Tag Archives: Customer

How Do You Bring Different Teams Together? Seven Points

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Situation: There are many opportunities to team with other companies, whether through partnerships, joint ventures or M&A. This is accompanied by the challenge of bringing together different teams to succeed in new roles and tasks. How do you bring different teams together?

Advice of the CEOs:

  • People are an investment. Just like the stock market is not up every day, neither will be the performance of your people. Bringing people into new relationships, roles and responsibilities takes patience, work and nurturing to build skills and to get the best out of people.
  • To optimize this, build an organizational chart of the new or revised organization that you will build. Fill in the spaces with the individual who currently holds responsibility for each role. This means that some people will have several different roles. This is OK. As you add additional people, they will fill many of these roles.
  • Build a set of company or project values to guide individuals through the decisions that will drive future growth. Involve the full team in this exercise so that ownership of the resulting chart is broad.
  • Develop and consistently express the roles and boundaries of the company or project.
  • Focus on systems and processes, not just on tasks. The core of any organization is people and relationships. These are best expressed through systems and processes, not tasks. Tasks express discrete roles. As sophisticated as these may be, they won’t encompass the richness or complexity of the systems, processes or the people involved.
  • When dealing with people always ask “What is my role?” and “What is their role?” In each situation, work to understand the other’s perspective and what opportunity or concern they are bringing to the table. Trying to transform an individual into someone that they are not doesn’t work.
  • Particularly in a company or venture that focuses on high levels of customer service, act urgently, but avoid emergencies. You want your response to customer needs to be swift, but you don’t want to destroy operational rhythm.

Thanks to Jennifer Choate for her contribution to this discussion.

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How do you Boost Value in a Commodity Market? Five Suggestions

Situation:  As a result of the technology revolution, products in established markets have become commoditized. For example, advances in medical technology has driven down price while increasing incidence and prevalence of diabetes has driven up demand. How do you boost value in a commodity market?

Advice:

  • Taking a broader view of the market is critical. Analyze the entire customer experience, not just your segment of the market. Assess markets and industries surrounding your primary offering and look for un-served opportunities and gaps. Where you find opportunity, elevate your offering to the next level by integrating your product as component. Create a compelling advantage but avoid unnecessary adaptation of your existing product or service. Can your technology become part of a broader service offering, or even part of a personalized solution? Are there opportunities to move higher up in the value chain?
  • Begin your transformation at the first signs of commoditization. Being first brings a huge advantage.
  • Once you identify an unmet need, consider working with related industry groups to create new standards addressing these gaps. Implementing the resulting standards will give you a new competitive advantage against your competitors.
  • Find other applications for your product or service. Consider new applications for the components used in your current offering. Find new customers outside of your historic customer base. Consider alliances with other companies experienced with the new opportunities you find.
  • Within your own organization begin a process that routinely analyzes the customer experience and general needs beyond your current offering. Working with an outside consultant can help by adding a new perspective.

Thanks to Dirk Boecker for his contribution to this discussion.

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How do you Research the Brutal Facts of a Business? Seven Options

Situation: A company wants to enter a new market, but does not know much about it. Jim Collins advises understanding the brutal facts of any business as an essential part of strategy. How do you research the brutal facts of a business or market?

Advice from the CEOs:

  • Determine the key players in the market, and closely observe them – their mistakes and successes. Identify and interview clients and look for gaps in products and services offered. Use this research to develop a differential advantage for your product or service.
  • Use allied resources. As an example, for a general contractor this includes real estate professionals and other allied professionals who know the marketplace and the performance and reputations of other contractors.
  • Business consulting firms conduct surveys of markets. Look for and purchase published surveys. If you participate in their surveys you can get the results at a reduced cost.
  • Trade magazines and business journals like the San Jose/Silicon Valley Business Journal publish surveys of the “Top 25” local businesses by industry. These help to assess local competition and gather information about revenues, principals, etc.
  • Leverage industry associations. Attend conventions and learn the lay of the land from the attending sales people.
  • Leverage Internet resources: Hoovers.com, Dunn & Bradstreet, HarrisInfo.com.
  • Have your best sales reps talk to customers in the new market about their needs and desires, and their current suppliers. Ask them to gather information and present to marketing and sales competitive reviews of the market based on what they learn.

