Wednesday, December 26, 2007

Week 52 - Say + Look + Do = Reputation, Farewell

This is the 52nd and final installment of a program of change for your small business. Throughout the year I have shown how an organized approach to assessing “where am I” through to figuring out what you want and finally how to get it is the key to your freedom; freedom to choose, be that to sell your business for a great price, franchise, or simply not have to turn up seven days per week.

Along the way there are soft things (how do you treat your employees) through to hard programs (number of leads x your conversion rate x average sale for example) that need to be worked into your on-going review process to ensure you are constantly improving.

If there is one secret to improving your lot in this small business life it’s this commitment to constant improvement. As I have said the Japanese call this Kaizen and it has helped propel many of their firms into market leading positions worldwide. Let’s face it, you don’t have to be the smartest, or the fastest, or the cheapest. You simply have to thrill your customers and this thrill is relative to their expectations. How do you know what they expect if you are not looking outside your business?

In this world where many businesses are commoditized by a Google search we can’t forget the basics – they are probably more important than ever. THRILL YOUR CUSTOMERS, have your friendly, engaged staff selling as many prospects as much as they need helping them to achieve their own goals. Work with experts on your Google ranking and your PR efforts but never assume these in isolation will fix anything. Sure you could get a spike in orders from a great Internet campaign but if you don’t thrill the shoppers, you have wasted your money. The same goes for a newspaper article on your company. What have you really achieved unless you attract more qualified prospects and convert them into lifetime customers?

It would be right if I didn’t end with my favorite business mantra from OOCL Chairman C.C. Tung.


Say = how you and your employees project your policies and procedures
Look = how your business appears or is perceived by the public
Do = how you and your employees carry out your policies and procedures, thrilling the customer in a profitable manner.

As I’ve just said above, it all adds up to Reputation which is more important than ever. Whether being reflected on-line via customer reviews or spread around the local pub, it’s your lifeblood, pay attention.

I wish you the very best and hope I have helped to Change your Business, Change Your Life. I’ll be posting almost every week from here on but the posts will be focused on marketing things great (and not so great). You can always find the weekly small business program stuff in the archive, it’s up here forever.

Marketing Musings: Batteries and Cooking Measurements...

Innovation and design are quietly emerging as the powerhouse differentiators of the early 21st century. Without great products that change the way we look at the functions they perform, you are treading water. “Me too” is perhaps a more dangerous positioning that ever given you are just a mouse click away from being overlooked.

Two recent innovations caught my eye. The first is the Black and Decker battery charger, you plug it into the lighter socket if you ever have a flat battery and it will provide the power to get you started – why didn’t I think of that comes to mind.

Seriously, every now and then a company’s willingness to solve a problem intersects with the latest technical know how and constraints resulting in a change in how we view such issues. In ten years I expect auto makers will include this thing somewhere in the chassis and it will seem weird to ever have a flat battery situation again.

The second is this Oxo Measuring Jug. Notice anything different? Rather than bend down to look at the level, it shows you from above. This is market leading, patentable innovation at its best. I love it.

Wednesday, December 12, 2007

Marketing Musings: Engage, engage, engage

Very cool - engagement and word of mouth, two key cornerstones of any marketing these days...

Billboard Whispers into Pedestrians’ Ears for A&E’s ‘Paranormal State’

An ad for A&E ghost-themed series Paranormal State uses technology to transmit an “audio spotlight” from a rooftop speaker in New York’s SoHo directly to the ears of passersby.
Pedestrians on Prince Street might hear a voice asking, directly in their ears, “Who’s there? Who’s there?” a few seconds later, the voice says, “It’s not your imagination,” writes AdAge.

The technology, created for museums and libraries and other environments that require quiet, is manufactured by Holosonics, which provides sound in a narrow beam, just like light.
A&E is using other unusual tactics in its $3 million to $5 million campaign to promote Paranormal State. In Los Angeles, a mechanical face emerges from a billboard as people walk by.

In print ads, AM New York flipped its gossip section upside down for Paranormal State, while this week’s Parade included a checkerboard of ads for the series.

Sunday, December 09, 2007

Marketing Musings: Marketing's Dead - Work With It

Where in the world is marketing going? I fast forward or mute all TV ads, listen to satellite radio in the car and generally ignore everything that shows up in the mailbox. What about online? When is the last time you eve clicked on a banner ad? What about a text link next to a search result. Obvioulsy people do it (look at Google’s earnings) but I am not sure how sustainable it is.

I recently read a Forrester report “Marketings New Key Metric: Engagement” which I can finally relate to. First they show the traditional marketing funnel:

But then they show what it has become:

What’s interesting is how 3 of the 4 “disrupters” they have shown in the second diagram are “word of mouth” related. As media continues to fragment further I suggest that marketing in general is dead in the water and that all businesses small or large should get back to basics. That is:
  1. Provide a fantastic, memorable product or service
  2. Back it up with fantastic programs to turn your customers into fans

If you can achieve this, ALL of your marketing dollars should be funneled into word of mouth enhancements. Capitalize on your success as a business. Generate awareness through your loyal network of satisfied customers. Don’t waste money chasing the general public who are almost impossible to reach these days and even if you do, there is no personal context so they will cast aside your message.

Sunday, December 02, 2007

Marketing Musings: Some Vacuum Cleaners Suck

Just how important is it to move with the times? In my opinion change is everything and ignoring what’s going on in your industry because you are in love with your product or service seals your long term fate. I talked about this in more depth back in Week 27 and previously I also mentioned James Dyson and his approach to winning in business. Disclaimer: Dyson is one of my heroes. He is the very essence of what it means to compete on the basis of innovation and design as opposed to price and spin.

With that out of the way let’s have cold hard look at Dyson versus Oreck. I wouldn’t normally just pick on a competitor for the sake of it but lately I have seen an increased number of Oreck ads and I also happened by a store of theirs in Manhattan over the weekend. They sell on history, price and “free steak knife” promotions. Let’s have a look at some pictures:

Oh my, notice anything? Don’t judge a book by its cover I hear you say. Well the fact is that Dyson changed the playing field when he removed bags from the vacuuming equation simply because they clog. Nothing else to it, they clog; sometimes rapidly, and therefore diminish your ability to clean your house effectively. Dyson went so much further than solving this problem. He also has a passion for design and how that intersects with the practicality of a vacuum cleaner – all those odds and ends to snap on and keep neat. The result is a stunning example of being so far ahead of your competition that they literally cannot touch you.

For a great Christmas present buy your favorite friend in small business “Against the Odds”. It’s a fantastic read and will get you deep inside Dyson’s mind. Happy cleaning.

Monday, November 26, 2007

Marketing Musing: Be Authentic

In Week 15 I referenced Naomi Klein and her belief that marketing is not about spin; the heart of every good marketing campaign is a positive and valuable product or service. A new book called Authenticity really digs into this subject and is essential reading. Consumers are more informed that ever; don’t try to pull the wool over their eyes.

Take a brief look back at Week 12 where I talked about creating unexpected experiences in your business. Often times many of the little perceived extras you provide are considered part of the service – you need to look beyond these and wow your customers. Previously I would have said create “amazing experiences” for your customers. Really I should be saying create “authentic, amazing experiences”.

Many PR companies are great – they know a whole bunch of influential folks that you don’t, they know when and how best to reach them and that is hugely valuable in itself. However, never lose sight of your core business offering and that by focusing on making it great the PR will begin to take care of itself.

There is so much noise and clutter in today’s environment. We are told we have to “spin to be heard” which in fact might be true if your product sucks. The authors of Authenticity also wrote “The Experience Economy” in which they talk up the benefits of the service economy. Ironically it is the service economy itself that’s almost self devouring. Every day another “serviced based business” pops up to fight for recognition on behalf of their client’s product. The noise is more deafening than ever. Be authentic.

Monday, November 19, 2007

Random Quotes - Inaction Breeds Fear

Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy."

Dale Carnegie

Week 51 - Choices - What a Feeling!

Above all, one time actions equal one time results. You MUST keep repeating the actions that we have highlighted over the past 12 months. Keep reading, keep networking, and keep learning about new industries and where yours is going. Stay positive and choose your friends on that basis. If necessary, make the decision to change businesses.

If you can stick to the plan, you will be faced with the most liberating of all words…. CHOICE. In this case, the choice to sell your business, to franchise your system or to simply work in your business less while it provides you with the income you need. There is no way we can put a timeline against this. Every business is different and whilst many are facing the same challenges, most are doing so from a different starting point. So don’t get discouraged if things don’t happen as quickly as you would like.

