team in fact managed to win the championship in a series of closely contested games that came down to players needing to perform at their best as the minutes dwindled down to the last few precious moments.  While the pundits on the sports pages will dissect; strategy, game decisions, personal contributions and accountabilities, there are important business lessons that can be learned by examining how the two teams approached the season and the playoffs.

Leadership

LeBron James, for better or worse, is recognized as “the best” player in the NBA by many fans.  While it is not unanimous, even those that do not see him as the best, would not quibble with his name being mentioned in the conversation.  As an elite player, and one brought onto the team to form a triumvirate of superstars, he was expected to lead the team to a championship. Anything less than that would be a failure.  Unfortunately, for the Heat, that did not happen.  Similarly, in business there are high profile, elite executives who are brought into companies with the expectations that they will change the prospects of the business for the better.  General Electric has become a developmental ground for senior executives – not always with the best of results.  Robert Nardelli  famously flamed out at Home Depot – even though he had been seen as a successor to Jack Welch by some at GE.  Larry Johnston, of Albertson’s fame was also a GE alum.  Both of these highly regarded executives were unable to take their success at one company and apply it with another.

Lebron James and Dwayne Wade trying to figure out what happened to their chance at a championship.

On the other hand, Dallas has one superstar (Dirk Nowitzki) and sourrounded him with highly competent players who all were willing to contribute to the team’s success.  In this instance, the lesser-skilled players were able to defeat the higher-skilled players because they all played a contributory role and did not compete with each other to be the “star.”   One researcher refers to the ability to create this “oneness” or focus to an outcome as “Flow.”  By becoming so dedicated and immersed in the task at hand and losing one’s own sense of self, the outcome takes on an increased importance

 It brings to the fore – how well does your business integrate the role players within your organization?  How successfully do the “elite members” of management cooperate with each other to improve the team/business result over their own personal contributions?

Clutch Play

This series also pointed out the importance of performing at the most critical or “clutch” moments.  LeBron James was widely criticized for not performing as well in the 4th quarter as he had in the first three quarters of each game.  The time when the game was being decided was when the “best” player came up ineffectual.  In business, we can argue as to what the analogy is to the clock in the game (is it the customer service interacting with existing customers looking to overcome an issue? The sales team or retail store employees having to explain the benefits of a product to a customer?  The quality control folks who ensure that products are safe?  etc.).  Regardless of which (or all) that are used as the example – when the requirement for performance is at the highest – do your employees “become invisible” or do they “step up and meet the challenge?”

Using sports as an analogy for business is trite, overused, and often feels forced to make a point.  However, in this example, the relevancy is so apparent that to not acknowledge it would be an injustice.  The Heat are comprised of the “better players.”  However, the game is won or lost on the efforts of the “team.”  Without question, the Mavericks were and are the better team and proved it over the course of a best of seven series.  How would your business fare if viewed in a similar light?

Driving Market Share

Tuesday, June 7, 2011 by:David Zahn
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When marketers look at how to drive business or volume to their business, they often look at two different paths.  The first is to get someone to switch their purchases  from a competitor.  The second is to create a new customer or consumer.  When one looks at how those two intersect, you create four different scenarios: 

  1. The shopper or customer does not buy a product nor shop with the business for any of their needs.
  2. The shopper does not buy the product, but does purchase other items currently with the business.
  3. The shopper buys the product, but does not currently make any purchases with the business (they do all of their shopping with a competitor)
  4. The shopper buys the product and they also shop with the business (though they may not buy ALL of their purchases of the product with the business).

Neither Product Purchase Nor Shopping with Business

In this scenario, the prospective shopper does not buy the product and does not make any purchases with the business.  So, in this scenario, there has to be justification provided to get the shopper to change two habits.  One, give the shopper a reason to switch where they do their shoppping and start shopping with the business (which entails understanding why the shopper is NOT shopping with the business.  Is it because the business is not located where the shopper prefers to shop?  Is it due to a previous bad experience?  Or other reasons).  The other requirement is to provide a rationale for purchasing the product.  No matter how convenient the store may be, and regardless of the price, assortment, or attractiveness of displays within a store, if the store is selling pet foods, toys, cages, or other pet items – those without pets will not be inclined to shop with the store.  The likelihood of winning them over to shop at that store and to make specific purchases are limited.

Shop at the business, not the Product

In the scenario where someone does walk into a specialty retailer and occasionally buys something or does make purchases with a business; but doesn’t purchase a specific product, the situation is a little different.  The office supply stores may sell copy paper to many customers, but that does not mean that the same person is a viable customer for the other products in the store.  So, for example, the person may not buy thumb tacks, rubber bands, or calculators at the store.  Is the lack of a purchase because the shopper does not KNOW the products are available there (and if they did know that, they might purchase it?).  Do they not know how to use certain products and so they don’t even know that they COULD use the product (if someone explained how to use a label-maker, the customer might buy it – but they are not even aware that such a product exists or how to use one)?  Is the person aware of the other products, but purposely has not make a purchase out of a lack of need or interest (I know they sell pens, but I don’t have a need to buy pens at any store, I get all I can use from my employer)?