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How Do You Differentiate Your Offering? Five Critical Steps

Situation:  A company has had success with a few large clients but wants to expand their customer base for long-term growth. The challenge is that their offering competes in what is commonly regarded as a commodity market. How do they avoid being perceived as a commodity? How do you differentiate your offering?

Advice of the CEOs:

  • One company created differentiation by getting to know everyone in the business. They built long-term relationships, based on reputation and trust. They took the time to understand the needs of customers that they wanted to develop. As opportunities arose, they built relationships and asked questions to clearly define and align with client needs. While this takes time and patience, the objective is to be able to say “We know your business” – with credibility. Here are the steps that they took:
  • Study the businesses, sector, and customers that you wish to serve.
  • Leverage your success with large customers. Talk about how you helped subunits within these large customers. This makes a big customer seem more like a collection of small customers similar to your prospects and makes your experience relevant.
  • Let prospective customers know that you are hungry and will go the extra mile for their business.
  • Learn who currently serves your prospective clientele. Study these competitors, their strengths and weaknesses. Talk to their customers – learn what they love about competitors’ service, and what they would like to see changed. Find the holes in what others provide and fill these holes with a better offer.
  • Look for and encourage repeat business and references to new business.

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How Do You Create a Client-Centered Company? Four Guidelines

Situation: A CEO wants to make her company more client-centered. How have others achieved this objective and what are the most important considerations? How do you create a client-centered company?

Advice from the CEOs:

  • One CEO transformed his company into a client-centered organization based on conversations with customers. The new structure is based on client-market groups. The core of each group is cross-trained professionals who focus on client needs. These groups are supplemented with a cross-trained support staff who can shift between projects depending on market conditions.
  • Organizational structure must start from and support a strategic vision. The vision must be informed by the realities of your market and the products/services that you offer. Once you have determined strategy and analyzed customer markets, develop a structure that allows the company to adapt to market changes. Structure follows strategy and market.
  • Closely monitor the following: Flexibility within the structure. You want most of your staff to be flexible, so that you can move them among projects as market conditions change. Cross-training is critical. You need strong leaders who can develop market segments. Create objectives and accountability that will tell you how the market segments are operating and whether staff are meeting cross-training objectives.
  • As you implement a new structure be aware that any change is met with insecurity. Coach your managers to communicate with their teams. It is essential to assure employees that they are valued, that any change will be gradual, and that you will provide them with the appropriate training and incentives that they need to succeed.

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What are Effective Metrics for a Service Company? Seven Suggestions

Situation: The CEO of a service company finds it challenging to measure project profitability and client satisfaction. What measures and metrics have other service companies found to be most useful? What are effective metrics for a service company?
Advice from the CEOs:
• For billable services one CEO measures utilization percent defined as (hours available for service delivery)÷(billable hours). Include in the denominator both billable hours and customer good-will or preventative maintenance hours. The latter, while not producing current income, are an investment in future income. Set up audits for service needs, especially future needs, when working with customers. This will help you to stay abreast of changes in the service environment and to plan accordingly.
• For fixed budget projects – another CEO measures budgeted vs. actual expenditures by project.
• For fixed-fee services a third CEO calculates a fraction expressed as: (income per customer company) ÷ (cost in hours for that customer).
• In a discussion on customer audits and surveys, options offered included: (1) An exit “pizza party” with the client. The challenge is that this may produce tainted results. While this builds customer good-will and may provide qualitative feedback, it should be supplemented by more objective measures. (2) A mailed survey – from a 3rd party with a prize for responding. (3) Email follow-up from a 3rd party that directs the customer to the 3rd party site to complete the survey.
• A final suggestion was ambassadorial CEO visits to the top contact person in key accounts. This provides an opportunity to learn about the customer’s present and future needs, staffing plans, business and strategic direction. Helps to anticipate changes in the competitive landscape. The more a business relies on recurring revenue, the more important these visits are.