Try to enjoy the process - you will know you are on your way when your weekly sales start to increase, your bills get paid more quickly and you start to generate more and more referrals. Along the way you will have the choice between watching TV and reading a business magazine, or the choice between a game of golf or attending a tradeshow. Just remember the longer term effects these choices can have and the question “do you want to continue to exist, or do you want to do something really special with your business?”

As I have said repeatedly, we are all different and are running different types of businesses so no two situations are the same. Having said that, how you view your business, how you market your business and create new income streams and how you tie it all together with systems are factors that can lead to success in any business. Further you need to use all of the tools. Use some of the tools and you will only get mixed results. This is because all the systems tie together so tightly. You cannot do any consistent marketing without knowing exactly who you are and what you stand for. You can’t be consistent without knowing what systems deliver you the best results. You cannot ask people to make referrals unless your systems are delivering an awesome experience for your customers. The list goes on obviously. Use all of the tools in a systematic way and the world will open up for you

Occasionally some of the people you work and share life with hope to forestall change and hang on to the old system - even though it may be broken. Why do people behave this way? It could be because they fear they will not be able to “grow” into a new thing, create new skills that will be valued. Change makes people worry about being left behind. If you have not already read it, get a copy of Who Moved My Cheese by Spencer Johnson. This will help you to understand feelings that surround change. You may also be able to recommend to those who just cannot let go of the past.

Sunday, November 11, 2007

Random Quote: Choose Your Friends Carefully

“Keep away from people who try to belittle your ambitions. Small people always do that, but the really great make you believe you too can become great.”


Mark Twain

Week 50 - Make Changes Stick

Any change you make needs to be supported by a system to ensure actions continued to be carried out in the new way. By now you should be comfortable with systems, policies and procedures so this is the point where you must systematize the revisiting of the policy and procedure making process. That’s right, before you laugh, we do really need a system for updating your system!

Set aside one day each month to review your policies and procedures. During this day you should spend one hour on each different area of your business. Do this every month with unwavering commitment and your business will improve as never before. Can you honestly remember when you last took the time out in this way to make positive improvements?

Some things you can look at each month are:
  1. What problems arose for us during the month and how can we modify our policies and procedures to avoid a repeat of these?
  2. Did any of our policies and procedures cause trouble during the past month – how can we adjust them to avoid a repeat?
  3. How do the employees feel about the policies and procedures? Which would they like to see modified and why?
  4. Responsibilities – are all bases covered? Do we need to assign new responsibilities to employees to cover new areas of business?
  5. Does anyone think we could make more money or make our jobs easier by changing the way we run things?

It is essential that you involve your key employees (perhaps all of them) in this workshop discussion. Through a combination of effective systems and development of new income streams, your business will be far less vulnerable to the ebb and flow that is business today. So what about you personally - can you handle the ebb and flow? You see the same principles apply to you as an individual. You need to prepare your mind, constantly feeding it with rich information and positive re-enforcement.

Saturday, November 03, 2007

Marketing Musings: Scowls on Rodeo Drive

This week The Wall St Journal ran a story about customer service on Rodeo Drive in Los Angeles. In Week 42 I wrote that you really must ensure that all aspects of your business are firing. It’s not enough to have a nice shop fitout, or helpful front desk staff. All areas of your business must be lifted to the same level. What’s interesting about the WSJ article is that despite the multi-million dollar shop fit outs, the global branding budgets and the huge expense of staff, you can still “Fall at the Last Hurdle”. Here is an excerpt:


…I decided to gauge just how inviting Rodeo Drive's stores are with the help of Mr. Hill, who is president of Sensory Logic, a company based in Minneapolis that helps businesses from Target to Toyota connect emotionally with patrons. Mr. Hill employs "facial coding," a technique of reading and using facial expressions to elicit the most profitable emotional response in a customer. The premise is that feelings occur more quickly than thoughts and play a more effective role in purchasing decisions, so businesses need to appeal to our emotions. This is territory plumbed eons ago by Madison Avenue's ad men, but it's been harder to put into practice in many retail stores.

If it's the emotional rather than the rational part of our brains that makes many of our buying decisions, that's particularly true when it comes to luxury. (Certainly, it was my emotional brain that bought a St. John Knits suit recently, which my rational brain is now trying to justify.)

Yet just training sales clerks to say, "May I help you?" may not be terribly effective, given Mr. Hill's argument that only 7% of communication relies on verbal exchange. The rest is store décor, the facial expressions of sales associates, and things our eyes and ears pick up subliminally. Thus, on Rodeo Drive, Chicago's Michigan Avenue or London's Bond Street, one of the key factors deciding whether you walk out with a new Prada handbag may be the muscles at the corner of a sales clerk's mouth.


It’s great stuff and worth while reviewing your business from the ground up.

Friday, November 02, 2007

Marketing Musings: Shape-Shifting via Facebook

My usual stance on ANY advertising that does not result in a lead that has a chance to be converted into a sale is, don’t do it – especially if you are a small business with limited resources. In general this has resulted in me viewing “institutional advertising” or general branding messages (without a call to action) as simply a waste of money. This month in Fast Company magazine a new Facebook VP really got me thinking about whether or not this type of advertising is truly dead in the water.

Read the paragraphs below - it makes complete sense that there will always be a place for the emotional pull of a generic branding ad in forming opinions in the first place. Not all companies are lucky enough to benefit from extreme word of mouth marketing and for them, spending somewhere remains a necessity. I love the phrase "shape-shifting".

...The primary accelerant is a Facebook feature called News Feed, which automatically shares information across friend networks and groups. As a result, "News Feed optimization," the art and science of writing a compelling News Feed announcement, has become an industry itself. "News Feed is as important to Facebook as AdWords or AdSense is to Google," says entrepreneur and blogger Dave McClure, who is teaching the Stanford course.

Harnessing the power of News Feed, the new apps, and the booming user base to make money for Facebook itself is the task of a new hire, VP of product marketing and operations Chamath Palihapitiya. Zuckerberg brought him aboard this summer to help figure out how to exploit what Facebookers call the "social graph"--those thousands of threads that make up users' connections to other people--and to create Facebook's coming targeted advertising program. Palihapitiya, 31, is tall and whippet thin, with elegant manners and a ready smile. A former electrical engineer, born in Sri Lanka and raised in Canada, he ran AOL's instant-message group, then jumped to the venture fund Mayfield. He is part Sand Hill Roadster and part freethinker; he appeared in an art film last winter making pointed comments about Silicon Valley's "old boy's club."

It is only day 67 for Palihapitiya at his new job when we sit down to talk, but he already sounds like a true believer. While cagey about details, he isn't shy about the potential he sees for targeted ads to fill Facebook's coffers. He madly sketches on a notepad, drawing a fine distinction between demand fulfillment (I want a cheap ticket to Hawaii. Now!), which the Internet has become quite good at, and demand generation, the shape-shifting set of marketing messages that conspire to get a consumer to want something. That, he says, is where he sees serious money on the table. "Facebook users are more engaged with each other," he says. "Aren't you more likely to be interested in what your friends are doing?" Google, which focuses by and large on demand fulfillment, is a $160 billion company. "For every dollar that goes into fulfillment, there are hundreds that are spent on generation," he says, particularly by the big brands. So what could Facebook be worth? Five times Google? Ten times? "Could be," he smiles.

Tuesday, October 30, 2007

Week 49 – Learn to Accept Change, Even Enjoy It

The most intriguing thing to me about a business owner who fails to gain control and grow is that often they have the tools and information available to them, they just do not put them to use! I think one of the main reasons people fail to act is the fear of change, or the fear of things just becoming different to what they are now. So things really suck right now, but if I try all of these crazy things life MIGHT get even worse. If you are to make progress, create new income streams, grow your business; some things just have to change. There is no way around this.

Everyday the world around us changes, life changes, and business changes. Change is caused by many things, sometimes it’s because people invent better ways to handle everyday problems. Other times it is inspired by a business that is striving to be more efficient. Your competitors may have found a way to remove some steps from a generations old process and if you supply product or services that those steps rely on, you may find your business disappears.

"It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change." -- Charles Darwin

As new competitors enter your market they can set new standards of service or cleanliness or value. You have to pay attention to what the public start to demand. This can be so gradual that you don’t even notice especially if you are tied up with trivial problems and employee issues. If you accept that things WILL change, no MIGHT change then you can schedule time each month to evaluate what the new standards in your line of business might be. It should be clear to you that there is nowhere to hide. Nothing is more certain than the world continuing to change. You need to adapt to this change, keep fresh and constantly review the results of your business and process innovations. Change with the times but more importantly, put in place systems to make the changes stick.

