Voice of the Business

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Some of the first questions that a business must answer are:

• Why do we exist?
• Who are our customers?
• What is our mission or purpose?
• What is our vision?

To understand the importance of the answers to these questions, we must first understand that different stakeholders in a business have different perspectives. The stockholders wish to get a return on their investment. Workers wish to get a good wage for their work. Managers and officers wish to meet the business performance metrics set forth by the owners (stockholders, etc). The community wishes to have a neighbor that provides jobs, pays taxes, supports the community, and has no negative environmental impact. These are just a few.

Understanding the answers to these questions from the stakeholders’ perspective helps to define problem areas within the business and its ambient environment. It allows the business to have clearer vision. In the final analysis though, there are two high level purposes of a business. In a capitalistic society, businesses exist to make money, to make a profit. Without this, the business would not exist. Secondly, when the business is profitable, it ideally gives back stability to the community in which it exists.

When a business correctly defines its problem areas, from the customer and business points of view, it is ready to take the next step to improve processes connected to the problem areas.

So what does process improvement mean to the business? It means lower cost, higher efficiency, and higher profits. These manifest themselves in higher customer satisfaction, improved market share, and larger margins. The tie between customer satisfaction and profitability is evident.

Similar metrics apply to organizations like non-profits. For them the metrics may be lower cost and higher efficiency. These may manifest themselves as lower dependence on outside funding and improved margins. The commonality between businesses and non-profits is that the focus is upon doing more with less, thus returning more margin to the stakeholders and more value to the customers.

These bottom-line metrics in a healthy business are in alignment with their strategic planning. Furthermore, when strategic planning is in alignment with customer expectations, improvement projects will improve customer satisfaction and profitability.

Communicating, Diversity and Problem Solving

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In the 1970’s, if you had a problem to solve, you could invite others to your office, write letters or make phone calls to bring minds together to help you. From a practical standpoint, you could bring maybe 5 or 10 of the best minds in your geographical area into one place, for a limited space in time, to synergize together.

Today, thanks to the internet, you can easily bring a million minds together to solve the same problem. These million minds do not have to travel to participate, so they are not on a time table. This is why the pace of change, world wide, is so fast. In fact, the pace of change is so fast, if you were to jump 10 years into the future, you would have the skills and knowledge of a child compared to others who have evolved to that time.

This poses a problem to our society. If the internet can bring millions of minds together, real time, then societies with large numbers of internet literate people will have an advantage coping with the fast pace of change. Additionally, societies that spend their energies looking for a way to work together will leverage these million minds to do great things and solve the un-solvable problems.

We in the United States do not have an advantage in numbers. I have read that there are more honor students in India than there are total students in the United States. The economic ramifications of our disadvantage in numbers of educated and internet literate people should be obvious.

Additionally, in the United States we spend our time looking for ways to differentiate ourselves from each other and from the rest of the world. Our focus is on divisive issues. Instead of celebrating our differences and leveraging our diversity, we try to destroy or eliminate anything that is different. This will be our undoing, if we cannot change.

Lean Six Sigma and People/Leadership Skills

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The problem with Six Sigma these days is that it is becoming a math exercise. Six Sigma, especially Lean Six Sigma, is a people thing. That is where the excitement is and where success can be found. I have never seen a project fail due to bad math, but I have seen many fail due to poor people skills and poor leadership.

If you want Six Sigma to work in your business, get people involved with people and the math will take care of itself. I can teach statistics all day (and I have), and not enhance project effectiveness. I can elevate the people skills of participants (and I have) and good things happen immediately.

Another Sales Strategy

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To close a sale, the prospect must see themselves buying from you. In order for this to happen, you must do two things.

First, enter the conversation that is already happening in the shopper’s mind. For a shopper buying out of necessity it is probably a conversation about cost, wanting the problem to go away, and avoiding a mistake.  For a non-necessity shopper the conversation is probably more about being is a hurry to possess the product or service. It is really like a fix to a junky.