The ability to get that shopper to shop for more of their potential needs with the business requires more insight to identify whether or not they have the need or interest in the products that are available, but not currently purchased.  It may be a matter of better promotion, advertising, merchandising or customer education that is required.

Buys item, but buys Elsewhere

In the event that the customer or shopper DOES buy the item, but chooses to buy it elsewhere – the focus has to be on identifying why the customer chooses to buy an item at a competitor:

  • is it due to assortment options?
  • is it due to pricing?
  • is it due to the way it is merchandised?
  • Other reasons?

This situation is most disturbing to the business in that the shopper may shop the store for other needs, but chooses to leave the store to make a purchase of a specific product because the sense is that the competition has something better to offer.

Shops with business and buys Product with Business

In this scenario, the business gains from both securing the shopper as theirs (versus losing them to a competitor), AND they gain the benefit of getting the sale of a product that is not going to the competition.  The potential “total share” of purchases though may be split across numerous providers.  Think about how many different places we each frequent to make a beverage purchase.  Some of the purchases occur in a restaurant.  Others, at a drive-through.  Still others at a convenience store.  For some of us, we buy some of our beverages in a grocery store.  And still other purchases happen in drugstore or other retailer.  While we are customers of ALL of those outlets, no one of them has us as a particularly loyal customer where we make all of our purchases.  Instead, we share our purchases across all of them.  Imagine how much more profitable we would be to any of them if we made our beverage purchases with just one of them.

When looking at creating market share, the factors of creating a new customer versus just “stealing” some other competitor’s customers is going to create very different strategies.  The best managed businesses work on both fronts – giving reasons to create switching behaviors, but also expanding the universe of customers by developing new shoppers who may not have known they could use a product, or need explanation as to how to use a product to improve their lives in one way or another.

Some experts say it is better to create new customers than to steal from competition.

Don’t be Tone Deaf

Wednesday, June 1, 2011 by:David Zahn
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There is no doubt that with the advent of social networking sites, blogging, e-mail, and the ease and speed with which companies and executives can communicate with customers, suppliers, and employees the chances for stubbing one’s toe by making a communication mistake increases tremendously.  Making this even more precarious is the politically correct environment that many businesses find themselves in currently.  It may seem to some that there are people or groups that are just looking for things to be offended about or to protest.  Unfortunately, those same people have access to the same communication channels, internet, and email.  Offend them, and it is quickly publicized on electronic bulletin boards, blogs, podcasts, posts, or other communication vehicles.

Tone Deaf Examples

Just recently, the following examples occured to point out how a company or individual may think is witty or funny can be perceived very differently by prospective customers or those that disagree. What some see as compelling can be seen as offensive or so inappropriate to be considered to be tone deaf to the general sentiment of others.

Be careful not to offend the sensibilities of customers and prospects.

Consultant example – a recent email landed in my email box (I will blind the person’s name who sent it so as not to bring further shame) that had the following “prompt” to join a webinar panel discussion being held by this consultant:  “This event is like having Arnold Schwarzenegger as your personal trainer – for your mind!” Now, given the most recent news about the former Governor’s infidelities and general diminishment of his status as a respected figure – is that really the example one should choose to induce a prospect to join the call?  The intended point was to link the once popular bodybuilder and his dedication to lifting weights and fitness with the idea of working hard on one’s business to see results.  But, isn’t it a bit jarring to invite people to an event by affiliating it in some way with the disgraced adulterer?

Second example – Cadbury was called to task by Naomi Campbell (herself not exactly one who should be throwing stones, or cell telephones for that matter) because a recent advertisement of theirsthat ran in the UK mentioned her by name and referred to a chocolate product as being a bigger diva than she.  Ms. Campbell’s ire was stoked not by the reference to being a diva – but because it was a chocolate product and therefore was racially offensive.  In response, Cadbury has pulled the ad and has no plans to re-run it.

Third example – a soda company in Connecticut known for creating quirky flavors of product and doing aggressive local marketing to drive distribution of their products in small convenience stores, delis, or other places where beverages may be purchased on impulse developed a product to take advantage of the stealth action taken against Osama bin Laden.  Their product apparently was meant to be celebratory and to have a little fun – but not all saw it as such.  A product that is meant to resemble the color of blood and to have a photo of Osama bin Laden on it may make some giddy and curious about the product – but it also runs the risk of offending many.

On Purpose?

There are marketers that believe that getting people to talk about a product is always good and that stirring up controversy is a sure way to generate “buzz” or at least get people to talk about the company, product, and marketing campaign.  For other companies, the risk is far too great and while there seems to be no end to what someone somewhere will find offensive, a little common-sense can often anticipate the majority of objections and find a way to steer clear of willfully creating outrage and generating il will.