Let’s have one last look at how you are going to increase your business by 15% in multiple key areas:
  1. Number of Leads – The number of phone calls or visits generated each year by your marketing. For a specific review, read Week 7.
  2. Conversion Rate, Average Value of Sale and your Margins – the rate at which you convert prospects into actual customers as well as the average amount those customers spend with you each year. Margins are the gross profit you make on each sale. Once you have the leads, people who walk into or call your business are silently begging to be led. You need to take control and lead them to the best solution to their problem. Take risk out of these transactions and you will close far more sales. Finally, existing customers are your best source of business. You need to remain in contact and have them coming back to buy more often. For a specific review, read Week 23 and Week 25.
  3. Number of Visits per Customer – the average number of times per year your customer purchases your product or service. You need to create new income streams to reduce the risk to your business. You need to set-up referral programs and ensure they are a lasting success. Finally you need to give your customers the tools to easily send you new business and never, ever give up when people say no! For a specific review, start reading at Week 27.

Monday, October 15, 2007

Week 48 - Revisiting Systems, Freeing Up Your Future

Week 48 serves as a reminder that “systems” implemented in your business have internal and external functions. I want you to look back over the previous ten weeks and really try to embrace systems. Systems are the key to success in any business so this is not just an area to tighten up, it is an area to evaluate and re-invent, on an on-going basis. Here are the key coaching tips to assist with your review:


  • Start building your operations manual today. The quickest way to get going is to develop a checklist for each and every function in your business.
  • Through a friend see if you can make contact with someone who owns a franchise. Call them, explain that you are trying to improve your business by putting systems in place and could you come in and look over their Operations Manual.
  • Blame a system, not a person.
  • Buy and read Building the Happiness Centered Business by Dr Paddy Lund. Set about implementing The Courtesy System in your business.


  • Listen and then ACT. Listen to your customers; resolve to make contact with at least 10 per month. Ask probing questions about your service or product quality. Take action using the information you gather.
  • Following your customer audit, consider how the customer’s perception affects your ability to price at a premium.
  • Conduct “presearch” within your industry. You are searching for what your customers want or expect from a business such as yours in the future.
  • Employ a “secret shopper” if applicable. Otherwise work out another way to test your systems and employees on a regular basis. This could include friends calling in (phone, email or fax) or one of your colleagues actually ordering services from your business and giving you a report.

Perform a service audit of your business:

  • How do we treat our customers? Try to identify 10 areas which you can improve on and look out for “Not My Job” syndrome.
  • Do your employees have all the tools they need to do their work efficiently?
  • Read the books Fish and The 22 Immutable Laws of Marketing.

Tuesday, October 09, 2007

Marketing Musings: Maestro of DVD Distribution

Although not that suitable for the smaller business, I do like Reed Hastings fresh (CEO of Netflix) approach to management.

PAY LAVISHLY Higher-than-average salaries—and tying bonuses and raises to the market, not a pool—can make stars less likely to bolt. Money is no object in hiring.

PROVIDE COMPENSATION CHOICE Employees are more likely to excel if they can pick how much of their compensation they get in stock rather than cash.

FOSTER TALENT HUNTERS Encouraging everyone to hire the three people they've loved working with most during their careers creates an intense, fun workplace.

LET THEM GO Don't give B performers a middling raise. Give them a decent chunk of cash and show them the door. And don’t surprise them. The laid-off leave with their dignity.

LIMIT RULES They reduce error. But they also stymie innovation. At Netflix, employees are responsible for their choices, even in how much vacation to take.

The full article is here at BusinessWeek.

Sunday, October 07, 2007

Marketing Musings: Oh No, The Sandgate Hotel

Gordon Ramsay is a master at picking apart hospitality establishments that have lost their way (or never had it!) What's incredible is how simple many of the mistakes appear but also how as an owner, you can be so oblivious to the solutions due to the pace and drama of the place. I highly recommend you seeking out the entire episode of Ramsay's Kitchen Nightmares: Sandgate Hotel. As a small business owner, it will probably be the most entertaining yet informative hour you have experienced.

Wednesday, October 03, 2007

Marketing Musings: Joie de Vivre Thrives

In Week 43 I discussed employees. How the heck do you inspire and encourage them to treat the business as if it were their own? Inc. Magazine has a great interview this month with Chip Conley who owns a chain of boutique hotels in California. Chip talks about being inspired by the psychologist Abraham Maslow; you might have come across Maslow’s “Hierarchy of Needs” before, you know, food and shelter at the bottom of the pyramid and so on?

What is impressive about Chip Conley is that he used the Hierarchy Pyramid as a guide for his own business and replaced the categories with the needs of an employee. And so it goes, the employee needs money (food and shelter) but as you work up the pyramid you get to things like recognition for a job well done and near the top, needs like meaning and creative expression.

There is no one silver bullet for ensuring every employee buys into your vision and treats your business as their own, but tools like this should be embraced to ensure you are doing all you can to make it a reality.

Monday, October 01, 2007

Week 47 - Systematizing the Marketing Function to Keep You Running at Peak Performance

You know you need a system for greeting your clients and you also need one for capturing their details, but don’t forget that the most important systems of all are the ones related to your marketing. Why so? Because marketing activity is the primary source of new business leads. If you approach it haphazardly you will jeopardize all of your other efforts.

Imagine for a minute that you walk into a new job as a marketing manager and the boss hands you a folder titled “Our Marketing System”. Inside the folder you find an in-depth description of all the campaigns that have been run in the past and everything that is planned for the next six months. In addition to this, you find a summary of success and failures to date as well as a list of “ideas and marketing methods” still to be tested.

As a new employee you would feel empowered and very glad that you are not starting from the beginning. The owner of the business is even happier because there is a good chance you can simply pick up where the previous employee left off. Think of your marketing manual as an “operations manual” all of its own. You should be setting aside 1 hour per week to review the results of your test campaigns and feeding that data into decisions regarding your next move. You must commit this time to this exercise. Book 1 hour in your diary each week, for the next three months. You should get into the habit by then. If you don’t do this, your marketing will get stale, your testing and measurement will become non-existent. Basically you will be back to square one!

Frequently review the key marketing concepts:

Testing – what else can you test? Look for new ways to present your offer, new formats or new mediums. For example, try a print ad, then try it in color, then try it in a different magazine or web site. You are looking for the best return for your hard earned dollars.

Measurement – make sure you are measuring the right aspects of your campaigns and spending time thinking about what the data actually means. Feed the findings back into your next campaign and aim to increase your results.

USP – is this still appropriate for your business or have other ME TOO companies diluted the value of your proposition? Keep it fresh and relevant, it may never have to change, but be aware of what is going on around you.

Advertising – are you following the rules when it comes to writing your ads? Use the advertising checklist (Week 20) against EVERY advertisement that you run. Ignore the rules and you can expect your results to drop.

Innovation – it is hard to keep your marketing fresh if you do not have any new products or services to tell the world about. Use your time wisely and commit to a certain number of new products or services per quarter. This will feed straight into your marketing machine and create a snowball effect of new business.

Referrals and repeat purchase programs – never forget that if you rely on one or two income streams, your business is ALWAYS at serious risk. By being on the lookout for new distribution opportunities, you will create a valuable stream of pre-sold prospects that do not cost your business anywhere near as much as cold prospects in time or money.

Marketing Musings: Big Bucks Turnaround

Would you do anything for a dollar? It seems that high flying auto executives just might. Just months after private equity interests purchased Chrysler the company has attracted some high flying execs from Toyota and the Lexus Division. Why would these folks leave their positions leading sales and marketing for the clear world leader? Ferrari I can see. A new breed of hybrid company, definitely. But Chrysler?

I am well aware that you have to start somewhere but this is no ordinary turnaround (as the headhunter has sold it). For me, it all starts with the product and as long as the products fail to meet the competitive standard (both design and quality wise) and the company is forced to cut costs and discount to move their product, the spiral will continue. It strikes me as a pretty daunting role. Not impossible, but there are there are 50 million other reasons why (at least reportedly in James Press’s case) the challenge was taken up and the private equity bet is that these people also believe they can do it!

Wednesday, September 26, 2007

Marketing Musings: Change Those Lightbulbs

Last week (Week 46) I talked about attention to detail in your business and how that is perceived by your customers. I just stumbled upon this piece from Charles Dunstone who founded The Carphone Warehouse in Europe. Carphone Warehouse has over 1800 stores and Dunstone is worth over £800 million.