Second, create a mental picture, in the shopper’s mind, that defines success as a result of buying from you. To do this you must first understand what success looks like from the shopper’s perspective. For the necessity buyer the picture may not involve what they are shopping for, but include instead the result of the purchase. If the shopper’s car is broke down and they are having problems getting to and from work, the picture might be how, after buying the repair part from you, the shopper is driving their own automobile to work without worrying about a breakdown. The product or service is probably not an important part of the picture.

For the non-necessity shopper, the picture may be that of the shopper using the product or service in the way they have presented the need. For example, if the shopper discloses that they want to be able to get their email anywhere, anytime; you will want to present scenarios where the shopper can visualize themselves using this new smart phone in various locations, while at the same time receiving an important email. The product or service is an important part of the picture.

In any case, the shopper and their motivation is the driving force behind any purchase they might make. You and the product you sell is not the driving force, but instead the road or map the shopper must follow to successfully meet their need or desire.

Necessity and Non-Necessity Shoppers

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From a very simplistic perspective, shoppers buy in one of two modes. I am calling these “Non-Necessity Purchases” and “Necessity Purchases”.

Non-necessity purchases are made to fulfill a need that is emotion based and acts like a “fix”, creating a high with the shopper. This buying mode is addictive because the high is focused on the front end of the “want-decide to buy-purchase-live with” (WBPL) cycle. After the purchase, the high wears off quickly leaving the buyer hungry for more. This shopper has a lower instance of customer service issues because their focus is on the beginning of the cycle where the high is instant and short lived.  They really want a new one because the fix is based on the “thrill of the kill” associated with the purchase, not with long term ownership.

The non-necessity shopper has convinced themselves that they need or want something to enhance their lives. These shoppers probably know something about what they want and have already scoped out where they can find it. This is a highly qualified prospect only if your product or service is capable for giving them their fix or emotional high.

There are three points to the sales process for the non-necessity shopper.  These are:

  • Sales person must understand the desire(s) of the shopper.  What need is the shopper trying to fill?
  • Frame the presentation of the product or service within the definition of the shopper’s desires.
  • Make it easy and quick to buy from you. Close the deal while the shopper is on their emotional high.

In an earlier article of mine, I defined the Shopper’s Journey.  This journey has 6 steps. Awareness, learning, liking, preferring, conviction, buying. Tying this together with pull selling you have:

  • Awareness: The shopper knows you are able to fulfill their desire.
  • Learning: The shopper learns about you and how you can supply the object of their desire. This includes the speed at which you can fulfill them.
  • Liking: The shopper likes what they learn about you and your products or services.
  • Preferring: The shopper’s experience causes them to prefer the product or service you offer.
  • Conviction: The shopper convinces themselves that your product or service is their best option.
  • Buying: The shopper purchases your product or service.

Necessity purchases are made to solve a problem. This buying mode is not addictive because the high is focused on the aftermath of the purchase. The shopper is happy to not have the problem anymore.  This shopper is more likely to have a customer service issue because their focus is on the end of the WBPL cycle, which is long term living with the purchase.  The shopper is concerned about the ability of the purchase to solve their problem over time.

The necessity shopper is trying to solve a problem.  Since they believe they are in a necessity buying mode, you can be certain they will be making  a purchase from someone.  Why not you?  This is a highly qualified prospect.

There are four points to the sales process for the necessity shopper.  These are:

  • Helping them understand their options and risks.
  • Help them to find the best solution for their needs.
  • Taking joint action with the shopper to actually solve their problem.
  • Make it easy to buy from you.

Helping the prospect understand their options and risks is an educational process. The prospect is explaining their situation to the sales person and the sales person is defining options that the shopper can be offered.  This dialog between the shopper and the salesperson is not a lecture, but rather a discussion between the individuals or groups.  The idea is to understand what solution characteristics are important to the shopper and how you can meet those demands. This is at its heart a consultative sales approach.

Part of the explanation of options is the discussion of benefits and risks associated with each option.  In the end, you want the shopper to make their own decision about what is right for their situation. Of course, you also want the shopper to purchase the product or service from you and your company.  When the shopper makes their own choice to do business with you, it is called “pull” selling.  The shopper is solving their problem, with your help (pull), as opposed to you solving their problem with their help (push).  The shopper, as a result, has some responsibility in the success, or lack thereof, of the solution.