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What New Business Options Should You Pursue? Five Guidelines

Situation: The CEO of a company observes that the business climate has been uncertain, but she hopes that it will improve soon. This will open up new options for her company. As these start to develop how do you decide what to do and what not to do? What new business options should you pursue?
Advice from the CEOs:
• Talk to your customers. What do they value about your current product or service and what is less valuable? Build on opportunities that customers value. What options are most consistent with the company’s strength and focus?
• Consider a customer survey – either online like Survey Monkey or by telephone. If there isn’t in-house expertise to design and administer a survey, look for knowledgeable outside resources. Assure that the survey questions will drive understanding of the company’s focus and potential.
• Get an expert to review the survey and administration plan. Before launching the survey to your full customer base, test it with a select group of customers. This will tell you whether it will produce usable information. If it doesn’t, revise the survey.
• Which opportunities will build sustainable recurring revenue vs. opportunistic or one-time revenue? Recurring revenue can be lower margin if the income stream is sustainable. Balance efficiency and utilization. For example, fixed fee service contracts that renew consistently.
• Judge opportunities against your “Hedgehog” as defined by Jim Collins in his book Good to Great: What you are passionate about? What you can be best at in your marketplace? What you can measure by a single economic ratio?

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How Do You Purchase a Company as a Non-Owner President? Four Points

Situation: The President of a company has a long-standing relationship with the Chairman and Founder, who is also the principal owner of the company. The President joined the company at a time that the Chairman/Owner thought that he was terminally ill and needed an individual who could take over operations as well as leadership. Since then the owner has fully recovered and wants to retake control. The President would like to buy out the owner. How do you purchase a company as a non-owner President?
Advice from the CEOs:
• What role has the President played so far? The President has advised the Chairman on how to grow the company and is leading this growth through developing key customer relationships.
• What is the owner currently doing? The owner has fully stepped back into his prior role, and is micromanaging all aspects of the business, effectively shutting out the President.
• The best way to avoid a situation like this is to negotiate the full deal, including transition of authority and terms of transition of ownership, up front before the signing of an employment contract. Not having not done this, the President currently has no leverage.
• The best option at this point is to have a conversation with the owner and to see whether the owner is open to a transition of either power or ownership. If the owner is not interested, the President may want to consider other opportunities.

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How Do You Expand Your Market? Five Suggestions

Situation: A CEO’s company has historically been organized around a single company’s products and technologies, though their customer base uses multiple platforms. The company wants to expand from a single-technology emphasis to a broader technology base which will more accurately reflect its customer base. What can assist the company in building both its technology and customer base? How do you expand your market?
Advice from the CEOs:
• Conduct surveys among users and employees of the existing customer base. Use what is learned to design new approaches to expand both the company’s technology base and customer base.
• Expand into additional industries, products, and a more diverse company customer base.
• Determine to there is a genuine need for the company’s technology and services. If not, adjust both the technology and offering to better meet customer needs.
• Build a marketing campaign around differentiating factors that others do not provide. For example, in the cooperative banking industry market accounts that allow no-fee ATM access through other coop networks’ and banks’ ATM machines to expand customer convenience and appeal.
• Target niches. For example, small businesses or home businesses where the company’s lower fees make a difference and personal service is appreciated by the owner or someone who works closely with the owner.

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How Do You Optimize Your Product Offering? Four Points of Focus

Situation: A CEO wants to take better advantage of his company’s product offering. There are many opportunities available, but the company needs more focus on optimizing these opportunities. How do you optimize your product offering?

Advice from the CEOs:

  • Brand – Where has the company been? Where is it going? The world is constantly changing – what’s the company’s new brand? The brand identifies the company and both your customers’ and business partners’ identification of the company and its products and/or services. In a changing world with increased competition and “noise,” having a strong handle on the brand and brand message is critical to remaining at the top of customers’ and partners’ awareness.
  • Education/Customer Advocacy – An underutilized source of marketing strength includes both customer education and customer advocacy. Customer education allows the company to better position its product and/or service to the customer and helps the customer better meet unrecognized needs. Customer advocacy positions the company along with its customers in an area of mutual interest and strengthens both bonds and loyalty.
  • Diversification & Channels – In a changing and rapidly diversifying world, being open to new opportunities and channels through which to reach the company’s stakeholders is a source of sustainable advantage.
  • Partnerships to Take Advantage of Diversification & Channel Opportunities – Partnerships are an underutilized resource to creatively diversify and open new channels to stakeholders. They require less investment than doing everything on your own and can form the basis for key alliances and strengths going forward.

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