Mastery of that kind of detail is a gift. Dunstone, always likeable, belittles it. “Staff know I’m Mr Lightbulb,” he says. “The simplest way you can measure an organization is to walk in and see how many lightbulbs have not been replaced. Look at Heathrow — the greatest place in the world to spot non-working lightbulbs. All it says to me is, nobody cares.”

Charles Dunstone, The Sunday Times, April 16 2006.

Sunday, September 16, 2007

Week 46 - Provide a Thrill Factor in a Welcoming Environment

Whatever you deliver, it has to be consistent. Once your systems are in place you will realize that it is not difficult to deliver a consistent service or product as these systems will support you every step of the way. Another way to climb out of the pile of competitors is to actually exceed their expectations. You see, most people expect decent service - that is, they expect you to go through the motions, supplying them, giving them their change and moving on. Not bad, not great, just good decent service.

Most customers will be shocked if you go out of your way to make the transaction a truly memorable event. This “thrill” factor is lacking in 99% of businesses today, which is great for you because it gives you the opportunity to differentiate yourself. Nearly every business success throughout the world counts “creating outstanding experiences” as the one of the keys to their success.

The flip side of this is bad experiences – have you ever called a business at 5:31pm and received a recorded message stating they are only available between 8:30 and 5:30pm? How does that make you feel? Even worse, what if you call back again in the morning at 9 a.m., and the message is still playing? Make sure you DON’T do this in your business. It shows that you don’t have a system and secondly that you don’t really respect the time of those that are trying to call. One thing I have not said until now is that EVERYTHING you do is marketing in some way so you must review your performance in these areas.

Sabotage doesn’t end with your phone system… The final touch to any systems based business is of course the impression you create when someone calls into your premises. Whether you are working from home, an office or even out of the back of a truck, you need to be projecting an image that is consistent with your traditional marketing and the reputation you seek.

What sort of coffee do you serve? Are your waiting room magazines 3 years old? Is your van filthy and disorganised? How does your business look? How does it smell, what is the decoration like – is it visually interesting – is it an inviting space?

There is a newsagent in Sydney who simply uses his business as a distribution point for papers and magazines – absolutely no effort has been made to make the shop inviting. There is mess everywhere, old posters – it always makes me think how little pride these people must have in their business. What about the hair salons that have the 10 year old, yellowing photos in the window? Not only do they look dated and worn – the hair styles have even gone out of fashion!

The usual excuse for this is that the owner simply does not have the money to update their premises. That may be the case, but this lack of funds is ultimately linked to all of the other issues we have discussed week to week. Once some progress has been made toward implementing systems, creating new income streams and running effective marketing campaigns, this situation will turn around and it is then that the premises must be dealt with. Nobody wants to eat in a dirty little diner anymore. Have you recently walked by a fast food shop which has not updated its interior in 10 years? These businesses have no real hope of survival unless they commit the dollars to renovation.

Just like meeting someone face to face, you only get one chance at that first impression. So a dirty restroom or broken piece of furniture may not seem like a priority to you today but think of the long term damage it can do, especially when you recall that each customer is worth a lot more than they actually spend on that day!

Friday, September 07, 2007

Week 45 - What Sort of Boss Are You? Unlock the Secret to Buy-In!

Getting employees to “buy-in” to your vision can be much harder than it seems. What motivates you each and every day may mean nothing to your employees. Each employee must understand what you are trying to achieve and then encouraged to behave in a manner which helps you on your journey. To put it another way, they either work for you to earn money and couldn’t care less what happens to the business long term, or, they treat the business as if it were their own and constantly look at ways of improving the way things are done. The second version is obviously preferable!

Thriving on Chaos author Tom Peters is very blunt: “Every employee must buy in or else you are wasting your time.”

I recall owning a fast food restaurant and early one morning I discovered that the freezer motor had broken down. Pulling out the Yellow Pages I found a fridge mechanic and rushed to call them. After briefly describing the problem, the mechanic’s rough response was “…you know it is double time on Sunday don’t you?” There I was with at least $5000 worth of rapidly spoiling stock on hand and all this guy’s attitude said to me was basically “do you really need me to come out today?” When he did finally turn up, his demeanor was that of an angry bear. I wonder how his apprentice or other employees view his attitude and whether they even care about his business. He did not seem to. If he does not care about his business, how do you think he treats his employees? The guy just didn’t want to be there and of course was never heard from again, despite the fact that fridges broke down at least 3 more times in the months following. This could have been easy money for a friendly business owner with a few simple systems.

Virgin, a role model

One of the more striking international examples of “buy in” is the Virgin Group of companies. Sir Richard Branson has a presence and energy almost unique in the world and he manages to convey this through all of his companies. It doesn’t matter if you are talking about the airline or some project he has simply lent the Virgin name to, nearly all of the employees involved become starry eyed, in many cases accepting below market wages for the opportunity to serve him.

You should be able to come up with a combination of measures to kick start the buy in process in your business. Borrow the energy and fun created in the Virgin culture and mix it with Jack Stack’s methods of including employees at every level. Open up your business, spread the word regarding the figures, including profitability and marketing goals and above all, bear in mind that your attitude is contagious and is reflected in your employee’s behavior. Want others to be excited? You must BE and act excited yourself.

John McGrath is considered the most influential figure in the Australian property industry. He tells us “…a business will NEVER outpace its leader”.

Wednesday, August 29, 2007

Week 44 - How Kaizen Can Help Your Business Today

It is very interesting how often business owners exclude their employees from critical conversations regarding the future of the company, or indeed the day to day operations. After all, it is the employees who do most of the work, who have most contact with customers and who have to work to the policies and procedures you have put into place. It makes sense therefore to involve employees in all of these discussions.

Morris Lasky, a US based 40 year veteran of the hospitality industry, has turned around more than a hundred organizations (hotels, stores, factories) in the last 20 years. He was quoted as saying "I'd say that 95 percent of a good bailout campaign comes from the comments of the people who are already there ... [who] know what the problems are, but have never been asked ...”

Japanese companies big and small already know this and it is part of the reason that they have been so successful over the past 30 years. The Japanese call it Kaizen, which is the word for improvement. This is not some hollow word on a mission statement hanging in the lobby of their buildings; this is a deeply ingrained culture of involving the entire group in innovation and striving for constant improvement. Granted to Japanese economy continues to see some very tough times but the quality of the products they produce certainly continue to change the world. What they do is “raise the bar” which thankfully for consumers means companies all around the world are forced to reconsider their quality standards as well as what could be considered as standard features.

The key aspect of Kaizen is that it is an on-going, never ending improvement process. The search for new methods and means of achieving a given result never ends and the focus is on small improvements, day after day, month after month.

The most interesting aspect of Kaizen is that it involves everyone in an organization. Employees at every level are actively encouraged to participate through continuous suggestion. These suggestions are reviewed by management and acted upon rapidly if it makes good business sense. For many Japanese companies, the search never ends. There is always something that could be made stronger, faster or more cheaply. There is an old saying: “if it ain’t broke, don’t fix it.” You can consider Kaizen to be the exact opposite of that statement.

You can borrow these techniques for use in your own business:

• Involve all employees in process improvement discussions
• Value each contribution
• Never accept that some new improvement cannot be found

Flying The Friendly Skies!

I was on a flight from Seattle to Los Angeles this morning and a flight attendant handed me the pilot’s business card with a note on the back welcoming me (by name) to the “Friendly Skies”. Despite a long list of things still to fix at United (after a few years in bankruptcy) it is great to see a pilot leading the charge towards a turnaround. This completely random event (no one else seemed to get a card) is what keeps things interesting for customers; I mean when was the last time a pilot made contact with you? Keep it up United!

Friday, August 17, 2007

Marketing Musings: From Oil to Flowers, BP Shows How it is Done

You have all probably all seen the increase in “eco-marketing” by the big oil companies. Chevron’s “Will you join us?” campaign is plastered in nearly as many places as Accenture’s overused images of Tiger Woods. But the Chevron campaign, whilst a great leap forward in positioning on this subject, usually left me feeling flat. Tips on being green and educating me on everything the company is doing doesn’t seem to resonate simply because I don’t get the feeling that anything on the street is actually changing. I always had a nagging feeling, “...step it up Chevron”. After all, they made $5.4B profit last quarter.