Tying this together with the Shopper’s Journey, you have:

Awareness: The shopper knows you are able to help them.

Learning: The shopper learns about you and your specific options for helping them.

Liking: The shopper likes what they learn about you and your products or services.

Preferring: The shopper’s experience causes them to prefer the product or service you offer.

Conviction: The shopper convinces themselves that your product or service is their best option.

Buying: The shopper purchases your product or service.

In conclusion, it is important to know whether the shopper’s motivation to buy is necessity, or non-necessity, based.  From there the salesperson and enter into the conversation already taking place in the shopper’s mind. Then the salesperson can move the shopper through their journey to buying a product or service.

Organizations and the Laws of Physics

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I am writing this article to create an imbalance in the world of those who read my posts. I am not in any way attempting to consider all of the options, or to be fair.  I just want to Step on your t pets a little. If it makes you uncomfortable, that is a good thing.  It is what this article is meant to do.

Newton’s Second Law of motion, in paraphrase, states that to change the state of motion of an object, a force must act on it to create an imbalance in forces. The object will then move to establish a new state of equilibrium.

The second law of thermodynamics, in paraphrase, states that systems always move toward a state of equilibrium. This movement will persist until the system reaches absolute zero (system death) or equilibrium is reached.

These concepts taken from physics also apply to human endeavors at the individual and organizational levels. In the human experience we call equilibrium the “status quo”.  I personally find that the status quo is a place for those who need rest or are not motivated to move forward. I am not against rest, but if you are resting and your competition isn’t, you’re losing ground. In other words, the status quo for me is good only when the status quo is to avoid the status quo.  Chew on that one for a while.

The status quo mentality usually forms in organizations and individuals who are internally focused. Being internally focused will isolate you from your external operating environment. You do not feel, or you fail to recognize, external forces that create imbalances in your external operating environment. The result is that you become out of alignment with the world around you. You fail to benefit from changes in the environment or maybe you even fall victim to them. The ostrich may have protected his head, but his rear end is more than a little exposed.

I know that some will say that organizations and individuals must isolate themselves from destructive forces in their operating environment in order to protect their assets.  I will answer that I disagree. Individuals or organizations that do not try to manage within the environment they operate in are simply exchanging one master (the larger outside world) for another (isolation). We do not have to be mastered by either. We control our choices and we become stronger and more robust as we exercise our ability to choose.

Let me give you examples. Governments and businesses isolate themselves from the governed and customers with bureaucratic layers of management. Religions do this by operating on a paradigm of exclusion (us, them) instead of a paradigm of inclusion. The result is that some governments, businesses and religions become more and more isolated, lose connection with their sense of purpose and eventually fail.

So what do you do? First understand that nothing stays the same in our world.  We age, tastes change and the people around us change. There is an interesting story line in the movie “The Time Machine”. The time traveler sits in his time machine and watches the world change around him.  He is isolated from the effects of the change and when he arrives in the future he is out of place and out of sync with the world around him.  The world experienced the changes first hand and has adapted, he did not experience the changes and finds himself in danger without a full understanding of how to cope. In the movie the good guys win, but in real life it probably would not have turned out that way.

We don’t have to agree with, or placidly accept, the changes around us. We can push back, adjust our strategy, etc. What we cannot do is ignore what is happening. The wise person evaluates these changes against reality and avoids letting others interpret their meanings for them. In sports we call this “keeping on your toes” or “keeping you eye on the ball.” In life it is simply a matter of paying attention to what is happening around us and keeping the main thing, the main thing.

In short we must embrace change. The world is moving onward with a great deal of inertia and it doesn’t care if you get left behind. The days of large stable bureaucratically ran organizations are coming to an end.  These are the days of smaller, fast and flexible, organizations that can move quickly to take care of customers, no matter how the environment changes. What customers, and people in general, want are solution providers, not protestors or clingers on to the old paradigm.

