Monthly Archives: April 2016

Are you getting the best results from your business?

 

Part of creating a successful business is to focus attention and effort on the areas that are going to bring the most reward.

There is a fundamental economic principal sometimes referred to as the law of diminishing returns where the first additional resources applied to a production process give far greater output results than those applied later.

One way to imagine this is to think of a seized wheel where the first few drops of oil enable the wheel to move. Adding more oil will improve the lubrication and the process, but those first few drops make a massive difference.

In business, it’s really easy to keep adding more oil to the process that is running. You’ve done it before and you know that it had a good or even a great effect. You don’t have to think too hard about it!

Fixing the thing that isn’t working, or starting a new project or process may well require you to put in greater initial effort but the return may well be much larger.

Applying this thinking to a sales & marketing context, perhaps you are well established in a market, with a particular type of customer. You understand their needs, you have a presentation and a product or service that has been successful in the past and you know how to win more business. There will come a point where doing more of the same will not have the same effect, and it will take more sales & marketing effort and expense to win new customers.

The alternative strategy might be to identify a new market, where you are not established and you don’t have the same level of knowledge. The initial resource required – especially from leadership – will be greater – but the returns may be even greater still. If you now have two markets where you are established, instead of one, you have a more robust and less risky business.

You can apply this thinking to many different aspects of the business. You don’t have to keep doing more of the same if the results don’t warrant it. Are you getting the best results for your efforts?

Cross Training to keep your business fit!

For me, cross training in a gym is a distant memory but I am sure some of my readers may still indulge. In a business sense, cross training is a great way to improve the business.

In a well-designed induction program a new team member may experience several different departments over a number of days or weeks. That allows them to start on the job with a wider understanding of how their work impacts upon the rest of the business.   It’s a really good way to bring someone into the team and make sure they have a decent understanding of how the business as a whole gets things done.

It’s not often that you see the same principles being applied to established team members, but it can be a great way of making sure that departments work together, rather than forming silos where information is retained within the department and competition with other departments rather than cooperation is the order of the day.

Tesco used to require the senior team (from directors down) to spend some time on the shop floor every year. I wonder if that no longer happens, and some of their problems can be related to the disconnection between the leaders of the business and its customers.

When you acquire a business you should have a plan to integrate the two businesses and a very powerful way to blend the cultures is to have an exchange of staff.

I’ve used cross training with the credit and collections teams, working with the sales team.  The credit team can be very dismissive of the sales team – I’m sure you have heard phrases like “Those lazy sales folk, they can’t even get the credit application form completed” but get the credit team into the meetings and they’ll realise (a) how much else is going on to secure the customer and (b) how clumsy the credit application form is.  In one case I remember the credit application form was reduced from 8 pages to 2.

Cross training really can keep (your business) fit

Who looks after your customers?

 

Some time ago I was collecting my wife from the station one evening.

It was cold and windy, and when I entered the station lobby it was no warmer than being outside as one of the doors was open.

I stood there for a few minutes, trying to see if her train had arrived, and then realized I was early and would have to wait – so I closed the door.

As soon as I did so, one of the security guards leaped up and propped it open again, telling me “We have to leave it open, there are no handles on the outside – if the door is closed no-one can get in”

Many of you will know that Reading station and the surrounding track have just undergone a £400m investment program – the whole station is practically new, as are the doors in question!

You can understand, I suppose, that the detail of a mechanism to allow passengers to enter when the doors are closed was overlooked in the initial plans, or even during the final construction. What is difficult to understand is that the station and these doors have been operational for several months without remedial work.

Passengers have not been seriously inconvenienced as the doors are always open, but on the evening I was there three ticket office staff and two security guards were suffering the cold weather coming through the open doors.

If the front-line staff are inconvenienced in this way, how are they likely to give their best service? Why hasn’t this been fixed? I am sure a handle could be fitted reasonably quickly!

Are the management not listening to their staff, or is there no communication system? Are the staff unwilling or unable to raise this issue?

In your business, if you want to give the best service, you need to get the best from your front-line staff – which means you need to take the best possible care of them. Are you doing that?

 

Perception is reality

In almost any walk of life, it does not matter what you think. What matters is what the observer perceives.

Gustave Flaubert said “There is no truth. There is only perception”

If you are in any doubt just ask any politician!

If your team think you are likely to react badly to certain types of news or information, they will hesitate to share it. You’ll be left in the dark, and perhaps get a nasty surprise when it is too late to do anything about it.

If your suppliers think you don’t value their efforts, they are less likely to help out when you need that order expedited.

If your customers think you don’t care about them – the reality is the perception – you don’t care – or at least not enough.

I’m reminded of the Robert Burns poem, To a Louse, part of which is

And would some Power give us the gift
To see ourselves as others see us!
It would from many a blunder free us

You can avoid a lot of problems by asking how am I/ we being perceived, through employee surveys and customer surveys.

You can gain even more insight from exit interviews with staff who are leaving, and from former customers who are now buying elsewhere.

Ask your suppliers how they rate you as a customer.

Just asking the questions is a really good start. People love to be asked for their opinion, and making the effort to give them the opportunity will be beneficial.

Structured questioning, where you aim to uncover opinion in particular areas will sometimes provide greater knowledge but always allow for free-format comments.

You may think your business is the best thing since sliced bread, but what you think does not matter.

All that matters is what others think.