Yesterday I stopped at a new BP service station in Los Angeles and whilst I was mostly drawn in by the futuristic design, I could also see that they were trying to portray a new beginning in eco-responsibility. After I started filling the car, I emptied all of the garbage that had accumulated in my rental car; there were several recycling options for the various pieces of garbage, hardly a game changer but good to see. At that moment, a young man in a BP t-shirt approached me and started explaining the station from top to bottom.

After asking me if I was familiar with BP, he went on to explain how solar panels on the roof provided all of the electricity for the station, that the concrete driveway was made with recycled glass and other materials were sustainability obtained. He asked me a few questions to gauge my interest in the subject of being eco-friendly which I thought was engaging and interesting. He saved the coolest thing for last; he handed me a few eco “tip cards” which mention “driving aggressively causes increased fuel usage” and “turning lights off in a empty room helps us all”. I almost declined the cards until he told me that when I was finished with them I should soak them in water overnight and then plant them. Guess what, wildflowers will grow! How cool is that?

I left the station with a feeling that BP’s approach was far more than marketing spin. Not only was it wonderfully responsible, it was entertaining, original and the very definition of my mantra – SAY + LOOK + DO = REPUTATION.

Sunday, August 12, 2007

Week 43 - Eliminating "Not My Job" Syndrome

Most business owners want to get the best from their employees. Often they struggle in vain to influence the employee’s attitudes hoping that suddenly they will feel a new sense of responsibility. Bluntly, the first place to look for a solution is in the mirror. You have to be the embodiment of what you expect from your employees. Here again perceptions play a key role – how do your employees perceive your commitment to the business? Do they believe you want the best for the business and them, or do they think you only care about yourself?

Enough about you - what about the type of people you have hired? I once heard someone say “I always try to pick happy and bright people with common sense”. “The cash register”, the person stated, “is easy to teach. It is much harder to teach an unhappy person how to be happy!” I couldn’t agree more and obviously this will differ from industry to industry, but you should seriously consider adding it to your list of hiring criteria next time you have a vacancy. A major side benefit should again be increased sales. People buy from people they like! Sounds simple because it is, we buy from people we can relate to and feel comfortable with. If your employees are not happy and capable of building these relationships your sales are almost certainly suffering as a result.

When employees are made to feel valued through regular training and inclusion, and further, they are empowered so they can be made accountable, you should be 90% of the way to creating a environment for positive attitudes to flourish. The word individual means “having no like or equal” and this gives you a further hint about how you can get want you want from your employees. Yes every business has a purpose, but the employees are individuals, all are working there for different reasons. Try to tap into exactly what each individual is looking for. If you can help them to achieve their goals whilst getting what you want, it makes for an extremely positive environment.

In their book Fish, authors Stephen Lundin, Harry Paul and John Christensen point out that it does not matter what type of business you are in, enjoyment is a choice you and your employees have. Fish uses the Pike Place Fish Market in Seattle USA as a metaphor. How can you get more uninviting than a cold, wet smelly fish market? The authors present the keys to the employees enjoying the environment and turning up to work each day:

  1. Choose Your Attitude – Who do we want to be while we work? The choice of being unhappy or otherwise is yours to make each time you walk through the door.

  2. Play – Have fun at work, fun creates energy.

  3. Make Their Day – Involve your customers in your fun, go the extra mile, create an experience.

  4. Be Present – For the benefit of both customers and co-workers.
Take time out and ask “how could this work for my business?”

Tuesday, August 07, 2007

Week 42 - Don't Fall at the Last Hurdle

Incorrect perceptions are one thing to deal with but it is far more difficult to recover when your staff have mistreated a customer or offered less than perfect service. Many large and successful companies today openly state that their employees are the number one priority, ahead of customers. This makes sense when you think about it. How can you treat your employees as a second or third priority and then expect them to offer the best possible service to your customers?

The old chestnut that the customer is always right is wrong. As a business owner, you can kick and scream and abuse your customers and put up offensive signs like “no refunds” or you can attack the problem another way. As I have already explained, consistency is a key element in your customer service plan so whether you are good or bad, at least be consistent. Consistent, systematic and friendly customer service can turn almost any business owner into a success yet so often we see business owners making an effort in only one or two of these areas. The real key (just like your approach to marketing) is to get four key areas right, no exceptions:
  1. The outward facing policies in your business
  2. The attitudes of your employees
  3. The business systems that support your employees work
  4. Gaining respect and understanding (your attitude as the owner)

Let’s look at the first area, your outward facing policies (our rules for engaging the customer) – the other three areas will be covered over the following weeks.

The customer service experience obviously begins when somebody walks into or calls your business. At this point there are already certain rules and regulations you have in place for dealing with the customers and these can be presented in a number of different ways. What you should be striving for in this area is making doing business with you easy, appealing and even fun! Doing the bare minimum is unlikely to thrill your customers. For example, when you go to the supermarket and the cashier asks “how are you?” Do you feel good about that? Not really, because you expect them to ask that, just as you expect them to be courteous and offer an efficient service.

Providing unexpected services is awesome customer service. Doing what every one else does is simply expected and therefore does not have any real impact on your customers.

Before you shoot down this suggestion by saying that extra services cost your business money – consider this; providing awesome customer service and maintaining the profitability of your business is a balancing act. However, when performed in conjunction with the other techniques I have described, you should be able to charge more for your product or service. Some department stores are famous for going the extra mile; often they are not obligated to refund your money, but many do. They realize that the time spent arguing damages the relationship with the customer so they simply move on!

Don’t put up offensive signs, don’t argue with customers about your obligations and make it easy for them to spend money – “No Credit Cards” is not what I would call an inviting sign for potential customers.

Remember, your outward facing policies will create perceptions about your business, sometimes without you even knowing. Make sure your policies are not turning off potential customers.

Sunday, July 29, 2007

Marketing Musings: Find Out What the Market Wants Before You Deliver It

Sergio Zyman, was Chief Marketing Officer at Coca-Cola for 30 years and he tells us in his book “The End of Marketing As We Know It”:

“Every day the (political) candidate goes out on the stump, and the next morning the campaign manager gets up and says, how did we do yesterday? He or she collects the polling data to find out if the numbers came up, or down, and looks at voters surveys to find out why. Both of those are research. A good campaign manager goes a step further by doing “presearch”. In other words, he or she asks the voters: What if we told you this tomorrow? Would you vote for this candidate? And they keep asking until they find the positioning that is going to move votes.”

Can you take a lead and start doing presearch on your marketplace? I think this holds amazing possibilities for the average business. After all, we are always being asked “ did we like the service?” but virtually never “ would we react if in future we did things in this certain way?”.

Wednesday, July 25, 2007

Random Quote - Happiness

I frequently cite C.C. Tung's mantra of “SAY + LOOK + DO = Reputation”. I think understanding and implementing this short saying is the best building block for any business looking to improve.

This morning I saw another quote not from a businessman, but one of the greatest influencers of the 20th century, Mahatma Gandhi. This quote takes C.C. Tung's business focused statement and puts a personal spin on it:

"Happiness is when what you think, what you say, and what you do are in harmony."

Great stuff.

Monday, July 23, 2007

Week 41 - What Does the Marketplace Think of Your Business?

What is perception and why is it important? Perception is defined in the Macquarie Dictionary as “…to gain knowledge through one of the senses…” In other words, perhaps our experience versus the facts. The famous marketing authors Al Ries and Jack Trout tell us in their book “The 22 Immutable Laws of Marketing”:

“…the three largest selling Japanese imported cars in America are Honda, Toyota and Nissan. Most marketing people think the battle between the three brands is based on quality, styling, horsepower and price. Not true. It’s what people think about a Honda, a Toyota or a Nissan that determines which brand will win.”

Can you relate to those statements? Do you just “know” that your coffee is the best in the district or that your photography is better than anyone else’s, or that your hotel is always cleaner and more comfortable? If you are not seeing the results you would like, you could be right about your product or service, but the community may believe otherwise. Ries and Trout continue:

“What makes the battle even more difficult is that customers frequently make buying decisions based on second-hand perceptions. Instead of using their own perceptions, they base their buying decisions on someone else’s perception of reality. This is the “everybody knows” principle.”

This introduces a dangerous concept; bad word of mouth advertising. As you all know, this can literally ruin a business. “Everybody knows” can spread through a community or entire town very quickly. Think about it. When you are talking about products and services amongst friends, perceptions often rear their heads. “…they are expensive…”, “…it’s too cold on their balcony…”, “…they always turn up late…”, “…we waited an hour for a table and the staff were rude…”

On and on it goes, and you make decisions based on these second hand perceptions. The only way to proactively ensure that your business does not suffer is to keep on soliciting feedback from your customers. As I have said, just ask, and keep on asking. You will pick up perceptions good and bad every day. You are then in a position to change these perceptions by making good an error or calling the affected customer to explain exactly what happened and why it won’t happen again.