One way to manage this is to balance long term projects, goals and rewards with short term projects, goals and rewards. The long term perspective tends to add stability to an organization’s progress over time.  The short term perspective creates more employee engagement and a degree of instability, which is also good. Short term projects, goals and rewards operate in the current reality and force us to see what is actually happening right now. Long term projects, goals and rewards keep us focused on our mission and vision, which may be based in another reality. Short and long term efforts tend to modify each other in a healthy way when managed properly.

The balance point is always shifting.  Don’t let it become a tripping point.

Organizational Re-design

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In organizational re-design, there are changes to process, infrastructure and procedure. These are impersonal and structural in nature. They are also, by the way, the easiest things to modify when re-engineering an organization.

Just as important, but much more difficult to deal with, are behavioral changes. The best business process that has ever been designed will not work if the underlying user behaviors are not also changed.

The same is true in transactional processes such as sales. For example, you can design and build a totally green house, but can you change consumer behavior enough to get people to choose to live in it?

What this means is that we must value human behavior expertise as highly as we do technical expertise. The philosophy of “If we build it, they will come” only applies if you build something that the consumer or employee see as valuable.

The point is that you must listen to the “voice of the customer”. The customer can be an employee or someone who pays you for a product or service. It also represents a strategy of change management and innovation. That is, address human behavior issues before technology issues. The truth is that if you build it, they may not come.

Sometimes when we change human behavior first, the users themselves change the process in the direction you were trying to achieve. You may even find that change was not necessary or that your ideas for change were faulty.  This applies to all aspects of a capitalistic culture. Consumer demand drives technological innovation and cultural values drive cultural change.

Personal Motivation

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Personal motivation has 4 components:

  • Belief in purpose
  • Belief in process
  • Belief in self
  • Definition of success

Belief in purpose is about having a reason to want to achieve a goal or objective. What is the burning “Yes” in your life that makes you want to be successful?  For some it is our families, for others it may be a desired life style or a cause we are passionate about. In any case, you have to know what it is.  I am not talking about head knowledge in this case.  It is heart knowledge you need.

Belief in process moves you from the purpose of your efforts to an understanding, and adherence to, a methodology for achieving your goals. This means knowing what sacrifices it will take to achieve your goals and what map you will follow.

A good friend of mine gave me this advice a long time age. He said “find the person who is the most successful at doing the things you want to do and learn from them”. Let go of your preconceived notions, open your mind and learn.  At the same time don’t lose sight of what you value. In other words, don’t use a map to success that compromises your values. For example, you can get rich taking advantage of others, but you will lose the richness of self.

Belief in self is about seeing yourself being successful. Visualization is a key ingredient. Successful people see themselves in a positive light and visualize what success looks like. A successful hitter in baseball goes to the plate expecting to get a hit and seeing the event in their mind’s eye. Visualizing failure is a self-fulfilling prophecy.

People who do not believe that they deserve to be successful, or doubt their abilities, are doomed to a lower level of success. “I can’t do it, so why try.” The first person to convince is you. If you don’t believe, neither will anyone else. Conversely, if you do believe, others will follow.

A definition of success allows you to measure your performance. It involves answering two questions.

  • What does success for me look like?
  • How do I measure my performance?

This success component is important because we sometimes set our definition of success too high or too low. It is best to set up a series of smaller step goals that take you toward a larger goal. This way you can celebrate your success along the way.  It is the difference between running 5 miles every day for a week or just showing up on Saturday and trying to run 35 miles all at one time.

Your definition of success will tie directly into your belief in purpose. If not, you will be lost in the jungle of life, making the wrong choices and expending precious time and energy being successful at things that do not take you where you want to go. For example, if your 5 year plan is to become financial independent, going into debt for the “status” car may not be your best decision.

This is a personal journey.  You must make your own choices as you move through life. Getting your life into focus using the ideas above will allow you to move with purpose. Not getting things into focus will cause you to be like drift wood, tossed about by the forces of life, going nowhere on purpose and everywhere by accident.