STOP PRESS: There is far more to perception than just making sure there is not negativity surrounding your product or service. Do you pay more for dinner at an exclusive restaurant? Do you pay more for Nike shoes than for a store brand? Would you pay more for a Mercedes Benz over a Lexus? The questions are of course rhetorical as people do this all the time. What this means for your business is simple: if the market doesn’t believe it, you cannot price at a premium! Put another way, perceptions will always be directly linked to your ability to charge more for your product.

Monday, July 16, 2007

Marketing Musings: What is Service in Your Corner of the Globe?

It’s funny, I am never one to shy away from complaining about “over the top” service in America. The “…are we doin’ OK here?” and “…how’s everything?” and “can I get you anything else’s?” always seem to come at the key moment for your romantic dinner or business meeting. Why, I ask myself, do they go through this meaningless routine? We have to tip anyway, please just wait on us professionally and use some judgment before barging in on our conversation.

Last week I had a brief trip to Prague and my mind was opened regarding the things I complain about in America. Whilst the city was magnificent and the people friendly, wait staff were just appalling. They really could care less whether you waited 5 minutes or 5 hours to get your dinner. It was almost as if they resented you being present, possibly a cultural hangover from the almost forgotten socialist era. Ironically, I was praying for a “…are we doin’ OK here?”

But all was not lost – on the way home I spent a few days in Norfolk on the English seaside. Here pubs have been converted into beautiful restaurants and classy bars. One particular place inspired this post as although we had a fantastic meal and experience. I don’t remember the wait staff at all. At the end of the meal they even removed our plates without me noticing! Now that is service; a great meal and experience (we had everything we needed) and a professional staff that was sensitive to our communication and personal space. England wins this round :-) and do stop in at The Hoste Arms if you get a chance.

Week 40 - What is the Market Perception of Your Business?

External performance is critical as ultimately it dictates how you are perceived by your customers and the general public. Get it wrong and the best internal systems and marketing won’t help you! Working out what people in your community think of your business is quite easy - ask. You need to find out how they rate your product, your service, your opening hours, your range, your employees, your location and anything other factor of your business that you believe is important.

There are two great questions you can ask your customers:
  1. What was pleasing or distinctive about the service you received?
  2. What, if anything do you believe we should change to improve our service?
There is no point asking a watered down version of these questions such as “…everything alright?” These days everyone is busy so they respond “yes fine” and walk out regardless of how they actually felt. Dig deeper, it will be worth it in the long run.

You will know from your own experiences that when a business annoys you, or lets you down, you certainly tell your family and friends but rarely do you give that feedback to the business owner. Some people will be like that no matter what you ask them - you will never get their feedback. But if you begin asking the questions, you will get a whole lot more feedback than you ever thought possible.

Good or bad this information is priceless but it must be collected systematically. Many business owners go on a feedback “binge” for 1 or 2 weeks, resolve to fix everything and then never mention it again. As with everything in life things change, so you need to have a system in place which reminds you to gather this information as often as appropriate.

One further point: if you are going to make promises to your clients, do what you say you will do! If the feedback card says it goes straight to the Managing Director’s desk for action and a response, then make sure the Managing Director responds! Failing to do so will leave your business with very little credibility.

Thursday, June 28, 2007

Random Quote - The Power of Commitment

Until one is committed there is hestiancy, the chance to draw back, always ineffectiveness. Concerning all acts of initiative (and creation) there is one elementary truth, the ignorance of which kills countless ideas and splendid dreams: that the moment one definitely commits oneself, then providence moves too. All sorts of things occur to help one that otherwise would never have occurred. A whole stream of events issue forth from the decision, raising in one's favour all manner of unforeseen incidents and meetings and mutual assistance, which no one could have dreamt would have come his way. 'What ever you can do, or dream you can, begin it.

Boldness has genius, power and magic in it.

W. H. Murray.

Saturday, June 23, 2007

Week 39 - Can Behavior Be Systematized

Previously I have mentioned systems and employees but really only focused on the policies and procedures that employees are expected to adhere to. What about how employees treat each other or how they interact with the owner of the business - is it possible to systematize that type of behavior so that there are fewer disagreements within your business? The process begins long before these people are your employees.

It is not easy to change the personality of an unfriendly and unmotivated person. Seek out those people who are outgoing and seem willing to learn and ask for examples of how they have used common sense to achieve goals in previous workplaces. The technical aspect of your work may be quite easy to teach so you should focus on hiring people you believe will bring passion to your business.

To some it might sound far fetched, but one such business that has achieved “happiness” is Paddy Lund Dentistry, owned by Brisbane, Australia based dentist Paddy Lund. You see Paddy Lund’s dentistry practice operates under the “The Courtesy System”. Implementing The Courtesy System in your business could mean an end to disagreements and eventually to a much stronger feeling of collective worth.

Paddy Lund’s firm belief is that you spend so much of your time at work you should make an effort to enjoy that time. The time you spend at work is simply living your life. Paddy gave up trying to buy happiness through acquiring cars and property outside of work hours and rather realized that if he was ever to truly be happy, he had to make changes in his workplace.

Paddy begun this transformation by insisting that all staff use “please” and “thank you” every time they interacted. On top of that he demanded an end to office gossip. Initially as you might expect, the employees and Paddy himself felt that the words sounded “put on”. Interestingly the clients did not, they were often commenting how refreshing it was that employees were treating each other with such respect.

On top of employees being courteous to each other Paddy put in place daily meetings to tackle sources of unhappiness. By getting employees to speak candidly if things had upset them, Paddy could identify causes and put in place new rules to ensure the offending behavior was not repeated. What Paddy has learned is that he is able to work up to 50% less, his staff are happy all of the time and the people attracted to the practice (by referral only!) also possess positive attitudes. In addition, Paddy’s employees are with him for the long haul and on top of all of this, he makes more money than he ever did when he was unhappy! The reduced workload and extra money can be attributed to the implementation of systems (for both the business and how staff interact) which has lead to more profitable and happy customers. One example is that appointment cancellations plummeted leading to less scheduling problems (revenue) and a more organized environment (calm, happy employees).

Think about your workplace for a moment. Perhaps there tensions in the air between staff that can affect the way your customers perceive your business. Would you like to serve only your ideal customers and look forward to going to work each and every day?

What can your business learn from Paddy Lund Dentistry?

  1. Embark on a fact finding mission to establish the “happiness issues” in your business – start with an employee survey or group discussion
  2. Put systems in place initially to force greater co-operation and sensitivity
  3. Identify roadblocks to your continued success by involving all employees in open discussion
  4. Adjust the systems as required to maintain your positive momentum
  5. Never stop looking for improvements all the while ensuring you are treating your fellow employees with dignity and respect. Again this might sound like hard work and yes it will take time, but the effort required will taper off.
The rest you can learn from Paddy himself; buy his book here.

Sunday, June 17, 2007

Week 38 - Never Stop Looking for Improvements

Someone once said that a journey of a thousand miles beings with one small step. So it is with your policies and procedures that make up your business system. Start today, constantly refine the system when a problem occurs. You just need to ask yourself what other steps could be implemented to avoid the error in the future. These small incremental improvements will add up and one day you will realize that your business now runs without any yelling and screaming and that you do not actually have to be there! You simply must be committed to improving your processes incrementally, all of the time.

The word “system” might sound a little “constraining” to some of the more creative businesses out there. “Our people are individuals, we want their spirit and personality to shine through and thrill the customer with outstanding service”. No problem. Systems are not about leveling out each employee’s personality or creating an army of programmed robots. They are simply about producing a consistent result time after time. Your employee’s personalities can sit on top of the policies and procedures as a “presentation” layer. You can see this in action in well run businesses - some employees are friendlier than others, some might get into a conversation with you regarding the weather or the house you are painting BUT they all follow the same procedure of greeting you with certain words and up selling you.

In fact, effective systems backed up by the tools to get the job done actually free up your employees to spend time on the solution for the customer. In other words, get the hurdles out of the way, streamline your system and make it easier every day to process a customer transaction. That way you will find not only is your business running smoothly but your employees are happier and the customers are being treated consistently and with enthusiasm and genuine interest. Mike Basch, a founder of the global delivery and logistics company FedEx once said:

“Systematize the routine, humanize the exception."

Next week, can behavior be systematized? Paddy Lund Dentistry holds the answer!

Sunday, June 10, 2007

Week 37 – Want to Take Your Hands Off the Steering Wheel?

Walk into any franchised business and take a look around, I guarantee you will see the one thing that makes that business run like clockwork, the Operations Manual. The Operations Manual is the bible of running a tax planning or cheesecake making or hamburger grilling or any other type of franchised business. In contrast, how many non-franchised businesses have an Operations Manual on hand to solve the day to day challenges that every business faces?

Franchisors give their franchisees this manual so they can follow the processes and systems that led to the original success of the business. They often describe every function of the business, in absolute detail, right down to the procedure for cleaning a sink or answering a telephone. Franchisors do this because they know if left to their own devices, the business owner (or their staff) will perform inconsistently and deliver the products or services as they see fit.

Much research has been conducted on the success of the franchise system and the most important element attributed to those that are successful is the method of doing business. In most cases, the usual business rules still apply. You might need a great location, a unique product with mass appeal but ultimately it is the profitable delivery of the products or services that is the key to long term success.

Building policies and procedures for every aspect of your business is initially going to be time consuming. But look at it this way, until and unless you commit to putting what you expect in writing, you will never be able to leave your business. Leaving would be like taking your hands off the steering wheel when driving your car. So put in the work, commit to documenting one aspect of your business per week over the next three months. Eventually you will find yourself with a healthy sized overview of how to run your business the way that you want it run.

The bottom line: we are building an expert system rather than a business that needs EXPERTS to run it!

Perhaps one of the world’s best known pizza franchises is Dominos. Dominos is famous in business circles for the strict system that just about guarantees they can get that pizza to you in 30 minutes (this guarantee has recently been replaced by “Made Fresh, Arrives Fresh”). More importantly it will still be hot! How do they do this? You can’t rely on a fast delivery driver, or your best ever hire that is currently making the pizzas; you have to give all of the employees a tight system they can follow, no matter what their skill level.

Dominos do this by showing employees exactly how much time they have to complete each step of the pizza production and delivery process. They call this “Heightened Time Awareness”:

• 2 minutes “into the oven”
• 10 minutes “out of the oven”
• 12 minutes “out of the store”
• 22 minutes “to the door”

You can see how this framework allows a manager to pinpoint problem areas and make adjustments to create a consistent result. Pizza didn’t get to the door in less than half an hour? What happened? What point in the process took longer than it should have and what actual event caused this?

Within your business you may have made excuses in the past when the going got tough. In an independent pizza business the comments like “we are just busy tonight” or “we ran out of tomato sauce” might fly around when the going got tough. Well I will say it again. If systems have taken care of these trivial problems the pizza delivery system has every chance of getting the product out on time.

IKEA has similar systems for dealing with your order. Yes they are huge but remember they started as one small furniture store. Even the tickets on the counter at your local delicatessen are a system. How many shops have you been into which are equally as busy but have no system for dealing with the crowd? How annoying is that? Can you imagine if there were no guide ropes in an airline check-in area? Why then do so many businesses operate in this manner?

Thursday, May 31, 2007

Week 36 - Getting Coffee The Way You Like It

There is no big secret to fixing a consistency problem in your business - you need a system. A business without a documented system is like an airline pilot trying to get from Los Angeles to London without a flight plan or instruments. It’s that simple, the pilot might make it based on skill alone (after all, the pilot is good at flying a plane), but the odds are against long term success. Everyday we see examples of this in the business world. People sell products or services but they do it reactively, never bothering to stop and document the steps required to achieve a consistent result time after time. How does this show up in the community around you?
  • Have you ever been served a coffee that was perfect, only to return again and have your mouth scolded by milk about 30 degrees hotter than it should be?
  • Have you ever experienced outstanding customer service at a restaurant and then on another visit, had the opposite experience?
  • Has a friend ever received a discount or offer at a store and when you tried to take advantage of the same, the staff were confused or would not acknowledge the offer?
  • Have you ever been asked “...whose next?” or “ right?” rather then “Welcome, how may I help you?”
  • Have you ever visited a hotel or resort and been totally satisfied only to find that on a return trip the hotel was dirty and not as you had remembered?

You probably get the point. How does it make you feel when you are treated in this inconsistent manner? How does your brain react next time you want to buy a coffee or take a holiday? Nothing is more certain than your brain telling you:

“DANGER : not sure what experience I will receive this time, try somewhere new!”

Systems serve two main functions:

  1. INTERNAL PERFORMANCE - To ensure that internally, all critical functions of delivering your product or service are carried out in the same manner and consistently revised to improve their performance.
  2. EXTERNAL PERFORMANCE - To ensure that all of your customers are treated properly, but more importantly, are always treated consistently.

Over the coming weeks we will look at these two areas in depth and create an operations manual that will let you set your business on “cruise control”.

Monday, May 21, 2007

Random Quote - The Ultimate Equation

"The business equation is simple: Profit equals revenues minus cost. Or maybe it is slightly more complicated: Long term profit equals revenue from continuously happy customer relationships minus cost."
Tom Peters, Thriving On Chaos

Week 35 - How To Get Your Business Running Without You

Over the next twelve weeks we will look at perhaps the single most important area for all small business owners – the systems that support what they provide each day. Here is what I will cover:

  1. Why implementing systems will improve your business dramatically.

  2. How to develop your Operations Manual and why it is critical to your success.

  3. The difference between internal and external performance.

  4. How to ensure your product or service is consistent and tap into what the marketplace thinks of your business.

  5. Some simple techniques to get employees to really understand your business and act accordingly.

  6. Why training is critical to your short and longer term success.

  7. How to improve your marketing and advertising, week in, week out.

  8. How to ensure that your referral programs are an on-going success.

  9. How to create an experience for your customers that will keep them coming back time after time.

Systems are absolutely critical to your business success. Without them you can almost certainly not franchise your business and will find it much more difficult to sell, or indeed put in fewer hours. Systems are developed by paying attention to what goes on in your business at the lowest level. Systems are about treating the root cause of the things that happen day to day. We are all familiar with putting out fires but how many of us make an effort to ensure that a specific problem does not reoccur? The business owners who do this spend far less time answering the same questions or dealing with the same problems; they have freed themselves.

If you ever said “…I cannot take a holiday, this place would collapse if I didn’t show up every day…?” you will get a lot of value from the next 12 weeks. Many business owners feel exactly the same way; that is, “…none of my employees can do things the way I would do them so how can I leave them to run the business?”

If this sounds familiar I don’t need to know anything about your business to guess that you do not have policies and procedures for each aspect of it. The reason is that when left to their own devices, even the most dedicated and intelligent staff will fail to be consistent. What choice do they have? They do each job as they see fit and according to their mood in that moment. Let's get to work on fixing this.

Thursday, May 10, 2007

We Reserve the Right to Love Our Customers

I met a colleague in Santa Monica the other day and we decided on a new tea house that neither of us had visited before. Whilst the owners had the “just opened” spring in their step and were very hospitable, there was a hugely prominent sign (front and centre of the customer experience) that read:


What is wrong with this picture??? SAY + LOOK + DO = REPUTATION. You cannot choose one or two of these items - you need to excel in all three! If you must have a sign like this, why not make it tiny sign on the counter in 5 point Helvetica font? The current position of the sign indicates they expect to refuse service to a good proportion of people whereas in reality, it will only ever be the tiniest percentage. Get rid of it.

Contrast this experience with another little café I visited today. They have sign on the register that mentions a $10 minimum charge for credit card purchases. The big difference is the way they word their sign:

We appreciate a $10 minimum charge on credit card purchases.

Thank you! A business that understands their customers are their livelihood and future. LOVE your customers or head back to the section in Week 1 about figuring out what you really want from your business.

Monday, May 07, 2007

Week 34 - No Sale Yet? Never Give Up!

Over the last few weeks I have focused mainly on actively working with your existing customers to create more sales. Question: what if the prospect never becomes your customer? What if you were to travel to their house, provide a quote and then miss out on the work? Well, if most businesses dump paying customers after the first transaction, what do you think they do with prospects who don’t even buy? Yep, they don’t get a second thought. Perhaps they even receive a special outburst about the “big mistake” they have made!

Dormant and cold prospects can still be of value to your business so first and foremost, you should stay in contact. There are a hundred reasons why people don’t move forward with quotes – they might have found a cheaper price or a better referral but they also may have deferred their decision due to lack of money or an overseas trip. The point is it could be any reason, so stay in touch and re-read “Week 25” which talks about “follow-up”.

As with everything I write about, for follow-up to be effective, you have to do it systematically. An easy way to do this is simply call all of your non-buyers once every couple of months. Ask how things are going, “…is there any other information I can provide to help you make a decision?” Email is also an easy way to drop these prospects a standard note asking for an update on their situation. It has probably cost you money to attract these potential buyers in the first place, so don’t discard them. Try to extract some value over the following weeks or months.

To round out, here is a powerful question when faced with a “…no thanks…” from a prospect:

“Thank you for your time, do you know anyone who you believe WOULD benefit from our product or service?”

If it is appropriate, start asking that in your business today. Recruitment agencies do it all the time and over time build huge contact lists. Remember that word leverage. You have the customer on the telephone, on email (or on their porch) and you can decide to walk away, or ask the simple question and generate more income and profit for your business.

I will now move on to building your business systems. Once your business is operating like a well oiled machine (with or without you) you will finally get the time to start making choices for your business rather than them being made for you by the marketplace.

Monday, April 30, 2007

Don't Try To Please Everyone

In week 30 I talked about the fact that not all customers are created equal; in fact, there are many types of customers you probably don't want! I saw a great quote today which captures this much better than I did.

"I cannot give you a sure-fire formula for success, but I can give you the formula for failure, which is: Try to please everybody."

--Herbert B. Swope, Pulitzer Prize-winning journalist

Saturday, April 28, 2007

Be Anything You Want, Except Fake

Back in Week 15 I posted this great quote from Naomi Klein of No Logo and Fences and Windows fame:

In her book, Fences and Windows, Naomi Klein discusses those big multi-national companies who, with the help of a PR agency, decide that they “want to be your friend”. She describes those businesses which spend so much time and money trying to convince consumers that they really care about them while at the same time, behaving in a manner anything but! To use Klein’s words, do you have a “communications problem” or a “reality problem?”
Innovation, service and marketing are not about spin, they are about a genuine commitment to turning your business into a productive part of society.

This month Fast Company magazine has a great article on “authenticity” which really hammers home the point above - to resonate with your customers don’t spend energy on spin; rather spend it on creating genuine solutions to your customer’s problems. Or as they put it in the article “...the story a brand tells through its actions...”. Love it.

Sunday, April 22, 2007

What's This All About?

If you are reading my blog for the first time Week 33 is probably not the best place to start. As a quick refresher, let me summarize how we got this far, giving you the context that will help you change you business.

Change Your Business, Change Your Life is a collection of ideas, techniques and advice with a single goal; get your business from wherever it is today, to a place where it is delivering the life that you seek. Many business owners end up being defined and controlled by the businesses they create – which is just fine for some folks. For others however, spare time with the family, travel and philanthropy (as just a few examples) become more important but because of the business, are often neglected.

Changing your business begins with you – what do you want? Once you have this figured out, it really comes down to two things, effective marketing and systems. Sprinkle in some advice on actually being nice to your customers and making it easy for them to keep buying and you get a blueprint or at least an interactive map for starting your journey. The graphic above captures this best and I suggest you start with Week 1 back in August of 2006 to ensure you get all you can from this process.

PS - in the graphic are the words SAY + LOOK + DO = REPUTATION. This is not original, it is from CC Tung, CEO of OOCL, one of the least known (but my most admired) companies - until you realize that you see their shipping container logo nearly every day!

Friday, April 20, 2007

Week 33 – Licensing; Getting All You Can

I like to think of licensing as squeezing every last bit of juice from an orange. Earlier we learnt that getting the most leverage from your advertising can give you much greater results for the same cost. Licensing your method of doing business is the same thing. You will get maximum leverage of your efforts, meaning minimal effort to multiply your income.

Licensing is a key method for geographically constrained businesses to increase their turnover and spread their tentacles. For example, if you are a supplier of steel products, it is unlikely you can be competitive with another steel supplier 1500 miles away. The freight costs would eat any margin and ensure that the local supplier was always able to beat you on price. But what if you could license your method of doing business or method of steel production to all the competitors outside your competitive area?

For a real world example, look at world famous Rockpool Restaurant. The team runs two restaurants, a cooking consultancy business for the airline Qantas, two television programmes which the company co-produces, as well as a product line for the supermarket chain Woolworths. Now that is a great example of leverage through licensing. It all started with the restaurant. Running a top class restaurant is obviously tough but the recipes and concepts and flair can be leveraged through the other initiatives and product lines, without the founders having to work 2 or 3 or 4 times harder.

You have to think outside of your industry. At first glance a restaurant and TV show might not seem like a logical mix, but think how amazing it is that they now get paid to be filmed doing what they would have been doing anyway. You can see the leverage concept in action all around you, Starbucks leverage their core coffee product, super models leverage their beauty and professional sporting teams leverage their players.

Justin Herald, founder of the clothing brand Attitude® operates in this way but he warns that it was not as easy as it sounds. “People come up with concepts all the time, but you can’t just expect someone to offer you money for your unproven concept. You have to get out there, build your brand and sales before you can expect any level of interest in this sort of arrangement.”

How do you get started?

  1. Perform an intellectual property audit on your business. Write down all that is unique about your business. This could be your production methods or customer service technique or the selling system that works better than any competitors.
  2. How could you offer others training on your method of achieving a result? The point is that if your business is successful, it is because you have devised a system which is working, week in, week out. Parts of, or the entire system can be licensed, after all who wouldn’t want your success? You have to have your methods documented. Follow the guidelines we will discuss over the coming weeks.
  3. What other products or services can you offer? Could you add other company’s products and services to your offering but under your own name? Spend an entire day with your team brainstorming new product or service ideas that could grow out of your core offering. Put everything on the board - what looks silly now might seem like a good idea 5 hours later.

Friday, April 06, 2007

Week 32 - In It For the Long Term

Try signing your customers to a longer term agreement, for exampl, rather than a dozen bottles of wine once off, the program becomes a dozen bottles every six months. This becomes a recurring agreement until the customer cancels. Terms work very well for people in a seasonal business (pool cleaners, gardeners) who instead of servicing a customer once and walking away, signs them to a 6 month service program. You may give a discount for this commitment but the main benefit to you is the introduction of stability to your cash flow and therefore ability to forward plan.

Could you ask your customers for a longer term agreement? If you are a tax accountant you could sell your customers a 12 month package of financial checkups, tax planning and ultimately the tax return. What about a window cleaner or personal fitness trainer? Of course, these businesses naturally lend themselves to this type of program. Even a bookstore can offer to send the book of the month to their customers, or what about a dentist that sells an annual package of check-ups, 2 cleaning sessions and a tooth whitening program?

Stop now and write down all the ways you could get your customers to purchase in volume or sign them to a longer term agreement. Don’t get stuck focusing on what your industry is currently doing - look outside and borrow ideas from other industries. For example, I don’t think I have seen a dry cleaner offering a frequent cleaner discount card just as the coffee houses do. Nor have I ever received a call from a dry cleaner asking if I was satisfied, as car servicing businesses do.

Implement a reminder system

Because you now know that you must have your customers’ names and contact details, you will be in a position to implement a reminder system. Dentist and doctors do this very well but what about toner cartridge suppliers, clothing stores or fine restaurants for example? Some products such as a lawn mower are bought only once or twice in a lifetime, but in general most businesses can find a way to remind their customer base that it could be time for another visit. Spend some time thinking about how you could condition your clients to receiving your regular updates including how and why they should come back to see you.

Actively work your customer list, but remember the golden rules:

  1. Communicate with genuine interest in your customer’s well being.
  2. Offer real value in every communication, rather than just asking for more business (for example, a shoe store might include the latest European fashion in a small booklet, a car servicing business might send a city map, or a free test drive offer. At that point, you can ask for their repeat business, but not beforehand.)
  3. Keep your customer database “clean”. In other words, don’t send your clients the same offer three times and don’t continue mailing people who have passed away or moved from the city.

Most of the methods I have described over the past few weeks give you the tools to generate far more leads in a more efficient manner. Let’s review;

  1. By making contact with people who have purchased a complementary product or service before or after yours, you can pinpoint those most disposed to your offering.
  2. Using your systematic referral program you will be training your own indirect sales force to spread a consistent message.
  3. Finally, actively ensure you sell to each customer as frequently as possible.

Combination of effort in these three areas virtually guarantees you an increase in profits.